What makes a great design firm?
This is the question AIA research intern Sandra Montalbo, Assoc. AIA, and I set out to answer in our report, just published by the AIA Committee on the Environment (COTE), on whose Advisory Group I serve. “The Habits of High-Performance Firms” follows up on last year’s “Lessons from the Leading Edge," which I authored as a comprehensive study of two decades of AIA COTE Top Ten Award winners. Launched in 1997, the annual awards are the profession’s longest-running and “best known recognition program for sustainable design excellence,” according to the AIA.
COTE’s research shows that of the 130 architecture firms that have won a Top Ten Award, 29 have won more than once, and 17 (or 13 percent) have won three or more times. If the Top Ten Awards represent the pinnacle of sustainable design, these repeat winners arguably are the country’s leaders in producing high-quality, high-performance architecture. What’s their secret? What practices do they cultivate, and what can other firms learn from their success?
Of the 17 firms, 10 agreed to participate in our study and openly share information about their practice, process, and performance: BNIM, in Kansas City, Mo.; Brooks + Scarpa, in Los Angeles; EHDD, in San Francisco; KieranTimberlake, in Philadelphia; Lake|Flato, in San Antonio; Leddy Maytum Stacy Architects, in San Francisco; Miller Hull, in Seattle; Mithun, in Seattle; SERA, in Portland, Ore.; and Siegel & Strain, in Emeryville, Calif.
The COTE Advisory Group engaged Montalbo, a recent M.Arch. graduate of the University of Texas at San Antonio, to visit each office, interview staff, tour projects, and observe design habits. What she learned was fascinating.
Eight of the 10 firms have been listed at least once in the annual ARCHITECT 50 ranking, and seven have won the AIA Architecture Firm Award, the Institute’s highest honor. All are signatories of the AIA 2030 Commitment, and the average energy reduction for their 2015 projects was 51 percent, 13 points ahead of the overall AIA average. They also report that 84 percent of their 2015 projects achieved greater than a 20 percent reduction in potable water use, the current prerequisite for the U.S. Green Building Council’s LEED rating system. By virtually any measure—and not just the number of Top Ten Awards—these high-performance firms (HPFs) are extraordinary. How do they do it?
Size may be a critical factor. The average size for frequent winners of the Top Ten Awards is 75, which also happens to be the median size for AIA Architecture Firm Award winners. By contrast, the average size of all AIA member firms is 11, according to the 2016 AIA Firm Survey Report. Some 97 percent of all architects are employed by firms with fewer than 50 people—including the 26 percent who are sole practitioners. Smaller firms make up only 39 percent of firms that have won more than one Top Ten. Sole practitioners make up a quarter of all AIA members, but none has ever won more than one Top Ten.
Similarly, among the 17 firms who have won three or more Top Ten Awards, 70 percent have no more than two offices, and only three firms have more than four offices. None of the 10 firms we studied is larger than 150 people, and in the past two decades only two AIA Firm Award winners have been larger than 150.
That size aligns with the anthropological theory known as Dunbar’s Number, which proposes a cognitive limit to the number of people with whom any one person can maintain stable relationships. Accordingly, a maximum of 150 people has been suggested as the optimal size for an organization to develop a strong social network within the staff. A significant majority of design firms that consistently produce high-quality work appear to fall within the range of 50 and 150 people—large enough to ensure an extensive network of collaborators, but small enough to build a cohesive culture.
Staff composition is essential as well. A majority of the employees of frequent Top Ten winners have graduate degrees, and most of the firms are located in regions with top-ranked architecture schools. Gender parity also is a significant advantage for these firms. In the 10 firms studied closely, the staffs are nearly split evenly between women (46 percent) and men (54 percent); this proportion of women is 50 percent higher than the profession at large (31 percent, according to the 2016 AIA Firm Survey).
Furthermore, the firms we studied tend to have much higher numbers of women in leadership positions: 34 percent, compared to the industry average of 20 percent. Women-owned businesses account for 7 percent of the industry at large but 20 percent of the HPFs. As I’ve written elsewhere, studies consistently demonstrate that having more women in management positions yields many social, economic, and environmental benefits, including better employee engagement, greater company loyalty, higher confidence, lower turnover, stronger productivity, more environmental awareness, and a smaller ecological footprint. Gender-balanced companies are 15 percent more likely to outperform their competitors.
The most important differentiators for these high-performance firms may be their cultures. They have a strong vision and shared set of values and cultivate a diverse community of collaborators who are empowered to think broadly and speak openly. A 2010 study into what motivates employees in design firms found that the four most important factors are positive working conditions, organizational support, clarity of the design process, and recognition of effort.
In our surveys of the HPFs’ interns, 83 percent say their ideas are encouraged and embraced. In turn, as DesignIntelligence reported in 2016, 55 percent of architecture firms say that they are “benefiting from an infusion of new ideas about sustainability from recent graduate new hires.” Turnover is extraordinarily low at the HPFs—6.8 percent of their staff, as compared to13.7 percent for all firms, according to a 2015 study led by Deltek. “We treat every hire like they will be with us their whole career,” KieranTimberlake associate Ryan Welch told Montalbo. “Once we do find them, there’s very little turnover.”
Such loyalty can save larger firms millions every year, but the benefits to morale, culture, and institutional memory are priceless.
Note: This article has been updated since first publication to correct the caption for the first chart.