Geographic or market orientation: How should your practice/business be structured?

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Richard Massey, managing editor of the Zweig letter, has posted an interesting article for multiple-office AEC businesses and practices relating to the ideal organization format.

He suggests if your business fits this model, you should structure it as a market rather than geographically based organization.

Why is this so crucial? There are many reasons, but first and foremost is the fact that most clients increasingly want to hire experts who specialize in serving clients like them, and A/E and environment firms need to be in a position to provide the best talent to those clients, wherever they may be located.

The article goes on to answer other observations about how to manage the restructuring, which stretches from marketing to general business management, so you can read it here.

The focus here is the crucial issue — giving primacy for your vertical market focus(es) and establishing the discipline to build a segment or market niche expertise beyond a geographical focus.

You might rightfully ask, however, “Can you base your business on a geographical framework — in other words, could your “niche” be that of a local/regional expert?

Sure, but in that case, I think you would be restricted to operating a one-location office, and you probably will be operating that office in a smaller or medium-sized community.  In other words, your growth prospects are limited, indeed.

The challenge in developing a reputation for uniqueness or market leadership is that it is pretty hard to achieve this with a geographical orientation, and if you are operating in several cities, you would effectively need to homogenize your character to retain consistency.  It is far better to organize along centres of excellence and expertise where you can “own” the market regardless of geography.

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