Factor Blog for Architecture & Engineering Firms

The math for deriving utilization rate is easy. However, the real-world application of this simple formula to people—in particular those who work for architecture and engineering (A/E) firms—and their productivity isn’t nearly so clear cut.

Financial management systems for architecture and engineering (A/E) firms understandably focus on profitability and budgets. However, in some instances like the sharp decline in revenue that firms are grappling with as a result of the COVID-19 pandemic, cash flow is temporarily the top priority.

Effective project planning has always been important for architecture and engineering (A/E) firms. The stresses put on them by the COVID-19 pandemic have made it even more critical that they can schedule the time of their team members, keep the plan accurate, and use that information to make smart business decisions.

We can’t tell you how many times through the years a financial management role has been deemed “non-essential” to the success of the firms we’ve worked for or with. That is, until the time that the effectiveness of a firm’s financial management can make the difference between the business surviving and folding. Now, as the world struggles with a pandemic and the aftermath, is one of those times.

The COVID-19 pandemic has the U.S. and global economies staring into a significant recession. How will it affect your architecture and engineering (A/E) firm? That’ll be determined by how you respond to this challenge. One of the best ways to develop and implement a strategy for surviving a recession is to look back at the last serious economic downturn and review what worked and what didn’t for firms that were in business at the time.

The COVID-19 pandemic has the U.S. and global economies staring into a significant recession. How will it affect your architecture and engineering (A/E) firm? That’ll be determined by how you respond to this challenge. One of the best ways to develop and implement a strategy for surviving a recession is to look back at the last serious economic downturn and review what worked and what didn’t for firms that were in business at the time.

“Accountability”… it’s a word that people either love or hate, depending on whether they are expecting it or it’s expected of them. For architecture and engineering (A/E) firms — and really any type of professional services firm — it’s a concept that everyone should embrace, as it can drive significantly better business results.

Many architecture and engineering (A/E) firms see the terms “accounting” and “financial management” as synonyms. But the truth is that while they’re related, they are very different practices. And while limiting its focus to the former will allow an A/E firm to meet its financial obligations and survive, the latter is required for firms that want to thrive.

Many firm management systems on the market perpetuate the industry’s obsession with perfection. However, we’ve discovered that in order for firms to be financially healthy, they have to shake this obsession. Factor is designed with simplicity in mind and facilitates the production of draft financials within five days and final financials within ten.

Principals and managers at architecture/engineering (A/E) firms are often surprised to hear us say that while software packages can make time entry and tracking easier, they don’t necessarily make it more accurate. But, it’s true. The simplicity of the time entry function in these packages can, without proper policies and training, lead to inaccuracies.