Business

Quantum Business Start-Up

www.dilbert.com
This cartoon brilliantly captures a quality that is essential to anyone starting a business or launching a new building product. Before the first spade of earth is turned to build a factory, for example, one has to be know that the project is a total success; even if it can't be observed yet.

Information Technology Forecast for Construction

Engineering News Record, 12/28/2011, in an article by discusses the growing use of information technology in construction. Here are excerpts with my comments about what this means for building product manufacturers:
The new year will be the year of mobility... when the constraints on the flow of data into and out of the field, and the use of mobile devices to collect, share and present it, give way for good.
Almost everyone on construction jobsites carries a smart phone or other computerized device. This offers great new avenues for building product manufacturers to communicate with customers.
Watch for wireless networks, technology kiosks and pads, and tablets to sprout on more and more jobsites...
Your shop drawings, installation instructions, training videos, and other information has to be accessible.
The value chain has been joined from one end of the project delivery process to the other...
Consider the impact on your distribution strategy, sales management, and customer service.
...relatively inexpensive Tablet PCs running Android and the forthcoming Windows 8, challenge Apple's iPad and iPhone for business use in the field.  
Your field reps will have to be similarly equipped.
...independently created and relatively inexpensive apps will continue to compete with, and sometimes challenge the capabilities of more expensive, old-school, licensed software.
 "Independently created" means "provided by building product manufacturers." Move beyond providing materials to offering tools the contractor can use to run his or her business.
Three-dimensional printing of models and components will become commonly used tools. Imagineers will design, model, and print in 3-D to test and communicate ideas, and then build for real.
This will first happen in design offices. Some manufacturers use this for rapid prototyping of parts. In other cases, actual parts are now "printed."
The "Internet of Things" will grow exponentially and have a direct impact on design, engineering, construction and facilities management, as embedded sensors, cloud-based analysis and rapid data exchange turns our deaf, dumb and blind structures into introspective communicators. 
How will you build intelligence into your product? 
...expect the challenge of capturing, storing, sharing, managing, analyzing, interpreting and presenting the "big data"—that vast collection of information piling up as a product of all of that sensor data collection and analysis, to grow as well.
Intelligent machines are great at capturing, storing, sharing, and managing data, but human beings are still best for analyzing and interpreting a problem and presenting solutions. This means your sales reps must still earn the trust of customers.
In response, look for a drive to simplify data delivery through browser-based interfaces, neutral file formats and innovative visualization.
Don't leave this to your IT guy. Make sure your marketing communications team leads the charge.
In short, look for an exciting year ahead.
I agree.

The Ultimate Roll-Up?

I was recently asked about the attractiveness of having a single company provide all elements of the building envelope, including roofing, foundation, exterior walls, cladding, windows, curtainwalls, entrances, storefronts, insulation, vapor barriers, and the rest. The question came from a business strategy firm, suggesting that some group of investors is seriously contemplating such a move.

At least one company is already well on its way to being able to offer complete building envelopes. Oldcastle is one of the company's that is well on its way toward offering a complete package, with strong positions in masonry, concrete, glass and glazing systems, curtainwalls, doors and skylights. Add a roofing manufacturing line, and they have it.*

The past few decades has seen strong trends towards "roll-ups" -- bringing many small producers under one corporate ownership -- in attempts to gain economy of scale and improve competitiveness by dominating an industry and combining related products into package.

Roll-ups are well established in some sectors. In lighting fixtures, for example, Hubbell has acquired over 20 previously independent brands, and electronic giant Philips recently acquired the sixteen brands that had been rolled-up by Genlyte. Assa Abbloy and just a few other firms now dominate door hardware.

While roll-ups do have important competitive advantages, many suffer from the following syndromes:
  • They lose the edge in innovation to smaller, more flexible and entreprenurial business.
  • Promotion of individual brands suffer from having to follow a corporate model. For example, some of my clients have to use corporate websites that focus on selling to investors instead of to designers and builders.
  • Managers, striving to improve the profits of their division, become jealous of and competitive with each business units, to the detriment of the overall company.
  • Product offerings become so diverse, that individuals within the firm are unable to cross refer prospects or identify opportunities for other brands.
  • Size dilutes the expertise.  What salesman can be an authority on glass AND roofing AND insulation? In smaller companies, a prospect can deal directly with a principal or other senior personnel with true expertise in a field.
Indeed, I have been a consultant to many large firms and roll-ups that crumbled due to their mass, and were more competive when unrolled.

Further, roll-ups have to compete with companies that do not manufacture all parts of a system, but assemble or "package" products from multiple vendors into bid packages that also create economies of scale. Packagers also have the advantage of using the "best" product or a job without the limitations of having to use those from sister companies. They also have the flexibility to take advantage of attractive spot pricing.

In the final analysis, every general contractor is a packager, and already offers all elements of the building envelope.

____________
* Pre-engineered metal building manufacturers do already offer a complete envelope, including walls, roofs, structure, and accessories. But that is a subject for another blog post.

Another Score for Publicity

As we’ve noted before, the real impact of publicity is notoriously hard to track and quantify.  With more and more publicity exposure taking place via the web – exposure that often remains available and searchable for far longer than most print media ever did – it’s harder than ever to know who’s reading what, and what percentage of them act on what they read.

Anecdotal evidence continues to come in, though, saying, “Publicity works.”  The latest installment:

Michael Chusid recently wrote an article in a major architectural magazine about an advanced materials conference he attended.  In it, he mentioned a company that made a presentation, a company that specializes in digital fabrication and has done a lot of work with resin composites.  They weren’t the focus of the article, just one of many things described.

A few weeks after the article appeared – I was going to say “in print,” but with simultaneous web distribution of most magazines, print has become merely the tip of the iceberg ­– the president of the company received a call from one of the largest and most prestigious architectural firms in the world.  They requested him to come and do a presentation to them.   That kind of request was the bullseye on his marketing strategy target. 

Of course, this was only shortly after publication.  Who knows how many more such inquiries he may get from that one mention, over the next few years? The shelf life of articles on the web has become pretty much Forever, and unlike the advertising, they show up in search engines.  We have had numerous inquiries recently, responding to articles we authored for clients two or three years ago.

Computer-Based Systems Integration

This is an encore of an article Michael Chusid wrote twenty years ago. Looking back, it is encouraging to see that many of the advances predicted then have now become part of every day design and construction practice. Yet fundamental challenges about improving communication and project quality still remain.

For many architects, integration of computer-based systems still means figuring out which end of the cable plugs into their personal computer. But the topic was given much greater meaning at the First International Symposium on Building Systems Automation-Integration held in June at the University of Wisconsin-Madison. This week-long conference, initiated by Varkie Thomas of the Chicago office of Skidmore Owings B Merrill, was devoted to "the integration of computer-based systems for planning, design, construction, and operation of buildings." The conference offered bold predictions for computer technology and its effect on architecture.

While an increasing number of architectural and construction tasks employ computers, the Symposium identified two major barriers preventing computer-aided design from achieving even greater productivity. First, computers have been applied essentially as "electronic pencils," speeding up manual processes but not changing the nature of the tasks. For example, specification are written as though word processors are just fancy typewriters and CAD drawings replicate the types of lines and abstractions used in traditional drafting. Second, computerized information is still transferred from one application to another by manual methods, leading to increased costs  and errors in data processing. For example, it is rare for an architect's CAD file to be passed along for a contractor to use in construction engineering, and electronic product data are not passed along to owners for use in automated facility management. To overcome these barriers, conference participants presented an amazing variety of new computer-based systems and concepts that are already available or under development in laboratories around the world. They also called for new paradigms, based on integration of information and the building team, for the organizational structure of the building industries.

Computers and Practice
Many designers still practice what Tor Syzertsen from the Norwegian Institute of Technology called "Pencil and Paper-Aided Design (PPAD)." But he predicted that computers will soon be such an intrinsic part of architecture that we will drop the phrase "Computer-Aided" from our description of design. He called for the creation of "knowbots" to automate routine architectural tasks, many examples of which were presented during the week-long conference.

The Intelligent Design Checker, for example, can review a set of drawings for compliance with bullding codes and other standards. Nayel Shafei from Prime Computers, Inc., described how the New York State Facilities Development Corporation uses the program to check compliance of hospital designs with National Fire Protection Association standards and the New York State Life Safety Code. The Checker flagged so many violations in drawings submitted for final approval that the Facilities Development Corporation now requires architects to run the program during the design phase of projects, when corrections can be more easily made.

Architects typically design a building envelope and then pass it to mechanical engineers for an energy-use evaluation. This results in slow and costly iteration of design between architects and engineers. To improve this situation, both Larry Degelman of Texas A&M University and Edna Shaviv of the Israel Institute of Technology presented expert systems that integrate energy analysis and architectural design. Their systems allow architects to visualize buildings in 3D and simultaneously receive feedback on the energy consequences of design decisions. Both are using knowledge-based programs to suggest U-values, window placement, and design strategies to satisfy energy-code constraints.

Mehdi Khalvati from ASG explained that CAD programs could become "integrated architectural systems." ASG software, which runs with AutoCAD, links graphic information to specification writing, cost estimating, and product information. In a software package that ASG distributes for Boise Cascade, wood beams are treated as objects that contain information about their performance characteristics and limitations rather than just as lines; the program can automatically size and arrange wood floor framing members.

Expanding upon this theme, a team from Carnegie Mellon University demonstrated ARMILLA, which incorporates expert systems with a CAD drawing tool to aid the design of a building's structural, HVAC, plumbing, and other systems. A knowledge-base of engineering rules automatically makes trade-offs to coordinate the placement of beams, ducts, and risers.

New Models for Architects
Traditional architectural drawings, even those produced with the latest 3D CAD programs, are abstract geometrical representations of building components; the meaning of the lines is determined by the architect.

Computerized models, on the other hand, are constructed of "object-oriented" representations of each building space and component. "Object-oriented" is the computer equivalent of the architectural concern for the nature of materials; it is Louis Kahn's asking a material what it "wants to be." Object-oriented databases key building elements to information about what they are, their performance, and their relationships with other objects. Objects interact with each other according to knowledge-based rules and constraints. "Self-knowledge" enables objects to assert themselves to automatically generate designs or construction and facility management reports. Instead of the static abstraction of traditional drawings, this kind of computer model portrays a virtual reality that responds to changes in materials and conditions as would real buildings.

Visualization Software that creates photographic-quality 3D pictures of buildings will be valuable for both client presentations and as construction planning tools. Simulations will enable designers and owners to predict operating loads more accurately and to optimize the structure's performance by adjusting for varying conditions, thus reducing the need to over compensate for safety factors. And as new user interfaces are refined, architects may find themselves working in cyberspace environments that convey the illusion of being able to manipulate computer-generated items in the actual space.

Other developments in computer science presented at the Symposium that may affect architectural practice include neural nets, hypertext, artificial intelligence, and multimedia. Anticipation of these tools led to heated discussion about where the ultimate boundaries between human and machine capabilities might be. Some argued that creativity and aesthetics were not feasible or appropriate uses of computers. Shaviv countered with the example of a student with no architectural training who developed a program to draw housing plans based on code restrictions and a set of rules defining spatial relationships. "Some of the schemes the computer made were of great originality and beauty, designs a trained architect would never have dreamed of." Others argued that computers could stimulate human creativity by freeing designers from routine chores and presenting a greater range of options for them to consider. One software developer believed human intuition will remain an essential part of architecture; his program includes a "help key" that provides information unrelated to the task at hand to stimulate the user to make problem-solving breakthroughs.

The Need for a Standard
Developing the standard code necessary for object-oriented models will be an enormous undertaking and may not be practical in a fragmented industry that supports a multitude of incompatible computer and software systems. To overcome this, the Symposium struggled with standards and technical guidelines for exchanging computer generated information directly between systems and across the building industry. Current exchange protocols like the Initial Graphics Exchange Specification (IGES) and AutoDesk's DXF format primarily exchange geometrical drawing data. New standards are required to accommodate the richer information environment of object-oriented models.

The leading proposed standard is the Standard for The Exchange of Product Model Data (STEP). STEP is being coordinated by the International Organization for Standardization (ISO) and by the Product Data Exchange (PDES) in the United States. A PDES  brochure explains that STEP "will provide a complete, unambiguous, computer interpretable definition of the physical and functional characteristics of each unit of a product throughout its life cycle. (It) will enable communications among heterogeneous computer environments; integration of systems that support design, manufacturing and logistic function/processes; and support automatic, paperless updates of system documentation."

Development of a comprehensive data exchange standard will be extremely costly but is of paramount importance to automation and integration; but funding for the construction industry's effort is problematic. Participants in the Symposium, however, felt that development of STEP is of such importance to United States competitiveness in global construction that they called for a government effort comparable to the building of the Interstate Highway system. "Who will be the President Eisenhower to make it happen?" one participant asked.

Life-Cycle Models
The ability to share a common building model will change the organization of building projects. Duvvuru Sriram from MIT called current design methods over-the-wall engineering. "The architect works on a design and then throws it over the wall to an engineer. The project is thrown over the wall to a contractor who uses the drawings as a sketchpad to figure out how the building will really be built, and it is eventually thrown to the building owner who has to figure out how to operate the facility." He proposed a knowledge-based management system and distributed databases that would facilitate collaborative design among all building team members.

Information must also be managed so that it has value throughout the life-cycle of a building. As information is gathered, from the earliest planning stages through demolition, it should be sorted for value and stored in an accessible electronic form. Instead of merely automating current procedures, every part of architectural practice must be reassessed While putting product catalogs on to computer diskettes is a necessary first step, we should not lose sight of the need for an Electronic Data Interchange (EDI) system so that product data can flow directly from a manufacturer's catalog into a project database and then back into a manufacturer's production scheduling program without the time and expense of shop drawings. Owners will start demanding computer models for use in space planning, energy management, preventive maintenance, and operating systems; the quality of a building's database will be an asset they can carry to their bottom line.

The complexities of modern construction have created building teams with experts in many fields. Future architects may be able to work with fewer consultants as expert systems become more powerful and electric databases provide easier access to specialized information. This should lead to leaner and more productive building teams, but will require new approaches to architectural education and Practice. Ron Wooldridge of The Locke Group warned that "the good news is that 45 architects with computers will be able to do the work 50 people working manually. The bad news is that the 45 may not be a subset of the current 50." He urged architects to use integration and automation to add value to their work and to develop the knowledge-based systems and databases that would enable their firms to regain competitiveness.

The final advice from the Symposium is to not become too married to the current generation of AEC computers and applications. Rapid changes are coming that may make your personal computer as obsolete as a slide rule. Firms that accept the challenge of automation and integration will have to weather a turbulent period of industry and professional realignment, but are likely to emerge more competitive then before.

Have a question you'd like us to answer?
Send an email to michaelchusid@chusid.com 

By Michael Chusid, originally published in Progressive Architecture, ©1991

Building Product Careers

This is an encore of an article Michael Chusid wrote almost 20 years ago. The construction industry is, once again, experiencing a down phase of its economic cycle. If I wrote the article today, I would not be as sanguine about the stability of jobs with product manufacturers; many manufacturers have had to lay-off staff or switch from boots on the ground to some form of online marketing.

As opportunities for traditional architectural employment appear to he declining, many architecturally trained people are having to face involuntary career adjustments. If you are in this situation, you should be aware of opportunities for architects in the building product industry.

This industry is a large and robust sector of the construction economy and consists of manufacturers, trade associations, independent sales agencies, and distributors. Many architects find it hard to contemplate careers outside of design firms. To overcome this mind set, compare architects to engineers. It is widely recognized that engineers can succeed in industry as well as in consulting firms. In the same way, the communication, technical, aesthetic, and organizational skills acquired through architectural education and practice can qualify you for positions in building product sales, technical service, and management.

Sales
Who, for example, is better suited to make sales calls on architects than a fellow architect. While salespeople without construction background can spend years learning the language of architecture, it is already your native tongue. With your training you will not only understand your product, but also how your product contributes to the overall success of your customer's design. If you are selling windows, for example, you will be able to talk not only about glass and aluminum, but also about how the fenestration can reinforce the designer's concept. You can roll out the tracing paper to help solve detailing problems. The ability to see the total project as greater than the sum of its parts will enable you to establish better rapport architects - to be not only their sales representative, but also their consultant.

Your architectural skills will also find applicability in building product marketing. You have been trained to understand the big picture and to organize myriad small details that are necessary to accomplish a vision. Your communication and presentation skills will give you the edge in presenting your ideas and communicating them to corporate management as well as to your customers. Even your draftsmanship and aesthetic training will be called upon to help you create effective product literature and advertising for your product.

Technical
Product research and development may appeal to the more technically inclined. Product design is similar in many respects to building design. It begins with defining the performance requirements for the new product and developing alternative solutions. But while most architectural designs are one-of-a-kind structures and are not tested until occupied, product designers often have the opportunity to build prototypes to refine ideas and test a product's performance. Your understanding of construction materials and methods will be enhanced by an increased appreciation of the nature of materials and manufacturing processes.

Building product manufacturers also need architecturally trained individuals to serve as project engineers. With construction technology becoming more complex, consulting architects increasingly delegate detailing responsibility for building systems to manufacturers. Project engineers must evaluate the building and contract requirements and must design appropriate solutions compatible with their firm's capabilities. Individuals in these positions also act as in-house consultants to provide trouble-shooting, make field inspections, obtain code approvals, and respond to special inquiries about a product's performance or suitability for proposed applications. Your knowledge of the way buildings work will be tested daily.

Working for a manufacturer in a particular area of building technology, such as roofing or curtain walls, can enable you to develop a degree of expertise not normally obtained in architectural practice. You may eventually be able to return to practice with an attractive area of specialization.

Management
Experience as a principal of a design firm can be parlayed into a management role in the building product industry. While the product is different, you must still recruit and manage staff, marshal resources, watch the books, and supply the vision that gives a business direction.

The same entrepreneurial drive that leads many architects to start design firms has prompted others to launch building product businesses. Architects have developed many new building products when they recognized product ideas, stylistic trends, or construction problems not satisfied by existing products. And some have gone on to found companies to manufacture or market their product ideas. As in any industry, most of these new businesses fail. But others have succeeded and range in size from small custom mill work shops to leading manufacturers like Kawneer, founded by an architect who first patented metal window frames. Before launching your own building product firm, you may want to spend a few years working for an established company to learn the territory. But even if all you are launching is your own career, look for a company with a commitment to quality and training, who will provide opportunities upon which yon can build.

In general, economic rewards and job security in building product firms are at least as good or better than in architectural practice. If you decide to make a career shift into the building product industry, take your architectural sensitivities and passions with you; you will not stop being an architect just because you no longer work in a traditional practice. The building product industry influences architecture through the invention and dissemination of new technology, new building systems, the economic and political clout of major national and international manufacturers, and the persuasive powers of advertising and sales. During your career in building products, you will make significant contributions to the success of hundreds of buildings. A career in building products will still enable you to leave your mark on the quality and future of architecture.


Have a question you'd like us to answer?
Send an email to michaelchusid@chusid.com 

By Michael Chusid 
Originally published in Progressive Architecture, Copyright © 1992

Ad produced in 72 hours

Sometimes there just is no time.

On Friday morning, I got a call from a client stating that she had just signed a contract to place a full page ad in a major architectural magazine. Then the call from the ad sales rep came, informing me that the press ready ad had to be delivered to the printer no later than Monday morning.
Ad in a hurry. Produced in just 72 hours.
72 hours later, the ad has been designed, approved by the client, and delivered to the publisher.

Many thanks to Stephen Klippenstein, our award winning art director and graphic designer, for giving up his weekend, and to the rest of the Chusid Associates team for pitching in.

No Recession Here!

With the right products, effective management and creative marketing, building product manufacturers can profit and even grow through a recession.

One of our clients (you'll forgive me if I can't disclose which) just shared that its plant is running three shifts and has orders in-hand for most of its capacity for the rest of the year.

They are not coming out of a recession. They never went into one.

Creating New Words

Construction is a field where new technologies and practices often justify the invention of a new term. As an example, I coined the phrase, "studcast" to describe a new type of wall panel that consisted of a hybrid of prefabricated light-gage steel frame with a thin precast concrete veneer. I offered the term to all the manufacturers of this type of product, and most of them now use it to as a standardized, simple, and descriptive term.

However, some invented terms are unnecessary and can lead to confusion.  A case in point is the recently coined term, "civionics".

I first encountered the term in the article "New civionics technologies for structural health monitoring" in the November 2010 issue of CE News. While the article shares valuable information about the evolving science of structural health monitoring. I question whether the use of the term "civionics" was equally valuable.

The author, Nathan Yang, defines the term as "the synergistic combination of civil engineering, electrical engineering, computer engineering, photonics, and other disciplines for [structural health monitoring]. This definition suggests that "civionics" is an equivalent term for "structural health monitoring", a field that already encompasses a variety of disciplines. Indeed, electrical and computer engineering are already integrated into the practice of civil engineering. In this case, "civionics" is a word of of questionable value in a field already cluttered with jargon.

A search of the CE News website reviews that "civionic" has not previously been used in the publication. Similarly, a search of the internet reveals that the term has few users -- most of its occurrences on the internet result from one site quoting another. A similar concern has been raised by a commentator on Google Talk who opines, "All of the references describe [civionics] as an emerging field, yet they seem to point in a circular manner as to establishing the notability of this term. Wikipedia is not a place to establish notability. So if this term is not widely used in the engineering field, it should not have an article here." Nor, in my opinion, should notability be established by an oblique reference in a magazine article.

But marketing is marketing, and I note that the author of the CE News article works for a company that sells electronics to the Civil Engineering community. Maybe he feels his company will benefit from embracing new term. How ironic, then, that the term "civionic" does not appear in his website, either.

Utilities to use Amazon business model?

Could the power company start selling electricity the same way Amazon sells e-books? Jim Rogers, CEO of Duke Energy, thinks they could.

, writing for www.earth2tech.com, explains:
It sounds like the idea would be to sell an energy efficient device (like a smart fridge) via a utility and then sell discounted services or even electricity bundled into that device. The idea conjures up images of the utility as part retailer, part energy management provider, and at the end of the day owning the relationship with the customer. 
As Fehrenbacher points out, such a change would be a long time coming, and faces many challenges beyond the regulation changes that would be needed. Many utilities may even decide selling low-energy appliances is not in their best interest. Still, it seems an interesting inversion of the typical appliance/building system business model.

How to Build a Business: Lessons from Architectural History

As an architect consulting to building product manufacturers, I often draw upon the rich legacy of architectural history for inspiration.

For example, when faced with a large, complex, and daunting project, such as launching a new building product, I remember Daniel Burnham (b. 1846 – d. 1912), an architect responsible for some of the first skyscrapers, major projects like the World's Columbian Exposition, and the planning document that played a major role in shaping Chicago.

Befitting his large and ambitious projects, he is remembered for his exhortation:

"Make no little plans.
They have no magic to stir men's blood
and probably will not themselves
be realized."

An earlier exponent of this philosophy was Abbot Suger, who initiated the 12th Century rebuilding of the great Abbey Church of Saint-Denis, in France, one of the first great Gothic buildings. He dared dream on a scale beyond his means to realize.
After the west facade and narthex was constructed, he skipped the nave that runs most of the length of the building, and moved on to the construction of the chancel at the eastern end of the projected building.

There was a considerable distance between the two ends, and the infill construction was not completed for another hundred years. Yet he had the vision that inspired the project, and has continued to inspire worshipers for over eight hundred years.

While building a business requires attention to a myriad of small details, it is the big audacious goal is also essential to the success of an enterprise.