My clients — architecture, landscape architecture, planning and design firms — often ask me whether they should seek leaders from outside the design community for senior, non-design positions. It’s a good question: infusion of new skills and experiences could enrich design firms’ perspective and business strategy. As Kathryn Sprankle, owner of Sprankle Leadership observes, design for the built environment is “still an insular industry”: she says that “overall, we’re too slow to embrace the business of the business”.
Can a leader without design-industry experience succeed in a design firm?
I know of examples where “outsiders” have been very effective, and situations where they have been problematic. There is probably not one answer to the question my clients pose, but I’d like to be able to communicate the nuances as they consider taking this step. If you are considering bringing someone from outside the design community into your firm, you might want to reflect on these issues:
What motivates design firms to consider hiring from outside the design community?
Many design practice leaders yearn for the same kind of innovation in running their business as they do in solving their clients’ design problems. They suspect that individuals from other design firms would be subject to similar cultural influences that promote the methods and practices common to the industry. In addition to seeking a fresh perspective on old problems, they hope that leaders outside the design community would have more advanced technical experience in HR, Marketing, Financial management or whatever relevant function than their counterparts in design firms. Sometimes, design firm leaders claim that they just want to “shake things up”.
Are design firms different?
Most industries consider themselves to be unique, and the design community is hardly an exception. There are some legitimate differences between design firms and other — particularly non-professional service –businesses, that could take some getting used to and would provide a challenge to someone from outside the design community. These won’t seem particularly unusual to you, but to someone without design firm experience, they can seem hard to understand, causing them to lose patience. For example:
- Compensation: Compared to other professions, average compensation for senior design leaders is considerably lower. Yet liability is high and design firm employees work notoriously long hours. “Outsiders” may find motivation under these circumstances puzzling and discover that financial incentives are not necessarily effective inside design firms.
- Margins: Average profitability in design firms is lower than many other industries: leaders new to the industry may find themselves with fewer resources to do the same job they just left. Investment in R&D geared toward process improvement or enhanced design products is made by only a handful of firms. Aggressive attempts to address profitability by cutting costs don’t necessarily translate to radically improved profitability in this industry and run a high risk of employee alienation.
- Language: The language of business is not considered appropriate by many design firm leaders. (I have seen many react badly to the use of words and phrases like “sales”, “brand”, “reports to…”). Learning a new vocabulary to avoid negative associations with a “corporate mentality” is mandatory for someone outside the business to avoid instant alienation.
- Bottom-line orientation: Profitability is only one factor in most decision-making processes within design firms. It can be difficult for some “outsiders” to justify an unprofitable project. Most design firm employees see a robust bottom line as only one aspect of a successful practice: too much focus on profitability can be destabilizing.
- Non-replicability: By definition, design tends to be a “one-off” activity and doesn’t easily lend itself to standardization or other efficiency-driven techniques. “Outsiders” may see “obvious” opportunities for streamlining that are repugnant to their design-trained peers.
- Social good: Many design firms are highly motivated by, and place great value on, making a contribution to the well-being of society in general. This is a motivator and a design firm decision-making criterion in itself, but may be unfamiliar territory to “outsiders” as a business driver.
- Culture: All businesses have a culture, but in design firms, culture is almost a palpable presence. Many firms even hide behind their culture … invoking it as a reason not to embark upon new paths or activities. To some outsiders, “culture” will always be the elephant in the room.
I asked the new CFO of one of the largest design firms in the country what surprised him when he joined the firm. He said, “The top leadership is way more involved with the day-to-day operations of the firm than I expected. Some feel that they can independently take on direct executive participation in various areas and issues.” He added that he didn’t anticipate “the general rarity of good business/practice leadership/operations in addition to the presence of great design capability.”
Do some industries provide a better background than others for transferring to a design firm environment?
If you want to look outside the design community, consider its close allies. Moving from products to services is a giant conceptual leap. Industries that sell services rather than products would prepare a leader better than those which focus on issues like inventory control or supply chain management. Industries like consulting or advertising which share common traits of design firms would make for an easier transition. Issues like the billable hour, the requirement for most professionals to participate in business development, the criticality of client management… all these are common to service businesses. Advertising or branding in particular are businesses that also require creative input, so experience managing “creatives” would seem familiar. Someone experienced in professional services (e.g. law, management consulting, accounting) could also make a transition seem like familiar territory.
What positions can best benefit from “outside” leadership?
CFO and CIO strike me as two positions that would be the easiest to transition into from outside the design industry. CMO is a position that could benefit tremendously from “out-of-the box” thinking, but low budgets, a tendency in some firms to devalue the contribution that marketing can make, and a lower level in the design firm hierarchy than in other industries might derail even the most creative marketing leader. Likewise, HR leaders could make huge contributions in the strategic aspects of their jobs such as organizational development, non-technical training like leadership development, employee engagement and diversity but the cultural appetite for these aspects of human resource management may not yet be present in design firms.
Under what conditions is a non-design firm person most likely to succeed?
If a firm works hard to sensitize both its existing leadership team and the “outsider” before he/she begins work to some of the issues that make design firms different, an environment for early success can be created. “Prepare to be surprised, caught off-guard, or even offended” might be good advice to the design firm leadership team in persuading them to be consciously open to “outsider” opinion. Someone experienced in professional services (e.g. law, management consulting, accounting) could make a transition seem like familiar territory. Superb communication skills are arguably more important in hiring from “outside” than inside the design community: after all, the “outsider” will have to persuade others to do something that could be unfamiliar. Giving the candidate lots of opportunity to discuss business issues with his/her peers inside the firm before taking the job will also minimize surprises.
Go outside or not?
My recommendation would be a cautious thumbs-up. Certainly the design firm environment could stand to benefit from what other businesses have learned. There is an incestuous quality to design firm hiring. The thoughtful addition of a leader who has been sensitized to the eccentricities of the design firm environment but is eager to apply new thinking could be a key factor in helping to create the distinctiveness all design firms seek. Not taking the extra time to ensure potential fit could be both highly disruptive and potentially sour an entire firm on the idea of hiring from outside the design “industry”.