We are a civil/survey firm working with a mix of public and private clients. We're busy, but we still make time to look for new projects and clients on a regular basis. Every time we come across a project, however, several others firms are chasing the same opportunity. We get frustrated because we spend a lot of time and energy trying to get new work, but we are coming in second or third too often. Any suggestions on how we might improve our rate of success?
I have one word for you: Differentiation! What compelling reasons are you giving prospective clients to select you over the other (probably) equally qualified firms under consideration? What unique benefits will they receive or what problems will they avoid by picking your firm out of the pack for this project? If your benefit/avoidance message is too weak, or unclear, it will contribute to a disappointing number of opportunities going to your competitors. So think: Will you make them taller, thinner, and more handsome? Will you keep the community happy, avoid lawsuits, save money, and minimize change orders?
Learn to distinguish between features and benefits. Too many firms concentrate on telling prospective clients about their features—state-of-the-art engineering software, number of staff, or a new office building—and then assume that the client can figure out what this means to them. They generally don't connect the dots. The prospects need you to spell it out for them.
For example: "Our custom software typically cuts 20 percent off the schedule, and reduces construction material costs 10 percent to 15 percent for projects similar to yours, saving you money and helping to ensure your project will be done on schedule. Our new office allows us to employ a 'hoteling' concept. With hoteling, your project will have its own dedicated floor space established in our office, with each member of the team assigned to your project seated together for the duration of your project, with all pertinent design files and information readily at hand. Should you ever need to contact us, a knowledgeable team member will always be available to either assist you on the spot, or see that you receive a quick response."
To differentiate effectively, you first need to understand thoroughly the client and the proposed project to know what to emphasize. If you fail to develop a more than passing knowledge about the project you're pursuing, and don't uncover some hot-button issues you can use about the personality, preferences, or peculiarities of the client, there is no way to develop a strongly differentiated message. Most firms would be better served by chasing half the number of projects, but putting in twice the effort for those they do pursue to understand more fully the particulars of the projects/clients. This would allow them to better tune their answer to the all important question, "Why you?"
Cheap on training
I'm a human resources director for a 200-person engineering firm. Our principals are very reluctant to spend money for staff training, expressing reasons such as: "Professionals should be responsible for their own professional development … why should the company have to pay for it?" "We're too busy to afford the time away from project workload demands," or "If we invest in training people, they'll just be poached by other area firms who can afford to pay them more, since we've already incurred the expense to train them." I think they believe all these reasons, but I also think they are just plain cheap. How can I get them to free up some resources for staff development?
It does not make it right, but statistically, many firms share the same mindset as yours when it comes to spending for training. According to a recent industry survey, the overall median annual expenditure for training and education at AE firms of all types and sizes works out to about $461 per employee. As the median figure, half the firms spend more per person, half the firms spend less. This amount includes the out-of-pocket cost for tuition reimbursement, educational programs, and educational materials and expenses, including travel cost to educational programs. This figure does not include the salary cost for staff time to attend training sessions. According to the same survey, the median annual salary of all AE firm employees is just over $56,000 per year. Therefore, the non-payroll training cost amounts to far less than 1 percent of salaries. For knowledge-based businesses such as ours, we are not spending much as a profession compared with all other expenses incurred to run a firm.
My personal belief is that it is shortsighted not to invest in staff development. Sure, some might leave to accept better positions once trained, but many more will stay because you've created an environment in which people are learning and developing as professionals. In my experience, a reason some firms experience high turn-over is because staff feels that they have no opportunities to grow and develop and need to look outside their current firms to keep developing. It's important for morale to keep professionals at the "edge of their competency" as much as you can with a steady diet of stimulating, challenging work. People (and companies) grow by operating at their margins, not by staying in their comfort zones. A commitment to training equips people to take on these new challenges. Take the tack with your principals that training and development actually save money in the long run by reducing turnover, creating a more talented and enthused group of professionals, and offering a better value proposition to market to your clients compared with firms who do not.
Get answers to your questions about design firm and project management, finances, marketing, and related topics by sending them to Q&A c/o: CE News, One IBM Plaza, 330 N. Wabash, Suite 3201, Chicago, IL 60611, or faxing them to CE News at 1-312-628-5878. Include your name and telephone number in all correspondence. Your name will not be used in connection with published questions. David Wahby is president of Wahby & Associates (www.wahby.com), a management consulting firm serving A/E clients. He can be reached at 1-616-977-9756 or via e-mail at email@example.com.