That is definitely an education gap in architecture
Jon Clayton:around business basics.
Jon Clayton:You may be an amazing designer, but if you're lacking in business education,
Jon Clayton:you'll struggle to fulfill your potential.
Jon Clayton:Today, I'm joined by Ray brown of Archibus to share his thoughts on the
Jon Clayton:foundational business education that you need to bridge that gap and sets your
Jon Clayton:architecture practice up for success.
Jon Clayton:In this episode of architecture business club, the weekly podcast for solo
Jon Clayton:and small firm architecture practice owners, just like you who want to build
Jon Clayton:a profitable future proof architecture business that fits around their life.
Jon Clayton:I'm the host, John Clayton.
Jon Clayton:And if you want a business in architecture that gives you more
Jon Clayton:freedom, flexibility, and fulfillment.
Jon Clayton:Then go to architecture, business club.com forward slash blueprint and downloads
Jon Clayton:the architecture business blueprint.
Jon Clayton:It's the step-by-step formula to freedom for architects, architectural
Jon Clayton:technologists and architecture designers.
Jon Clayton:And it's absolutely free as a gift from me.
Jon Clayton:Now let's discuss foundational business education.
Jon Clayton:Ray Brown is a business coach and entrepreneur.
Jon Clayton:He built and sold several businesses in Scotland before relocating to
Jon Clayton:Australia with his family in 2005.
Jon Clayton:Ray has coached everyone from startups to top executives of major companies.
Jon Clayton:He also chairs multiple company boards, but today his main focus is coaching
Jon Clayton:and mentoring architectural practices.
Jon Clayton:Ray recognized there was a significant gap in the education provided to
Jon Clayton:architects around running a business.
Jon Clayton:So he founded Archie biz to help.
Jon Clayton:Ambitious architects build profitable and sustainable businesses whilst
Jon Clayton:maintaining good design standards.
Jon Clayton:You can learn more about the Archibiz Business Foundations Program at archibiz.
Jon Clayton:global forward slash BFP.
Jon Clayton:Ray, welcome to Architecture Business
Ray Brown:Oh, thanks, John.
Ray Brown:Thanks for having me on your podcast.
Ray Brown:Yeah,
Ray Brown:it's always a privilege,
Ray Brown:yeah, it's
Ray Brown:really nice
Ray Brown:to be invited, so thank you.
Jon Clayton:It's a pleasure to have you here.
Jon Clayton:I enjoyed our last conversation so much.
Jon Clayton:It would have been rude for me not to invite you on the show for another one.
Jon Clayton:Um, Ray, you're, you're originally from, um, Scotland.
Jon Clayton:Is it Aberdeen originally?
Jon Clayton:Is that right?
Ray Brown:It is indeed the frozen north, I think they call it, and, uh, yeah,
Ray Brown:I, I came to Australia looking for a bit more sun, and, my daughter was here
Ray Brown:and wanted to start a sailing business.
Ray Brown:The one, only thing that went wrong in that was Melbourne's
Ray Brown:not the best place for weather.
Ray Brown:It's a bit of a well kept secret.
Ray Brown:Place to live.
Ray Brown:But um, yeah, January through March
Ray Brown:is pretty
Ray Brown:good, but beyond that it
Ray Brown:can
Ray Brown:be a little bit up and down.
Ray Brown:Too hot or too,
Ray Brown:too
Ray Brown:cold.
Jon Clayton:Yeah.
Jon Clayton:You must enjoy life in Melbourne though.
Jon Clayton:You wouldn't have stayed there for so many years otherwise.
Ray Brown:Yeah.
Ray Brown:Oh no, it's a great place to live.
Ray Brown:I tend to try and keep that secret
Ray Brown:going
Ray Brown:If you.
Ray Brown:don't mind.
Ray Brown:Yeah, it's got lots of culture, lots of food,
Ray Brown:and
Ray Brown:we're lucky enough to have a place down at the beach, so we can be there
Ray Brown:in an hour, and it's pretty good.
Jon Clayton:Oh, fantastic.
Jon Clayton:Well, I actually was fortunate enough to work in Melbourne for
Jon Clayton:a few months, many years ago.
Jon Clayton:It was during a year long backpacking trip and I ended up working for an
Jon Clayton:architectural practice in Melbourne.
Jon Clayton:I lived in North Melbourne, not far from the Victoria market and worked
Jon Clayton:for a practice out in East Kew.
Jon Clayton:And, uh, I absolutely loved it.
Jon Clayton:I had a great time there.
Jon Clayton:I was very tempted to stay, to be honest, it wasn't for the fact that
Jon Clayton:I was really excited about visiting a few of the countries that I'd planned
Jon Clayton:to visit afterwards, that I I may have ended up staying there a bit longer.
Jon Clayton:And then, um, I met who is now my wife, and then that kind of like scuppered
Jon Clayton:the, the plans to return to Melbourne.
Jon Clayton:So that kind of went, the plans were on hold for a while, and then they've,
Jon Clayton:they've been on permanent hold ever since.
Jon Clayton:So,
Ray Brown:Yeah, no good.
Ray Brown:Well, if
Ray Brown:we continue our relationship, you never know, you might be out here
Ray Brown:visiting and visiting the deck.
Ray Brown:Drinking a beer would be nice.
Ray Brown:I'd love to see you here.
Jon Clayton:Oh, that sounds awesome.
Jon Clayton:Yeah.
Jon Clayton:I'd love to do that.
Jon Clayton:We could talk about this for hours, I'm sure, but we're, we're actually
Jon Clayton:here to talk about foundational business education, specifically
Jon Clayton:for architecture practices.
Jon Clayton:So I'm really excited to hear about this.
Jon Clayton:So Ray, I want to ask what, what would you consider foundational
Jon Clayton:foundational
Jon Clayton:business education to be?
Ray Brown:Yeah, but it's a phrase that we've worked really hard to get to.
Ray Brown:We've been in business for five years and it's only really in
Ray Brown:the last six months that we've
Ray Brown:finally
Ray Brown:honed in on the words.
Ray Brown:And, and, you know, I would, I would encourage architects to see that that
Ray Brown:process is not something that you
Ray Brown:immediately say, this
Ray Brown:is who you are.
Ray Brown:This is where you fit in the market.
Ray Brown:This is what you do.
Ray Brown:It sometimes takes time.
Ray Brown:So foundational business education for us is we aim to fill the gap that
Ray Brown:architects tell us about every single day.
Ray Brown:We don't get taught about business at university.
Ray Brown:We are well meaning amateurs when it comes to business.
Ray Brown:All of those things.
Ray Brown:And unfortunately
Ray Brown:that
Ray Brown:leads into a little bit of what I call woe is me thinking.
Ray Brown:If you don't have the education, you need to go out and get the education.
Ray Brown:And the two analogies we use
Ray Brown:One
Ray Brown:is driving a car.
Ray Brown:You wouldn't buy a car, jump in the car, and go out on the
Ray Brown:road, because a car's dangerous.
Ray Brown:You know, it's
Ray Brown:dangerous to
Ray Brown:your health, to your well being, all of those things.
Ray Brown:And business is very similar.
Ray Brown:You can lose a lot of money in business, you can become very
Ray Brown:stressed, and really, it's a tough existence if you don't get it right.
Ray Brown:But, the good news
Ray Brown:is
Ray Brown:that business is a simple game.
Ray Brown:We used to use chess as an analogy and then we moved to drafts or
Ray Brown:checkers, and someone, one of our clients said, look, the way you put
Ray Brown:it across, it's not that difficult.
Ray Brown:It's more like snakes and ladders.
Ray Brown:So snakes and ladders take 10 minutes to explain.
Ray Brown:Without that 10 minutes, it's just a mystery.
Ray Brown:Ladders, reptiles,
Ray Brown:colored
Ray Brown:squares.
Ray Brown:But you can teach a five year old snakes and ladders in probably 10 minutes.
Ray Brown:And business is a bit the same.
Ray Brown:with the basic rules of the game or the foundational business education, you're
Ray Brown:really at high risk of coming unstuck.
Jon Clayton:I love that simple analogy there that you've given us.
Jon Clayton:I guess that starting a business in architecture, it
Jon Clayton:can be bad for your health.
Jon Clayton:If you, uh, potentially, if you don't know what you're doing and, um,
Jon Clayton:yeah, having some basic instructions to lay those foundations is, it's
Jon Clayton:got to be something surely that's essential really for, for everybody.
Ray Brown:Yeah, I think
Ray Brown:the, the, the, the
Ray Brown:paradoxical thing
Ray Brown:is
Ray Brown:that architects are very tempted to go into their own business.
Ray Brown:I think the statistics, something like 70 percent of architects end up
Ray Brown:working for themselves in some form.
Ray Brown:But the
Ray Brown:problem is that they tend to drift into architecture.
Ray Brown:You know, they do some work on the side, and then they get a
Ray Brown:bigger job and a bigger job.
Ray Brown:And
Ray Brown:then
Ray Brown:suddenly they
Ray Brown:say,
Ray Brown:I've got enough to pay my wages.
Ray Brown:and I can leave
Ray Brown:my job.
Ray Brown:paid job.
Ray Brown:The problem with that is you're not setting up a business.
Ray Brown:You're creating a job for yourself.
Ray Brown:It's only over time that people realize,
Ray Brown:hold
Ray Brown:on, there's more to this business thing
Ray Brown:than
Ray Brown:I thought.
Ray Brown:And we meet a lot of disillusioned architects.
Ray Brown:They love architecture.
Ray Brown:They're passionate about the profession, but they just don't
Ray Brown:understand the business side.
Ray Brown:They don't make money.
Ray Brown:In a lot of cases, they're paid less.
Ray Brown:Then they would be paid working for somebody else.
Ray Brown:And they've got that, probably their partner, telling them, you
Ray Brown:know, why you're doing that when you
Ray Brown:could
Ray Brown:be working here and we could live a better lifestyle.
Ray Brown:So, we see ourselves in the business of, um, reducing that stress
Ray Brown:and teaching people the basics.
Ray Brown:It really is not complicated.
Jon Clayton:I, I think that's so true.
Jon Clayton:I can.
Jon Clayton:I could really relate to that from my own personal experience as well,
Jon Clayton:that, um, I'm very much, I thought I'd, I had a business, but I'd really
Jon Clayton:just like recreated my old job.
Jon Clayton:It's taken quite a long time to, to realize that and to have had some business
Jon Clayton:education at the very beginning would have allowed me to take a shortcut and
Jon Clayton:to have been far more successful with my own small practice than, than I was.
Jon Clayton:Because I had to learn a lot of it from mistakes and, you know, making
Jon Clayton:the mistakes and then, you know, learning from them, but to have had
Jon Clayton:some foundational business education at the very beginning would have been.
Jon Clayton:Well, potentially transformational.
Ray Brown:Yeah, well it is.
Ray Brown:It's interesting
Ray Brown:you use
Ray Brown:that word transformational because we, again, we've been working on
Ray Brown:how we explain to people what we do.
Ray Brown:And it really is about process driven transformation.
Ray Brown:That, that, that's the story.
Ray Brown:There's a lot of, um, a narrative in architecture
Ray Brown:covers
Ray Brown:a whole lot of ground, but typically architecture is very hard.
Ray Brown:nobody understands this.
Ray Brown:It's hard to sell a value.
Ray Brown:All of those things may be true, uh, but architects, they work in
Ray Brown:a nice office, there's a need for the product, um, they don't have
Ray Brown:factories, vehicles, uh, distribution, warehouses, you know, it's a pretty
Ray Brown:simple business that you sell a service, you deliver that service well, and
Ray Brown:you've effectively got a good business.
Ray Brown:One of the fallacies we find, um, is that people think if I only had
Ray Brown:more business, if I only had more projects, I would be fine, which
Ray Brown:is
Ray Brown:We need to fill the pipeline or we're going
Ray Brown:to
Ray Brown:run out of work.
Ray Brown:And
Ray Brown:it's, it's, it really is a
Ray Brown:fallacy
Ray Brown:because if you don't
Ray Brown:have a well run business sitting behind those
Ray Brown:projects, more work is probably
Ray Brown:the last thing
Ray Brown:that you need.
Ray Brown:So building those solid
Ray Brown:foundations
Ray Brown:across really what we call the four P's, the practice, projects, the
Ray Brown:people.
Ray Brown:And the perception that that's really
Ray Brown:the key
Ray Brown:to running a good
Ray Brown:business and understanding where are
Ray Brown:the opportunities in each of those
Ray Brown:areas to
Ray Brown:sharpen the business and squeeze out a little bit more, uh, whether
Ray Brown:that be revenue or profit.
Ray Brown:It's, it's,
Ray Brown:there's huge
Ray Brown:opportunities in there.
Jon Clayton:Okay.
Jon Clayton:Well, we're going to dig into that in a little bit more detail in a moment.
Jon Clayton:Before we do, why, why is this not happening already
Jon Clayton:in our industry as standard?
Jon Clayton:Why are we not, why is it not just the standard that we do get educated in this?
Ray Brown:Well, that's a great
Ray Brown:question.
Ray Brown:And there's a lot about architects and architecture.
Ray Brown:I didn't understand.
Ray Brown:And then conversation with one of my clients this afternoon,
Ray Brown:and I was asking him, you told
Ray Brown:me about
Ray Brown:a new
Ray Brown:house
Ray Brown:he's designing
Ray Brown:for himself.
Ray Brown:And he did this, he said,
Ray Brown:oh,
Ray Brown:it looks
Ray Brown:a bit like this, and there's a
Ray Brown:slab.
Ray Brown:And I said, why
Ray Brown:is it going to peak?
Ray Brown:Because all the architecture
Ray Brown:I see is flat roofed and things.
Ray Brown:And he was telling me about something that happened, I think it
Ray Brown:was in the 1930s, the, the grease.
Ray Brown:convention or something where there was
Ray Brown:a real decision among
Ray Brown:architects to leave the past behind.
Ray Brown:And I think that kind
Ray Brown:of thinking,
Ray Brown:um, and that leadership from the top has been very
Ray Brown:influential
Ray Brown:in architecture.
Ray Brown:And I was on a panel not so many years ago, uh, with someone,
Ray Brown:I was speaking about business.
Ray Brown:I had one of my clients there
Ray Brown:and
Ray Brown:I'm older architect.
Ray Brown:let's put it like that.
Ray Brown:Grabbed the
Ray Brown:microphone at one point,
Ray Brown:300 people in the audience, most of them struggling architects.
Ray Brown:And
Ray Brown:he said,
Ray Brown:what you people have got to realize
Ray Brown:is we're not an industry or
Ray Brown:a business.
Ray Brown:we're a profession.
Ray Brown:Now, I don't know what that means.
Ray Brown:I really do
Ray Brown:not know what that means.
Ray Brown:If you run your own business,
Ray Brown:whether you like it or not, you're in business.
Ray Brown:And
Ray Brown:that smacks to me of
Ray Brown:a
Ray Brown:little bit of arrogance.
Ray Brown:You know, it smacks of a little bit of
Ray Brown:naivety.
Ray Brown:And it's pretty, pretty
Ray Brown:widespread in the industry that, that
Ray Brown:the leadership and industry, and particularly the,
Ray Brown:the, um,
Ray Brown:industry
Ray Brown:bodies, um,
Ray Brown:we've had in
Ray Brown:some cases, there's real exceptions and they're
Ray Brown:quite happy to embrace what we do.
Ray Brown:But.
Ray Brown:Without naming names, there are certain big organizations that, that
Ray Brown:either they see us as competition
Ray Brown:or not required, or, um, we don't need to be taught about that
Ray Brown:stuff.
Ray Brown:We've been doing it a long time.
Ray Brown:So that, that, we come
Ray Brown:up against that
Ray Brown:a lot.
Ray Brown:But
Ray Brown:we, to
Ray Brown:be honest, we've stopped trying.
Ray Brown:We deal with the people who, uh, we, we say
Ray Brown:we're looking for
Ray Brown:energized searchers, people who are looking For
Ray Brown:a better
Ray Brown:way, looking
Ray Brown:for a
Ray Brown:better outcome and we can deliver that better outcome.
Ray Brown:So they're
Ray Brown:happy, we're happy, and the ignorant mass is just,
Ray Brown:well, good luck for them.
Jon Clayton:That's really interesting.
Jon Clayton:There's a couple of things in that there isn't there, but that thing of
Jon Clayton:some of those preconceptions that there are within the industry about, I think
Jon Clayton:we're often sort of led to believe that, you know, your work, like, just.
Jon Clayton:You show your, your great design work and that should just bring in the customers.
Jon Clayton:And it's like, there's this whole tortured artists thing of like, you know,
Jon Clayton:we, the, the, oh, well architectures is different to other businesses.
Jon Clayton:It's different.
Jon Clayton:It's not the same.
Jon Clayton:It's, you know, it's, it's interesting that that point you make that,
Jon Clayton:you know, business is business.
Jon Clayton:If you want to be successful in the architecture industry, you
Jon Clayton:want to have a successful practice.
Jon Clayton:Actually, it's a service business.
Jon Clayton:Whether you're serving your clients helping design a building for them,
Jon Clayton:or whether it's some other type of consultancy, it's, it's a service business
Jon Clayton:essentially, and, um, a lot of those business principles that should apply
Jon Clayton:universally, not, it's not like we're sort of, oh, well, it's architecture.
Jon Clayton:So it needs this totally, totally different way of doing things.
Jon Clayton:I think there is a kind of few misconceptions there about business
Jon Clayton:and architecture generally.
Ray Brown:You used the word a few there.
Ray Brown:I think it's a much bigger number than just a few.
Ray Brown:People,
Ray Brown:people buy things to solve
Ray Brown:their problems.
Ray Brown:Okay.
Ray Brown:that, everything.
Ray Brown:Not, not just architecture.
Ray Brown:And typically people buy confidence.
Ray Brown:That you're
Ray Brown:going to solve my problem
Ray Brown:and
Ray Brown:perceived value that you're not going to overcharge for what you're doing.
Ray Brown:And that's a, that
Ray Brown:can be
Ray Brown:a learning skill, how you
Ray Brown:communicate that value.
Ray Brown:So our business started and we were told to start a new business,
Ray Brown:you need market research.
Ray Brown:So we got 10 architects around the table and
Ray Brown:my
Ray Brown:business partner at the
Ray Brown:time,
Ray Brown:she and I sat down
Ray Brown:and we brainstormed a few questions.
Ray Brown:What
Ray Brown:are we going
Ray Brown:to ask these guys?
Ray Brown:And the number one
Ray Brown:question was,
Ray Brown:what's the value of architecture?
Ray Brown:We
Ray Brown:were thrown out of that restaurant
Ray Brown:at 1030
Ray Brown:and we hadn't got to
Ray Brown:question
Ray Brown:number two,
Ray Brown:okay, because they were
Ray Brown:still arguing amongst
Ray Brown:themselves and
Ray Brown:big discussion.
Ray Brown:If you're in
Ray Brown:a, if you're in an industry
Ray Brown:finds it that hard to communicate your value, and there
Ray Brown:is value in architecture,
Ray Brown:I'm
Ray Brown:not sure I could argue that.
Ray Brown:articulate
Ray Brown:it properly, even after five
Ray Brown:years of working with architects.
Ray Brown:A lot of them are
Ray Brown:different.
Ray Brown:You need to position yourself properly as
Ray Brown:an architectural practice.
Ray Brown:And if you're not, if
Ray Brown:you're one of the
Ray Brown:many architects
Ray Brown:around who puts
Ray Brown:a picture of a building on the home page of the website and more
Ray Brown:or less
Ray Brown:says, if you want one of
Ray Brown:those, come to us Then you're missing such a huge opportunity
Ray Brown:to differentiate because
Ray Brown:whether you like it or not,
Ray Brown:there's a lot of people in your market who will be able to
Ray Brown:deliver a very similar building
Ray Brown:in the same
Ray Brown:time,
Ray Brown:same way, same process.
Ray Brown:So you've got to really got
Ray Brown:to find ways
Ray Brown:of being a
Ray Brown:better business.
Ray Brown:It's such a
Ray Brown:big opportunity for people is to
Ray Brown:run a better business
Ray Brown:so that you get more work and
Ray Brown:you differentiate yourself from your competition.
Jon Clayton:Remember.
Jon Clayton:Don't forget to download the architecture business, blueprint the
Jon Clayton:step by step formula to freedom for architects, architecture, technologists,
Jon Clayton:and architecture designers.
Jon Clayton:You can grab the blueprint without any charge@architecturebusinessclub.com
Jon Clayton:forward slash blueprint.
Jon Clayton:And if you enjoy this episode, then please leave a five star review or
Jon Clayton:rating wherever you listen to podcasts.
Jon Clayton:Now, back to the show.
Jon Clayton:So Ray, let's swing things back around then to, um, something
Jon Clayton:that we mentioned a moment ago.
Jon Clayton:I wanted to just dig in actually to your approach.
Jon Clayton:Like what is , the Archie biz approach to foundational business education?
Jon Clayton:Could you tell me a little bit more about
Jon Clayton:that?
Ray Brown:I could, I could.
Ray Brown:Um, you, you're like
Ray Brown:a lot of people,
Ray Brown:you,
Ray Brown:you, you're
Ray Brown:an architect
Ray Brown:every day of the week and
Ray Brown:you see that configuration letters.
Ray Brown:Uh, but when you see
Ray Brown:it in a different context,
Ray Brown:you say arch instead of
Ray Brown:arc.
Ray Brown:No.
Ray Brown:Architect.
Ray Brown:Um,
Ray Brown:I'll let you off
Ray Brown:this time.
Jon Clayton:thanks Ray.
Ray Brown:foundational business education, it's
Ray Brown:just, which are the basics?
Ray Brown:It's understanding
Ray Brown:you What
Ray Brown:are
Ray Brown:the things related?
Ray Brown:So there are
Ray Brown:really.
Ray Brown:three key areas, or four key areas that we speak about.
Ray Brown:We
Ray Brown:encourage people to meet once
Ray Brown:a month to speak about the business, to
Ray Brown:work
Ray Brown:on the business, not in the
Ray Brown:business.
Ray Brown:It's,
Ray Brown:it's what we
Ray Brown:call a board meeting.
Ray Brown:And architects, we're too small to have a board meeting.
Ray Brown:But
Ray Brown:then
Ray Brown:when do you speak about the business?
Ray Brown:The business, when do you speak
Ray Brown:about strategy?
Ray Brown:Oh,
Ray Brown:well, we just have an occasional meeting of the directors or whatever.
Ray Brown:So
Ray Brown:start with finance.
Ray Brown:Finance, again, it's a very simple process.
Ray Brown:It's the business scorecard.
Ray Brown:Where are you winning?
Ray Brown:Where are you
Ray Brown:losing?
Ray Brown:What's going well?
Ray Brown:What's not?
Ray Brown:Um,
Ray Brown:operations is the
Ray Brown:second.
Ray Brown:component.
Ray Brown:That's how you do what you do.
Ray Brown:So improving your utilization,
Ray Brown:improving your budgeting,
Ray Brown:improving your
Ray Brown:management of projects.
Ray Brown:Then we've got sales and
Ray Brown:marketing.
Ray Brown:Are you bringing in the right projects at
Ray Brown:the right time, at the
Ray Brown:right price?
Ray Brown:And finally, this project.
Ray Brown:So every business needs to have a range of
Ray Brown:ongoing projects that may be new software or a new office
Ray Brown:or
Ray Brown:something that's a standalone
Ray Brown:time limited project
Ray Brown:that needs to get reported
Ray Brown:somewhere.
Ray Brown:So that monthly meeting allows
Ray Brown:management
Ray Brown:of the business or the leaders of the business
Ray Brown:to look
Ray Brown:at the finance.
Ray Brown:to the operation, to the sales
Ray Brown:and marketing,
Ray Brown:um, and the progress in the various projects that are ongoing.
Ray Brown:And, and what we
Ray Brown:bring is we bring the templates to make that
Ray Brown:overseeing really easy.
Ray Brown:Okay.
Ray Brown:There
Ray Brown:are standard things in, in, in business.
Ray Brown:The
Ray Brown:one that I like the most, if I, if I was an architect, I would want to know
Ray Brown:the six month rolling average of work secured.
Ray Brown:So picking up work in an architecture
Ray Brown:practice can be
Ray Brown:lumpy, But if you take the last six months of work that you've
Ray Brown:won, you divide
Ray Brown:it by six
Ray Brown:and you
Ray Brown:record that number.
Ray Brown:If
Ray Brown:you record that every month, That will show you whether you're picking up enough
Ray Brown:work to pay the bills in the future and
Ray Brown:make a profit, or if
Ray Brown:that's dwindling and you may have
Ray Brown:to cut resources.
Ray Brown:So it's all about
Ray Brown:looking to the future, forecasting
Ray Brown:and not looking to the past
Ray Brown:in terms of how the business performs.
Jon Clayton:I love that.
Jon Clayton:There's a couple of great takeaways in there.
Jon Clayton:That's just a really useful.
Jon Clayton:KPI, Key Performance Indicator that, that any practice could use.
Jon Clayton:They could use that right away now.
Jon Clayton:Couldn't they?
Jon Clayton:That sort of six months of, um, projects secured.
Jon Clayton:I love what you're doing with the monthly board meeting can we just recap
Jon Clayton:on those different categories there?
Jon Clayton:So there was finance.
Ray Brown:Finance
Ray Brown:number one.
Ray Brown:So finance
Ray Brown:is the scorecard.
Ray Brown:Are
Ray Brown:we winning?
Ray Brown:Are we losing?
Ray Brown:Operations is
Ray Brown:number two.
Ray Brown:So the, the,
Ray Brown:the,
Ray Brown:the, there are KPIs
Ray Brown:around
Ray Brown:operations too.
Ray Brown:utilization, throughput, all
Ray Brown:of those things.
Ray Brown:Um,
Ray Brown:the, the amount of return that
Ray Brown:we, strictly speaking, architects are in a very simple business in terms of business
Ray Brown:model.
Ray Brown:We buy ours
Ray Brown:and we convert that into revenue.
Ray Brown:There's a
Ray Brown:lot of design stuff
Ray Brown:within the middle.
Ray Brown:Absolutely.
Ray Brown:That's the
Ray Brown:product.
Ray Brown:But the business model is Buying hours, selling
Ray Brown:hours.
Ray Brown:So making that
Ray Brown:conversion is the operations piece and
Ray Brown:that needs
Ray Brown:to be as efficient as possible.
Ray Brown:And thirdly, we've got sales and marketing, which is bringing
Ray Brown:in the right work at the right time through the business.
Ray Brown:And the last one is projects, special projects to improve the business.
Jon Clayton:And again, that's, it's a really simple framework that you've
Jon Clayton:integrated that into the, the, the program that you have and, but also
Jon Clayton:there's something there that I think that if maybe there's somebody out there
Jon Clayton:that's listening to the show, and they're maybe thinking, I maybe don't have
Jon Clayton:the resources right now, or, you know, the money to invest in a, in a program
Jon Clayton:like, like raise that there's actually, they could actually create their own
Jon Clayton:board meeting, or maybe they could have a buddy that they could do that with.
Jon Clayton:They're not going to obviously get access to ready made frameworks
Jon Clayton:and that additional support.
Jon Clayton:But if you're looking at making a marginal improvement in what you're doing
Jon Clayton:already, that would be such a useful thing that people could start doing.
Ray Brown:I think so, um, and much as I don't want
Ray Brown:to disagree with the host,
Ray Brown:but, you know, this
Ray Brown:is, this
Ray Brown:is not, that's an
Ray Brown:investment.
Ray Brown:It's not a cost.
Ray Brown:And if you're short of money,
Ray Brown:this program costs,
Ray Brown:uh, 2, 000, 1, 990, whatever it is.
Ray Brown:What
Ray Brown:we find is a lot of architectural practice.
Ray Brown:They'll spend much
Ray Brown:more than that on, on photographs of a
Ray Brown:building.
Ray Brown:You know, they finish a building and it's going to be
Ray Brown:done by a professional.
Ray Brown:It's going to be laid out by, uh,
Ray Brown:Somebody that sets
Ray Brown:up the
Ray Brown:stage to be photographed, I have nothing
Ray Brown:against that,
Ray Brown:but to put
Ray Brown:that amount of value on that and not get the basic business education
Ray Brown:and the way
Ray Brown:to look at the
Ray Brown:business education is you're going to get a
Ray Brown:return on that investment
Ray Brown:for the next five years, 10
Ray Brown:years, 15 years, the number of people
Ray Brown:who
Ray Brown:have said to me that I wish I'd done your program,
Ray Brown:um, 25 or
Ray Brown:30
Ray Brown:years ago, cause it would have
Ray Brown:changed my life.
Ray Brown:okay?
Ray Brown:I'll be implementing stuff now, but had I known this back then, I would have Life
Ray Brown:would have been a lot better.
Ray Brown:So in terms of lifetime value,
Ray Brown:we give
Ray Brown:people lifetime access to
Ray Brown:the product.
Ray Brown:We're always adding to it.
Ray Brown:We've got a community, we've got regular
Ray Brown:forums.
Ray Brown:It's
Ray Brown:not, it shouldn't be, it should be
Ray Brown:seen
Ray Brown:as an investment and an
Ray Brown:investment that people say,
Ray Brown:I've
Ray Brown:got to come up with a really
Ray Brown:good reason for not doing
Ray Brown:this.
Ray Brown:Okay.
Ray Brown:Why, why would I not do this?
Ray Brown:And shortage of money
Ray Brown:at that level
Ray Brown:shouldn't
Ray Brown:be a constraint
Ray Brown:because that
Ray Brown:If you can't raise that amount of money to do
Ray Brown:the program or speak to us about
Ray Brown:spreading the cost
Ray Brown:over time,
Ray Brown:uh, then you've got to look in the mirror and say, am I really
Ray Brown:in business
Ray Brown:here?
Jon Clayton:I, I can't disagree with anything that you've said there.
Jon Clayton:I guess I was using the example more with like startups in minds.
Jon Clayton:I've had some conversations recently with some people that are literally just
Jon Clayton:starting out which is an argument to say it would be the perfect time for them to
Jon Clayton:do the program, they don't have a pipeline of, of work already kind of lined up.
Jon Clayton:Maybe before they're, The ready to make the investment, which I appreciate is,
Jon Clayton:it's not actually a lot of money really in the world of running a business.
Jon Clayton:It's actually, as you say, you could spend more on a set of photos for a project.
Ray Brown:I think it's a really
Ray Brown:good, good conversation to be had.
Ray Brown:And it's not me banging the drum and saying, buy our program,
Ray Brown:buy someone else's program or
Ray Brown:get, get yourself a business coach locally.
Ray Brown:I'm not,
Ray Brown:not in
Ray Brown:the business.
Ray Brown:We're not the
Ray Brown:only
Ray Brown:people doing this kind
Ray Brown:of
Ray Brown:work.
Ray Brown:Uh, but I would
Ray Brown:come back to that startup
Ray Brown:week.
Ray Brown:Sell the program to a lot of
Ray Brown:startup
Ray Brown:people
Ray Brown:and
Ray Brown:they're the ones who are going
Ray Brown:to do
Ray Brown:well,
Ray Brown:okay, because
Ray Brown:they're thinking from day one that they're a
Ray Brown:business owner,
Ray Brown:not an architect.
Ray Brown:Exclusively.
Ray Brown:Okay, the getting some work and winning some money
Ray Brown:and
Ray Brown:get get the systems and
Ray Brown:processes set up at the beginning.
Ray Brown:Okay,
Ray Brown:business.
Ray Brown:Business is
Ray Brown:not a no cost startup.
Ray Brown:Architects tend to take it like that, that you've
Ray Brown:got some work and now
Ray Brown:I can feed the family and do the stuff.
Ray Brown:I
Ray Brown:do think that
Ray Brown:that
Ray Brown:that
Ray Brown:ends up with you having
Ray Brown:a job.
Ray Brown:Rather than a business.
Ray Brown:So the choice is yours.
Ray Brown:Are you going out on your own
Ray Brown:to feed the family and do
Ray Brown:your own work, which is obviously the driving, often the driving force,
Ray Brown:or do
Ray Brown:you really want to be in business and that business happens to be architecture?
Jon Clayton:What I hope is that by people that are in those early stages,
Jon Clayton:by Accessing things like this podcast and listening to these conversations
Jon Clayton:that we can help educate them in the value of investing in themselves and
Jon Clayton:their business and doing it as early as possible, because it can save so much
Jon Clayton:time, stress and hassle and set you up for success far sooner than otherwise.
Jon Clayton:Because I mentioned earlier that I made just about every mistake possible.
Jon Clayton:And it's because of that lack of business education at the very beginning.
Jon Clayton:But I think that the time when people probably needs that education
Jon Clayton:most, they have to kind of get to this realization point themselves
Jon Clayton:that, Oh yeah, I actually, I do need to invest in this thing.
Jon Clayton:People aren't always.
Jon Clayton:there when they need to be even though there's a solution there for them
Jon Clayton:that can help them out, they might not be at the point when they, um,
Jon Clayton:are quite ready to go ahead with it.
Jon Clayton:So I hope that, you know, people will listen to this and think, whoa, actually
Jon Clayton:this is a knowledge gap that I have.
Jon Clayton:And I'm actually listening to this.
Jon Clayton:I do need to do something about it and perhaps a bit sooner than
Jon Clayton:I would have done previously.
Ray Brown:Yeah, no, you're absolutely right.
Ray Brown:I think there is
Ray Brown:a, there is a movement
Ray Brown:around.
Ray Brown:Okay.
Ray Brown:We shouldn't have been able to set up Archibus five years ago
Ray Brown:and be
Ray Brown:virtually the only people
Ray Brown:that we think who are providing a practical, holistic, systems
Ray Brown:based program
Ray Brown:specifically for
Ray Brown:architects.
Ray Brown:Okay.
Ray Brown:There's lots
Ray Brown:of.
Ray Brown:People out there, there are lots
Ray Brown:of
Ray Brown:webinars, there's lots of courses, there's
Ray Brown:lots of things.
Ray Brown:Typically what happens is
Ray Brown:that you attend a course, and then you come back tomorrow into a
Ray Brown:business that's really working hard.
Ray Brown:And, you
Ray Brown:know, when do
Ray Brown:you find time to
Ray Brown:put it in?
Ray Brown:And how do I reconcile the financial
Ray Brown:advice I'm getting with the marketing advice I'm
Ray Brown:getting?
Ray Brown:And what we
Ray Brown:think we bring to the party is, this is how to set priorities, and this is how to
Ray Brown:really evolve
Ray Brown:your business
Ray Brown:in.
Ray Brown:the right direction.
Ray Brown:This one, uh, one hour meeting a month, one and a half hours
Ray Brown:at the very most.
Ray Brown:And what
Ray Brown:we say is if, if
Ray Brown:you
Ray Brown:make five decisions every month, that improves your business, that's 60
Ray Brown:in a year.
Ray Brown:That
Ray Brown:will transform your business.
Ray Brown:That's, that's process
Ray Brown:driven transformation in action.
Ray Brown:So there's no magic wand.
Ray Brown:This is not a unicorn.
Ray Brown:We
Ray Brown:have lots of
Ray Brown:clients who were losing money, making money, making
Ray Brown:a little, losing a little.
Ray Brown:And now the target that we set our clients is 15 to 20 percent net profit.
Ray Brown:After a salary
Ray Brown:is paid
Ray Brown:to the, at a market rate paid to the people working in it, including
Ray Brown:the owners.
Ray Brown:So if you're not getting 15 to 20 percent
Ray Brown:return on your investment
Ray Brown:and creating employment and the work you're doing
Ray Brown:in the market, you really need to, as
Ray Brown:I
Ray Brown:say, look in
Ray Brown:the mirror and say, am
Ray Brown:I running a real business or is
Ray Brown:this something that needs work?
Jon Clayton:There's a misconception there with, with, with having a business or
Jon Clayton:running a business or being in business.
Jon Clayton:We often say that we run a business, whereas actually you've created a job.
Jon Clayton:You might be in business, but you don't necessarily have a business.
Jon Clayton:And that's an interesting distinction there, um, which I just wanted
Jon Clayton:to point Pick up on, cause it has come up on, on other occasions
Jon Clayton:as well in the conversations.
Jon Clayton:That's been really interesting, Ray.
Jon Clayton:Thanks for talking us through that.
Jon Clayton:I guess I want to try and round things up now.
Jon Clayton:What, what'd be the main thing that you'd like everyone to take
Jon Clayton:away from this conversation?
Ray Brown:Well, I
Ray Brown:suppose beyond getting
Ray Brown:some foundational business education, if you want one
Ray Brown:specific thing,
Ray Brown:it would be around financial
Ray Brown:literacy.
Ray Brown:And that, that's something
Ray Brown:that, that architects will say, I don't want to be
Ray Brown:an accountant.
Ray Brown:And that's not, I'm an architect.
Ray Brown:And, um,
Ray Brown:I was
Ray Brown:38 and had
Ray Brown:three businesses and
Ray Brown:I really didn't know the difference
Ray Brown:between a profit and loss in a balance sheet.
Ray Brown:We
Ray Brown:cover that in the program.
Ray Brown:And when I used to be running courses for, for
Ray Brown:fairly senior managers, I would say,
Ray Brown:do you want me to go through the basics of
Ray Brown:finance?
Ray Brown:And most people said yes, because you don't get taught that And your accountant
Ray Brown:with the best will in the world.
Ray Brown:Accountants are not.
Ray Brown:Very good teachers.
Ray Brown:You don't see that as part of the role.
Ray Brown:They're about
Ray Brown:accuracy
Ray Brown:and all that stuff.
Ray Brown:So
Ray Brown:getting some financial literacy
Ray Brown:at a basic level, so you know regularly how
Ray Brown:your business is performing, both
Ray Brown:forecasting and historically.
Ray Brown:So you want early warning, you
Ray Brown:want what we call lead indicators, not
Ray Brown:lag indicators, not
Ray Brown:something that tells you where you've been in the past.
Ray Brown:Something that
Ray Brown:says, I've got a pretty good feel for where we'll be in six months
Ray Brown:time or a year.
Ray Brown:so that would be
Ray Brown:my key.
Ray Brown:And
Ray Brown:that would be the same
Ray Brown:advice to any business owner.
Ray Brown:If you don't have basic
Ray Brown:financial literacy, um, then you really are missing a big piece of the
Ray Brown:jigsaw.
Jon Clayton:Brilliant.
Jon Clayton:Sage advice.
Jon Clayton:Ray, was there anything else that you, you wanted to add that we, we haven't covered?
Ray Brown:Oh,
Ray Brown:that's
Ray Brown:a great
Ray Brown:question and we've covered a lot and
Ray Brown:I'm
Ray Brown:a
Ray Brown:very passionate, hope it's come across that I am passionate about helping
Ray Brown:architects
Ray Brown:and I'm just so glad that, um, there seems to
Ray Brown:be a groundswell of recognition that this is required, you
Ray Brown:know, particularly from some of the younger leaders
Ray Brown:in, uh, in architecture, and
Ray Brown:I would just encourage
Ray Brown:everybody to reach out
Ray Brown:and not necessarily
Ray Brown:buy
Ray Brown:something tomorrow, but find out what they're not buying.
Ray Brown:okay, find out what
Ray Brown:they're missing.
Ray Brown:and
Ray Brown:not
Ray Brown:perpetuate this architecture
Ray Brown:is different, you know, nobody understands this life's hard.
Ray Brown:Nobody
Ray Brown:wants to hear that story.
Ray Brown:I want to speak
Ray Brown:to, There are plenty of successful, profitable
Ray Brown:architectural businesses out there
Ray Brown:and we deal with a lot of them.
Ray Brown:So I, I,
Ray Brown:I have no
Ray Brown:time for the doom and gloom
Ray Brown:stories.
Jon Clayton:Oh, absolutely not.
Jon Clayton:There's too much negativity out there already.
Jon Clayton:We don't need any more of that, do we?
Jon Clayton:I like to kind of concentrate on the positive side of things.
Jon Clayton:And there are a lot of positive things that we can talk about.
Jon Clayton:So, um, yeah, thanks.
Jon Clayton:So thank you so much, Ray.
Jon Clayton:There's one other question that I wanted to ask and it's
Jon Clayton:nothing to do with architecture.
Jon Clayton:Just a regular question.
Jon Clayton:I like to ask all of the guests.
Jon Clayton:I, I love to travel and discover new places.
Jon Clayton:And I just wondered if you could tell me about One of your favorite
Jon Clayton:places and what you love about it.
Jon Clayton:Oh,
Ray Brown:Well, I think if people look up,
Ray Brown:uh, a place called Mount Martha on, which I now
Ray Brown:write a Melbourne,
Ray Brown:um, we're fortunate enough to go down
Ray Brown:there most weekends.
Ray Brown:It's got the most beautiful beach, and
Ray Brown:the
Ray Brown:beach is,
Ray Brown:um, a row
Ray Brown:of very
Ray Brown:colourful beach boxes.
Ray Brown:The, the beach is pristine.
Ray Brown:Uh, when we bought our place down there, it was pristine.
Ray Brown:pretty
Ray Brown:unknown.
Ray Brown:It's getting a little bit more
Ray Brown:popular
Ray Brown:now,
Ray Brown:but
Ray Brown:I've traveled
Ray Brown:many places and
Ray Brown:been on many beaches,
Ray Brown:but
Ray Brown:none
Ray Brown:of them match up
Ray Brown:to
Ray Brown:Mount Martha on the Mornington Peninsula.
Ray Brown:And the extra bit
Ray Brown:on that is that
Ray Brown:within 25 minutes of my
Ray Brown:house,
Ray Brown:there are 65 vineyards.
Ray Brown:So there's
Ray Brown:plenty, plenty of wine tasting and lunches
Ray Brown:to be had around the peninsula.
Ray Brown:So great place.
Ray Brown:Great place to be.
Jon Clayton:that sounds fantastic.
Jon Clayton:Ray, thanks again.
Jon Clayton:Thanks so much for coming on the show and sharing your expertise with us.
Jon Clayton:I really appreciate it.
Jon Clayton:Could you let everybody know where is the best place to connect with you
Jon Clayton:online if they want to get in touch?
Ray Brown:Yep, happy
Ray Brown:to,
Ray Brown:you can find me on
Ray Brown:LinkedIn, um, Ray Brown, uh, with Archibiz,
Ray Brown:or my email address is ray at
Ray Brown:archibiz, uh,
Ray Brown:dot global.
Ray Brown:So I
Ray Brown:would encourage you to go and check out the business foundations program
Ray Brown:or reach out to me
Ray Brown:directly.
Ray Brown:I'm
Ray Brown:quite happy to
Ray Brown:have a chat, always up
Ray Brown:for a zoom call, speak about architectural
Ray Brown:business and how we
Ray Brown:can
Ray Brown:help.
Jon Clayton:Brilliant.
Jon Clayton:And can you please remind everyone, um, the, the web address for the
Jon Clayton:business foundations program?
Jon Clayton:Can you remind everyone of that, please?
Ray Brown:Archibiz dot global
Ray Brown:forward slash
Ray Brown:BFP.
Jon Clayton:That's brilliant.
Jon Clayton:Thanks so much, Ray.
Ray Brown:Pleasure.
Ray Brown:Thanks for inviting
Ray Brown:me.
Jon Clayton:Thanks so much for listening to this episode
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Jon Clayton:You can find a link to my profile in the show notes.
Jon Clayton:Remember.
Jon Clayton:Running your architecture business.
Jon Clayton:Doesn't have to be hard and you don't need to do it alone.
Jon Clayton:This is architecture business club.