AEC Managing Partner Newsletter September 2006
Welcome to the September 2006 Edition of the AEC Managing Partner Newsletter.
I had the good fortune of presenting on the topic of Incentive Compensation at the SMPS/PSMA Build Business Conference in August. I had never attended the conference before and I wasn't quite sure what to expect. I was pleasantly surprised by the quality of this conference and look forward to next years conference in Washington, DC. A special thanks to Bill Scott , V.P. of Education for SMPS and Mark DellaPietra for keeping me informed every step of the way and making my participation an enjoyable one. An article on the conference is included in this newsletter.
In this Months Newsletter:
1. Growing Pains - an article by Herb Cannon
2. Build Business Conference 2006
3. Strategic Planning Facilitation Services
4. Houston ASHRAE Workshop September 26th
5. Axium Users Conference on October 20th
6. Valuations and Ownership Transition Seminar November 17th
7. SMPS Southern Region Conference January 26-27, 2007
Growing Pains
Yes, the summer is now officially over and so far, the year 2006 has been a good one. The economy is in relatively good shape, many firms in the A/E industry are operating at 110% of capacity and profits are strong. Many firms have grown this year by 20% or more in terms of revenue and employees, everyone is hiring and the backlogs keep increasing.
With all of this success also comes some growing painsand your management structure may no longer effectively support your growing organization. The systems and strategies that have brought you so much success and growth may very well be keeping you from getting to the next level.
Do any of the following sound familiar?
1. All of a sudden, your 20% + profit machine is slipping to the 12 to 15% range or worse. You rationalize that you are making it up on volume, but in your heart you know that the mismanagement of increased volume is costing you money.
2. Monthly invoices are not sent until 3 weeks after month end and you are unsure if it is the process, software, accounting personnel or something else that is the root cause.
3. The rapid growth has strained your cash flow. What was once a healthy bank balance has dwindled to a dangerously low level to accommodate the rapid growth.
4. Your office is over-crowded and you are searching for more office space.
5. For the third time this year, you are purchasing additional AutoCAD licenses. (see item 3 above)
6. Your computer network is sluggish and your telephone system is at capacity. Both need serious attention - but you are not sure if your IT staff is up to the task.
7. You continue to take any project that comes through the door regardless of fee, staff availability, project type or questionable client history.
8. Even though you have record backlog, you are still concerned that not enough people in the company are marketing oriented.
9. You are personally overburdened with both project work and administrative tasks. You are also struggling with the short-term pain of delegating as much as you can - but cannot seem to let go.
10. You and your partners disagree over whether growth is a good strategy. Some partners never wanted the firm to grow at all. They are perfectly content the way things are. In fact, they wish the firm was smaller - just like the good old days. Other partners (maybe you) have always seen controlled growth as necessary part of building a successful business.
11. You wonder how you got here and what the future may bring.
What can you do about it?
Over the past year, many of my clients have been struggling with the pains of rapid growth. In short, what has made them successful is not what is needed to keep them successful. If this sounds like your company, this is the perfect opportunity to take a time-out and reflect on what is working, what could be better and where do we want to go from here.
In other words, I am talking about a strategic planning session. In my experience, there is simply no better way to take control of your firms destiny than to spend two days planning for your firms future.
Successful firms retain a facilitator exclusive to the A/E industry and take the time (2-3 days every year) to develop a simple plan of where they want to go and how to get there. The result of the session should be a simple action plan that articulates the companies goals, assigns responsibility, assigns deadlines for action and has a mechanism for follow up.
I personally facilitate about a dozen strategic planning sessions each year and assure you that the results can be outstanding. Years later many of my clients look back on the strategic planning session as a transformational event in their company's success. If your company hasn't held a strategic planning session, you owe it to yourself and your company to give it a try.
Build Business 2006
I had the good fortune of presenting at the Build Business Conference in Hollywood. The conference is a joint undertaking of Society for Marketing Professional Services, the premier A/E/C marketing and business development organization, and the Professional Services Management Association, committed to excellence in design firm management.
The conference took place at the Hollywood Renaissance Hotel, which is adjacent to the Kodak Theatre, home of the Academy Awards and of course, the American Idol finals. The venue was terrific and I was surprised to find that there were over 1,000 attendees. The conference was essentially a 2-day event with optional pre and post- conference activities.
The two days were filled with 28 well-organized and fast moving breakout sessions with snappy titles like "Maverick Marketing", "Where's my Birthday Card" and "Cracking the Sales Code". "Incentive Compensation - The Key to Increased Revenue and Profit" was presented yours truly, (next year I hope to come up with a better title). The Keynote addresses were also entertaining and on target.
However, the most interesting event was the black-tie awards gala. Most awards galas are a combination of mediocre food, strained table conversation and long winded monotone speeches that only their mothers would love. Well, let me just say that I was pleasantly surprised. The food was great, the conversation was terrific and the speeches were short and interesting.
The event was hosted by a Jay Leno impersonator that kept the event light-hearted with some funny jokes and ad-libs. The awards presentations struck a great balance of being respectful to the award winners and not being bogged down with rambling speeches. Anyone interested on how to run an awards presentation and make the attendees look forward to next one, should attend next years event in Washington DC and find out how to do it right.
Strategic Planning Facilitation Services
Successful firms retain a facilitator exclusive to the A/E industry and take the time (2-3 days every year) to develop a simple plan of where they want to go and how to get there. The result of the session is a simple action plan that articulates the companies goals, assigns responsibility, assigns deadlines for action and has a mechanism for follow up.
AEC Management Solutions works exclusively with Architect and Engineers to develop a strategic plans that help them earn and keep the money they deserve for their creative efforts.
Please call us at 732-705-5098 to find out how we can help you achieve your goals.
Houston ASHRAE Workshop September 26th
Herb Cannon wil be conducting a workshop session titled - Productive Project Management - A Profit Perspective, plus a luncheon presentation titled "The Seven Habits of Highly Ineffective Engineering Firms"
Contact the Houston Chapter of ASHRAE for more information
http://www.ashrae-houston.org/
Axium Users Conference on October 20th
Herb Cannon will be conducting a session on Incentive Compensation
Please visit the Axium Website for More Information
http://www.axiumae.com/events/userconference/
Valuations and Ownership Transition Seminar November 17th
Herb Cannon will be presenting a ½ day valuation and ownership transition seminar in on November 17th. Download the Registration Form.
http://www.aecmanagementsolutions.com//Ownership%20Transition%20November%202006.pdf
SMPS Southern Region Conference January 26-27, 2007
Herb Cannon will be presenting at the SMPS Southern Region Conference in San Antonio, TX on the topic of Strategic Planning. More details will follow
Visit the AEC Management Solutions, Inc. Website
http://www.aecmanagementsolutions.com
Want to Reprint an Article from AEC Managing Partner?
As a publisher of a print or web-based publication, you are hereby granted the right to reprint any article contained in this newsletter with the following provisions
1) The words "By Herbert M. Cannon" must be included immediately following the article title.
2) The following "resource box" is included following or preceding each article.
Herbert M. Cannon, President of AEC Management Solutions, Inc. and Publisher of AEC Managing Partner Newsletter, is a management consultant, seminar provider and speaker exclusive to the A/E Industry. He is available to speak at company meetings and conferences. For more information contact Herb via e-mail hcannon@aecmanagementsolutions.com. Or visit his website at www.aecmanagementsolutions.com
3) You send us a hard copy of any printed publication in which one Herb's articles appear. Printed issues may be sent to 183 Higgins Road Matawan, NJ 07747
Thank you for taking the time to read my monthly newsletter. As always, I look forward to your feedback.
Regards,
Herb Cannon
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