The Aftermath

I've given quite a bit of thought as to where we head as a firm in the Aftermath of the Great Recession. And when I say Aftermath, I mean when things start on the upswing and clients are looking for architects once again. I don't really think we are there yet. New work is still pretty scarce and cash is flowing like thick mud.

But as we do move ahead into the Aftermath, things will be different. Kermit Baker, chief economist for the AIA states that "...architecture is a cyclical industry, with very rapid growth or steep declines. The steady state is never there." I have indeed noted that over my 25 years in the industry and it's never been more obvious than this time around. The recessions of 1984, 1993 and 2001 have nothing on this one. There was another bad recession in 1976 that I am too young to remember, but those that do say this is even worse than that one, too.



For us, things were crazy busy from about 2003 until 2007. We could not get enough work out the door. We could not find enough good employees because they already had jobs. It was hard to take vacations. We were making mistakes because we rushed things and clients were willing to overlook them because they had even more work for us to do. We even had to start outsourcing as a way to get work finished on time. Things were hectic.

Now things have changed. Clients are still demanding. Business is still hectic, but in a very different way. Every detail of every project is scrutinized by our clients as they attempt to make their thick mud spread as far as possible. Invoices are being rejected if every reimbursable expense is not clearly backed up with receipts. Hourly rates are questioned. Timelines are being stretched as clients wait for bank financing to pay fees. No one seems to be in a hurry. And to make things harder, the competition for new projects just got a whole lot stiffer. Large architectural firms are now going after work that they would not have even considered a year ago. Employees that have been laid of are striking out on their own.

So the simple formula is this; less work, more competition means more or less, no work!

But it's not the end of the world. For those firms that are creative and can see the big picture there are opportunities. Reinvention in the Aftermath is a must.

Next: Our formula for reinvention in the Aftermath.