As if 2020 hadn’t been challenging enough for architecture firms, what happens when talented employees decide to jump ship?
The cost of losing employees is so huge that it can cripple any architecture firm, so no matter how large or small your firm is, make sure employee-retention strategies are central to your company’s ethos. When an employee leaves, the transition can cost the firm up to 100% of that employee’s annual salary, according to Simon Goodhead, principal at The Coxe Group, a consulting firm focusing on the architecture, engineering, and construction industry. For example, if a firm employs 100 people, has a 20% attrition rate, and the average salary of the employees who left is $70,000, it can cost the firm $1.4 million to lose those 20 people and hire 20 new people.
Goodhead attributes this staggering cost to several factors. First is the cost of the employees’ decreased efficiency when they emotionally disconnect before they leave. Once they resign, the principal might spend time trying to keep them. When they do depart, the rest of the team has to catch up, fill in, and rescue unfinished projects.
Recruiting another employee brings significant time and money costs—and those costs don’t stop once the employee is hired. “You have to onboard the new person and spend the next three months ramping them up to a standard which is close but not quite where the previous employee was,” Goodhead says.
And the impact isn’t just financial: Losing employees has emotional and social costs. “If you spent time investing in someone and they turn around after a year or two and leave, it’s emotionally draining on your firm,” says Kristine Millar, principal at Orcutt|Winslow, a 120-person architecture firm in Phoenix.
So how can your firm keep good employees? Experts weigh in with four employee-retention strategies to keep your employees happy and engaged.
1. Maintain Regular, Effective Communication
Orcutt|Winslow retains its employees for an average of nearly eight-and-a-half years. One factor that helps maintain this kind of retention is open communication between leaders and employees. At a minimum, top-level firm leadership interacts with each person via a weekly email from the partners letting employees know how the firm is doing financially and what is going on with business development and operations. Employees appreciate this level of transparency. “During quarterly or annual reviews, this weekly letter and touch-base has been attributed over and over again to helping employees stay engaged,” Millar says. “Many tell us: ‘I just love getting that letter. I feel like the firm is being so transparent, and I stay informed about where we are as a firm.’”
A mid-career architect, who now has his own firm and wishes to remain anonymous, echoes this point. He recalls working at a firm that was exceptionally transparent and shares how much it meant to him. “The leadership was honest and open about where we were as a company, even when things were bad,” he says. “We knew where we stood. Even through the Great Recession, I trusted them. Their openness made us feel like we were an important part of the company, that we were valued.”
Something as simple as a weekly team meeting can also make a big difference. The mid-career architect mentioned above recalls working at a high-profile, award-winning design firm early in his career and being astonished to find that the firm didn’t hold team meetings. “A weekly team meeting is where the staff finds out who is working on what, who might need help, and who is available,” he says. “Team meetings also provide a weekly snapshot of how the firm is doing. They are a good opportunity for staff to give feedback to leadership. Without them, there was a lot of confusion, distrust, stress, and turnover.”
2. Build Trust Through Authentic Leadership
An important way to build trust with valued employees is through authentic leadership. Building trust allows for honest feedback from employees; this can’t happen if the workforce fears retaliation. Goodhead says that if you suddenly hear, “‘I am leaving for more money,’ or ‘I am leaving because my spouse got a different job,’ that is telling you that the employee doesn’t have enough trust in the organization to come to you and tell you all the things they thought were going wrong.”
Feeling seen and accepted for who they are, even if they are going through a rough patch, helps employees trust that leaders in their firm genuinely care. Orcutt|Winslow has an informal policy called “know your eight.” In a firm of 120 people, it’s not possible for leaders to have a close relationship with every employee, so they aim to keep in regular contact with an invisible reach of at least eight people they work with and create a strong relationship with them—and know what is going on in their lives personally and professionally.
“If I know Tom over there is going through a divorce, I have different expectations of what he is able to handle versus Sue, who is flying high because she is working on a brand-new project she’s been hoping to do her whole career,” Millar says. “Knowing what people are going through and where they are as a whole person—not just at work—is important to retention.”
3. Empower Employees by Giving Them a Voice
Millar says that, at Orcutt|Winslow, the team strives for everyone to have a voice. “No matter where you are or what level you’re at, you have access to the managing partners and can propose and take action on things that are happening within the firm,” she says. Goodhead adds that having a say in their destiny may be the most important way for employees to feel heard. Leaders can offer professional growth opportunities, but they must also tune in to their employees’ own ideas about growth. “People want a say in the way they want to grow—not just have the opportunity to grow,” he says.
Millar says good communication lets leaders know exactly what someone considers advancement in their careers. “We assume that somebody wants to be on a certain path, but not every person may be motivated by the same thing,” she says. “They may not care if they have a title; they may just want to be able to work on a certain type of project. Advancement could mean something totally different from one person to another.”
4. Recognize Employees for Their Efforts
Showing appreciation and recognizing employees for their efforts is key to keeping them happy. “One reason a person will stay at a firm is recognition for their contribution,” Goodhead says. “Just hearing, ‘Well done; congratulations; you did a great job on this project,’ makes a huge difference to an employee.”
In contrast, the anonymous mid-career architect says he once worked at a firm where he felt like he was an interchangeable commodity. “There wasn’t any gratitude for all the work we put in,” he says. “There was never a, ‘Thanks for staying late. Thanks for coming in on the weekend.’ But they were quick to point out if you did something wrong, and that is a big reason I left.”
“We show appreciation through traditional raises and bonuses,” says Millar of Orcutt|Winslow. “But we also celebrate everything we can, like project awards, projects that are under budget, project milestones, the projects themselves and the people who are doing them, babies, dogs, participants in competitions, and happy days.” The firm also holds a “Good News” happy hour once a month to share positive news in the lives of their staff. They also cater lunch once every other week to show their appreciation, offer an easy venue for casual conversations between colleagues, and foster a sense of community.
Retaining good employees is becoming even more important with a projected shortage of architects on the horizon. “There is a reduction in the number of architects graduating,” Goodhead says. “Schools are struggling to fill those places. If you are a great designer, why would you spend five years in college, have $100,000 in debt, and come out in a $45,000-a-year job as an intern architect when you could earn $100,000 a year at a tech company?”
Leaders of architecture firms must recognize that competition for good staff is only getting stiffer, so prioritizing an employee-retention strategy in combination with higher efficiency is crucial to their continuing success.