Back to Basics #1: The Collateral Organization

Back to Basics #1:
The Collateral Organization

For the past 15 years or so, the marketplace has been reasonably strong.  Firms maintained a level of service, and clients provided a flow of new work.  Now, times are changing … and not just a little … and not just for a few years.  Yet. Many professionals are so accustomed to doing things a certain way, thinking in truly new ways can be a lot more difficult than any of us imagine.  Habits became “habits” for a good reason:  Those behaviors led to successful projects and a positive career.  To walk away from what’s been our “bread & butter” for many years is not easy.  So …

Why not identify a small group of people in your firm who are eager to do things differently … people who seem constantly restless, who seem averse to doing the same thing even twice, and who seem to be constantly searching for “a better way.”

The Summer 2008 issue of Stu’s News spells out a process for conducting client focus groups, to identify new markets, new needs within your current markets, and new services that your clients need … and which set you apart from other firms.  Yet, professionals who are more comfortable doing things the same way may say …

“I talk to my client all the time.  I know what their needs are
and what they will be.  I don’t need to do a focus group.”

Or, if they do conduct a client focus group, a professional who works in that market, and has a bias, leads the session and asks …

“What other kind of help do you need from an engineer?”

The response will be close to “the usual,” because the question was framed in a traditional way, “Engineering services,” and posed by someone used to “the usual.”

Michigan, one of the hard-hit states, economically, has a growing number of wind machine and PV manufacturers … industries that are growing over 30% a year.  Wisconsin, another state with out-migration, has a huge “green movement” – which gives rise to new needs and new kinds of projects.  Firms in those states see a shrinking flow of RFPs and price-based selection … signs of a shrinking market.  And if you ask about those markets …

Instead of waiting for economic change, or for a new government program, use your group of restless people who always search for “a new way.”  They can lead a “cross section” focus group – one person from each different market plus some 3rd parties – politicians, major realtors, economic development directors –people who always seem to know what’s going on and where growth may occur.  The key question …

“What do you see growing in this area over the next 4-8 years?”

They could also lead focus groups of clients – especially in markets they don’t personally serve, so they can be open and curious.  The questions, listed in the Summer 2008 issue, identify new needs for help – if we’re open to them.  For example:

An upstate NY architectural firm focuses on K-12 schools – a mature market.  Clients need schools, but fear their bond issue won’t pass.  Instead of thinking, “We’re architects, not fund raisers,” they created a unique service with a 93% success rate.  Other firms can design schools, but don’t have a high funding success rate.  They’re thriving and often given projects, sole source, because of their unique ability.

Sometimes we need to think as “problem solvers,” not as architects or engineers and just figure out some way to solve the problem. Or, if you surface a new market:

•    Rapid transit growth.
•    Municipality “greening.”
•    Waste to electricity power.
•    Wind machine manufacturing.

You’ll need people who can look at the new market in a “pure” way and can ask …

    “With whom can we team to create the needed service package?”
    “Where can we go to begin meeting a lot of clients in this market?”
    “How can we get our name out there, so these clients know who we are?”
    “And then … how can we identify our first real project opportunities?”

Once you have your first few projects, the people who helped you create the new services or enter the new market will likely itch to keep trying other new things.  Bring in your solid project-focused professionals, let your new service or market begin to grow … and let your restless types go off to pursue something else.

The “restless” group is known as a “Collateral Organization.”  It’s like a “Skunk Works” or R&D group.  When something new succeeds, weave it into your main production organization and the collateral group ceases – in that arena.  In a sense, each Collateral effort is like an “ad hoc” committee that ceases to exist when its mission is accomplished.  And the production side of your firm keeps adjusting and getting stronger, as new markets and services are woven into it.

Difficult times, which may be here for several years, can also be times of opportunity!

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As we’re hearing increased concerns from firm leaders, we’re completing a survey that identifies what they see coming;  you’ll have a summary shortly.  We’ll also send a series of “Back to Basics” suggestions.  And, if you need a presentation of key trends, for your professional society, we’ll provide that for just travel expenses.