Choose your Architect/Engineer Team to suit your Project – Strategic Facility Planning for SMEs

In "To Build, or not to Build", I dealt with the feasibility of undertaking a construction project. I assume you have completed that activity, and decided to proceed with the project. Now, you need an architect/engineer team. A building project actually involves four phases: commencing with planning, through to design, construction, and terminating at the operation and maintenance phase.

On large jobs, separate teams may undertake the planning and design phases, especially where planning requires highly specialised expertise.However, a single architect/engineer team generally undertakes both stages in smaller jobs. Even though you may not be billed for planning, do not assume the stage does not exist: design cannot commence without first having determined the project requirements.

In "Consider Image Carefully", I recommended that you be intimately involved in this planning process. This is especially true if the project is to be particularly complex or innovative.As the owner, you should initiate the process because there is a better likelihood that you will determine the criteria to judge the selection of an architect/engineer team appropriate for your job.It is not uncommon for an architect/engineer team to be changed even during the construction stage, so having a firm grasp of what is required from this team will facilitate an appropriate selection, though this is not guaranteed.

At the very least, you should determine the nature of the project - whether innovative, complex, or routine - and your priorities with regard to cost, time frame and quality of the work. The reasons will be apparent in shortly. The selection of an architect/engineer team generally takes two forms: either direct negotiation with a specific team or a process involving the pre-selection of a number of teams, creating a short-list, and then selecting the most appropriate team. The latter is typically used for large projects, so we assume the former is used: though the selection process to be outlined will be instructive to both.

The Coxe Group Management Consultants (Seattle) surveyed 100 design firms of varying sizes, markets and organizational formats. They classified these firms by their "technology" - what they do best - and, their "values" - the goals of the firm.

With regard to the former, the Coxe Group identified three categories of firm technologies: the "strong-idea", "strong-service", and "strong-delivery" firms. A "strong-idea" firm delivers expertise or innovation to unique projects. It adapts to any project and typically depends on a few outstanding individuals. A "strong-service" firm delivers experience and reliability particularly on complex projects. They provide comprehensive service to clients that are actively involved in the process. A "strong-delivery" firm provides efficient service on similar or routine projects to clients seeking a product, rather than a service. It repeats successful solutions for technical cost and schedule compliance.

In this case, the nature of the project will indicate the appropriate team. You need to determine if the project is to be unique, complex, or routine. Having made this decision, the short-list of technology-oriented firms will be self evident. Knowledge of the projects undertaken, or physical inspection of these, will be instructive.

Within these technology sets, the Coxe Group determined that the firms have values that are either "practice-centred" or "business-centred". The "practice-centred" firms emphasize quality: serving their clientele and satisfactorily representing their discipline. "Business-centred" firms are profit oriented. Therefore, cost and time are emphasized.

If you prioritize your needs based on quality, cost and time, you can eliminate firms with inappropriate values. "Practice-centred" firms can also be judged on knowledge of their previous projects, or physical inspection of these. "Business-centred" firms can be judged on their performance on the above. Discussion with previous project owners will likely be needed for due diligence. In the case of new firms, this evaluation will have to be done on previous projects by the principals and team members, prior to founding/joining the firm being considered.

You may intuitively realize that "strong-ideas" firms will gravitate towards "practice-centred" values, while "strong-delivery" firms gravitate to "business-centred" values. But, especially small firms may lack focus and not be easily classified; while, highly focused firms will most likely disqualify themselves from discussing your project if it is not compatible. Nevertheless, this procedure will serve to guide your selection of an appropriate architect/engineer team for your project.

Other than routine projects, the projects evaluated need not be the same but should be similar in nature contemplated: that is, uniqueness and complexity. The teams' respective performances on the projects evaluated with regard to quality, price and time should then be compatible with the manner you expect your project to be handled. It should now be apparent that when you choose particularly an architect based solely on work you may have seen, without thought to the performance on that job, you will likely end up with a "practice-centred", "strong-ideas" firm, which may not be suitable for your project. So, you need to consider both, and choose an architect/engineer team to suit your project.


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To Build, or not to Build? – Strategic Facility Planning for SMEs

As I pondered upon my next blog post, I realized that I had not dealt with a fundamental question: whether to build, or not to build.  The first two posts dealt with the issue of image: the first warns about improper motives to build, and the second on creating an image that suits your business.  But, do you really need to build at all?  That is the question.

As has become customary, two cases are presented; one good, and one bad.  Both preceed the turn of the century: a very trying time in Jamaica.  In his book Jamaica Meltdown: Indigeneous Financial Sector Crash 1996, Wilbern Persaud stated that “Jamaica’s indigeneous financial sector crash was, to date, … estimated by the World Bank review of forty-two banking crises to be third”.  Our first blog post, “Consider Image Carefully – Strategic Facility Planning for Small and Medium-Sized Businesses”, described one failed financial entity as an example of poor strategic facility planning.  In this post, we examine one of its subsidiaries, a banking group, as  a good example in deciding not to build.

But we shall start with a case from Persaud’s book, another banking group, as the poor example which decided to build.  As Persaud states: “… at the height of the euphoric credit and real estate boom” this group “embarked on construction of a set of luxury apartments“ in an upscale community billed as “Kingston’s soon-to-be most prestigious address”.  The venture generated much interest, but the boom and accompanying inflation led to ever escalating costs.  To salvage the project, it was redesigned to become a hotel: thus taking advantage of the government’s tax incentive to the tourism sector, at the time.  As a business-type hotel, the venture was doomed to failure: it was too far from Kingston’s business district, too far from other facilities associated with the tourist trade, and in a local plagued with traffic congestion.  So after a relatively short period, the hotel did fail and was subsequently converted to apartments, under different owners.

By comparison, our other banking group owned a multistory building that was originally designed and constructed as apartments but later converted to government offices: though little refurbishing works seem to have been done.  This group also considered converting their building to a hotel.  But, it had all the advantages the former lacked.  It was in the heart of Kingston’s business district, between three successful hotels.  It was anticipated that at the very least the hotel could take referrals from the adjacent hotels.  So, a feasibility study was commissioned.

The consultants of the parent company were commissioned to undertake this feasibility study.  It was fortuitous that the same consultants had also been responsible for the construction of the building they were to examine.  After careful study of the cost for the conversion, against demolition and rebuilding the building, the banking group wisely decided to sell it.  It was sold to another established hotel also located in the area, though some distance from the site.  They were the ones to refurbish the building.  They sold their original premises and relocated to this new location and continue to operate from the location today.

The building was not in the core competence of the banking group.  It was in the core competence of its new owners.  It is not certain whether the new owners did any studies of their own, but the bank would have pitched it to them as being appropriate for a hotel.  Whenever a building project is contemplated, this should always be considered as any other investment: the options need to be considered, evaluated, and compared to determine the likely outcomes.  If this banking group can be criticized on any aspect of the sale, it would be that they failed to consider what could have happened when the hotel relocated.  The original hotel was located opposite one of the bank’s major branches.  When they relocated, a major competitor bought the land, demolished the hotel, and constructed a new facility on the site.  This competitor was previously engaged in putting up a new branch in the resort city of Montego Bay, but when the opportunity presented itself, they suspended the design of that building and seemed to have concentrated their effort on this new venture.  Who could have envisioned such a scenario?