In his 1946 book “Tomorrow’s House’, George Nelson (along with Henry Wright) created a popular, post-war consumer pattern book defining the "house of the future". Equal parts designer, critic, writer, gadfly, and teacher, Nelson at the time was setting up his own industrial design shop, had just been named Herman Miller’s new Director of Design, and was in the process of helping introduce what has become defined as the ‘post war modernism’ (I’ll leave this distinction to the small army of historians who can talk more eloquently about design in this era).
Concluding ‘Tomorrow’s House’, Nelson sets out educating the reader on selecting an architect, negotiating with a contractor, obtaining financing, etc. The passage below, in Nelson’s erudite prose, caught my attention recently as it illuminates so many of the issues we still face in setting ‘appropriate’ fees commensurate with our efforts:
"It might be added here that there is no reason to be afraid of going to see a firm of architects simply because it has a first-class reputation. Architects as a rule have fee scales which do not vary tremendously, and many people find to their surprise that the fee charged by the best available firm is frequently no greater than that asked by its less talented competitors.
Among the better offices it is fairly standard practice to charge at least 10 percent of the cost of a house for architectural design services and supervision. A few offices go above this figure, and some will go below. There are architects-many of them-who will set their fees at 6 percent or even lower. These, however, do not fit into the group whose work appears here.
Perhaps you would like to know why architects have to charge a 10 percent fee to do a decent job on a modern house. A little arithmetic should make this fairly clear. Let us assume that a house is going to cost around $12,000. This puts the architect's fee somewhere in the neighborhood of $1,200. Of this amount he will be able to recapture $300 to $400, if he is lucky, as payment for his time, which may run from three to six months or more. The remainder-say $850-has got to pay his overhead, salaries to draftsmen, and the other expenses of his business. In return for this he will camp on your doorstep, practically psychoanalyze the family, try to distinguish what you want from what you say you want, produce a series of drawings from which the house can be satisfactorily constructed and equipped, negotiate with bidders to get the house within the budget, and arrange for changes in the plans and details. And, into the bargain, he will probably give advice on furniture, color schemes, fabrics, and landscaping, in the event that specialists in these fields are not engaged: That is why a conscientious architect cannot undertake to do a reasonably good job on a custom built house for less than 10 percent. Probably, if he were as good a businessman as he is a technician and artist, he would charge considerably more.
There is another situation that has to be met. Rather early in the game your architect will find that existing home equipment, whether for lighting, storage, or some other purpose, is not properly designed, and he will suggest, frequently with good reason, that a certain amount of special work be done. This involves dealing with a miscellaneous assortment of electrical supply people, metal workers, hardware firms, and others, in an• effort to concoct something superior to the stock article.
Some people find that this part of the process of designing a modern house is great fun. But even so, it is a lot of work, too.” (Nelson & Wright, “Tommorrow’s House”, 1946, Simon & Schuster, p.200).
60+ years on this passage is illuminating, perhaps more so as it’s geared towards a consumer of our services. Why? Because it shows just how little we’ve moved off a few key areas:
A proliferation of specialists –note that Nelson points out that, essentially, an interior designer and landscape architect would/should be a part of the equation, in addition to the architect. More important is the implication that the homeowner would contract with them directly, instead of the architect putting that under our scope of work in many cases. Or it leaves unresolved the question of how these are to be integrated, the time the architect would require to integrate their work and how the architect would be paid, etc. Now? We’ve multiplied the number of consultants (lighting, AV, security, commissioning, code, etc.) as the number of possible systems have proliferated. Very few firms would (or even could if the desire was there) attempt to host all these under a single banner. Integrate perhaps, but not host.
An over extended commitment of time – how many architects will really ‘camp out on your doorstep’? Hyperbole to be sure, but there’s a subtly delivered message about the raw time spent in the service of a project. Why? Is that simply a general professional complaint that’s echoed through the ages? Again, perhaps so. At the very least, as a whole, have we become better at correlating time/effort with our clients assumptions?
A ‘starving artist’ mentality – yep. Still here. Still detrimental. Still… yeah.
“Someone else” undercutting (and probably under delivering) fees – enough ink has been spilled on this topic….except for one new wrinkle that hadn’t occurred to me before and which we’ll wrap up with below: the idea of a “lower fee” was pushing up against much stronger, more defined ‘norms’ related to an architect’s compensation. Nelson, actually, does an admirable job of acknowledging the issue (“there are architects…who will set their fees at 6% or lower…”), clarifying that ‘those’ architects work isn’t shown here (a jab at their implied quality), and then proceeding to demonstrate why a ‘normal’ fee is barely adequate for the effort the architect is expending. His value argument is wholly self-contained: It’s effort “X” that’s the great value.
(As a sidebar: really, if the public thinks we are well compensated, why are we so insistent on undermining that perception? Peter Eisenman, of all people, made a great observation once that clients don’t take you seriously until it costs them real money. And the longer I practice, the more this axiom proves to be doubly true in a “fee for service” arrangement).
Finally, one of the lynchpins in this passage: Fee schedules – I’m finally convinced we’ve never really escaped from their overarching influence, even this far removed from their being in force. As mentioned above, this passage from 1946 shows a reliance on the fee schedule to establish a ‘norm’ for compensation, something that’s tied to an assumed level of ‘basic services’. Over time, as the complexity of buildings changed and the architect’s scope evolved, the schedules/normative fees were adjusted accordingly. In a bitter twist of fate, the extinguishing of the schedules in 1972 roughly corresponded to the nascent explosion of building systems and technologies. Our scope of work, especially with regards to building systems design/coordination, began to multiply but our fees did not. Why? Why have our fee rates (not literal amounts) remained unchanged in 40 years? It would take some additional research, but my hypothesis is that we’ve allowed the extinction of the schedules to essentially ‘cap’ what the broadly accepted fees are. In short, we’re still stuck on that schedule, even though we’ve continued to allow greater scopes of work to be defined (both literally but more important, culturally) as ‘basic services’. That’s really the key: what truly constitutes ‘basic” (or minimum or essential) services an architect “must” provide as part of their legal and ethical obligations?
Contracts (especially the AIA’s Owner-Architect Agreement) define a core set of minimum services as ‘basic’. Once upon a time, these were very explicitly tied to the fee schedules. So, if the project’s scope went up in complexity, the basic service could remain the same but the fee expectation was ratcheted up. Already, in Nelson’s writing, we can see how the alignment of ‘actual’ services could be seen as disproportionate to compensation and why certain thresholds (the schedules) needed to be maintained. (I’m allowing for his writing to be somewhat ironic and to help press a case for a base fee expectation in the consumer’s mind. But isn’t that our point?). But I don't see this as the problem. We can define, all day long, what an 'appropriate' fee SHOULD be, in our eyes. The problem is: this doesn't match our client's expectations. Which, I'm contending, are still largely being driven by a 40+ year old schedule. What's changed is the assumption of scope embodied in that fee and the increasing disconnect it has to our stated desires.
There’s enough to unpack in this area that it’s going to take a few posts to work through. Formal fee schedules are gone. So, how do we define a truly ‘basic’ level of service, one that helps properly correlate our efforts with a basic level of compensation in the minds of our clients? Is this even possible? (The Union of International Architects has taken a shot - you can see their fee compensation calculations here). Can we reach an agreement on what these services constitute? Could, as one example, the AIA ‘demand’ a level of services as a condition of membership (ie, a member can’t offer a lower level of service than the ‘basic’)? What’s clear, looking back, is that we’ve got to move forward on clarifying the basics of what we do with the public and do a better job correlating that with some kind of baseline that’s easily understood.
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