Learn 5 best practices architecture & engineering firms can adopt from the software development industry to improve business processes, KPIs, client experience, and more.
“We needed someone to run finance for our architecture firm, so we hired an architect.”
A customer made this comment recently and then chuckled a bit. They may have been half joking, but there is a running theme in the architecture and engineering space about looking internally for solutions. The industries can be insular.
There are a lot of very well-run A&E firms out there to draw inspiration from. However, even for those firms, good ideas can often come from external sources. In working with thousands of A&E firms, I’ve often thought that some of the best practices that software companies like ours deploy might be useful for architecture and engineering firms to learn from. Here are five of them.
A&E firms are often rigorous about breaking down projects into phases. For example, most architecture firms follow the typical SD, DD, CD, CA project structure. But what about your company processes?
As a software company, we follow a similar process when it comes to building software. However, we expand the notion of a business process across the entire company. Here is a typical “customer journey” (note we always frame from the customer’s perspective) that a software company might follow:
Critically, each of these phases has:
One leader who is fully accountable for results
Documented standard operating procedures
Purpose-built tools to enable those procedures
Key Performance Indicators (KPIs)
In many ways, professional services businesses like A&E firms are more complex, but it still may be helpful to break your overall process into component parts. When we design software for A&E firms, we think of a “proposal to cash” business process:
Win new clients and projects (marketing and business development)
Set up and staff projects (team management)
Deliver projects (project management)
Invoice and collect for projects (financial management)
A&E firms put a lot of attention and pride into the actual design work, but standardizing your own firm’s approach to each of the overall business cycle outside the specifics of design is valuable. I recommend thinking about the entire cycle as a design process and working to develop a repeatable process from Marketing to Revenue.
KPIs are the heartbeat of our – and really any software company’s – business. We have put a lot of time and attention into defining the right metrics, implementing the right systems to track them, and then creating the right outputs and meetings for review.
While every software company operates a bit differently, this is what I’ve seen tends to work well:
As a management team, we review trended weekly data across ~50 KPIs. This helps us shine a light on any trends
We have monthly reviews of financial and operating data
We schedule daily or weekly reports which are sent to the leadership team giving an overview of various initiatives
We have individualized reports and dashboards for “quantitative” roles, such as account executives or customer success managers
Each team tracks metrics internally and each person has specific metrics they are responsible for.
Is 50 KPIs too many? Maybe. But we started with the 5-10 essentials and gradually added granularity over time. And each member of the leadership team is only responsible for a handful of KPIs, so the responsibility of tracking and reporting is distributed.
It’s worth keeping in mind: a lot of what we as a software company need to accomplish can’t neatly be quantified. For example, we might need to release a new feature or update customer training. We ask leaders in the company to prioritize 3-6 initiatives each quarter, then evaluate red/yellow/green performance against those initiatives.
We use a system called “Rocks” from the book Traction by Gino Wickman, but there isn’t one “right” operating system. Other companies use OKRs, or MBOs, or other more obscure acronyms. The bigger point is that all businesses should have specific metrics they are tracking for each area of the business. They should be looking for trends and opportunities for improvement, and should have a handful of larger goals that are the priority for each quarter.
Sales – or business development – can seem like a dirty word to A&E firms. It’s often either spoken of as a necessary evil, or it’s ignored entirely. Most architects and engineers that I've spoken with don't enjoy this part of running a firm, and fewer have an established process in place focused on business development.
I get it – many of us picture a smarmy used car salesman with slicked-back hair using high-pressure tactics to sell a lemon. However, sales has evolved since then. The unlock for me was to approach selling from a place of curiosity. Sales is about learning what your clients problems are and then designing a way to solve that problem while creating value. If you approach sales from a place of curiosity and start asking lots of questions to learn from your potential clients, it becomes a lot more enjoyable.
Once you’ve reframed sales from pushing to problem-solving, the topic feels a lot less taboo. From there, you can start building process around selling. A few tactics we leverage:
We implemented a CRM (customer relationship management) platform to track our conversations and interactions. I can’t remember what I had for lunch yesterday let alone my conversation from six months ago. A CRM helps you know what have been communicated to who, and when the right time for follow ups may be. We can also track performance, e.g., where are we winning and losing.
We defined the different steps in our sales process. What questions do we ask on the first call to better understand a prospect? How do we leverage that information to make a more thoughtful pitch? This process is repeatable and part of our training for our team.
We aim to understand how our customers are using our software platform, and what pain points they use it to solve, to understand when we ought to get in touch to ensure they are getting value or even whether we can cross-sell additional features or services.
These are all applicable to A&E firms. For example, being very intentional in how you pitch work matters. You might track your work history with a client, and use triggers (e.g., no work in 12 months) for when to reach out to sell additional services. Most A&E firms think that their “product”, i.e., their services, determines the winner. In my experience, that helps, but selling skills often win the day.
Firms often make assumptions about the client experience or ignore it altogether. In my experience, there can be a major disconnect between perception and reality. Here’s an example from our company: We thought we were doing a great job of communicating updates to our customers on our login screen. However, most power users of the software rarely log out, and so they weren’t actually getting the communications they needed. When we learned this, we started designing other ways to communicate important updates so people would get them in areas that fit their workflow.
If you aren’t 1) regularly seeking feedback from clients, or 2) actually experiencing your services for yourself, you probably don’t know what is or isn't working. And their experience is probably worse than you think.
Here are a few tactics we take:
We regularly survey our customers, both in the product and over email, to capture customer satisfaction scores
We have a Customer Advisory Board, regular partnership reviews, beta tests, and other channels to be getting customer feedback
We “secret shop” ourselves – effectively posing as a prospective customer to get a true sense for what it feels like to interact with our teams.
We regularly listen to and evaluate calls between our staff and our customers to understand where we’re hitting or missing the mark
As the CEO, I've personally had hundreds of calls with customers over the past year to understand their challenges, pain points, and how we can improve our product and services.
The easiest way to start might be to ask some of your clients what’s working and what’s not. Even better: ask some of the clients you didn’t win what happened and why they chose another firm. You could even offer a client feedback form after each phase of a project to get feedback and make improvements before getting to the end of the project. Simply giving clients the opportunity to provide feedback tends to elevate their experience.
Image credit: piterskii_punk
There are a lot of risks to any business that can keep leaders up at night. However, I tend to sleep pretty well. Half of that is from chasing my kids around when not on the job at BQE, but the other half is because we’ve systematically reviewed risks to the business.
For example, a risk to any software company is a phishing attack where a bad actor tries to gain access to our systems. We regularly train our employees on how to identify these attacks and have implemented software to mitigate risk.
A few common risks for a software company:
Customer concentration: If large customers represent a substantial percentage of revenue, losing those customers can be challenging. Companies often try to reduce the percentage of the revenue pie from major customers.
Industry concentration: Certain end markets can be hit more than others (think hospitality during COVID). Companies often try to expand into new verticals
System outage: Software companies put in place redundancy and recovery plans.
For A&E firms, the risks might vary, but the approach ought to be similar. Document the risks to the business, prioritize the ones that matter, create mitigation plans, and review them on a recurring basis with your leadership team and possibly even your full staff.
Borrowing best practices from the software world can give architecture and engineering firms a real edge. Refining business processes, measuring the right KPIs, improving sales tactics, understanding the client experience, and tightly managing risks are all software industry standards. Following them helps drive the speed, innovation, data-centricity, and customer satisfaction our industry is known for.
One last note: We are heavy users of software to enable these best practices. Having worked in many industries, I have noticed that the A&E industry tends to be on the slower side for technology adoption. It might be worth considering whether it’s time for a change. I recommend every firm have an internal group dedicated to researching the latest technology, software, and other tools that can make your work better and more efficient.
By the way, software companies (BQE included) certainly don’t get everything right. It’s also a good reminder for us at BQE to keep an eye out for what other industries are doing well. Let us know what best practices from the A&E industry we ought to be incorporating!
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Matt joined BQE as Chief Executive Officer in 2023. His role is to ensure BQE becomes an increasingly Customer Obsessed organization, delivering great software and service to customers. Prior to BQE, Matt spent nearly a decade at Serent Capital, a leading investment firm focused on building great businesses. There, he helped roughly a dozen mostly bootstrapped software companies scale. After many at-bats (and tough lessons), Matt came to understand that the best outcome for company and customer came from putting customers first. Outside of BQE, Matt spends time with his couple kids and dogs.
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