Looking forward: Hidden Sources of Income

Following is a list of services for any office to generate additional sources of revenue. I started generating this list a few years ago and have brought it up in different ways at previous firms I worked for. These ideas might be helpful for any architectural firm.

Specifications

A good spec service costs about $15,000, most of the time this is contracted by the client although sometimes it's a part of the architectural contract. Even wen paid directly by the client, in addition to the direct cost to the client, architects have to spend a substantial amount of time coordinating with the spec writer. I've estimated this cost at about $5,000. By writing the specs in house an architect can capture the profit of writing the specs as well as the cost of the coordination. There are good internet-based spec writing services that costs about $3,000 per year, these offer unlimited spec writing ability and ensure that all references are coordinated, including testing standards. It also checks on a continual basis that all products specified are up to date. The spec writing can be handled by a project manager or a very good job captain. Estimated labor cost to an office is 40 hrs x 120/hr (estimated billable rate for a PM) = $4,800 + 10 hrs x 185/hr (estimated billable rate for a principal or senior associate to review the work) = $1,850 for a total of $6,650 resulting in a profit of approximately $8,000 per set of specifications.

It should be noted that the 40 hours is estimated for someone with only a very basic idea about specification writing. A second set of specs should take half the time.

Interior Design

The interior design services are often contracted separately by the owner, but like specifications they require a substantial amount of coordination by the architect. By offering interior design services the architect collects the fees and pockets the portion of labor that goes for coordination.

Marketing Graphics

Same as interior design and specifications.

Tenant Improvement for downsizing

As companies downsize in this economy they look for firms to handle tenant improvement in their reduced spaces. In many cases these firms relocate to more affordable parts of town. In some cases they do downsize. In some its both. Architects have the capability to handle this job for them, including not just space planning but interior design as well. If architects want to expand their services they could offer a turn-key option including coordinating the entire move or downsize event.

LEED and Green Building consulting

As more clients become aware that going green saves green, architects can offer ways of cost reduction for utilities that also have the side-benefit of increasing productivity of their staff.

Smart Apartments (see my other blog posting about this)

Borrowing the name from the European Smart Cars, the objective is to offer developer clients innovative compact and intelligent Smart apartments that occupy a small footprint while giving the appearance of larger areas. These apartments will encompass green principles and should be designed to easily meet the requirements of LEED Gold Certification.

Innovation

We can, but don't have to, reinvent the wheel. There are plenty of little products or methods of construction that architects could be helping design better. How many times have we heard out in the construction site or from the drafting room "someone should invent a way to..."? We should become that someone. I read about a small firm in Barcelona, Spain, that "has only three completed buildings to its name but holds nine patents for building technology", according to an article in Hanley Woods' Modern Materials supplement. With all the creative talent most architectural firms have, why aren't we innovators? Why don't we lead instead of follow? Why do it? not only does this get us notoriety but also residuals. We don't actually have to physically invent a material like the ETFE that clads the Water Cube of the Beijing Olympics, it can but doesn't have to be that forward-looking, but we can write about methods to simplify existing technology. We can also be innovators in the sense that we can be the first, or one of the first, to apply an innovative technology; then we milk the heck out of the publicity.

A firm is born

It's been a little over three months since I was laid off from WMA on June 30, 2009

When I was first informed, three weeks prior to that date, I braced myself for an adjustment, although "brace" is probably too strong of a word in this instance. I'd been preparing myself for almost a year. I knew that it was only a matter of time, and I had told this to my peers on various occasions. There was no way that WMA could survive with it's upper management team intact and at least two senior associates would have to go, and it was natural (as I saw it) that the two most junior associates (myself included) would be chosen.

When the time came to pack up and leave I had it all planned out and I wasn't in any way depressed or upset. I'd created the concept for three businesses only marginally architecture related that I wanted to start up if I wasn't successful at finding a job. Understanding that the search for a job would take a while and that starting up even the most realistic of my business ventures would also not come quickly, I fancied myself putting in at the very least a couple of months of leisurely bike rides, catching up on a backlog of reading, and completing a long list of DIY things around the house.

As it turns out, that leisure lasted about a week. Immediately an old client whom I'd brought into WMA gave me a small project, followed by one of my former WMA clients who dropped a big project on my lap with the promise of others. One job offer and an interview offer also came my way, both unrequested. In addition, I received leads on various other small projects ranging from painting a house for a famous political figure to designing a bicycling museum. So many choices when I didn't expect any, and there went my plans for my businesses.

I've now made the decision that if there is work to be had in this economic climate then there will certainly be plenty of work when the economy picks up; I've officially started my architecture practice. For now it's called Ovalle & Associates, although that name is subject to change. This is a great opportunity to put into practice all the ideas that I had for WMA and for previous firms. I will have no excuses not to implement the ideas and I will have no one to blame if they fail.

Santa Cruz, Bolivia

We're home, after a nearly 19 hour trip.

They say a liberal is a liberal until he gets mugged. I guess the problem is that neither Angela and I consider ourselves liberal to begin with so the saying doesn´t apply to us.

During the entire trip we've been staying in less-than-stellar parts of town. Not to say that we've been asking for trouble, I mean, we don't stay in the skanky rooming houses next to the train stations or bus terminals, but we do stay in pretty inexpensive hostels. The problem is that we are overly curious and walk everywhere instead of taking taxis or renting cars because we don't want to miss anything, we want to fill our senses with everything that one can only experience on foot and sometimes I suppose we let our curiosity get the best of us, despite that sixth sense telling us 'don't go there'. Three days ago was one of those days. I knew we shouldn't have gone there ('there' is a hill in the center of Cochabamba with a monument to the woman heroes of the independence movement "Heroinas de la Coronilla") but I didn't say anything. Angela did say that she had a bad feeling but we agreed to keep going. It was all fine until we started to head down the deserted hilltop monument. All of a sudden we were surrounded by three young guys with long butcher knives yelling at us to get down and hand over everything. My first thought was anticipating the feeling of the cold blade entering my stomach, a feeling that the leader of the gang was threatening to make real. That thought quickly faded when I glanced over at Angela, who wouldn't hand over her bag to the second guy even while the third held a knife to her throat.

In the end we lost all our money, credit cards, Angela's ID, my new camera -the first I've owned in over 20 years- assorted other stuff in our pockets, my prescription glasses. The worst was the loss of the best pictures of the trip, including photos of the ancient colonial cities of Sucre and Potosi with wonderful architectural details, photos and movie clips of indians protesting against discrimination, photos of political graffiti and posters including very refreshing ones from the local Trotskyists, photos of our trip of the salt flats of Uyuni -one of the natural wonders of the world-, and photos of the amazing people we met during the trip -locals as well as from other parts of the world-.

All in all though, we came out physically unscathed. I will have to reserve the feeling of sharp cold steel entering my gut for another occasion. Angela and I both agreed that we came out winners, having come out with our lives, as everything else is replaceable. The pictures of things we can most certainly find in the Internet, the pictures of the people we met would probably bore you. Most importantly, this event could have happened to us anywhere in the world, including right in our front yard in the U.S.

We can't say we're not angry, but we know that crime is a factor of the incredible poverty in this land-locked country. Bolivia's mines have generated amazing amounts of silver, copper and tin for the world, creating wealth for international and local mining interests but nothing for the local population. Now with the green movement and electric and hybrid cars a reality and photovoltaics in everyone's mind... and sometimes on their roof -at least in the industrialized countries-, with the consequent demand for adequate energy storage which only lithium batteries can provide, the greatest reserves of lithium in the world in Bolivia's Uyuni Salt Flats promise to further increase wealth for a few at the expense of many.

Aside from that isolated mugging incident, we found the people of Bolivia to be amazingly warm, friendly, polite, helpful, and many more nice adjectives. Even the ones with decidedly different points of view than ours. The country itself is beautiful despite its extreme poverty, and I would highly recommend it as a travel destination for it's cultural and geographic richness. For those with an interest in politics, the country is in an exciting phase as the indians begin to assert power as a majority under the leadership of Evo Morales, to the chagrin of the mestizo and white ruling classes, who at best make only feeble attempts to disguise their racism. Certainly there are mistakes being made, and the opposition makes great fanfare of these mistakes. But no progress has ever been made without mistakes, and this revolution is irreversible.

Hanging out my shingle

I'm hanging out my shingle!

Why now? Even in these trying times business can be good, under the right conditions. As we come out of this economic slump, as I mentioned in my post titled "quantum leap", the world will be different, and I want to be a part of that. This is my opportunity to begin something during the worst of times because from here there is no way but up. This is my idea of the office I want to create, this is the new face of architectural practice, or any other practice in what we traditionally call an office.

The new office has to be flexible, adaptable, nimble and versatile. It has to be quick on the feet, respond swift and smart, operate lean, and stay on the leading edge of technology.

The new office has to be versatile, with staff capable of working concurrently and at ease on different projects, project types, building types; for this to work the office has to place education at the forefront of it's operation. Education of it's staff will be it's most valuable capitalization cost.

The new office has to operate on a new model with significantly less overhead, taking advantage of technology by way of teleconferencing and working meetings; electronic reviews of drawings with clients, consultants and contractors; cloud storage and computing allowing remote access to office and project data from home, job site, or other remote locations.

The new office will not necessarily have a physical presence in the traditional sense. No cubicles with workstations, everyone will have a laptop and will be able to work from home, job site, Pete's Coffee, the beach. Rather than a grand lobby with pictures of projects and awards, a gallery of the firm's work will appear on a high-quality web site with high-resolution photographs and interactive displays. Rather than make everyone commute, with inherent stress build-up, expense, danger, environmental and physical detriment, the office will allow remote work as much as possible and will get together for face-to-face meetings when appropriate.

The new office will not have a hard and fast work schedule: everyone will have an electronic office calendar with all it's projects and office activity kept current via the Internet. As long as the project deadlines are met, M-F, 9-5 is meaningless. When working from home, social interaction will be maintained via IM and when necessary video-conferencing; we can't escape that medium so we might as well use it to our advantage. On the other hand, Fridays will be reserved as team-building days, office-wide meetings, in person, where we will learn as a group. Anyone will have the opportunity to show and tell about anything they are working on as long as they can make the case that it is related to a creative field. A cool new bicycle design? An innovative textile? A design for a base in Mars? Fridays will also be used for charrettes, design competitions, educational field visits, etc. and as a last resort, work.

Design-build and BIM (Building Information Modeling)

Recently many clients including governmental agencies have begun or are considering moving, away from the traditional public bid for Architects and General Contractors. The trend towards design-build contracts is show in the graph below [not yet posted]. Cost and time the primary reasons for doing away with the traditional design-bid-build system, but in the not too distant future it will not be a choice. 

With the advent of BIM, the traditional relationship between design professional and contractor will necessarily blur to the point where perhaps there little will be left of the architect-contractor relationship as exists today. Already, the primary software systems used as an integral part of BIM require the design professional to be intimately familiar with how a building is put together, as the building has to be built in virtual reality. 

This new paradigm requires close and continuous collaboration among all the participants, including not just the design professionals but the owner, contractor and subcontractors as well, from the early stages of design through construction. The holistic approach made possible and necessary by BIM will render obsolete the need not only of traditional construction administration documents but the traditional design-bid-build method. Ultimately, rolls of plans will disappear as well, at least in the sense with which we are familiar.

Smart Apartments

The trend in the last few decades has been to double the size of the typical American home while the size of the households has been steadily declining. As with the trend against larger gas-guzzling vehicles, there is a nascent trend towards smaller yet more efficient dwellings. Borrowing the name from the European Smart Cars, the objective is to offer to our developer clients innovative compact and intelligent "Smart apartments" that occupy a smaller and well designed footprint while giving the appearance of larger areas. These apartments should encompass green principles and should be designed to easily meet the requirements of LEED Gold Certification, as well as take advantage of innovations in newer methods and materials with an emphasis on prefabrication.

The following video is perhaps a little bit extreme of what I mean, but the concept is there; namely, that it is entirely possible to have a lot in a little space if it is well designed.

The Maelstrom

As a child I spent countless hours reading comic books. One of my favorite characters was the super-hero Thor. In one issue Thor says, and I'm paraphrasing, 

  "Tis not through fear, but by jumping into the maelstrom of life itself that thou shall find thy wisdom"

Caution will keep us safe, but at what cost? We don't have stories to tell our grandchildren, we don't have scars, we spend our precious few years on earth melting into the background as another insignificant statistic.

In the end we live but we're not alive. Progress is owed to the non-conformist, the revolutionary, the inventor who refused to keep his feet planted firmly on the ground, against all odds.