5 Innovative Business Models for Young Architectural Practices
The architecture profession is in a perpetual debate concerning the myriad issues that impact how we practice and how that work can and should impact the world around us. As the chair of the AIA’s Young Architects Forum, I am keenly aware of the problems facing the next generation of practice leaders: inefficient practice models that lead to overworked, underpaid, and highly unsatisfied staff. We hear repeatedly that a seismic shift in the way firms operate is necessary to successfully move the profession forward and retain talent.
In October, the AIA held their first ever Practice Innovation Lab, looking to develop new practice models to raise the value of architects and the services that they provide to their clients with the goal of sparking a new debate that could challenge the status quo in firm management.Ten teams of six were formed with the intent of creating 10 new innovative practice models which would be pitched, “Shark Tank” style, after a daylong hackathon. Attendees then voted on the best practice model for the People’s Choice Award. Among the 10 pitches, there were five major themes to come out of the Practice Innovation Lab, which are discussed in more detail below:
1. The Networked Practice
The networked practice focuses on the fact that, as architects and designers, we can do more collectively than we can on our own. The people’s choice award winner, JAMB, is an example of this. They looked to create a membership-based organization where small and medium-sized practices can join their resources enabling them to become larger players and be more competitive.
Another team, New [net]WORK focuses their “cooperative network of professionals” to increase the accessibility of research as well as build collaboration and alliances between architects, researchers, and other advocates for the built environment.
In every model, the networked practice set up shared resources that remove physical barriers and create knowledge libraries that let architects practice where their specialized skills are needed most. It also enables network members to find partners when particular skill sets are needed that may not immediately be filled within their own firm.
2. Data to Drive Revenue
Several teams sought to use the growing Internet of Things as an opportunity to turn building data into a revenue source for their firm. Team Datalus’ value proposition is to become the “Google of the physical world” by aggregating building data to influence code and policy, inform good design, as well as be the keepers and sellers of their designs and data throughout the entire lifecycle of a building.
Similarly, MOM+DAD utilizes Monitoring Operations and Maintenance (MOM) to provide a continuous feedback loop with Design, Analytics, and Data (DAD). They hope to build long-term relationships through continuous data harvesting and analytics for their client partners.
3. Solution Seekers
Teams sought to flip the reactive nature of architecture, by becoming problem seekers rather than waiting for clients to come to them. Team 4PIE gathers problems from strategic partnerships and helps them find solutions, putting them in direct competition with design consultancies such as IDEO and research at Universities. They look to monetize their IP solutions through licenses or spin outs/spin-offs (equity plays).
4. Freemium Service Models
A few teams looked to disrupt how clients interact with designers while taking a page from the “gig economy” work style. Design on Demand looks to connect clients to designers at their point of need through an interactive web portal. They seek to elevate the standing of the profession through accessibility and give clients an omni-channel experience while providing 24/7 access to design services. It would also allow designers to work on their own terms and during alternative hours that may better suit their work-life needs, whether that is around childcare, pursuing second degrees, or needing to bulk up hours for an upcoming big expense or life event.
5. The Socially Responsible Practice
Nearly all teams also had a socially responsible focus with a commitment to the local community by finding ways to engage with them more actively, not only through projects, but through shared space and educational seminars. Team Covalence’s vision is to empower architects and the broader design community to impact their local (and typically underserved) communities. They do this by building a network of community spaces, as opposed to offices, that are also co-working spaces for designers. Similarly, team Re\Thread is a combo for-profit\not-for-profit firm that holds an equity stake in each community through the spaces they own.
I have been and will continue to be a strong advocate for the necessity for architecture practice to evolve for our profession to remain relevant in an ever-changing economy. If the fate of our firms is continually reliant on the cyclical construction industry, there may be a time when we are unable to rebound as profitably. The timing of the Practice Innovation Lab is critical to expanding this dialogue at a time when we have the ability to proactively think about our next steps, before being tossed into another economic downturn putting architects in crisis mode. While we do not expect any of the participants to go back to their firms and create instant change, we are hopeful that the energy and dialogue created by the Practice Innovation Lab will plant the seeds for those looking to practice on new terms, and spark conversations for more traditional practices on ways to expand viability.
To hear more thoughts from the Practice Innovation Lab, you can view the mini event documentary below. In the next few months, additional outputs will be shared, including a broader document containing the outcomes from each of the 10 teams work. Stay tuned, and if you are interested in being a part of the dialogue we are looking for other opportunities to host additional labs or find additional ways to keep the profession moving forward.
Evelyn Lee, AIA, is chair of the AIA Young Architects Forum and the regional workplace manager at Newmark Knight Frank’s San Francisco office. Prior to working at a commercial brokerage, Evelyn contributed to the growth of the Strategy practice at MKThink, a multidisciplinary firm that is focused on how buildings can energize culture, enhance human performance, and optimize resources.
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