Accountability. In so many architecture, engineering, and construction (AEC) firms, this is a key ingredient in the secret sauce for success. Just talking about a vision for growth, firing a low value client, or making an acquisition is great. But, without action and accountability, nothing happens. On a related note, a lack of accountability is often the underlying reason why a firm fails to achieve desired goals. By who, by when…that is the bias for doing that comes with clear accountability.
With a flood of capital flowing into the AEC industry via private equity investments, that accountability coin can make a very disruptive flip. For many firms, the transition from internal employee ownership to outside investor ownership introduces a new level of accountability that can be both disruptive and productive.
Thinking about private equity for your next recapitalization? Get ready for…
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A new sense of urgency and impatience. Employee owners take the very long view because they are in it for the long haul. Outside investors may only have a 5-7 year investment horizon. No more hanging onto that underperforming office waiting for the next market upswing.
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A decoupling of emotions and operations. Without that outside accountability, it can be easy to justify hanging onto a loyal (but misaligned) employee or falling into the “we’ve always done it that way” mindset.
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A constant state of curiosity. The incumbent hardly ever sees the disruption coming. An outside perspective brings a new level of curiosity to question business models, growth strategies, and traditional thinking.
For a lot of firms, this new world of accountability is where the magic happens. If you are ready for it, it will be a wild ride that can be challenging but also wildly rewarding when both sides get excited about what is possible and the cultural alignment between the AEC firm leadership team and the outside private equity team is there.
Not sure if you are ready for a PE investment in your firm? Try using the WWPED test on the next confounding issue that comes up in a Board of Directors meeting. What Would Private Equity Do? That impatient, objective, and curious mindset just might lead you to a more disruptive and definitive outcome.