MANAGING FEES -for Building Design practices PART – IV

Post 511 by Gautam Shah

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Building Design firms often provide many different design services, such as Architecture, Interior Design, Structure, Interiors, Landscape, etc. And within these broad range of groups, the actual services may relate to New constructions, Renovations, Alterations, Extensions, valuation and project assessment, project feasibility reports, etc. The projects, when handled simultaneously rarely remain within the confines of well-documented definitions. Like some pre-emptive work for interior or landscape design will occur in the architectural scheme. And when the post building construction, other services are prematurely terminated, the ‘pre-emptive’ work will not get paid.

Serpentine BP Pedestrian Bridge by architect Frank Gehry’s Buckingham Wikipedia image by Author Torsodog

The Louvre Museum

These services occur in different schedules, and their scopes are based on very different criteria. Building design fees are chiefly collected on the basis of floor spread or footprint, except in few countries where it may be based on hours spent on it. The floor spread based varies with the type of project. Fees charged for Architectural projects include the construction cost (built-up coast) + some extra for site development design works. Similarly structural design fees are computed on the construction costs, but that may be a small part, in comparison to costs of site development works like land contouring, retaining walls and other support entities. Interior Design fees cannot always be calculated on the basis of carpet area, as lot of materials and objects are retained or reused.

Maggie’s Care Centre, Glasgow, Scotland Wikipedia – Flickr image by Author scarpadog (Jon-Marc Creaney)

In a group or associated practices the savings occur from the seamless handling of a project. This occurs when common entities are detailed or specified just once. Like for Landscape design site structures (pavings, curbs, retaining walls, water-body formations) are specified with architectural details. Electrical layout for architecture and Interior design is nearly identical.

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Das Haus der Deutschen Kunst in München.

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Yet, in all these, the most important issue, vis a vis a client that comes through is, What should be, and How to determine the Cost of the job? The term Total Cost of Job nominally means to include all the costs of actually executing the designed job, similar costs of inputs from other design consultants or agencies, and the cost of all the peripheral work executed on the site through or by owners themselves or their agents, during the Currency period of the Design Services. The total Cost of Job will also include the estimated value of the work being preserved or maintained on the site.

interior-of-maintenance-shop Public Domain images by Hillebrand Steve, U.S. Fish and Wildlife Service

At the start of a design project, the total cost of the job, is not available. As a result some notional figure is determined, to bill the first installment of fees or a lump-sum figure is used for first bill. This figure is determined on the basis of total cost of the job, but more importantly the intellectual rights of design formation. To determine the cost of a job, spread of the job or the built-up area is very useful. Structural engineers often base the fees on RCC (or structural) component of the project or a percentage of fees payable to the architect. Interior designers base their fees on Carpet area, but more surely on Interior Design intervention area, which is more rational or realistic. In spite of this in a group or associated practices it becomes difficult to derive a common fee’s formula.

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The Louvre Museum

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HOW DO PROFESSIONALS and CLIENTS SEEK EACH OTHER ?

Post 484  by Gautam Shah

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Professionals and clients seek each other in a variety of ways. A client can go about it without any inhibitions, whereas a professional can go about it with certain restrictions, depending on the type ethics followed by the profession. Client and professional come to know about each other primarily through intermediaries like friends, relatives and so on. However, in a rare case, the client may contact a professional directly after seeing or experiencing the work as a real entity, sketch or a publication about it.

CLIENTS’ approach

A lay-person as an Individual is always free to appoint any person as an adviser or helper for the professional services. Here no Government regulations or rules of the professional bodies like council or guild can be operative. Perhaps by dealing with ‘unrecognized professional’ one may not get legal protection or redressal.

When an organization, as a client is not allowed, or authorized to deal with any professional, on a person to person basis; a process for an appropriate selection of a professional is required. The process of selection begins with invitations offered to:

  • any competent member of society,
  • member of bodies with a certain level of competence
  • members of a body who necessarily have certain level of competence.
  • persons belonging to a certain geographical region, experience, age, sex, nationality, religion.

For complex jobs, selection of a professional is done through a competition, wherein professionals are required to tackle certain essential components of the job, or offer a holistic concept towards the issue.

Intermediary

A client may not contact a professional, unless there is some foreknowledge, reference or suggestion by someone. This usually comes through another professional, like a financial adviser. Members of the society usually know where and how to locate professionals of well established or traditional fields. However, in newer branches of human skills, the professional and the client do not have an appropriate forum to interact. In such situations, the intermediary professionals help to bring together the potential clients and professional.

PROFESSIONALS’ approach

A professional on realizing a person’s potential as a client, may seek the person directly or through a mutual acquaintance or a friend. However, if the person concerned is a potential client in the official capacity (employed official of Government or private organization), than an official appointment with the clear declaration of intent is necessary.

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A professional can seek a client in a variety of ways. Most of the professional bodies regulate a professional’s exposure and consequently the behaviour with the society in general and with potential clients in particular. Many professional bodies discourage direct advertisements by professionals to seek clients and assignments. “An advertisement however effective cannot project the professionalism or the competence of a professional”. It provides an undue advantage to the user.

Lawyer of the years

Most professional organizations believe that professionals should receive jobs in proportion to their professionalism and not their capacity to project through media. Paying out any consideration or any promise to that effect, to procure a job is also considered unethical. Problems of this ground arise; when a person is a client on the basis of the official position (so is capable of selecting / appointing and compensating a professional).

1024px-Consultation_-_Health_Check-up_Camp_-_Howrah_Swamiji_Sangha_-_Dumurjala_-_Howrah_2015-04-12_7598Cultivation of social contact is the most common method for a professional to come into contact with a potential client. Other Personal approaches include, specific letters, generalized bulletins, telephonic calls and face to face meetings. The impression created through a meeting or telephonic call may not be of desired type and intensity. Letters are very objective, last longer but have to be brief to be effective. Professionals get clients from other professionals. Here their competence is assured by the referring person.

Bio-data or resume is ever lasting, and very effective medium of exposure. Bio-data may contain basic information about the person, professional achievements and competence. Bio-data could be a very specific document, prepared (tailor made) for a potential client or could also be a generalized document that may serve to a set of potential clients with similar needs. Bio-data could be a very general introduction, good for any person whether potential client or a lay person.

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A bio-data that is tailor made, may reveal or emphasize data that is relevant to that particular exposure. Concealment or non emphasis of data in such a bio-data is intentional and is generally not unethical though could be malafide. General bio-data tends to create impression of a commodity pamphlet. Creative professionals generally do not favour this type of medium. Internet has become an ideal medium for placing a Bio-data. A digital document is very flexible and accessible worldwide.

In dealings with clients, what kinds of behaviour, actions or attitude are considered as unethical, malafide or bad, varies from country to country, region to region, profession to profession, and time to time. In professions where rules regarding behaviour have not been formalized, it may vary even from a professional to professional.

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PROFESSIONAL FEES

Post 475 —by Gautam Shah

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Rare professional skills earn a high return in society. Sometimes a professional also earns more by exhibiting exemplary behaviour or professionalism. An experienced professional earns more than an amateur or novice. A young professional with fresh or new talent may demand more fees. Professional fees are often suggested or prescribed by their bodies, public groups or Government, yet professional fees remain subjective and negotiable. It is private understanding or a covenant, sometimes secretive, and no one else needs to know or be informed about it. Professional fees are very subjective. A professional may charge different set of fees for nearly similar project or assignment conditions. Fees vary from a professional to professional, from project to project, and also from one client to another. There are no standards.

Fees’ determination and thereafter fees negotiations are very difficult aspect of professional practice, but (first) fees collection sometimes more worrisome matter.

Senior professionals have experience, and so can prejudge the value of their professional services. Fresh professionals and even seniors venturing into unknown fields cannot do so. They would rather compute the cost of input first, and then add a fixed or a percentage amount, as profit, or more simply find out what others are charging, and follow that up.

A notary at work (painting by German artist Max Volkhart).

To determine a right fee, a professional is expected to know the following:

(a) What is the Value of professional services to the client, and in the society,

(b) What is the cost of providing professional services (cost of input),

(c) Wills there be a surplus (profit) after deducting (b) from the (a).

A professional’s involvement in an assignment or a project depends on many factors: Personal attitude (sincere, commercial), Demands by the client, Nature of the assignment / Competition from others / Client’s readiness to bear the additional costs (of intense involvement), etc. Cost of involvement in the project is as per the agreement on the variety of design services offered and agreed upon, and the scale of the project. Any downward sizing of the project does not automatically reduce the involvement of the professional. Though, upward scaling of a project, increases the professional’s work.

Scale of a project varies during planning, designing and the execution phase. Even at fixed spread or volume, the costs inflate or deflate according to the economic conditions.

Professionals conduct two types of jobs. ONE, where the projects are materialistic [1] consisting of materials, labour etc. and charged on the Cost basis. And TWO, where the projects are metaphysical [2] may be delivered as formatted over some media. The cost of creating, delivering such a metaphysical entity is of course negligible, and the cost physical actualizing could also be very small. But the affectations of such offerings are great. A client may gain extraordinary advantage by such professional contribution.

Consultation Desk 1960

[1] Materialistic projects are like Architecture, Interior Design, Software programming, etc. Metaphysical projects are like project consultancy, medical, legal, delivery of proto-types.

[2]  Metaphysical  projects are made up of concepts, advises, ideas or abstract offerings like artwork or literary compositions.

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