Phil Bernstein's Blog

Exploring New Value in Design Practice: 0, 1, 2

Overview:  This term Yale is offering a graduate seminar entitled “Exploring New Value in Design Practice.”  I’m guiding this experimental research course with my Harvard colleague Brian Kenet (who teaches professional practice at GSD).  Brian is a management consultant to architects and engineers but not an architect.  That makes us an unlikely but possibly potent pair to explore the central question of the course:  why isn’t the practice of architecture properly valued, economically or otherwise?  And if you accept that premise then what options are available to change our value proposition as architects?  Here’s the abstract from our syllabus:

How do we make design a more profitable practice? Design practice has traditionally positioned building as a commodity in the delivery supply chain, valued by clients like other products and services purchased at lowest first cost. Intense market competition, sole focus on differentiation by design quality, and lack of innovation in project delivery models and and business models, has resulted in a profession that is grossly underpaid and marginally profitable, despite the fact the building sector in its entirety operates in large capital pools where significant value is created. The profession must explore new techniques for correlating the real value of an architect's services to clients and thereby break the downward pressure on design compensation. This seminar will re-imagine and re-design the value proposition of architecture practice, explore strategies used by better compensated adjacent professions and markets, and investigate methods by which architects can deliver--and be paid for-- the value they bring to the building industry. 

We are going to look at the business models of practice and construction, and the construction industry supply chain, for clues and opportunities, talk to experts in adjacent professions like law and medicine, and investigate other design disciplines like product design, fashion and film-making.  Through the semester we hope to establish a series of hypothesis and vectors for further investigation and research.

Brian, our students and I thought this this blog might be a good place to document some of our discussions, early conclusions and general thoughts, so I will be attempting to do so weekly.  Those of you who know me as a teacher know that I try to be compulsively planful and prepared, and this seminar—because it explores a largely unexplored topic—is neither.  So I hope readers will tolerate the messiness that is an early draft of what we hope will be provocative ideas forthcoming.  And with that, some notes on our first couple of sessions:

Session 1/Problem definition:  “Why don’t architects get paid for value?” We started our first class of the term asking “what is the issue here?  Is there actually a problem?”  Brian set out the four components, as he sees them, of practice:  Art, craft, service (as a regulated profession) and business enterprise.  The value “machine” is somehow comprised of these parts.  Since there has been no systematic study of this question, there’s no real understanding of the “sweet spot” between the competing demands of each.  (That lack of study is mostly a function of the tertiary position that practice has in most U.S. architecture schools, combined with the Justice Department’s consent agreement with AIA that they be not at all involved in any discussion of architect’s compensation, lest it be considered anti-competitive.)

We examined a possible “boats and ocean” analogy where architectural practices are small boats floating in the larger “ocean” of the industry, along with the adjacent vessels of our engineering collaborators, the building industry, and finally society at large.  Each of these participants have their own definition of “value.”  

After a brief discussion of the seemingly “winner take all” culture of star architects receiving the lion’s share of significant commissions, leaving the balance of practice to compete on a fee basis for the remaining work, we turned to the question of why value per se is an issue.  It was suggested that architects may not be interested in the question (until they see their first paycheck); firms struggle to differentiate from each other making value only a function of lowest fees; a lack of general understanding and appreciation of “what architects do for a living;” and the inherent tension of the provision of professional services versus creation of physical products (like drawings or buildings).

We then looked at a first working list of the possible “value outcomes” of practice, with an eye toward revisiting and refining these ideas during the course of the term.  The list included:  happiness, profit, asset performance, public satisfaction, public affection (where’s the “American Idol” of architecture?), brand, and civic pride.   An incomplete, but interesting, list to big a larger discussion.

 

Session 2/Defining Value Propositions in the context of industry economics:  This class started our series of brief kick-off presentations by the students about background topics that build understanding of industry issues.  A very provocative summary of “what is a value proposition?” included the following definition from Wikipedia:

A value proposition is a promise of value to be delivered and a belief from the customer that value will be experienced. A value proposition can apply to an entire organization, or parts thereof, or customer accounts, or products or services.  Creating a value proposition is a part of business strategy. Kaplan and Norton say “Strategy is based on a differentiated customer value proposition. Satisfying customers is the source of sustainable value creation.”Developing a value proposition is based on a review and analysis of the benefits, costs and value that an organization can deliver to its customers, prospective customers, and other constituent groups within and outside the organization. It is also a positioning of value, where Value = Benefits - Cost (cost includes risk)

The students (Yas-Teg) then suggested a derivation of Maslow’s hierarch that could define different kinds of value in architecture:

  

The “architectural hierarchy” was then interrogated to ask if Brand/Design are somehow the key values delivered by architects, and efficiency/cost+schedule could be delivered by others.  The idea suggested that somehow “design” was separate from these other issues, but we’ll explore that question later.  In the meantime, the hierarch did raise another even more provocative, if not unexpected set of questions about whether the essential, ineffable quality of good architect should be “valued” in any way other than simply appreciated, and whether that “outcome” should be correlated to the core value proposition of practice.  It is certainly strongly implied in how we train architects; why doesn’t it manifest more clearly?  And since it was suggested that “critical architecture” actually alienates the public, is value found elsewhere?

We concluded by looking at the economic models of building in the United States, where in 2011 (according to AIA statistics) architects generated approximately $21B in fees in support of the design of $320B in buildings and generated approximately $2B in profit from those fees.  If profit is an indication from a market of value, then that $2B is about 1/2 of 1% of the overall cost of the total $341B spent on buildings. 

Session 2/Practice Business Models:  This session was focused on understanding the underlying mechanics of an architectural practice, including the business and financial model.  The backgrounder team presented a concise analysis of business models, defining them as follows:

A business model is a framework or strategy consisting of four elements that help a company define, create and deliver value: 

1. Customer value proposition: how does the business help a customer get a job done?

 2. Profit formula: how does it create value for company and customer?

3. Key resources: what people, equipment, technology, brand are required?

4. Key processes: what training, development, planning, sales?

After an exploration of pricing (or how a business “keeps” some of the value it creates as profit) the team explained the basics of the architectural business model:

1. Customer value proposition: deliver high quality projects on time and within budget 

2. Profit formula: charge percentage of customer budget (cost-based pricing!) resulting in  fragmentation of the suppliers (unable to share resources, drive down price) 

3. Key resources: talent, brand, client relationships

4. Key processes: design process, marketing development 

Brian then explained the dynamics of financial performance of a practice, which really can only adjust three variables to increase its value as defined in these terms (in other words, the gross profit it generates): (1) increase the customer value proposition and thereby bring in higher fees; (2) increase the utilization of people working in the firm, creating work faster or staying more consistently billable on projects, and (3) get clients to pay bills faster so you don’t have to borrow money to cover payroll.  Of course there are lots of other subtleties—like fee mixture, capitalization, principal payments, bonuses—but the model itself is surprisingly simple to understand and run.

Inasmuch as the term is not focused on polishing the simple business model, we turned to thinking about how one might increase inputs to the model (higher fees) and other efficiencies.  A first list included:

1 - Getting paid more for the same amount of work provided by correlating it to some other value than lowest price

2 - Reduce the number of providers in the marketplace, creating scarcity and price rises

3 - Connect compensation to measurable outcomes (the lower regions of Yas-Teg) rather than fixed bids.

4 - Capture the value of capital as it passes through the supply chain, like a financial services company sets up deals

5 - Find new ways to capitalize practice and operate from a stronger financial platform.  The inherent instability of services businesses make them lousy capital investments—how many publicly-held design firms are out there?

6 - Radically improve collections to get money in the door faster

7 - Radically improve utilization to make work much more efficient.

Brian concluded with the following suggestion:  can we find “novel activities, linked in novel ways, including new participants, that can generate new kinds of value?”  As we explore other models and professions we will return to this theme.

We sent the students off for studio travel week, taking a weeks’ break before Session 3.

The day after my last posting, AIA sent the following encouraging information about U.S. construction info: http://www.aia.org/practicing/AIAB097351

"Even though growth in the U.S. economy continues to be disappointing, nonresidential construction activity is projected to see healthy if unspectacular gains this year, with construction spending for buildings rising by 5.0 percent in 2013 before accelerating to 7.2 percent in 2014. The construction of commercial facilities is expected to lead the upturn, with spending gains of almost 9 percent this year and nearly 11 percent next year, led by double-digit gains in hotel construction. Industrial construction spending is projected to nearly match the overall nonresidential building totals this year and next, while institutional construction activity should lag behind, with modest single-digit gains over each of the next two years. Healthcare is expected to be the strongest institutional sector."

Winter Commencement, Redux

It’s been a year since my “Winter Commencement” discussion, and just a few days since I gave my annual talk to our graduating students about the state of the construction economy and what that means for their spring job hunt.  And since ArchDaily decided to repost that blog recently, it seemed timely to reflect a bit on how things have changed since December of 2011, and what those changes might mean for job prospects going forward.

And what a difference a year makes, at least for this year’s graduating class.  The elections are over, most of the economic malaise, while not lifted here in the U.S, is certainly lighter, and designing, building and, most importantly, hiring seems to be on the rise again.  In fact, for the first time since 2009, I suggested to our students that prospects for their employment are the brightest of the young decade.  Here’s my reasoning:

Capital is starting to flow and projects are starting up again in the United States.  A lot of money has been sitting on the sidelines during the economic crisis, and it’s starting to move into construction again.  “Long money” projects (like hospitals and university projects) slowed but didn’t completely stop in the last three years and several projection suggest they are accelerating again.  The AIA’s Architectural Billings Index is on a five-month climb and is stronger than it has been in five years.  This means clients are starting to convert inquiries for work into actual projects.  A lot of larger firms in the U.S kept the lights on with work in Asia, India and Russia, and that work continues even as local projects begin to perk up.

Expanding work means firms need to hire after the draconian contractions of the last several years.  With total employment in U.S firms (according to the AIA) down from 220,000 in 2008 to 153,000 in late 2010, many firms haven’t filled a new position for a long time, and my (admittedly anecdotal) discussions with firms around the country suggest that lots are starting to hire again.  The rampant destruction of design and construction capacity in the downturn—where clients took advantage of tough times to drive fees and costs as low as possible—probably pushed the real capacity of the industry below what it needs to actually function normally.  And with homebuilding surging again, there are actual shortages in construction labor in some markets.  Many of the several million construction workers who left in the recession are likely never coming back, making the next several years look profitable for the survivors.  The same will be true for architects.

Technology isn’t optional anymore in most practices and construction sites.  BIM adoption by architects, engineers and builders in the U.S is now above 70% according to recently published studies, and most firms are expanding their digital muscle, creating demand for digitally savvy employees.  BIM-enabled designers have always been in high demand, and that demand will increase as construction relies on digital information.  Architects with experience managing BIM-based projects will have lots of options. But almost every recent graduate of architecture school is more digitally enabled than the folks fifteen years their senior, and those skills are increasingly in demand.   As some baby-boomer architects (and their construction superintendent counterparts) begin to retire, some of the digitally disabled make room for younger stock.  [Important note, however:  upward mobility in firms will likely be retarded by some baby boomers, whose retirement savings were devastated during the crisis, who have to work longer to survive.]

Integration in the delivery supply chain increases demand for architects as more “vertically integrated” businesses like large contractors, super-sized AE practices and other models evolve to provide a continuum of services from feasibility through construction to building operation.  Those firms find architects to be very useful, not just in traditional roles but across the services continuum.  A well-trained designer can lead a lot of different kinds of projects, using her problem-solving skills in unique ways.  So there will be more spots for a young practitioner to start a career or develop skills, and perhaps some new trajectories through the profession itself.

So all this means that the employment prospects for the next couple of years seem pretty good.  But before we breath a huge collective sigh of relief that the worst is forever over, remember that the construction industry, like the economy upon which it depends is heavily cyclical, riding up and down every three to five years.  Here’s a graph of the AIA’s ABI from 1996 through 2012:

I’ve been through at least five of these downturns, and probably haven’t seen the last one before I pack it in.  Architectural jobs will come and go accordingly.  The bigger question, touched on in this blog and elsewhere, is not so much how many architects will be working, but what they will be doing when they are.  We exit this downturn slowly, and the surviving firms—both architects and contractors—have been tempered by the experience.  As work begins to accelerate again, many of the questions of how design and construction are connected, how design information transits from intent to execution, how professional roles and responsibilities are allocated, and the what value architectural services might have will once again in be in high relief.  Changes in the means of representation (like BIM), the implications and responsibilities of design for building operation (like LEED), and the modes of project execution and delivery (like IPD) will create both big challenges and even bigger opportunities for architects.  Let’s not just ride this upturn in the ABI to its inevitable turn back downward without addressing them.  

The Architect's Newspaper

While the worlds of economic policy and design are often at odds, last year's “Archtober” in New York and “Beijing Design Week” on the opposite side of the globe are encouraging signs that the distance between these ideas is rightly closing. Design and economics are, in fact, wholly intertwined. Here in the West, Archtober is a month of lectures, tours, and other events that celebrate the role and importance of architecture in the life of New York City. In contrast, in China, Beijing Design Week highlights architectural talent—both emerging and established. In both cases, the events are geared to connect design innovation with economic vitality. In introducing last year’s Archtober, AIA NY president Joseph Alioto proclaimed New York the center of American design and suggested that it “demonstrates this sector’s powerful economic impact and draws global attention to one of New York’s leading exports.” Beijing Design Week was supported and endorsed by Chinese government officials and took place during Golden Week, when the country’s founding is celebrated nationally. Clearly, the organizers of both recognize the fiscal and commercial power of architecture and design.

via archpaper.com

Still out here, just writing in different spots...

You'd Better Care Who's a Licensed Architect

In a recent piece in ARCHITECT magazine, Aaron Betsky asks “Who Cares Who’s A Licensed Architect?”  Disclaimer:  Aaron and I were graduate school classmates, and while we have traveled wildly different routes in the profession, I have followed and greatly admired his work.  But on this one, I think he’s asking a valid question but looking for the answer in the wrong place.

I am a licensed architect, and as someone who teaches professional practice at that same institution where we both graduated, I strongly urge my students to sit for the exam and go get a license. Most report they plan to do just that.  One of the primary reasons the course I teach is required in the curriculum is precisely to prepare these folks to actually “practice architecture” with competency beyond, or perhaps in support of, Aaron’s valid plea for architectural capabilities.  How you get a building built is just as important as the idea that generated it, otherwise it’s just an unbuilt concept. Who, exactly, gets the right to design that building and help a client get it built?

His brief brush with the authorities over the use of the title “Architect” was rightly characterized as silly.  Under those rules, Bill Gates, Microsoft’s “Chief Software Architect” is violating the California licensure regs when he visits San Francisco and hands out his business cards. But that stuff is designed for a specific political purpose—to create a barrier of entry for competitors “doing architecture” in a jurisdiction where only the licensed may purvey.  It’s an economic maneuver to protect the locals, but really obscures in a more important consideration.

Professional licensure regulations have a very specific purpose:  to protect the public’s health and safety.  It’s the reason that related “learned” disciplines like medicine and engineering are purveyed by individuals with special education and professional certification.  That there is little overlap between this requirement and Aaron’s “architectural competency standard” can only be laid at the feet of architects themselves, who create the very exam that misses his mark.  If he believes that architects need to be more competent to create relevant design, those criteria are best be instantiated into curricula, accreditation and testing, all of which we control anyway.

And while he’s statistically correct about the de minimus number of buildings designed by architects in this country, state laws generally require any building of size or height (3,000 GSF or taller than three stories) be designed (and signed and sealed) by a licensed architect.  That hundreds of thousand of spec tract houses don’t fall under that aegis is mathematically correct but much less important than it sounds.  No piece of software, or amateur designer working from a kitchen table on a laptop, is allowed to create those “larger” designs and get them permitted and built. Almost anything built in a city today, by extension, must be designed by an architect.  And the supporting cast of systems designers needs a leader to make sure that their ideas are deployed in the service of the architecture idea and don’t take on a life of their own.  If anything, the regs should be extended to include those tract houses.  But Aaron seems to want to go another way.  

But here’s my real point: as architects we should celebrate and reinforce the logic behind licensure regulations because that’s the single spot where public policy acknowledges the importance of the involvement of architects in building, and requires it.  We weaken those demands at our great peril, especially at this particular historic moment for the profession.  Decimated by the recession, and under siege by the usual collection of builders, program managers, and others who are just as desperate for work and control (and much more willing to be cut-throat about it) architects who abandon or condemn licensure concede our most important leverage over the building process.  Licensure may not be elegant, but it has the necessary effect.  So fix it, don’t toss it.

The ALB’s stunt in the UK occurs at a delicate juncture. The government has declared that the construction industry is critical to the future of the economy itself.  Various players in the process are jockeying for position accordingly.  New building regulations, carbon and energy requirements, technology and government building policy are re-forming the market in which architects work.  Do we really want to erase the very certification that gets us to the table in this conversation?  

I completely agree with Aaron’s belief that the real importance of architecture is it power to affect our lives, but suggest that giving up the idea of licensure will have exactly the opposite effect he’s seeking.  Does he want fewer buildings designed by certified architects, or those same buildings designed by better architects?  Rather than invest all our energy trying to demonstrate the value of architects and architecture—something the AIA spends an inordinate amount of time doing while ignoring more pressing issues—why not make sure we maintain our relevance by shoring up licensure and connecting the power of architects with the power of architecture?  We will certainly regret doing otherwise, lest we end up building without either.

The Collective Wisdom of Design

One of the most interesting aspects of the current intersection of technology and practice is the way that differing disciplines must look at problems collectively, whether under integrated project delivery methods or simple digitally-driven collaboration.  Today’s training and licensure approaches are largely silo-ed by individual disciplines, and it’s only after attempting projects “in the real world” do designers, engineers, manufacturers,builders and others begin to understand how to consider the perspectives and ideas of others, and collaborate toward a common goal.

The overlay of digital technology provides a simple but common denominator.  “Collaborative” mechanisms that allow information to move quickly and smoothly and be understood transparently reduce the coefficient of friction of working together, and today’s generation of social-networked enabled young designers use these tools without concern for the inhibiting protocols of their baby-boomer predecessor’s.  Nobody real cares, for example, who “owns” the information in a highly digital, collaborative exchange of information.

And this stance has enabled the important but largely unrecognized potential of crowd sourcing—the use of collective insight and knowledge—to be applied to design problems.  Deploying that collective wisdom in addition to the acceleration of ideas  that can come from cross-disciplinary view of challenges suggests that there might be new ways of defining, unwinding and attacking difficult problems where design can help.

 I often wonder how my students, who spend as much as seven years studying architecture and working almost exclusively with their peers, can be exposed to such questions, but I observe a recent surge in interest in collaboration.  In project’s like Yale’s XS students are breaking free of the traditional constraints of the curriculum to explore the implications of how radically different perspectives add to the excitement and insight of exploration.  I think such ideas are a result of this generation’s particular upbringing in the digital ocean combined with a studied indifference to traditional boundary roles.  In the main, both good and important stances.

Autodesk University is a place where a lot of Autodesk users, across many disciplines, gather to learn about our technology and generally exchange ideas about design and creation.  So this year I thought it would be pretty interesting to explore this topic—how collective design insight can see and solve problems differently—in a more structured way.  We’ve put together a session at AU called “The Collective Wisdom of Design” where creators from four different disciplinary silos—building, infrastructure, manufacturing and gaming—are going to look at a problem for their particular and collective perspectives, and marshal their own crowd-sourced networks to generate ideas.  These ideas will be presented in Las Vegas, and the attendees will “crowd source” an opinion about their efficacy, and award the best one with a sizable research grant to continue the work throughout the year.  I figured this might be a way to see just how these new forces of collaboration might let us see problems and their solutions differently.  It’s a pretty wild experiment (even for Las Vegas) and I’m betting on equally wild results.

Here’s some more detailed information about the forum (with apologies for the slightly shameless AU marketing).  Take a look at these folks, and these sites.  If you’re headed to AU, looking forward to seeing you in Las Vegas and at this session.

We’ll report back on the results of this session in a blog entry after the event in December.

FORUM DESCRIPTION:  The Collective Wisdom of Design Across Boundaries

This forum explores the blurring boundaries of design methodologies and how adjacent disciplines look at similar problems in different ways.  Faced with tremendous environmental, economic, political, medical, security and social challenges, we must look beyond single, heroic design solutions to solve global issues. For example, a solution for climate change requires scientists, policy-makers, human behaviorists, designers, engineers, builders and individuals. The best answers may lay not in point answers but will a hybrid of the collective expertise of experts in diverse disciplines.  Our four speakers are leaders in disparate industries who will utilize their talents, technologies, and social networking and crowdsourcing to consider and propose solutions for the pressing concern of providing healthcare to underserved areas.  These four leaders from building, infrastructure, manufacturing and media & entertainment will suggest solutions to this problem using all these resources and present their interpretation of the problem along with the most viable solution, discussing the commonalities and differences in approach, process and technology.  The result will be a proposed answer to this global problem based on collective input, ideas and innovation.  During the Forum AU attendees will vote on their favorite solution, the winning solution will be further developed by a non-profit or academic organization with an Autodesk grant of $50K and presented back at 2013 AU.

 

PARTICIPANTS:

Dr. Myshkin Ingawale, entrepreneur, researcher, co-founder of Biosense Technologies, TED Fellow, Unreasonable Fellow, and long-time Liverpool Fan. His team at Biosense has developed and is commercializing a low cost, non-invasive, anemia screening tool to improve health outcomes for mothers and children in developing countries. Myshkin has previously worked as a consultant at McKinsey & Company, where he advised clients across Banking, Healthcare and Technology sectors. Myshkin is also a co-developer of the Copenhagen Wheel, a hybrid electric vehicle concept built at MIT and demo-ed at the United Nations Climate Summit, Copenhagen 2009. He is an Electrical Engineer who got his PhD at the Indian Institute of Management, Calcutta, analyzing the networks behind Wikipedia, the free online encyclopedia. He is passionate about startups, technology and football.

(Representing Product Manufacturing.)

Facebook: https://www.facebook.com/CrowdsourcedProductDesign

 

Dr. Alasdair MacDonald, Director of Strategic Innovation, Balfour Beatty 

Dr. MacDonald has experience developing and implementing innovation, performance, operational and engagement processes in the UK and Australian Infrastructure, Transport and Water Industry.  Dr. MacDonald has developed the Research and Development Framework for the UK Highways Agency R&D Program, created the successful innovation approach adopted on the award winning Heathrow Terminal 2B project, and designed the collaboration approach for the Essex County Council Highways Tender. Dr. MacDonald holds a Master’s Degree in Civil Engineering, a PhD in Organizational Performance Management and is a visiting fellow at the University of Bristol.

(Representing Infrastructure Design.)

LinkedIn:   http://www.linkedin.com/groups/Crowd-Sourced-Solutions-Infrastructure-4654112?_mSplash=1

 

Liz Ogbu, Environments Designer
An architect, social innovator, professor, and self- proclaimed “Green Giant,” Liz is an expert on sustainable design and spatial innovation in challenged urban environments. Liz was a design director and part of the leadership team at Public Architecture, a national nonprofit that mobilizes designers to create positive social change. Liz’s signature efforts include the Day Labor Station, an innovative design and advocacy campaign that engages day laborers to address issues of space and dignity. She also served as project director for the development of a sustainability framework for International Planned Parenthood Federation’s Bolivian affiliate. She did the same for the Design for Reuse Primer, an e-publication funded by the U.S. Green Building Council, intended to demystify and inspire mainstream material reuse. Her projects have been featured in museum exhibitions and received numerous design awards globally.
(Representing Building Design.)
HCD Connect: http://hcdconnect.org/projects/improving-the-healthcare-experience-for-the-uninsured/

Professor Marla Schweppe, Rochester Institute of Technology

After a decade in the New York theatre painting scenery, building costumes, doing special effects and designing, she transitioned into computer graphics and animation, which she teaches at RIT.  She now combines the two interests to design scenery, projections and effects for physical or virtual stages.

(Representing M&E.)

Facebook page: http://www.facebook.com/MediaEntertainmentCrowdSource 

Integrated Development

In various discussions about integrated project delivery (IPD) here in the US I'm often asked "what sort of projects are best suited for IPD?"  I consider these queries to be a derivative of a similar question of maybe eight years ago, to wit "what sort of projects are suitable for BIM?"  And I guess the correlation isn't unexpected since IPD as a concept emerged from the process implications and potential of BIM, and in early days (say the mid 2000s) the two ideas were often co-mingled and even confused.

But now that the technological process (BIM) has been conceptually parsed from the delivery process (IPD) have the answers to these questions changed?  In the case of BIM itself, I believe that we're way past the "what sort of projects suit" because the technology has matured, adoption widened, and I see projects from house additions to campus complexes being modeled successfully.  The project type question for IPD, however, is a little more nuanced because of a very important factor--and it's not project type--the client.

A fundamental precept of IPD (or any "integrated delivery" approach) is deep collaboration between the designers, the builders *and* the owner.  In the case of clients where success is deeply dependent on such collaboration, such as complex programmatic projects like hospitals, institutional buildings, research labs, or concert halls, an IPD approach is consistent with good design and construction practice.  The more the client is connected to every important decision the happier he or she is likely to be, and the more informed the architects, engineers and contractors who carry out that vision.

But what about developers, those commercial clients who might comprise (according to the latest AIA survey) as much as 28% of all projects (including hotel, retail, commercial and multi-family housing)? In theory, no problem:  IPD is based on collaborative decision-making (check), outcome-based compensation (well, maybe), advanced use of BIM technology for transparent decision-making (umm, perhaps not so much) and reduction of risk through cross-indemnification of the parties so they can work in the best interest of the project (uh oh).  Let's look quickly at each issue.

A "strong" IPD project is based on consensus-based decision-making, meaning that the primary players (designer, builder and client at minimum with others included as needed) must agree on every decision that any deems important, and only those decisions can move forward.  This suggests that the more normative "propose/dispose" model that we use traditionally with clients (do you like this scheme?  do you like this space? do you like this price?) gives way to total agreement or no agreement.  This means more detailed involvement in the project as it unfolds, bigger time commitments by the client to be deeply ingrained into the project process, and perhaps most importantly, jointly responsible for each of these decisions.  That closeness also closes off subsequent opportunities to hold other parties exclusively responsible for those decisions.  Many developers may not endorse the loss of such an enforcement mechanism.  For more on this issue, see “everyone “promises not to sue” below.

Strong IPD also means compensating the project team for accomplishing objectives that are defined at the outset and are in the interest of the project, and paying those profits jointly to the members of the project team.  Less paperwork and invoicing (a good thing for the client) but more importantly, perfect alignment of interests of all the parties and the project itself, so, as John Tocci says "Everyone works for the project."  And since many development projects are driven by well-established outcomes (meeting budget and schedules, or sustainability goals) this one seems like it would work well.  And perhaps there's an even more interesting oppotunity to get to even better alignment--if one such coutcome was the financial performance of the project in rental rates or rent/square foot, there would be even stronger incentive for quality work amongst the players, and a continued relationship beyond substantial completion that's more interesting than just the statute of limitations on a potential lawsuit.

Right now, I suspect the average developer client is disinterested in the use of BIM on projects, inasmuch as they don't dictate any of the tools that their teams might deploy to finish a project.  It's all about the schedule and the budget in most cases.  But as BIM empowers dynamic analysis of projects in ways that can allow developers to see, almost in real time, the cost, energy, occupant flow (and resulting revenue) of jobs as they unfold, perhaps interest will increase.  And those that operate their buildings after completion will surely engage in BIM-based facilities management as those solutions mature.

But speaking of which...many IPD projects attempt to create a "safe zone" for everyone's participation and ideas by providing cross-indemnification (legalese for "everyone promises not to sue everyone else") in the agreement.  The thinking here is that everyone, including the owner, is therefore free to take responsibility in the joint decision-making model--and include their best ideas irrespective of role--if they are not spending all their time making sure they don't get sued.  John also says that he can spend as much as 30% of his time on a typical CM-at-Risk project (many of which he does for developers) in "exculpatory" activity that only makes sure that he has documented or challenged everything that might create potential liability for his firm.  That's money that the owner pays, but sees no value from whatsoever.  The question, of course, is whether a developer is willing to relinquish this particular Sword of Damocles held over the team in case the project goes truly south.  It is likely only the most progressive who will be willing to experiment with such an approach to recapture the resulting value.  Of course, architects, statistically, probably benefit most from such provisions, since the vast majority of their claims come from clients and contractors.

[Sidebar:  in many large development projects like the ones that I worked on when I was practicing, even our sizable $5 million insurance policy wouldn't make a serious dent in any real problem that unfolded on the job.  The threat of litigation was as much an enforcement technique as a source of funds to resolve problems, and in any event getting access to those funds takes many years after a problem is identified by the time such matters are resolved.  Not a very efficient system.]

Most if not all of today's IPD projects are being undertaken by recidivist clients--owners who build repeatedly and are looking for solutions to the repeated crises of construction.  Developers surely fall into this category.  But most of those projects are being constructed by long-time owners of their buildings, institutions like hospitals or universities.  Many development projects are "turn-key" in that they are sold quickly after leasing and completion, although the tide may be turning on this concept in our current time of tough credit and longer leases.  I suspect--without benefit of any evidence, of course--that there are some progressive developers out there, who are perhaps building green projects with long-term operational obligations, who might be willing to experiment with IPD.  They'll be in the vanguard, and would certainly accelerate the trend toward less contentious, siloed delivery that might be more profitable, less risky, and more fun.

If you know of such a project out there, please let me know.

School Days 2012

After my summer blog hiatus I return to the page as my next fleet of students arrive to begin their last year of graduate school.  Thanks to the peculiarities of our academic calendar, my class will be both the first and final experiences of the term and the last collective experience they have as a class before Commencement.  It’s a funny place for a professional practice course to occupy in the studio-centric world that is architectural education.

Those of you who are architects probably don’t remember Pro Practice as a high point of your schooling.  Often taught by an “adjunct” faculty member (who works outside his or her teaching responsibilities and isn’t tenured, like yours truly) these courses are considered necessary medicine to get through the  academic spanking machine that is an accredited, licensure-ready degree.  War stories, dry recitations of AIA documents, balance sheets…as one of my students once asked (about another issue) “where’s the serendipity?”  I have been preparing for the term with much the same question.

Our school will be evaluated this year by the Gods of Accreditation (the National Architectural Accreditation Board, or NAAB) and we’re busy making sure we’ve properly covered all the necessaries of the so-called Conditions, an exhaustive list of all the stuff we’re supposed to teach budding architects.  The Conditions for my neighborhood of the curriculum (Practice) stipulate the following:

Architects need to manage, advocate, and act legally, ethically and critically for the good of the client, society and the public. This includes collaboration, business, and leadership skills. Student learning aspirations include:

 -  Knowing societal and professional responsibilities

 - Comprehending the business of building

 - Collaborating and negotiating with clients and consultants in the design process 

So there are three big ideas here:  a properly educated graduate must understand how the professional works with and affects society; understand the amorphous ecosystem of building and how we fit into it, and understand the business machinery that the architect deploys to get work done.  A daunting task to be sure, and not just because we have to find a way to cram all this stuff into a curriculum already choc-a-block with theory, engineering, sustainability, computation, digital fabrication, and of course design studio.  And notice the word “collaboration” is cleverly inserted into the equation as well. 

Here’s how my syllabus purports to accomplish this daunting task, according to the course introduction:  

The process by which an architectural design becomes a building requires the designer to control many variables beyond those purely aesthetic.  While the practice of architecture was formally established in the United States in the late nineteenth century, the role and responsibilities of architects in the twenty-first century are rapidly evolving under the influence of broad building industry changes in sustainability, digital technology and integrated project delivery.  Understanding architectural practice as the mechanism that realizes design--and project management as the leadership and control of the means that make projects happen--is as central to the successful design of a building as its form and character.  Effective practitioners master both design and practice issues to assure their designs reach fruition in the varied contexts of profession, practice and the individual project.   

But here’s the problem (or at least one of them).  At the risk of a strained comparison, there are certain similarities in the production of buildings, the creation of software and the education of architects, the three realms that occupy my professional life.  Each involves speculation about a future state, an assertion about how to prepare for that state, and a hope that all the intervening preparation will reach proper fruition many years later.  From initial desire to certificate of occupancy, a choice to translate a work process into digital code that is a production-strength piece of software, or from freshman year to licensure—all of these sequences take many years.   I worked on more than one project in my practice career that took more than a decade to complete.  Autodesk made the Revit acquisition in 2002 and only now is BIM reaching the mainstream.  NCARB just published a study that suggested that more that 50% of architects reach first licensure at age 32 (!), fourteen years after your average freshman starts out.  And the average number of years between graduation and licensure is creeping up accordingly; folks who got licenses in 2010 took seven years after graduation to get there. These are long timelines that we’re talking about here. 

So those of my students in the Class of 2013 who choose this route (which we assume is why they have invested so much blood and treasure in an architecture degree) can expect to have a license and truly “manage, advocate, and act legally, ethically and critically” sometime around 2020.  And I guess that means I know exactly what they will be facing, and how they might best be prepared to do so.  I wish… 

But I do find myself wondering if the centroid of architectural education needs re-centering a bit, even if we can’t predict with perfect fidelity what the world of practice might look seven or so years from now when my students get licensed and are certified as “minimally competent” practitioners.  Surely the essential skills of design (which they spend the majority of their calories honing) will be a basic platform for their careers, but what about the other stuff?  Maybe there’s no time in architecture school to teach business skills, negotiation strategies, proper presentation techniques, clear writing, or even the basics of how to collaborate or lead teams.  But I would note that across our campus at the School of Business, our future clients-in-training spend 50% of their two-year MBA curriculum (a year shorter than our program) learning these same skills.  Is there any doubt why these relationships are so asymettrical?  Perhaps the design studio becomes a fulcrum from which some of these ideas might emanate, rather than having them increasingly “shoe-horned” into the curricular suburbs of professional practice.

In a New York Times piece this weekend, Michael Graves argues that the demise of hand drawing, inflicted upon thecurrent generation by slavish devotion to the computer, is a root cause of the deterioration of our profession.  As you might expect, I disagree with his logic, not about means but rather ends.  Like the collection of necessary skills demanded by the Conditions, drawing is another instrument, just like the computer.  But unlike the pencil, technology is changing both the means of representation in architecture and the relationship of the architect to the very process of building.  I suspect that it is neither pencil nor BIM missing from the equation, but rather the ability to deploy both in the complex, collaborative, negotiated, measured and value-driven future of design and construction. Somehow, we have to teach that.

The End of CDs?

As an architect of a certain age I have distant memories of my first assignments in an architectural office, when finally offered a desk and chair (versus running prints and making the twice-daily Coke run).  They were almost invariably something connected to the making of working drawings:  practicing block lettering, tracing details, starting with rudimentary drawings of small portions of the building (like the toilet partitions), then moving to drawing even larger portions (like the entire toilet plan), to entire plans, and so forth.  Learning th discipline of analog architectural drafting—a mostly lost art form—was the spanking machine through which one passed to greater responsibility in the office.  At least for me, it was never the other way around: being assigned to help conceptualize a project came much later (although making presentation drawings and building models might punctuate the time spent on those toilet partitions).

Years later, as my drafting instruments sit mouldering in my desk drawer, the age of integrated delivery via BIM is calling into question the very existence of traditional working drawings, and with it some of the methods by which young architects learn the craft of putting together a building.  We’ll leave the latter topic to a subsequent post, and consider here some early thinking why working drawings, or “CDs” might be going the way of their audio counterparts.

Before examing the question, first consider exactly what a “working drawing” is supposed to do, and how it might be positioned in the design-to-build continuum.  Since designers under Western construction models are responsible for something called “design intent” (a general description, with discontinuous levels of detail, of what the building should be when finished) and builders for “means and methods” (figuring out the coordinated, procured and sequenced means to make the building) there is a natural division of labor and a constant source of tension, controversy and litigation.  Before the age of plaintiffs attorneys, super-complex buildings and viciously low-margin bidding, this wasn’t really an issue—architects knew enough about what contractors needed to build to provide sufficient information in CDs and contractors knew enough about how to accomplish those aims that most projects flowed with reasonable smoothness.

In the main, none of that is considered true today, and the oft cited statistic that “92% of owners think architectural working drawings are insufficient for the purpose intended” (CMAA Owner’s Survey 2005) is a symptom of larger pathologies that the integrated delivery movement is designed to address.  The principles of BIM-enabled integration, however, suggest that the notion of “final design documents comprise design intent only” is under siege, and perhaps rightly so.  Early builder involvement, high resolution parametric model content, integration of shop drawings into CDs, fast tracked packaging, performance specifications—all this stuff will eventually morph what was the “Construction Documents” phase and the “Bidding and Procurement” phase into something else entirely.  It might look something like this;

1. As sub-contractors are involved earlier in the design process, their insights, translated into what was once known as shop drawing levels of resolution, can replace large swaths of “design intent” information.  This is happening today when MEP sub-contractor fabrication information finds its way directly into the final documents, and the single line diagrams and 2D ducting plans of yore disappear.
2. Once constructors are more fully integrated into the design process, documentation will be “reverse engineered” from construction outcomes rather than “refactored” from design documents.  What was once a set of CDs organized by the originating discipline (architecturals, structurals, electricals, etc.) will change into packaging that supports specific construction strategies and will likely look more like bidding packages (foundations, superstructure, enclosure, finishes, etc.).
3. As model-based information replaces traditional 2D documents, everyone can access the database of design information and extract or cross-tabulate whatever information—geometric or otherwise—might be necessary for their particular component of the work.  This means the “abstract notations” that have been created to make CD documentation efficient (like wall type indicators) are no longer needed.  Whomever is building that wall can find out pretty much anything they need about it by referring to the model. Who needs a drawing?
4. As digital fabrication techniques for selected building systems (like for example, curtainwalls) becomes more prominent, interpolating architectural and structural information to “understand” that system so it can be machine manufactured makes little sense.  Information willl need to be organized and extracted to drive that process first and foremost.

So these are just a few musing about why what we now know as “CDs” may be something entirely different before my drafting instruments pass along to my children as part of my estate.  Perhaps the “CD phase” will give way to something new, like the “Implementation Documents” phase, as certain IPD constructs suggest.  In any event, I suspect that the days of making diagrams of toilet partitions as the port of entry to the technical documentation process will very soon disappear completely.  And it’s probably about time.

 

Aspiration, History

I've recently given a few talks on the implications of model-based "measurement" strategies for the building industry, and how the ability to measure outcomes prior to construction becomes the basis of all sort of new stuff, particularly new delivery and compensation schemes.  The delivery implications  will be the subject of another post.

It occurs to me, however, that this latest development in the evolution of use of BIM technology for building might be seen as a third "segment" in the technology's evolution.  I'm not talking about the UK model for BIM 1.0, 2.0, or 3.0,  but rather the emergence of a third motivation for technologic-based change in industry process.  Here's a quick sketch:

While there was lots of theoretical work on the idea of BIM in building (so called "product models"), early commercial implementations like ArchiCAD and first-generation Revit were focused on the first wave modality:  improving drawing production.  No one questioned whether orthographic projections of plans, sections and elevations were sufficient for the problem at hand, just that they needed to be better.  If we could just "fix" working drawings, all would be well.

The argument evolved as we began to realize that drawing issues were a symptom of an even larger problem, industry productivity.  Between the Egan work in the UK and the seminal CURT Whitepaper 1202, technology catalyzed a conversation about how to improve the overall results of the construction process, attacking the putative 35% productivity loss so often discussed in tandem with BIM.

As BIM matured and adoption became more widespread, and concerns about sustainability changed the frame of reference from delivery silos of design, bid and build to overall building operation, a third wave has now begun characterized by what I'll call industry effectiveness, or achieving better outcomes.  Early experiments in IPD--where project players are rewarded not based on lowest cost but on performance of the built artifact and the processes that create it--meaning we're now getting to a very interesting part of the discussion.  Making digital prototypes of a design that are performative implies that outcomes can be better measured and predicted (think energy simulation) and even tied to contractual terms.  If technology, delivery models and contracts, and industry methodology can evolved accordingly, the benefits should reach everyone in the building supply chain.

I will also note that these three waves of development roughly parallel Negroponte's three stages of technology adoption/use described in The Architecture Machine, accomodation (using technology to replicate an analog process), adaptation (extending the newly digital process into new, incremental functionality) and evolution (creating new, otherwise unanticipatable practices).  Of course, the wave of evolution for buidling is likely to be long and challenging, but might allow us to remake the industry in novel but desperately needed ways.