Changemakers On: Business
Shaped by climate realities and uncertain market forces, the construction, architecture, and design industries need to embrace business ideas that help leaders navigate uncertainty.
To learn what ideas can get us there, three changemakers in design, and industrialized construction shared their insights. Our focus: What business ideas do we need most right now?
One changemaker told us about how the benefits of sustainable design and construction now align clearly with business goals — which can have a transformative impact on both the environment and business bottom lines.
Another reminds us that the business idea we might need most is connected to us at an individual leadership level.
Finally, one has a call-to-action to move away from a conventional approach to construction projects and instead focus on adaptability and return-on-investment in these uncertain economic realities.
What’s clear from these conversations is the ideas for building a different future of business are out there. It’s up to each one of us to bring them to life.
Business Priorities Now Drive Sustainability Goals
“It doesn’t matter if someone believes in climate change, because their insurance company sure does,” says Eric Corey Freed, Principal and Director of Sustainability at CannonDesign.
“We’ve seen the big insurance companies have gone to great lengths to understand climate risk,” he says, adding that 100% of his clients are focused on sustainability. “We’re also seeing a push from shareholders to hold companies accountable for their climate pledges. Exxon was sued by its shareholders for failing to address how climate change is a risk to their investments.”
Freed’s firm frames the benefits of sustainability using something called “living-centered design.” It’s an approach that targets vital outcomes for clients, whether they’re financial, social, or societal. Then the firm uses the design process to pursue those benefits. In one recent project, they helped a hospital system drastically reduce its costs by introducing a geothermal solution.
“I asked them what drove them crazy,” says Freed. “And without hesitation they said they spent $95,000 a year plowing snow. So, I explained how we could install a ground geothermal system, which would create snowmelt zones across their site. They basically never have to plow snow again. They’re also able to retire their old steam plants and reclaim that space in the middle of their campus. That geothermal well will provide heating and cooling for the entire campus and pay for itself in a matter of years."
We’re still hoping Iron Man is going to come up with some incredible technology that will miraculously suck carbon out of the air. But that’s pretty unlikely.
Targets set by the UN Environment Programme and the Intergovernmental Panel on Climate Change (IPCC) call for carbon neutrality by 2030, which requires a 45% drop in emissions. With that deadline now seven years away, Freed is emphasizing the importance of acting now to address sustainability goals.
“We've all seen too many Marvel movies where the hero saves the day. I think in all our hearts, including my own, we’re still hoping Iron Man is going to come up with some incredible technology that will miraculously suck carbon out of the air. But that’s pretty unlikely. We need to be taking steps today in order to achieve our sustainability goals,” he says.
A green building isn't just more environmentally friendly. They can provide real business benefits and better outcomes. Focus on the outcomes use sustainability to get there.
How Servant Leadership Unlocks Sustainable Growth
The key to winning more work isn’t focusing on closing more deals. It’s about providing value and building long-term relationships.
This is how André Davis approaches his work as a Corporate and Community Engagement Executive at Built Interior Construction. It’s a philosophy known as “servant leadership” where a leader’s goal is focused on providing value — to clients, employees, and stakeholders — rather than exclusively driving bottom-line financial results.
Davis believes this is the optimal path to accelerated growth.
“I used to be in sales, where you’d have a script and you’d be prepared for a given response,” he says. “It’s inauthentic. Over time, I learned that people won’t come back to you with that approach, because they see you as a commodity.”
Instead, Davis strives to embody a more authentic, relationship-driven approach.
Once I feel we aren't a good fit, I'll offer to bring in another firm that might be a better fit for them. This is truly one of the ways we add value and how we connect on a much deeper level with our clients. This pays incredible long-term dividends for your business.
“It's simple,” Davis says. “When I meet with people, I typically ask: ‘What are you trying to solve?’”
From here on out it's all about listening and adding value on the front-end without making the "ask" for their business, he says.
“Once I feel we aren't a good fit, I'll offer to bring in another firm that might be a better fit for them. This is truly one of the ways we add value and how we connect on a much deeper level with our clients. This pays incredible long-term dividends for your business because no one does it. And the person on the receiving end says: 'Why would he send me to another firm rather than his company? These guys must really want what's best for me rather than just making a sale.'"
When you become known for this approach, Davis says you're never not busy. “You’re always getting pulled into conversations about potential project opportunities.”
Davis shares a story about a lunch meeting he had with the CEO of a healthcare organization. It was a long discussion where Davis didn’t talk about his company or services at all.
“It was a great meeting,” says Davis. “For three hours, we talked about wine and bourbon. His dislike for tomatoes, and my dislike for Brussels sprouts. In the last part of the meeting, I invited him and his executive team down to our office to meet our team over some bourbon. When they came for a visit and were walking around our office, he wanted to know more about our work. I said, ‘Wait a minute, I invited you down for bourbon not to talk construction’. He said: ‘Can we do both?’ This is the level of authenticity that delivers huge outcomes. They are now very interested in how we might help them on future build-outs.
Building sustainable growth is rooted in delivering value whenever you can. It all comes from building an intentional, authentic relationship, he says. That’s at the core of servant leadership and long-term business success.
Building intentional relationships with clients and partners is about being a servant leader first. Add value even when you don’t financially benefit and seek to add value before asking for something in return.
Conventional Construction Must Adapt to Uncertain Economic Challenges
A perfect storm of economic disruption, pandemic challenges, and global uncertainty across most every industry has created a shift in the world of architecture, design, and construction, says Mike Iannone, Director of DIRTT’s Constructability Division.
“It's seismic when you think about the impact to the labor force and supply chain coupled with global economic instability, and then competing recession and inflationary conditions right now. That is the perfect confluence,” he says.
Despite this unpredictability, some in the construction industry continue to use the same methodology for conducting business, which raises the question: Why would an industry choose an increasingly risky business methodology, which ultimately leads to a form of planned obsolescence?
The reason that people are staying with conventional construction is it's one of the few industries where you don't have to know how long it's going to take, or what it's going to cost, or how it's going to come out, yet have the results accepted.
The legacy of construction has been simply to build as quickly as possible with the least amount of cost and little, if any, consideration for timelines and quality. However, now is an era where construction is moving in another direction.
Iannone says that beyond costs, it’s time to think about how to maximize return on investment in construction.
“The way you do that is by using state-of-the-art systems as the basis of design and construction that easily respond to future needs, whether it's where a wall sits, or more importantly, what functions that wall is being asked to accommodate,” he says.
But because of economic and global uncertainty, a compromise is taking place at the earliest stages of design. Limitations are being imposed on designers and contractors forcing them to change the space to be smaller or use different materials than would have otherwise been used. Pricing that is agreed upon today will inevitably change over the life of the construction phase. Quality deteriorates and, as Iannone notes, “kicking the can down the road, is a kind of Ponzi scheme.”
Architects and contractors already mitigate risks for clients. “In the design world, we often say we have to protect the client from themselves,” notes Iannone.
Now with current market forces, architects and GCs must help protect their clients even further by embracing construction approaches that prioritize adaptability and maximize return on investment.
Conventional construction, the supply chain, and the labor force that supports it are rife with challenges in today’s market. Maximizing a return on investment with the built environment should include Day 2 considerations. Architects and GCs can help protect clients from the headache and cost associated with future change by building with adaptable options to begin with.
Explore More of DIRTT's Changemaker Series
This article is part of a series where we talk to industry leaders about the issues, changes, and opportunities facing design, construction, real estate, and business leaders. Explore more topics and hear from more changemakers.
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