Episode 18 – Understand Your Design Firm’s Financials w/ Rick Linley
When small and midsized design firms try to strengthen their firms, they tend to fixate on the “Practice of Design”: doing better work. However, the work itself isn’t the problem. Getting stronger requires a shift of focus to the “Design of Practice.”
This foundational philosophy is expressed early and often in Rick J. Linley’s new book, titled Scoreboard Your Practice: 7 Numbers to Understand Your Design Firm’s Financials.
His focus on the “Design of Practice” is more than just a clever turn of phrase: it is a pillar around which Rick weaves and distills lessons learned from over 30 years of serving in the trenches of the architecture and design profession, culminating in his role as Principal/COO of Smith Carter Architects and Engineers Inc., a 200-person, multidisciplinary design firm (now part of Architecture49).
In this episode of Bevel, I tap into Rick’s experience and his courage to shine a light on realities of the business of the design industry that tend to not be discussed often but should if professionals want stability and success in their careers. We take an unvarnished look at some of the biases that have invaded the psyche of many privately held, small and midsized design practices such as the bias for growth, cost versus value and how Full Service is a dangerous myth. We discuss the cold hard truth that good work is essential but not sufficient to ensure financial success, and the embarrassing fact that leaders of design firms often don’t understand their numbers.
Now working with principals of emerging and evolving design firms through his consultancy Strong Practice Strategies, Rick unpacks the four overarching results he sees as necessary to make a firm strong: 1) optimized financial risk, 2) optimized profitability, 3) optimized cash control, and 4) optimized firm value. “These four priorities represent the most significant part of a shift from the Practice of Design to the Design of Practice,” says Rick.
Scoreboard Your Practice: 7 Numbers to Understand Your Design Firm’s Financials is available in eBook, paperback and hardcover versions at online booksellers including Amazon, Chapters Indigo, Apple Books, Google Play, and Kobo Store.
An excerpt from Rick Linley’s new book was featured in the August issue of Canadian Architect and can be seen below.