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Survival in Challenging Times Risk management becomes even more vital during downturns b y J i m A t k i n s , F AIA a n d G r a n t A . S i m p s o n , F AIA
Here we go again; another recession. And since the work of the design professional is directly related to the economy, our livelihood thrives or suffers accordingly. Those good times that seemed as though they would never end seem to have ended, at least for the present. Projects have gone on hold, or away, friends have been laid off, and many employees are now wanting for something meaningful to do. Many of today’s practitioners have not experienced a downturn before. This most recent “boom time” lasted longer than the ones that preceded it, and many careers were developed in the recent lucrative and busy times. Many budding professionals don’t have the benefit of past
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experiences that might fuel their motivation as they strive to endure. Many new or soon-to-be college graduates are fearful for their future and may take the first job offer that comes along rather than holding out for one they really want, while some older architects may not finish their careers as they had hoped. Quite often in times like these we see some firms go out of business. We always see firms shrink in size. Layoffs increase, the job market becomes flooded, and profit margins are challenged due to inefficient work forces, not enough projects, or nonpayment of fees. As difficult as it was to produce acceptable work in a growing economy, times such as the present are by far the most difficult. The survival and ultimate success of architects and firms greatly depends on how quickly practitioners recognize the threats and challenges that accompany these times and how
effectively they respond. Every aspect of risk management that can be adjusted to increase efficiency must be identified and appropriate action taken to ensure survival.
Where the Risks Reside W hat are the risks in times such as these? Obviously, many of the risks that challenge us in good times do not go away in bad times. However, when times get tough we are more vulnerable and new risks emerge. Here are a few potential pitfalls: • Diminished Collective Skills – If the work slowdown has caused layoffs, the collective quality of the workforce may have suffered. When more expensive, more highly skilled workers are let go, the quality of a firm’s designs and documentation may diminish accordingly. It is a tough decision to make to let go of good talent, and the smaller
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Photo illustrations by Julie Pizzo; sketch courtesy merriman associates/architects
In times of profound change, the learners inherit the earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists. —Eric Hoffer
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