How to unlock growth with solid organizational structure
Growing a firm by a dozen employees each year can sound daunting.
But the truth is that when you look at growth as a puzzle rooted in organizational structure, you can begin to make confident progress.
Michael Hsu Office of Architecture did just that when the growth rate of Austin, Texas caused them to grow the firm from 21 to 78 people in just seven years.
By doing things like hiring a financial strategist, working with like-minded clients, and fostering employee growth, they have created a firm that is making an impressive mark.
Recognize firm inflection points
As founder, Michael Hsu has seen the firm grow by leaps and bounds since the city of Austin became a growing social and economic hub.
In their case, the firm’s growth was truly propelled by the growth of the city.
However, he noted that there are key milestones, or inflection points, and result in the need for internal structural change and hiring more bodies.
He said that when a firm reaches 15 people and again at 30 people, it’s time to start making more hires.
“There are natural break points in our profession. Probably when you're about 15 people or so, that's actually really tough. Over 10, under 20. Because it's when the owner or the principal is doing everything. You're doing biz dev, accounting, bookkeeping, human resources. You're paying the bills, maybe cleaning the toilets, you’re stocking the fridge,” he said.
Growth can be beneficial at this stage, because making a few strategic hires will allow you to stop being a jack of all trades and start working on what you’re good at or interested in again.
“Middle staff” and project managers become increasingly important at these stages of growth. You need to bring on people that you can trust to mesh with your culture and stay on top of day-to-day work.
Hire for talent, not projects
Making intentional hires is difficult, but it’s the key to steady growth versus a growth chart that looks like a roller coaster ride.
You want a slow and sustainable trajectory upwards, not a mad scramble to staff the firm on a project-by-project basis.
Maija Kreishman is a managing partner at Michael Hsu Office of Architecture. She credits smart hiring as a critical piece of the firm’s successful growth to date.
“We're pretty conservative when it comes to bringing on people. They're not hired for projects, we're really hiring for talent. And we look for it pretty much constantly,” she said.
“During the pandemic, we were at least able to keep everyone intact. Our project base is so diverse. That is fundamentally the thing that really kept us stable.”
Find a financial consultant
Once you reach a certain size, it’s a smart move to consider if you need to begin working with a financial strategist or even hire a COO.
Michael said that they seriously considered the COO option, but ultimately decided against it. They wanted to remain an architecture firm, rather than a business, and keep their culture front and center.
“One time in our history, we said hey, should we go hire a chief operating officer? Someone to just run the business, let us do design. You just run it. And we decided that wasn't gonna work. That we'll end up turning into a business and not an architecture firm,” he said.
Their solution was to bring on a financial and strategic consultant about seven years ago. It was one of the best decisions they’ve made.
Not only has the consultant been able to understand the firm culture and goals, but he’s helped them unlock new opportunities for growth.
“It's half therapy, but more getting us to lift outside of our heads, and also dipping into the strategies,” Maija said.
“Getting ourselves out of the usual silos of how architecture approaches structuring a firm, and all of those things. I think it's been tremendously helpful. I don't know that we would be where we are without having a little bit of an outside perspective into what we think our own strengths and growth trajectory could be.”
The consultant’s intimate understanding of firm goals and the bigger professional landscape has allowed them to reach new heights.
Use metrics to select projects
Michael said that while their client set is extremely diverse compared to your standard architecture firm, they don’t accept every single project.
They typically use a concrete set of questions to vet whether a potential project is worth pursuing.
“Very early on we even had a scorecard for how to go about project selection. We try to keep it very concise, because too much data can be debilitating,” Michael said.
Questions they ask include:
- Who is this project serving?
- Is this project good for the firm?
- Are there design opportunities?
- Can we at least financially break even?
- If pro bono, is this an audience that we believe in?
It sounds basic, but every single project accepted should be held to a certain standard.
In addition to the questions above are the necessary logistics questions, such as whether enough staff is available, if your firm has the required technical ability, and the project location.
Pick clients with the same goalsIf you pick your clients wisely, you might get lucky enough to work with a handful of the same clients for decades.
That’s because as your firm grows in size and stature, your best clients will grow right along with you.
Michael gave the example of one client who has transformed from tiny projects to giant projects over the years. That’s because they recognized a kindred spirit early on, and chose to say “yes” instead of “no.”
“The first job we did for this client was a $10,000 project. Now we’re designing developments that are up to a million square feet for this person. And they've been the largest single source of billing,” Michael said.
“This is someone who we think of as a creative partner. This is a client, quote-unquote, and a developer, quote-unquote. But this is someone who has sensibilities that are lined up with us. And that's almost more important than the number.”
You can also nurture client relationships that don’t pull in the big bucks.
“It's also about making sure that we still retain those sort of scruffier, smaller, hands-on projects that really inform our design process. Typically when you go to an architecture firm, you end up designing what that firm has always designed. And we felt like that was a bit of a dead-end of design,” Michael said.
In a field like architecture, it can be valuable to have a diversified client set that both helps you survive in tough times and inspires you.
Nurture employee growthIn addition to nurturing ongoing client relationships, don’t forget to nurture your employees.
Once you hire an all-star team, your job is far from done. You need to cultivate an awareness of employee strengths and recognize what their own goals and ambitions are.
Maija said the firm recently founded a formal mentorship program to help employees connect with both peers and more advanced architects.
They also recognize that each employee has unique aspirations, and want to encourage them to stay with the firm in a role that best suits them.
“Everyone has aspirations, but they're not necessarily all the same. What we did find was a title or the role and the stress that comes along with those titles isn't a one-size-fits-all. So we've been having a lot of conversations about how you can have different strengths and even different aspirations and still have longevity here,” she said.
From partnering with consultants to clients to new hires, when you take a strategic, intentional approach to everything that you do, your firm will have the solid footing it needs to tackle rapid growth.
Join us on Thursday, July 8th for Best Practice, a virtual fireside chat series dedicated to practice operations at architecture firms and beyond. From pain points to potential, hear how leaders in the architecture and engineering industry are innovating through new business models and managerial techniques.
We’re chatting with Michael Hsu, FAIA, IIDA, NOMA, Principal, plus Maija Kreishman, AIA, Managing Partner, of Michael Hsu Office of Architecture about how they grew their award-winning office from 17 to 71 people in the past 7 years.
Michael Hsu, FAIA, IIDA is the founder and principal of Michael Hsu Office of Architecture, a fully integrated architecture and interior design firm. MHOA was founded in 2005 and has studios in Austin and Houston. Following graduation from the University of Texas at Austin School of Architecture, Hsu worked at OMA in the Netherlands before returning to Austin where he has practiced since 1998. Hsu is currently the Texas Society of Architects 2021 Austin Chapter Director, as well as a member of the University of Texas School of Architecture’s Advisory Council. He is a Past President of AIA Austin and was elevated to AIA’s College of Fellows in 2021. His firm has received numerous design awards from the Texas Society of Architects, AIA Los Angeles, IIDA Texas/Oklahoma Chapter, Heritage Society of Austin and AIA Austin – including Firm of the Year in 2016. Michael Hsu Office of Architecture was formed with the goal of producing locally engaged, design-driven architecture and interiors. The firm advocates a simple, edited design palette, using creative materials and techniques to create unexpected results. Notable projects include the Uchi family of restaurants, South Congress Hotel, Montrose Collective, MKT, LINE Austin Hotel and Shake Shack’s corporate headquarters.
Maija Kreishman, AIA, is Managing Partner at Michael Hsu Office of Architecture (MHOA), where she has been a critical member of the firm since 2007. In addition to managing a broad range of architecture and interior projects, Maija oversees strategic visioning, studio culture, operations, marketing and business development. She is leading MHOA’s recent growth into Houston, where the firm established a second office in 2018. Maija’s passion for food and travel has shaped her design perspective and developed in her a penchant for hospitality design. Prioritizing experience, her design approach seeks to engage and connect the user to a space by prompting a response to interiors, materials and furnishings. Maija holds a Bachelor of Science in Architecture from the University of Virginia and a Master’s in Architecture from The University of Texas at Austin, where she has also served as a guest lecturer. Maija’s notable projects include South Congress Hotel, LINE Austin, Fareground at One Eleven, and several large mixed-use projects including MKT, Montrose Collective and Heights Mercantile.
Michael Hsu Office of Architecture (MHOA) was founded by Michael Hsu, FAIA, IIDA, in 2005 in Austin to unite people through design. MHOA is a nationally award-winning, fully integrated architecture and interior design practice. The work is rooted in hospitality and placemaking and includes diverse projects that include large mixed-use developments, adaptive reuse projects, public realm design, architectural branding, single family homes, hotels, restaurants, workspaces, and bespoke furniture design. MHOA works throughout Texas and across the country in cities such as New York, Los Angeles, Chicago, Atlanta and Denver. Michael Hsu Office of Architecture opened a second office in Houston in 2018 and has staff members representing our firm in Colorado and on the east coast.