...2,000 employees, but we could use about 200 more.” This has led to a major renewal among design firms to recruit and retain people.

The lack of people to do the work has caused some firms to alter their human resources policies. “In the past, we may have looked for a person from the county or area around the local office that needed that person,” says Charles Dalluge, executive vice president of Leo A Daly. “Now, we are in a continuous recruitment mode.” He says that all local offices are tasked with finding people, and are not limited to the local area where they work. “If we find a good candidate in North Dakota who is willing to relocate, we want that person,” he says.

Many firms are finding the answer in exposing young people to their firms early. “We are increasing our internship program dramatically this year,” says Roehling of SmithGroup. “Once a young person sees the work environment and the quality of projects we work on here, we are confident that they will want to come to work with us full-time after they graduate.”

The real trick is retaining good people once they join the firm. Many lament the fact that firms constantly are stealing people from each other. So retention has become a priority. “Retention is not just about money,” says Glenn Bell, CEO of Simpson Gumpertz & Heger. “A lot of it is having interesting work, giving young people clear growth paths and opening up ownership opportunities.”

One thing the personnel crunch has done is give a boost to younger workers. “Everyone’s looking for experienced people, and firms are robbing each other of people left and right,” say Neimeyer. This means that firms that had recruited only experienced people in the past are recruiting in the schools now. “Younger people are being given greater responsibilities, which they love,” he says.

For some firms, recruitment and retention is old hat. “We have five full-time recruiters on staff,” says Heery’s Moynihan. The firm established Heery University, its in-house training program over 10 years ago, to ensure its staff is technologically sophisticated. “Other firms like to brag about their new training programs, but are they willing to spend millions the way we did to make sure their people are fully equipped for the job?” he asks.

CDI began as a staffing business. “We haven’t had to fight the image of being a staffing firm for quite a few years, but even as a full-service firm we continue to do staffing work,” says Giorgio. The firm still retains 170 recruiters. So now, it is marketing a new product, “Recruiting Process Outsourcing,” in which it will take over human resources recruiting functions for design firms, he says.

Modeling the Future

One of the most talked-about issues this year is the emergence of Building Information Management systems. “BIM is a real mindshift,” says Dalluge of Leo A Daly. “Every line on the screen means something and any change will have an impact on other elements of the design that have to be documented and communicated.” BIM systems allow these changes to be reflected. “Everyone has to be very knowledgeable in the system, but once everyone is on board with it, it’s a very powerful tool,” he says.

One major concern for BIM’s future is what system, if any, will become an industry standard. Several systems are emerging and are beginning to be used by designers, often as test platforms. “Autodesk’s Revit is quite powerful and it now has a structural tool and they promise to have an HVAC system released within the next month or two,” says Mahadev Raman, principal and buildings sector leader for Arup Americas. “And Microstation has a platform that a lot of people swear by.”

One firm that is experimenting broadly is Studios Architecture. “We came out of Silicon Valley and one of our first major clients was Apple, so we ended up working Macs rather than PCs,” says CEO Todd DeGarmo. The firm is trying out a wide variety of BIM platforms. “We have a team working on the Pentagon using Microstation. Another team is using Revit on a project and we have people using ArchiCAD on another project.” He says the firm has been working with ArchiCAD for a long time, “so 3D is ingrained in our culture.”

Many designers complain that the learning curve for BIM systems is steep, as are training costs. “It is very complicated and a major investment in training and you have to change your processes,” says Roehling of SmithGroup. But he says there will be a real “stratification between firms working with BIM, and those that don’t. The ones that don’t are going to fall by the wayside.”

Exporting Work

To meet the increasing demands brought about by a strong market and shrinking work force, firms increasingly are looking to outsource basic design and drafting to design centers in places like India. “We are constantly getting brochures from Indian firms saying, ‘We will do your drafting for you,’” says Eick of HMC.

But many see the outsourcing trend as ominous. “It’s a reflection that there is more work than people to do it,” says Wetzel. “But it also is a reflection that design is treated as a commodity here in the U.S.” Adds Raman: “The price differential between U.S. and Indian design work is roughly six-to-one, which makes such proposals for outsourcing hard to resist in a competitive market.”

Some firms are comfortable in the idea of offshoring on a limited basis. “I can see where you have a project where the client wants to add a couple floors to a building. I don’t see a problem with off-shoring the repetitive drafting that would require,” says DeGarmo of Studios Architecture. He says the role of the architect is to provide value and leadership in the design process, and not do repetitive drafting work.

Many firms wonder about the economics of offshoring. “There’s this fairyland view that while we are sleeping, engineers in India, China, Poland, or wherever are busy working on our designs and, when we wake up, you can step right in and take over,” says Marco Aieta, director of water practice at Carollo. “Designs have to be carefully coordinated. You can’t just hand it back and forth. It takes a big investment and you must have the right people to do the job.”

There also are political and social implications to offshoring. “We might have a client in Las Vegas who might object to having part of the work done in Phoenix. They want quick, local access to the people doing their design,” says Carollo’s Wirtel.

Offshoring has not been a successful experience for some firms. “We bought a firm in Manila about seven or eight years ago to help with drafting and simple design issues,” says Roehling. But after a few years, SmithGroup closed the subsidiary. “We found that design is a value-added exercise throughout the process and you just can’t hand off portions of the project to people from abroad,” he says.

For many firms, the refusal to offshore is a point of principle. “We have never done that. When you hire Leo A Daly, Leo A Daly people will be doing the work,” says Dalluge. Moynihan adds: “I want to be the one who hires the people working on Heery projects.”

There are those who look at offshoring as sending the wrong signals. “In the short-term, offshoring scratches an itch,” says Patton of ENGlobal. “But in the long term, I think it further discourages kids here in the U.S. from looking at engineering as a profession.”

One of the long-term concerns is that, as U.S. design firms farm out more and more work to these Indian and Chinese outsourcing facilities, they may be building design powerhouses that could become competitors to U.S. firms in the international market, or even in the U.S. market. “This happened in the information technology industry two decades ago, as IT firms shipped more and more of their work to low-cost centers,” says Raman. He points out that India-based IT firms like Cognizant and Infosys now are major players in the U.S. market. “They came over here to cut out the middleman—the U.S. firms,” he says.

However, not everyone is so pessimistic. “You’re not seeing in this industry what happened in so many other industries, where whole chunks of work were being farmed out to India or China with very little local input,” says CDI’s Giorgio. He says the U.S. design sector has been very careful and professional in outsourcing the basic drafting work while retaining in-house control over the value-added portions of the design.

Designing for the Future

There is a growing interest in sustainability in building design, led by the U.S. Green Building Council’s Leadership in Energy and Environmental Design standards here in the U.S. For example, the U.S. Army April 10 announced that it would be transitioning from its own sustainability project rating tool to LEED, beginning in 2008.

For many firms, the move toward sustainability is cultural. “Sustainability is just now becoming widespread,” says Roehling of SmithGroup. “Just about everything we do is LEED rated.” He says Ford Motor Co. Chairman William Clay Ford Jr. is a major advocate of sustainable design and that has spurred the concept in the Detroit area. “Further, the cost of a sustainable design is not that much more than traditional building. And with energy costs the way they are, sustainability makes economic sense.”

Many owners and designers do not see LEED as the be-all and end-all. “LEED is gaining a lot of traction,” says Raman. “However, many owners are saying that gaining LEED points is fine, but is the design really sustainable?” Raman notes that high energy prices have made the design of energy-efficient buildings more attractive to owners. He believes that in the upcoming years, energy efficiency will not only be attractive, but critical.

“There’s a theory called ‘Peak Oil’ that is gaining some notice,” Raman says. The theory is that we are slowly reaching peak production of oil. Once that peak is reached, worldwide oil production will begin a slow decline, while at the same time demand for petroleum products will increase from large developing countries like China, India, and Brazil, among others. “The current high oil prices aren’t a temporary thing, but something we will have to adjust to. So sustainability won’t be a luxury, but a necessity,” Raman says.

It’s a Small World After All

Design firms are continuing to move abroad to meet the demands of a globalized market. “Up until a couple years ago, we were happy to stay in the U.S. market,” says Simpson, Gumpertz & Heger’s Bell. Now, his firm is in China, the Emirates, Korea and Pakistan. “We are continuing to expand on both the energy and water side to prepare us to move into the global market,” says Wetzel of R.W. Beck. He notes that Beck already is working in Singapore and is looking to expand into other countries in Asia.

What is interesting is that, as the megafirms in the industry get bigger, they are providing an international market for smaller firms. “These big firms seem to be concentrating more on management, so they are providing a safe way for niche firms to get into the global market by subcontracting work to them on international projects,” says Bell.

Design executives also note a growing tendency for students from India and China, who used to attend university in the U.S. and then stay to work for U.S. companies, to return home after graduation. “It’s a sign of the economic growth and maturity of those markets that Indian and Chinese students are going home,” says Johinke. “But it also means that the talent pool in those nations is getting broader.”

Ironically, this trend is working to the benefit of some U.S. firms. Bell notes that some foreign-born engineers hired by Simpson Gumpertz left after a few years to return to their home countries. “At first, we were disappointed. But now, we are finding a positive as they are becoming our business partners with their new firms in their home countries,” he says.

There are many concerns about the future of design. Some see it gradually becoming one more price-driven element in the construction process. But CH2M Hill’s McIntyre disagrees. “Design is not a commodity,” he says. “For any project to be successful, you need the best design people possible for the job. That is not being a commodity. That is being a professional.”