Large Firms Struggle to Outbid Small Firms- firm within firm model

By Jessica Sheridan, Assoc. AIA, LEED AP


Event: Super-Models, MEGA_100+, Large-Scale Firms Revised
Location: Center for Architecture, 07.11.07
Speakers: Aaron Schwarz, FAIA — Principal, Perkins Eastman; Christopher McCready, AIA — Associate Principal, Skidmore, Owings & Merrill; Christopher Lee — Principal, HOK Sport
Moderator: Julie Iovine — Executive Editor, The Architect’s Newspaper
Organizer: AIANY New Practices Roundtable Committee
Sponsors: The Architect’s Newspaper; Häfele America Co.; Skyy 90; Severud Associates; Fountainhead Construction; MG & Company; Microsol Resources

In the U.S., many large firms are beginning to compete with — and lose to — small firms for innovative projects. To remedy the situation, large firms are using the small firm model to shift the balance in their favor. By establishing smaller companies within the larger organization, big firms are finding they are able to take advantage of the flexibility and collaborative work environment offered by small firms while maintaining the vast resources and funds offered by the parent firm.

SOM Education Lab and HOK Sport are smaller, specialized firms operating within the large firms of Skidmore, Owings & Merrill and HOK, respectively. Since the profitability of small projects is the biggest issue for small firms, according to Christopher McCready, AIA, associate principal of SOM Education Lab, working as a firm within SOM helps alleviate monetary pressures. Focusing on campus planning and design, the firm can comfortably work on lower-budge projects in a small studio environment.

Although HOK Sport receives funding and office space from HOK, the independent practice struggled, as many small firms do at its start — entering competitions until it was able to build up a small client base. Christopher Lee, principal of HOK Sport, argues that the firm-within-a-firm model is successful because it creates long-term loyalty and employee satisfaction. Every employee is important to the continuing design process, and therefore, each project improves with his or her growing experience.

Perkins Eastman has not founded a small firm within its firm, but even though it has 700 international employees, principal Aaron Schwarz, FAIA, claims it is really “a small firm on steroids.” Large firms often have quality control problems and rely on bureaucracy to organize inevitable chaos. In doing this, firm structure can get in the way of the work. Large firms also tend to be run by individuals who are farther away from school, and forget the contributive nature of architecture school studios. Perkins Eastman avoids these pitfalls by breaking into smaller studios and encouraging principals to pick up teaching jobs on the side. The firm retains its flexibility and employees learn from their peers in an open environment.

Resources, money, security, and confidence are benefits of large firms; however, small firms are able to better maintain agility, a collaborative environment, and employee satisfaction. Although the two seem to be incompatible, large firms are starting to adapt and use small firm models to reinvigorate their work. By having the best of both worlds, large firms could become forces with which no other firm can compete. However, will the additive drawbacks smother their efforts? At this point, HOK Sport, SOM Education Lab, and Perkins Eastman do not think so.

via AIA new york chapter .