Three steps to protect your architectural firm from risk

In the world of architecture, risks exist in various ways, including legal disputes, information inaccuracies, and insufficient firm-wide engagement. Such risks not only result in financial liabilities but also hinder productivity and erode firms’ reputation. This blog details three pivotal strategies to address risk management challenges to keep your firm safe.

1. Ensure accessibility and longevity of information

Defending your firm against fee claims can be a labor-intensive process that requires a substantial investment of valuable working hours from senior management, which could otherwise be spent on design-focused tasks. As a result, many firms assume that paying off fee claims is more hassle-free than implementing a robust document management system to streamline information workflows since the beginning.  

However, with recent shifts in the regulatory landscape following the Building Safety Act and the Defective Premises Act, legal disputes can emerge over an extended period of decades after a project’s completion. This means fee claims shouldn’t be considered as isolated risks, but rather ongoing liabilities, in which your firm may be required to compile records to demonstrate design decisions years down the line. 

It’s therefore essential to store project information in a centralized hub to ensure effortless retrieval. One of the most common challenges of managing project information is when team members store data in inconsistent locations, such as different folders, individual mailboxes, or server archives. That’s why moving towards the cloud, where information can be seamlessly accessed anytime, anywhere, has become an industry trend in the AEC space.  

Equally vital to storage mediums is the longevity of data. In a constantly changing digital environment, the systems and tools that firms use today maybe outdated in the future. It’s critical to implement measures that guarantee durable access of both current and historical project information decades into the future, protecting against potential technological obsolescence.

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2. Maintain information accuracy

Another notable risk is the occurrence of information errors that can cause delays in project progress, resulting in fee penalties, or even harm to a firm’s reputation among clients.  

To mitigate such risks, it’s imperative that project teams are always able to issue the correct revision. Implementing an intelligent document management system with advanced version control capabilities will enable team members to seamlessly locate and collaborate on the latest revision, thereby maintaining consistency and preventing discrepancies.  

Equally crucial is the availability of complete audit trails of transmittals, capturing details on which information was issued to whom. These audit trails are critical in verifying that accurate information can reach its intended recipients.

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3. Empowering a quality-driven culture

For risk management to be successful, firms must cultivate a quality-driven culture where every individual is empowered to adopt best practices. From managing directors and project managers to team members, each person must thoroughly engage with their firm’s quality management process and implement it into their day-to-day workflows.  

Moreover, architectural firms must also foster an environment where project ownership is the key to upholding quality. While it previously wasn’t common for architects to perform design decisions without fully grasping the financial implications of these decisions, the industry is shifting towards an opposite trend.  

Nowadays, project leaders are empowered to take complete ownership, gaining more authority in their scope of work. From creative processes to financial aspects, the latest industry practices require architects to fully understand the rationale behind each design decision and how it financially impacts the firm. Because of this, architects are now key players in quality and risk management, ensuring that every aspect of a project upholds high standards and contributes positively to the firm's financial health.  

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Key takeaways to protect your firm from risk

• Ensure that information is readily accessible, searchable and in a centralized, cloud-based system

• Guarantee the accuracy of your information through automation and stored version histories

• Maintain a culture of quality within your firm, with each employee adhering to quality practices no matter their position