Today we are joined by Lisa Henry, FASID, LEED AP. She is a princpal at Greenway Group, a company that gives design firms information, knowledge and counsel that enables them to focus on what they care most about: doing great work. In today's episode we discuss creating a strategic plan for your architecture firm, and how following that strategic plan can help you reach your goals.

In today's episode we discuss:

• Strategic planning is a design problem
• The 3 elements of a successful architecture firm
• Your firm's strategic path: Where do you want to be tomorrow?
• 4 steps to create a strategic plan for an architecture firm
• Don't be blind to your firm's weakness: developing a strategy
• How having a strategic plan sets your firm free
• A firm by design: The benefits of having a strategic plan

Show Notes

• Connect with Lisa Henry at: Greenway Group and through her LinkedIn‎

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Interview Transcript and Members Only Resources:

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Enoch: Hello and welcome back, Architect Nation. This is Enoch Bartlett Sears. I am happy to welcome everyone back today. This is the show where we talk about business and about running a better firm.

Today’s show is brought to you by the Business of Architecture Conference, which will be coming to you in early October where you’ll be able to learn everything about starting an architecture firm, marketing a firm, getting more clients, and running an excellent business.

Today, I’m happy to welcome to the show Lisa Henry. She is a business consultant, Principal of Greenway Group. She specializes in helping architecture firms and design firms have better business performance.

So, Lisa, welcome to the show.

Lisa: Thanks, Enoch. It’s great to be with you.

Enoch: Lisa, just so we can get to know you a little bit better, could you give me just a little bit of a background of who you are and what brought you to your current position and your current focus on business consulting?

Lisa: I’ve always had a business penchant. My background is in [Inaudible] business management initially. I had extended experience working as a Trading Analyst for Merrill Lynch, but my creative side really needed to get out and I pursued a design degree in order to make that happen.

I knew I wasn’t going to make a living as a sculptor, for example, which I love, however I do know that design is a way to connect to the economy and still be able to express myself creatively. I had a marvelous career as a Design Director at a workplace strategy group. I had an amazing experience working with Knoll for many years as their Regional Director of Architecture and Design, working, again, mostly on workplace strategy.

But, then that business piece, it just started to emerge once again. I had a great business leadership experience as the National President for the American Society of Interior Designers. That just led me to think I would like to combine these two in a more robust way.

I’ve worked with Jim Cramer at the Greenway Group and Doug Parker there and Bob Fisher who you’ve interviewed in the past. One of the aspects of the work they did that was just fascinating to me is was their work in service to helping firms improve their performance. The components of business are obvious. I view them as design elements and looking at business as a design challenge, to me, was really part of what the appeal was. We put it together and I’ve been with Greenway for a year.

Enoch: Tell me a little bit about what Greenway Group does.

Lisa: Greenway is a business strategy and consulting firm. Their work is focused within the architecture, engineering, and construction realm. I think that specialization is important because the unique aspects of operations, the unique aspects of marketing, the unique aspects of finance, and leadership that are within those types of firms, I believe they really benefit by specialized consulting and specialized consultants who are really aware of what those unique aspects are.

All of us have some kind of a background in one of the design professions. We all have a direct experience in that realm before Greenway, so I think this is an important piece that helps us understand that dynamic.

Enoch: Lisa, when you talk about designing a business as a designer would look at a design project – Take for instance a new building an architect might consider the problematic elements, the shape and size of rooms, the way the sun hits the building, what are some of the considerations that go in to designing a successful business?

Lisa: Well, we utilize components around marketing, around firm operations, around the professional practice, and around finance that are combined in ways that, you know, let’s say each one of them is a cylinder in an engine. These can be viewed as firing at optimal or suboptimal levels. If they’re all working together, it’s going to be an engine that drives up performance in a firm, but if one of them is not working, of course, you can see that there will be challenges.

If a firm doesn’t have a robust marketing program, they’re not going to be able to get the business in. Marketing is about getting the business in. Financing is about, you know, how to pay for the support, consultants, or staff, or overhead, etc. If that’s not firing on all cylinders, you can see the challenges around that; firm operations are how the work gets done. Operational aspects of architecture and design firm performance, you can imagine, are critical – project flow, scheduling and so forth, profitability, come in to play. All of these have to be firing at an optimal level.

So, when we see components of business in these terms, we work with firms and essentially diagnose where the strengths and weaknesses are, and assemble these elements in a way that form a strong foundation for the firm, combining that with strong leadership and identifiable culture. Those are the elements that compose a successful firm performance.

Enoch: Lisa, her on the show a lot of our listeners belong to smaller firms.

Lisa: Yes.

Enoch: Are there any commonalities that you see with smaller firms in terms of the weaknesses that you mentioned when you come in and look a business?

Lisa: Well, primarily, not… This is my experience: smaller firms tend to be, justifiably and understandably, really focused on immediate getting business in and doing the business.

The area of neglect that I most commonly see is around lack of strategic planning and sticking to a plan. There are a lot of fire [Inaudible] that are going on out in the client world within projects, and they have to be attended to. So, that reactive mode of everyday work is something that’s a big deal with small firms. They’re running around just getting it done and not stepping back and taking the time to really strategically identify their markets – what the strengths and weaknesses are within their own staff, potentially where they have to fill in gaps. It’s all very on the fly.

Yeah, it takes time and it takes a lot of energy to focus on developing strategy and sticking to it. But, if that investment is made up front and creating a real plan to identify where you want to go, that goes really far in a successful, proactive… getting ahead of the market and taking the firm in the direction that you really want it to go in the long term and not just “What are we going to get today?”

Enoch: Lisa, what are the advantages or benefits of having a strategic plan for an architecture firm?

Lisa: Well, it’s like any plan, you know, when you start out a design – again, we’ll go right back to the metaphor of a design project in the business – you have to start out with a plan. As a firm develops that plan, it determines, ultimately, the whole purpose of the firm, the direction of the firm, which is really important. That’s done through its vision, its aspirational vision.

A strategic plan also helps identify the goals of the firm. It identifies the mission of the firm. I think that big picture ensures that the firm will spend its resources in the direction that will yield the greatest return; that they won’t have… It’s important that the reactive doesn’t supersede the proactive – that a firm is always moving in the direction that it chooses by design not by just happenstance.

You know, we can all be pulled in a lot of different directions, but staying on course because you have a plan and a direction, and a goal in mind is really what a strategic plan does. I honestly, Enoch, think strategic plans set you free. It sets you free. It doesn’t just help make an owner make decisions about what they want to do. It helps make decisions more clear about what you’re not going to do. Honestly, that truly is one of the biggest benefits that I see.

Enoch: How does knowing what direction not to go in, how does that help a firm?

Lisa: Well, for example, I worked with firms that are choosing to, potentially, enter in to a new market. It’s great if they choose that by design. They want to enter in to the realm of – oh, just take a specialty area – law firm office design. That means they’re going to strategically go after that. So, if something comes along that takes them in another direction completely – they have a multi-housing opportunity that may be a certain scale – they’ll say “No” to that. That, to me, is really important. That decision not to go in a direction is just as important to make as the direction that you’re going to go.

If you’re on a track, getting sidetracked can really take you down a rabbit hole. That’s going to cost time and resources, you know, people time as well as financial resources. Developing expertise and putting it out there, that means that you made a commitment to go in to a certain market. That means, ergo, you can’t have Door #1, #2, and #3. Pick one, go with your strength and I think that’s important to do.

Enoch: Okay. I’m going to play devil’s advocate here, Lisa.

Lisa: Yeah.

Enoch: I’m sure you’ve come across this as well. There’s a firm or sole-practitioner and this person doesn’t really have or doesn’t feel like he or she has the opportunity to turn away projects. That if a project comes in the door…

Lisa: Sure.

Enoch: How can they say “No” to that?

Lisa: No, I agree with that. In a case like that I would say if the till is low and you have time on your hands, that particular project that comes in that might not be in your immediate preferred wheelhouse – go for it because that might take you in another direction… If you’re not ramped up, and you’re not operating at capacity, that could really take you in another direction that will provide a new element in to your plans.

A strategic plan does not have to be written in stone. That is a perfect example of it. If there is capacity at your firm, no matter what the size, and there’s an opportunity that comes through the door that you have not heretofore defined as your preferred area of your operation, but if the business sis there, go for that business and think about how that project can then be leveraged to get another one like it.

The point is if you don’t want to be sitting around with capacity. That’s clear. But, it also demonstrates the reality that a strategic plan has got to be flexible and has got to respond to the market. If you’re market is demonstrating itself is not fulfilling its potential and a new market comes along, that’s your opportunity to seize that and go in to a different direction.

You know, once you get a project in a certain realm, you can start building on that as a new strategic direction. I think, that’s an extremely good example to demonstrate the importance of not writing a strategic plan in order for it to guide- to be written in stone, but having it respond to the market realities that your firm is facing.

Enoch: What are the first steps of creating a strategic plan?

Lisa: The first steps in creating a strategic plan would be:

• I would just say really keep it simple. Include a statement of what you’re all about as a firm. You call it a mission statement. Keep it short and sweet. Why are you in business? What are you doing? What do you want to do?
• Then, I would say, the next step would be to list out some specific target, objectives that you want to be met. Have them be defined around the elements of business design, the marketing – having objectives in marketing, having objectives in firm operations, having objectives in the professional service offering that you have, and having objectives in finance.
• I would suggest, also, that a strong plan be written with a three-year window in mind. You don’t want to go out too much further than that.
• Then, I would define how the business would be built and managed to achieve the vision of the firm. It doesn’t have to be long, but it’s a step that is critical that it’s done. It’s critical that it’s looked at from time to time and be used as a guide post. It, kind of, serves as a filter. Okay, call it a design concept.

  View the strategic as a design concept and every decision you make as a designer you touch back to that design concept in that process of designing. It’s the same thing. Touch back to the strategic plan and it will tell you if you’re on track.

  Have it measurable. Have your goals measurable so that you put a time frame on it and that you have a metric in mind. If you’re going to increase your profitability by 15% by the end of fiscal 2014, put that in there. These are the kinds of measurements that are part of it. It can’t be too ambiguous, you know.

Enoch: Okay. Why… So, going… In terms of the strategic plan you said at the beginning, you know, keep it simple: Why are you in business? What do you want to do? Can you just help me visualize that? Can you give me a couple of examples of some answers to those questions that you’ve heard and that you’ve helped firms develop?

Lisa: Answers to defining…

Enoch: The question of why someone is in business. You know, what is it that they want to do?

Lisa: Well, primarily, the questions around strategic planning that a firm would want to focus on would be: What market areas are their specialty? What kind of growth potential do they see? Are they looking to grow a firm or are they looking just to have a…? What is their purpose?

Are they looking to create an environment which provides a satisfying career path where they can express their creativity, participate in their community as contributors in architecture? Are they looking for a professional practice that has certain attributes? Are they looking to create a firm that has a partnership track where others are engaged? Are they looking for a firm that has a marketing function that allows them to be seen in specific areas?

The questions around how the firm sees itself. Not how it sees itself today, but how it wants to see itself tomorrow are these aspects that have to be answered during that initial planning process. We’re not planning for today. We’re planning for what we want to see the firm be in the future.

Enoch: When a firm gets in a project that may not look like it’s heading them down the strategic path that they want to go down, generally, what are the things that they need to be considering and thinking about when they weigh the decision of whether or not to pursue that project?

Lisa: Well, primarily, staff resources and whether they have the capacity to produce the work. If they don’t have the capacity in house, whether they have the inclination, and the outside consultants, and network to bring people in to execute the project. I think that’s the first thing. You know, “Do I have the capacity to get this work done either here or can I bring in people in order to have that done?” That’s probably the first question that an owner would say. You know, “Do I have time and the resources to get the work done? That’s number one.

Number two would be, of course, the go/no-go question. Is this a project that I want? Is this a project that is going to take me where I say I want to go? Do I have choices about…? Do I have other projects that I’m aboard that I’m involved with? Will this bring me… Is there something about this that will connect me to my ultimate goal and augment my business or is it something that is going to be a distraction? I think those are the top questions that you would want to ask. Can I get the work done and is it in my wheelhouse?

Enoch: Excellent. From your experience, when you see firms that follow by their strategic plan, what are the benefits that you see their firm reaping?

Lisa: The benefits are that they are operating a firm by design. Having a firm that’s operated by design is better than having one that just happens and it grows organically. Not that there’s anything wrong with growing organically, but on the other hand, there’s nothing much more proactive about taking it where you want it to go as opposed to just having things happen.

You know, people get lucky and great things can just turn up organically. That’s just great. But, when you know that you have, by design, put your plan together, and you are executing it, there’s an amazing feeling of accomplishment when that happens. It’s like you move from point A to point B and you can see it happening right in front of your eyes. You could see your goals being met.

People want to engage with firms that are successful. When you are able to demonstrate that success it really is satisfying. If the firm is looking to open itself up to partnership and leadership transitions in the future, having a well-managed firm that operates strategically is really a huge part of that. That it’s not reactive, it’s financially sound, and it’s growing according to its plan – that’s the kind of thing that other people want to be a part of. It produces a sense of pride. It produces a sense of a well-managed business that potential future partners want to be a part of.

Enoch: Well, thank you, Lisa. It’s been a very good conversation about strategic planning for architecture firms. I think this is a good place to end this section and we will pick it up again next week.

Lisa: That sounds good.

Enoch: Okay.
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