Not sure about others here (and I guess I should be glad to still have work) - but the office I work for has gotten much worse during the pandemic - everyone is working at least 60-65 hours a week (without overtime, obv), and mostly because the bosses and team leaders know that other jobs are scarce. Having everyone prepare various "studies" for no real reason has become the norm. Obviously we understand that the bosses are also desperate for work....
are they using the "studies" to drum up new work? is it working for them?
Jul 18, 20 3:13 pm ·
·
sameolddoctor
No, the "studies" are to capture any whim the client had while taking a dump in the morning - in a regular circumstance, the other designers would be a bit more vocal, but not anymore
Yes, especially for our developer clients, this has skyrocketed. The developer is concerned about leasing and follows every lead possible from potential tenants "oh is this change possible, maybe I'd sign the lease if this was possible" and, having sat in on a few of these meetings, the principal in charge (your mileage may vary) generally tries to resolve it in-meeting, but if there's any hesitance or concern, the defacto-response becomes "we'll draw a few options for you and we can look at it next meeting/tomorrow/ on a conference call/ etc"
Since most of my jobs right now are small enough that I'm the PM, PA, drafter, engineering consultant, and sometimes the only architectural representative in the room (principal is not there) I've been taking a "well let's draw it out right now" response along with a "and if we see that it's feasible, we can agree on an add service after you get them to sign a tenant agreement" That's been working a lot better and saving my drafter (me) some headache.
WTF. 60-80 a week for project managers wasn't the norm prior to COVID. I'm a PA / PM and I do right around 40 a week. Maybe three times a year I do a 50 - 60 week.
Yes, we are more appreciative and accommodating of our difficult clients that we may have been in a better economy. Cash flow is a concern for many right now. There's a lot of pressure to push out as much work as possible so it can be invoiced. Simultaneously, you have the whole WFH thing that is a drag on productivity and schedules for many, and it also makes hiring new people a really weird and dicey proposition.
I think there is a strong possibility of the bottom really falling out in the next 3-6 months. Completing work contracted pre-COVID and government assistance have kept a lot of people afloat, but that's running out. Firms will start to compete on price, making declines in staff wages and working conditions inevitable.
Jul 18, 20 5:03 pm ·
·
sameolddoctor
"appreciative and accommodating of our difficult clients" sounds like a good excuse for slave labor, frankly. Also, the WFH is working very well for company owners - meetings can be called in at any time, no one walks out for lunch...amazing
No slave labor here. Or much in the way of overtime. I'm appreciating and holding on to difficult clients right now only because it has allowed to have no staff pay cuts or layoffs.
WFH works just fine for us and plugging away (small office), even overtime as needed, but there is the occasional client who somehow thinks the pandemic puts them in a position to push harder...but we're busy and not desperate, so don't react much to these whims.
Still debating whether ever to work from office again, starting to wonder why I still pay rent.
agree. My personal goal was to run an office at 40 hours a week for employees, I still work 60-80 (but it's my life). If you can't run an office at employees doing 40 hours a week you are doing bad, that's the definition of struggling...something is wrong.
I'm actually curious about the perspective of a firm owner/ principal. Seems like if you're flogging your staff to work 50% -100% more hours than you pay them to work, you are probably saving quite a bit of money on payroll.
based on my own revenues, I would say 60% was payroll and consultants (including engineers, etc...) much of my overhead is down now even though I still have a physical office in one city (my house as the other doesn't count really). It's chump change to ask an employee to do an extra 10-20 hours a week (I pay 1.5 hourly on overtime) even then overall its minor. because the other 40% is overhead, and I include health insurance. that doesn't change right whether employee works 40 or 60 hours...in other words benefits cost the same, proportionally the extra hours, hence the 1.5x factor works out....so by "flogging" the principals make more. also, remember, like Oil, the price of a barrel to gas tank shouldn't really go up when something happens in the media as it takes weeks to get from crude to your tank, so price fluncuations take time (i've timed it right with PPP) and what some do is use the media to hype up adjustments....in the long run by "flogging" under presumed "panic" conditions you in turn increase your profits in the long run...
Jul 18, 20 6:52 pm ·
·
thisisnotmyname
I worked in two offices where people regularly worked over 40 hours a week. Both were due to inefficient design processes. One office had crazy meticulous drafting standards where drawing simple details would take hours longer than they should, the other place had a design director would totally change the design of projects every two weeks or so. Neither firm's ownership really profited from the
unpaid overtime, the staff's time was just wasted on work that was unnecessary. The interesting thing was that unpaid overtime was very ingrained in both firms' culture. It was considered a badge of honor and a sign of commitment. People that didn't stay late were unpopular among the employees.
/\ so in short, upper managements stupidity caused what amounted to staff hero's...this is very much a "designer" mentality. at all costs, but if you're doing everything wrong, what does that mean?
your point about details is important, sometimes a note as simple as "CONTRACTOR TO PROVIDE SHOP DRAWINGS FOR REVIEW" will avoid a messy attempt at drawing something that doesn't matter....
or in existing condition cases "CONTRACTOR TO PROBE AND ARCHITECT TO INSPECT" - right there I saved hours of guess work.
small office so I'm pretty much the PA, PM, although I've started handing off smaller jobs to the more senior staff and they're usually smart enough to tell me "I can't make that deadline." and "How do you want me to deal with this change by the client." I think when you're a young architect you just put like a project scope in your head and make it a deadline and you panic if you don't meet that. What I learned from a cooler boss, was half time there are so many other things going on in the clients world that half time something will change for the meeting or sometimes you wing it with a half-ass print and tracing paper and ink. Lastly, another boss, I would call a mentor, he would send work I did without reviewing it as he didn't have time and when the client would get pissed off if their were mistakes or clear miscommunications he would actually turn it around on the client and by the end of the call the client just agreed to everything he said. I'm half there, I often do just defend shit I haven't review, but sometimes I have to agree "ok, I'll personally work on it." Sometimes clients try to pit your staff against you, some clients are really fucked up. I trust my team and we sit in the same room, so it blows my mind when clients are lieing to me about my staff and setting up my staff for failure at the same time...as if we didn't speak to each other ? may be true for some firms.
the reason some clients try to set-up failure for your ream and if you admit it is to get their fee discounted or not pay you at the end. that's why you never admit failure, unless its just really dumb and obvious and then you say "architect is allowed 5-10% errors and omissions, you can sue me if you like."
Jul 20, 20 6:20 pm ·
·
Dangermouse
dude fwiw you seem like an excellent boss. paid OT, a no blame culture, comfortable with change...i'm jealous.
This is accurate, as when looking at the list pretty much EVERY FIRM took PPP. I’ve had a few crazy 60 hr weeks lately but due to one project wrapping up construction, issuing a set for another. Otherwise it’s 40-45 regularly.
40-45? I believe most firms expect you to be there a full 40 hours... weather or not there's work for 40 hours... that's a different story. I would bring this up at the the OP's next performance review... However, there's always the possibility that you may have been light on hours/work a few weeks/months ago due to the Pandemic, and its now expect of you/your team to "compensate" for the slow period. Who knows...
There's definitely a mentality that we were light for a bit and now we should make it up. I've pushed back on this as well, those were lost hours. I put in my 40. I was on call and at my desk and cleaned up standards, purged my emails, did some intern training, anything to stay busy. Was I profitable? not in the short term. Was I productive? I tried to be. Do I have time to throw 80 hours at all the submittals that came in at the same time? No, I still have a family to take care of.
I know of a firm in which some of leadership fought for a reduction in hours commensurate with the cut in pay instead of just a pay cut, so the firm is at shortened hours and using partial unemployment for the rest. They have employees who are refusing to work over the 32 hours. So far no layoffs. So that's a silver lining, maybe.
I usually work 32 hrs, in 4 days. Previous job 40 hrs, also in 4 days. Didn't hear of any firm forcing overtime in the Netherlands because of COVID, or in general, to do "studies". I did notice many more submissions when applying for research and project grants though.
another thought to what I wrote above: maybe they’re trying to get you to quit... either way the owners win: you quit, one less salary to worry about; OR you stay and they squeeze you dry.
the shitty part about voluntary resignation is that there is no severance. Not sure what that means for any other benefits you can apply for.
Jul 19, 20 11:00 pm ·
·
thisisnotmyname
In the USA, a voluntary quit would disqualify you from government benefits related to loss of employment. On the employer side, it's a very clean way to separate an employee. There's no unemployment claims, etc.
Jul 20, 20 9:08 am ·
·
sameolddoctor
yeah im not stupid to quit in this kind of atmosphere....no one is...
and that's why the firms run like that, they want you to quit. I was somewhat socially clueless at one of my earlier jobs and was dating a girl about 10 years older than me and she explained my boss was trying to get me to quit. he essentially fired me eventually. I just kept telling her, he does this and it doesn't make sense, he gets emotional and it doesn't make sense...I was fresh out of school.
Jul 20, 20 5:49 pm ·
·
robhaw
I've learned that being constantly overloaded with tasks and having to do regular overtime is mostly a bad omen. If the project you are on has a small fee, then that's project specific and could change. However, make sure you don't have a time management problem or don't lack the confidence required to set boundaries. If not, it's probably the management strategically under-resourcing projects to squeeze more profit and compensate for a lean period. Observe the other workers. Are they as busy as you are?
Especially in good times, this issue is the trait of an exploitative firm or it could be a hint they are trying to manage you out. In either case and also in the long-term, you are better off finding yourself another place. However, should things not work out at all, I want to stress out that you should first go through a grievance process, report the issue and demand changes so that if you face termination you have some evidence to reach a settlement. Don't immediately resign to your rights, instead put up a good fight and get a payout & references before leaving. Unfortunately, many young workers are not aware of their employment rights and savvy seniors screw them over.
It sounds like an overtime law in the US for salaried employees would solve the unemployment rate. 11% unemployment while many find themselves stuck in 60 hr+ work weeks, sounds like an easy solution to me.
seems to me, like the rest of society, this pandemic has exposed firms' true colors- those that are exploitative have been doing so more acutely and aggressively, likely due to a combination of fear, anxiety, and incompetence, while those that respect and treat their employees well have in many cases gone above and beyond to address the multiple problems we're all facing. i'm lucky to be in the latter camp, but i would encourage those in the former to move on and find a firm that respects you.. working at a firm that averages 60-80 hour work weeks shows both the employer and employee have little self-respect.
I don't plan on leaving my current firm anytime soon (I'm luckily in the latter camp as well), but you can bet that in the future I'll be looking at how a firm treated its employees during the pandemic as a way of sizing up whether I want to work there.
For some, yes. But not everywhere. We've added a senior staff member since this all started (and no pay or hour reductions, or layoffs). And just as it was after the last recession, the economy will readjust upward... Until it doesn't. That's just reality and to be expected.
I saw a big jump in my team members' recorded hours during the first month and half of WFH. They were not directed to work more, they just ... did. A big part of that was the breakdown of boundaries which happens when the only real work-life separation you have is a short walk down the hall, if that. I finally had to order them to stop working so hard, because they were burning themselves out, and it was causing me problems with the corporate accounting department.
I have no hourly employees in my practice group. They are all salaried, regardless of position level, and that's how I like it. My labor and overhead costs are mostly fixed, which means I don't have to spent lots of attention on trying to micromanage the cost side of my profit equation and can approach it much more strategically. The day-to-day focus is on revenue: effectively delivering work which can be billed and converted to AR in a timely fashion. Part of being effective in delivering work is prioritizing effort, setting people up to succeed, and not burning people out.
Unfortunately, the dominant financial management theory in our profession treats hours spent as direct costs when in fact they generally are not if your staff are not being paid on hourly contract (which most professionals are not). That conceptual framework is where a lot of this exploitative behavior comes from.
Treating hours spent as a direct cost is also the source of a lot of really perverse behavior I've seen in the past from project managers. Back during the downturn, I actually had a PM try to tell me that his project was "profitable" because he hadn't had anybody working on it, even though it was still active on the books. In his mind, he hadn't spent any hours on it, so it wasn't incurring any costs from the point when it had gone on hold following a bill sent. The fact that he hadn't been able to bill for any more revenue based on work delivered under the contract never even entered his mind, while at the same time we we still had to make payroll and pay rent. This is the kind of insanity which gives architects a reputation for not understanding how business works.
Treating hours worked as Billable, even though the project fee is fixed, is a perverse behavior that, yes, enhances this exploitative behavior. In some offices, its actually seen as a victory for PMs that can make their staff work way more hours than they are paid for...
Indeed. I once worked at a firm where I was told one of my responsibilities as a team leader was to motivate all of my staff to work 44-50 hour weeks continuously. Which is so stupid I literally can't even. Instead, I motivated them to deliver great work quickly and told them I literally did not care what they put down on their time cards. And our profit margins went up.
with regard to hourly, some work types require this, like restoration, legal, or forensic, but if you're real lucky, worked on a few of these for others, you get a client who surpasses the defined contrat scope, turns on "additional services" and just keeps paying. its usually not about the money, just time.
imagine being asked to drink 21 year scotch at 10am discussing psychics and astrology - you don't say no to that when the combined hourly in the room is $550/hr! (2 people + client)
Jul 21, 20 9:44 pm ·
·
square.
one nice thing to come out of the mandatory wfh is the dismantlement of the notion that a fixed work week of 40+ hours is necessary; i already conceptually knew this, but it's been nice to see in reality that i can get my work done on average much less than 40 hours once all the office bullshit is removed. i hope this is a permanent part of those good firms moving forward.
As someone who is an accountant, as well as an architect, I am continually stunned by how clueless architects are as managers and firm leaders. Anyone with even an elementary understanding of how to manage people should know that employee
'churn is extremely expensive.
Firms getting much worse during the pandemic
Not sure about others here (and I guess I should be glad to still have work) - but the office I work for has gotten much worse during the pandemic - everyone is working at least 60-65 hours a week (without overtime, obv), and mostly because the bosses and team leaders know that other jobs are scarce. Having everyone prepare various "studies" for no real reason has become the norm. Obviously we understand that the bosses are also desperate for work....
Is this anyone elses experience too ?
are they using the "studies" to drum up new work? is it working for them?
No, the "studies" are to capture any whim the client had while taking a dump in the morning - in a regular circumstance, the other designers would be a bit more vocal, but not anymore
that doesn't sound fun
Yes, especially for our developer clients, this has skyrocketed. The developer is concerned about leasing and follows every lead possible from potential tenants "oh is this change possible, maybe I'd sign the lease if this was possible" and, having sat in on a few of these meetings, the principal in charge (your mileage may vary) generally tries to resolve it in-meeting, but if there's any hesitance or concern, the defacto-response becomes "we'll draw a few options for you and we can look at it next meeting/tomorrow/ on a conference call/ etc"
Since most of my jobs right now are small enough that I'm the PM, PA, drafter, engineering consultant, and sometimes the only architectural representative in the room (principal is not there) I've been taking a "well let's draw it out right now" response along with a "and if we see that it's feasible, we can agree on an add service after you get them to sign a tenant agreement" That's been working a lot better and saving my drafter (me) some headache.
when they cut our pay, they also reminded us it wasn't an excuse to work less. Most PA's and above pull 60-80 hour weeks as the norm.
WTF. 60-80 a week for project managers wasn't the norm prior to COVID. I'm a PA / PM and I do right around 40 a week. Maybe three times a year I do a 50 - 60 week.
both your firms look like a combination of modern day slavery with a side serving of shock doctrine.
Yes, we are more appreciative and accommodating of our difficult clients that we may have been in a better economy. Cash flow is a concern for many right now. There's a lot of pressure to push out as much work as possible so it can be invoiced. Simultaneously, you have the whole WFH thing that is a drag on productivity and schedules for many, and it also makes hiring new people a really weird and dicey proposition.
I think there is a strong possibility of the bottom really falling out in the next 3-6 months. Completing work contracted pre-COVID and government assistance have kept a lot of people afloat, but that's running out. Firms will start to compete on price, making declines in staff wages and working conditions inevitable.
"appreciative and accommodating of our difficult clients" sounds like a good excuse for slave labor, frankly. Also, the WFH is working very well for company owners - meetings can be called in at any time, no one walks out for lunch...amazing
No slave labor here. Or much in the way of overtime. I'm appreciating and holding on to difficult clients right now only because it has allowed to have no staff pay cuts or layoffs.
WFH works just fine for us and plugging away (small office), even overtime as needed, but there is the occasional client who somehow thinks the pandemic puts them in a position to push harder...but we're busy and not desperate, so don't react much to these whims.
Still debating whether ever to work from office again, starting to wonder why I still pay rent.
a firm that has its staff working 60-80hrs per week is doing pretty bad IMHO.
agree. My personal goal was to run an office at 40 hours a week for employees, I still work 60-80 (but it's my life). If you can't run an office at employees doing 40 hours a week you are doing bad, that's the definition of struggling...something is wrong.
well the employees are certainly doing bad, yeah.
I'm actually curious about the perspective of a firm owner/ principal. Seems like if you're flogging your staff to work 50% -100% more hours than you pay them to work, you are probably saving quite a bit of money on payroll.
based on my own revenues, I would say 60% was payroll and consultants (including engineers, etc...) much of my overhead is down now even though I still have a physical office in one city (my house as the other doesn't count really). It's chump change to ask an employee to do an extra 10-20 hours a week (I pay 1.5 hourly on overtime) even then overall its minor. because the other 40% is overhead, and I include health insurance. that doesn't change right whether employee works 40 or 60 hours...in other words benefits cost the same, proportionally the extra hours, hence the 1.5x factor works out....so by "flogging" the principals make more. also, remember, like Oil, the price of a barrel to gas tank shouldn't really go up when something happens in the media as it takes weeks to get from crude to your tank, so price fluncuations take time (i've timed it right with PPP) and what some do is use the media to hype up adjustments....in the long run by "flogging" under presumed "panic" conditions you in turn increase your profits in the long run...
I worked in two offices where people regularly worked over 40 hours a week. Both were due to inefficient design processes. One office had crazy meticulous drafting standards where drawing simple details would take hours longer than they should, the other place had a design director would totally change the design of projects every two weeks or so. Neither firm's ownership really profited from the unpaid overtime, the staff's time was just wasted on work that was unnecessary. The interesting thing was that unpaid overtime was very ingrained in both firms' culture. It was considered a badge of honor and a sign of commitment. People that didn't stay late were unpopular among the employees.
/\ so in short, upper managements stupidity caused what amounted to staff hero's...this is very much a "designer" mentality. at all costs, but if you're doing everything wrong, what does that mean?
your point about details is important, sometimes a note as simple as "CONTRACTOR TO PROVIDE SHOP DRAWINGS FOR REVIEW" will avoid a messy attempt at drawing something that doesn't matter....
or in existing condition cases "CONTRACTOR TO PROBE AND ARCHITECT TO INSPECT" - right there I saved hours of guess work.
no shit!
So I assume if you didn't pay overtime at all (all staff salaried at 40-hour weeks) you'd really be making a killing saving money on labor!
I'm into the hourly model. As tempting as it is to hire a bunch of interns and pay them salary, it really isn't worth it in the long run.
Even with your PA's, PM's and other mid-level staff? That's good. You're a good boss.
small office so I'm pretty much the PA, PM, although I've started handing off smaller jobs to the more senior staff and they're usually smart enough to tell me "I can't make that deadline." and "How do you want me to deal with this change by the client." I think when you're a young architect you just put like a project scope in your head and make it a deadline and you panic if you don't meet that. What I learned from a cooler boss, was half time there are so many other things going on in the clients world that half time something will change for the meeting or sometimes you wing it with a half-ass print and tracing paper and ink. Lastly, another boss, I would call a mentor, he would send work I did without reviewing it as he didn't have time and when the client would get pissed off if their were mistakes or clear miscommunications he would actually turn it around on the client and by the end of the call the client just agreed to everything he said. I'm half there, I often do just defend shit I haven't review, but sometimes I have to agree "ok, I'll personally work on it." Sometimes clients try to pit your staff against you, some clients are really fucked up. I trust my team and we sit in the same room, so it blows my mind when clients are lieing to me about my staff and setting up my staff for failure at the same time...as if we didn't speak to each other ? may be true for some firms.
the reason some clients try to set-up failure for your ream and if you admit it is to get their fee discounted or not pay you at the end. that's why you never admit failure, unless its just really dumb and obvious and then you say "architect is allowed 5-10% errors and omissions, you can sue me if you like."
dude fwiw you seem like an excellent boss. paid OT, a no blame culture, comfortable with change...i'm jealous.
Remember, your firm is probably getting PPP. You are being taken advantage of.
This is accurate, as when looking at the list pretty much EVERY FIRM took PPP. I’ve had a few crazy 60 hr weeks lately but due to one project wrapping up construction, issuing a set for another. Otherwise it’s 40-45 regularly.
40-45? I believe most firms expect you to be there a full 40 hours... weather or not there's work for 40 hours... that's a different story. I would bring this up at the the OP's next performance review... However, there's always the possibility that you may have been light on hours/work a few weeks/months ago due to the Pandemic, and its now expect of you/your team to "compensate" for the slow period. Who knows...
Performance Review at this firm? LOLOL
There's definitely a mentality that we were light for a bit and now we should make it up. I've pushed back on this as well, those were lost hours. I put in my 40. I was on call and at my desk and cleaned up standards, purged my emails, did some intern training, anything to stay busy. Was I profitable? not in the short term. Was I productive? I tried to be. Do I have time to throw 80 hours at all the submittals that came in at the same time? No, I still have a family to take care of.
I know of a firm in which some of leadership fought for a reduction in hours commensurate with the cut in pay instead of just a pay cut, so the firm is at shortened hours and using partial unemployment for the rest. They have employees who are refusing to work over the 32 hours. So far no layoffs. So that's a silver lining, maybe.
I usually work 32 hrs, in 4 days. Previous job 40 hrs, also in 4 days. Didn't hear of any firm forcing overtime in the Netherlands because of COVID, or in general, to do "studies". I did notice many more submissions when applying for research and project grants though.
another thought to what I wrote above: maybe they’re trying to get you to quit... either way the owners win: you quit, one less salary to worry about; OR you stay and they squeeze you dry.
the shitty part about voluntary resignation is that there is no severance. Not sure what that means for any other benefits you can apply for.
In the USA, a voluntary quit would disqualify you from government benefits related to loss of employment. On the employer side, it's a very clean way to separate an employee. There's no unemployment claims, etc.
yeah im not stupid to quit in this kind of atmosphere....no one is...
and that's why the firms run like that, they want you to quit. I was somewhat socially clueless at one of my earlier jobs and was dating a girl about 10 years older than me and she explained my boss was trying to get me to quit. he essentially fired me eventually. I just kept telling her, he does this and it doesn't make sense, he gets emotional and it doesn't make sense...I was fresh out of school.
I've learned that being constantly overloaded with tasks and having to do regular overtime is mostly a bad omen. If the project you are on has a small fee, then that's project specific and could change. However, make sure you don't have a time management problem or don't lack the confidence required to set boundaries. If not, it's probably the management strategically under-resourcing projects to squeeze more profit and compensate for a lean period. Observe the other workers. Are they as busy as you are?
Especially in good times, this issue is the trait of an exploitative firm or it could be a hint they are trying to manage you out. In either case and also in the long-term, you are better off finding yourself another place. However, should things not work out at all, I want to stress out that you should first go through a grievance process, report the issue and demand changes so that if you face termination you have some evidence to reach a settlement. Don't immediately resign to your rights, instead put up a good fight and get a payout & references before leaving. Unfortunately, many young workers are not aware of their employment rights and savvy seniors screw them over.
It sounds like an overtime law in the US for salaried employees would solve the unemployment rate. 11% unemployment while many find themselves stuck in 60 hr+ work weeks, sounds like an easy solution to me.
seems to me, like the rest of society, this pandemic has exposed firms' true colors- those that are exploitative have been doing so more acutely and aggressively, likely due to a combination of fear, anxiety, and incompetence, while those that respect and treat their employees well have in many cases gone above and beyond to address the multiple problems we're all facing. i'm lucky to be in the latter camp, but i would encourage those in the former to move on and find a firm that respects you.. working at a firm that averages 60-80 hour work weeks shows both the employer and employee have little self-respect.
I don't plan on leaving my current firm anytime soon (I'm luckily in the latter camp as well), but you can bet that in the future I'll be looking at how a firm treated its employees during the pandemic as a way of sizing up whether I want to work there.
Well put EA.
just like in 09', all over again. back to "sweatshop mode"
For some, yes. But not everywhere. We've added a senior staff member since this all started (and no pay or hour reductions, or layoffs). And just as it was after the last recession, the economy will readjust upward... Until it doesn't. That's just reality and to be expected.
I saw a big jump in my team members' recorded hours during the first month and half of WFH. They were not directed to work more, they just ... did. A big part of that was the breakdown of boundaries which happens when the only real work-life separation you have is a short walk down the hall, if that. I finally had to order them to stop working so hard, because they were burning themselves out, and it was causing me problems with the corporate accounting department.
I have no hourly employees in my practice group. They are all salaried, regardless of position level, and that's how I like it. My labor and overhead costs are mostly fixed, which means I don't have to spent lots of attention on trying to micromanage the cost side of my profit equation and can approach it much more strategically. The day-to-day focus is on revenue: effectively delivering work which can be billed and converted to AR in a timely fashion. Part of being effective in delivering work is prioritizing effort, setting people up to succeed, and not burning people out.
Unfortunately, the dominant financial management theory in our profession treats hours spent as direct costs when in fact they generally are not if your staff are not being paid on hourly contract (which most professionals are not). That conceptual framework is where a lot of this exploitative behavior comes from.
Very interesting analysis, thank you for that. May I ask what the abbreviation 'AR' means?
Accounts receivable. I just learned that on a conference call a month ago.
Treating hours spent as a direct cost is also the source of a lot of really perverse behavior I've seen in the past from project managers. Back during the downturn, I actually had a PM try to tell me that his project was "profitable" because he hadn't had anybody working on it, even though it was still active on the books. In his mind, he hadn't spent any hours on it, so it wasn't incurring any costs from the point when it had gone on hold following a bill sent. The fact that he hadn't been able to bill for any more revenue based on work delivered under the contract never even entered his mind, while at the same time we we still had to make payroll and pay rent. This is the kind of insanity which gives architects a reputation for not understanding how business works.
Treating hours worked as Billable, even though the project fee is fixed, is a perverse behavior that, yes, enhances this exploitative behavior. In some offices, its actually seen as a victory for PMs that can make their staff work way more hours than they are paid for...
Indeed. I once worked at a firm where I was told one of my responsibilities as a team leader was to motivate all of my staff to work 44-50 hour weeks continuously. Which is so stupid I literally can't even. Instead, I motivated them to deliver great work quickly and told them I literally did not care what they put down on their time cards. And our profit margins went up.
with regard to hourly, some work types require this, like restoration, legal, or forensic, but if you're real lucky, worked on a few of these for others, you get a client who surpasses the defined contrat scope, turns on "additional services" and just keeps paying. its usually not about the money, just time.
imagine being asked to drink 21 year scotch at 10am discussing psychics and astrology - you don't say no to that when the combined hourly in the room is $550/hr! (2 people + client)
one nice thing to come out of the mandatory wfh is the dismantlement of the notion that a fixed work week of 40+ hours is necessary; i already conceptually knew this, but it's been nice to see in reality that i can get my work done on average much less than 40 hours once all the office bullshit is removed. i hope this is a permanent part of those good firms moving forward.
As someone who is an accountant, as well as an architect, I am continually stunned by how clueless architects are as managers and firm leaders. Anyone with even an elementary understanding of how to manage people should know that employee 'churn is extremely expensive.
I know of one firm that goes through a lot of people just to find that one "unicorn" who is a "hotshoe heavy hitter"
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