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Firms Report Booting Out the Boss

Tuesday, April 29, 2014

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The number of U.S. design firms that are ousting their principals is on the rise, a new market survey finds.

According to 2014 Principals, Partners and Owners Survey, 37 percent of architecture, engineering, planning and environmental consulting firms have let their leaders go, due to a lack of performance.

That figure is up nine percent from last year, according to ZweigWhite, the Fayetteville, AR-based management consulting firm that published the report.

U.S. Department of Labor
U.S. Department of Labor

Thirty-seven percent of architecture, engineering, planning and environmental consulting firms report letting their leaders this year.

"In this day and age, margins are too thin and markets too tight to carry overpriced dead wood at the top,” said Mark Zweig, ZweigWhite founder and CEO.

“Not to mention the damaging effect it has on morale.”

About 20 percent of firms surveyed said that they had fired a principal due to misconduct.

Abusing Power, Hiring Requirements

Filling an upper-level management position can be a daunting decision, and the end result may prove disastrous, the publisher said.

Thirty percent of respondents reported that principal(s) in their firm “abuse their position by failing to pull their weight.” 

The hiring process may be to blame, the firm said.

About half (49 percent) of A/E/P and environmental firms reported establishing eligibility requirements for filling principal positions, with large firms more likely than small ones to have requirements.

U.S. Department of Labor

Thirty percent of principal(s) “abuse their position by failing to pull their weight,” respondents said.

Requirements for principals often include:

  • Professional registration/licensure (the most common requirement);
  • Business development/sales abilities;
  • Project management experience;
  • Staff management responsibilities;
  • A minimum number of years of experience (typically 10 years); and
  • A minimum number of years of service to the firm (typically five years).

ZweigWhite said 81 A/E/P firms responded to the survey.

The 203-page report can be purchased here. It also covers topics such as ownership, stock appreciation, buy/sell agreements, non-compete agreements, voting rights, roles and responsibilities.


Tagged categories: Annual report; Architects; Business management; Engineers; Good Technical Practice; Market; Personnel; Trends

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