8 KH: We deal with this issue on a daily basis. We find that most clients are not interested in a “learning experience.” We’re working on enhancing our continuing education and mentoring program so that younger staff can shadow more experienced staff and learn from that observation. With challenging deadlines, that can be difficult, but it’s critical to our future success. TZL: Architects love being architects, but what are you doing to instill a business culture in your firm? KH: From the founding of our firm, we’ve been keenly aware of the fact that we are a business and we must monitor our costs as well as our clients’ costs. Our many developer cli- ents help us focus on the importance of cost. We continue to keep our staff aware of fee structures and hourly rates along with the ongoing challenge of balancing fees with our design creativity. TZL: Diversity and inclusion is lacking. What steps are you taking to address the issue? KH: We’ve had the good fortune over the years to have a di- verse workforce relative to age, gender, race, and ethnicity. Specifically, as more women have been entering the field of architecture over the past several years, we’ve seen many more female candidates applying for positions. As a result, the percentage of women in the firm has grown – today our staff is 44 percent female. Using national resources such as the AIA has helped us recruit international employees; some of whom we have assisted in the visa process. Addi- tionally, we encourage our current staff to be our recruiters and ask them to recommend the firm to people they know and respect. This is especially helpful relative to our recent graduates and we believe this will continue to increase our diversity. “Our legacy is to allow people to ‘reach’ for personal growth as opposed to handing it to them. It really is a function of the initiative and drive of the individuals, and when that is present, we welcome it with open arms.” TZL: A firm’s longevity is valuable. What are you doing to encourage your staff to stick around? KH: One of the hallmarks of Bernardon over the years has been the long tenure of many individuals. We do not have a “hire and fire” mentality, and I believe that the turnover in our firm is well below the industry average. We let new hires know that we’re investing in them and that we hope they will reciprocate by staying with us. We treat our people fairly and make the firm a good place to work, and that has resulted in many of our staff staying with us for a very long time. This sets an example for younger staff and makes us an inviting place to work and build a career. TZL: Benefits are evolving. Are you offering any new ones due to the changing demographic? KH: Recently, we’ve implemented a change from vacation and sick time being separate to a paid time off policy, where LONG TENURE, from page 7
these are combined into one benefit. The intent is to give our staff more flexibility in how they handle their time off and for those employees who are fortunate enough to stay healthy and not get sick to not forfeit their sick time. We want to give people an opportunity to strike a balance be- tween their work and personal life. Time off is important to recharge, so our policy limits the carryover of PTO from year to year to encourage people to take their vacation time. “We’ve implemented a change from vacation and sick time being separate to a PTO policy, where these are combined into one benefit. The intent is to give our staff more flexibility in how they handle their time off.” TZL: Tell us about the last time you named a new princi- pal from outside the firm. KH: Currently, we have seven principals – six of whom worked at the firm for a number of years prior to becom- ing a principal. Historically, we’ve found that to maintain our culture, it pays to give prospective leaders some time to get to know us and vice versa. We did make one exception to that policy 15 years ago when we named a new principal from outside the firm. That situation involved merging that person’s sole proprietor firm into our larger firm. Because we had joint ventured on several projects over a multi-year period, we were very familiar with each other, and it has worked out exceptionally well. TZL: How are the tariffs impacting your business and that of your clients? KH: We see the unpredictability of costs creating significant problems for our clients in terms of their procurement of materials for construction. However, we have not had any clients change their strategy specifically as a result of the tariffs. TZL: How are the tax cuts impacting your business? Have salaries and bonuses increased? KH: The federal tax cut has had no impact on salaries and bonuses within our firm. When the economy does well, so do we. When the economy falters, it has a direct impact on our business. For the last 10 years, since the depth of the Great Recession, we’ve been on a continuous upward track. At this time, we’re carefully monitoring market conditions and trying to prepare for a recession, whenever it may oc- cur. TZL: How have the tax cuts impacted your firm’s valua- tion? Do you plan on doing another valuation due to the tax cuts? KH: The tax cuts have not directly impacted our firm’s valu- ation. We do a valuation on an annual basis as a matter of policy; we feel it’s a good practice. TZL: Are you currently pursuing the R&D tax credit? KH: No, but we are open to the opportunity in the future.
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THE ZWEIG LETTER March 25, 2019, ISSUE 1289
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