drone

They offer a bird’s eye view of construction sites. They provide breathtaking photographic opportunities for architects looking to showcase their work. And they’re fun to fly. However, while they may be intriguing tools for architects and engineers, drones open up the design firms that use them to many possibly unanticipated risks. These days, obtaining a drone is as simple as stopping at your local WalMart, but all drones are not created equal, nor are all drone pilots equally skilled and certified.

Victor O. Schinnerer’s Risk Management Blog recently offered an overview of this issue. Should your design firm use a drone in your administration of contracted services? Read on:

“Professional service firms have to be aware that the use of drones is not a simple transition in the process of observing the work on a project site. As with web cameras, drone cameras often produce far more images than are used in the evaluation of a project. If not properly denoted in a contract, the scope of the firm’s services could include the use of all the available images as part of the firm’s duty to observe and evaluate the project as part of construction contract administration duties.

“Additionally, while licensed drone operators are undoubtedly careful about having general liability insurance that protects others from their negligence in aerial activities, and follow the FAA’s rules and guidelines, many firms using drone photography are doing so as amateurs. Turning hobby activities into commercial uses is likely to be unlawful, dangerous, and uninsured.”

Continue reading Drone use can put firms at risk beyond their knowledge by Frank Musica

Raising the Federal Gas Tax: A Debate

american_road

America’s federal highway system–once a source of great national pride–is disintegrating. Why? For one thing, it’s been 20 years since the Federal Gas Tax was last raised. President Ronald Reagan increased the tax to just over 18 cents a gallon, reminding the American people that the federal highway system required an ongoing source of income for maintenance. The Highway Trust Fund–where the Federal Gas Tax is collected–provides funding for road, bridge, and mass transit projects across the country. Today, it’s running out of money. Should this tax be raised?

It’s an important question, and if you’re not sure where you fall on the issue, here’s a fun place to start…

Intelligence Squared US hosted a debate in October wherein a panel of four experts, two on either side, addressed this motion: Raise the Federal Gas Tax to fund infrastructure.

“There are many arguments for a leaner fund, among them, the idea that scaling back the program would force government to prioritize projects and eliminate waste. But proponents of the tax say that it still plays a vital role in supporting infrastructure, and that perpetual shortfalls have led to construction delays and uncertainty. Should Congress raise the federal gas tax?”

Listen to the podcast for free either on the website or download via iTunes.

Screenshot 2015-10-16 13.03.11Design firms may not seem like prime targets for hackers, many of whom are after sensitive, personal information, etc., but this assumption can be dangerous for architects and engineers. Intellectual property must be kept secure, and the threat can come from outside hackers, as well as from employees.

As detailed in Schinnerer’s most recent issue of Constructive Comments, the “(t)he Federal Trade Commission (FTC) has developed cyber security principles in its Start with Security: A Guide for Business. The publication’s guidance is based on the FTC’s data security settlements. Lessons from more than 50 FTC cases show how companies can improve their cyber security practices.”

The guide breaks the strategy down into the following ten steps:

 

1. Start with security.

2. Control access to data responsibly.

3. Require secure passwords and authentication.

4. Store sensitive personal information securely and protect it during transmission.

5. Segment your network and monitor who’s trying to get in and out.

6. Secure remote access to your network.

7. Apply sound security practices when developing new products.

8. Make sure your service providers implement reasonable security measures.

9. Put procedures in place to keep your security current and address vulnerabilities that may arise.

10. Secure paper, physical media, and devices.

Access the PDF version of Start with Security: A Guide for Business here.

ConstructionTradeContractors

The appropriate classification of employees is a frequent source of confusion for design firms, usually coming up around the renewal of a firm’s Workers’ Compensation policy. It is an issue ripe with risk on an Employment Practices level. Recent court rulings in Arizona and Utah have resulted in construction firms paying hundreds of thousands of dollars in back wages, damages, and penalties.

As explained on the Schinnerer Risk Management Blog:

In an age of rising benefit costs and other constraints on the operations of professional service firms, some firms are turning to a range of tactics to reclassify workers to take them off the formal payroll and, therefore, lower their costs and administrative burdens. However, doing so may subject the employer to state and federal employment law fines and penalties.

All this is happening against the backdrop of a broader shifting of risk from employers to workers, who are shouldering an increasing share of responsibility for everything from health insurance premiums to retirement income to job security. While the future might present a model where everyone is truly an independent contractor and neither those actually providing services nor those using the services have any continuing or controlling interest in each other, such a situation does not currently exist and any firm that thinks it can avoid employment responsibilities, tax obligations, or employment practices liability needs to carefully consider alternatives to hiring workers.

Regulators and courts have increased their scrutiny of the relationship between business entities and independent contractors. Alleged misclassification of workers has been one of the primary battlegrounds of this shift, leading to high-profile lawsuits.

For decades, some professional service firms have shifted work from employees to independent contractors to cut their overhead and labor costs and, at times, to qualify for special government procurement assistance. Often, this has been accomplished by relabeling workers and slightly altering the conditions of their work. And some professional service firms have simply ignored regulatory and tax guidance and “informally” used the services of professionals and clerical workers as “consultants” or “leased personnel” or “temps.”

Now, however, businesses—including design firms and construction contractors—are turning to other kinds of employment relationships, such as setting up workers as owners of limited liability companies (LLCs) in an attempt to shield the businesses from tax and labor statutes. In response, some state and federal agencies are aggressively clamping down on such arrangements, passing local legislation, filing briefs in workers’ own lawsuits, and closely tracking the spread of what they see as questionable employment models.

Visit the Schinnerer Risk Management Blog to continue reading.

If you have questions about the appropriate classification of your employees prior to your next workers’ compensation renewal, contact your local a/e ProNet broker. We’re happy to help!

drugs_alcohol

Compared with many other industries, the Engineering and Architecture community has a relatively low abuse/dependence rate (7.9%) on any substance, and alcohol is the substance these design professionals are most likely to be dependent upon. This is according to a 2010/2011 national survey completed by the Substance Abuse and Mental Health Services Administration.

“Coping with substance abuse and dependence is a big enough challenge on its own, but balancing both an addiction and a career can pose an even bigger struggle. The impact of drug abuse on workplaces is astronomical, costing the United States $120 billion in lost productivity in 20071. Alcohol abuse is similarly widespread, with 15% of American workers reporting being impaired by alcohol while at work at least once during the previous year2. And the effect on safety can be potentially catastrophic: Employees involved in accidents were more than four times as likely to test positive for opiates3. So what are the patterns of substance use across America’s industries?” — Treatment4Addiction.com

You can visit the Treatment4Addiction website for analysis and presentation of the survey data. As you’ll see, while Design Professionals rank mercifully low on this list, Construction Trades & Extraction Workers rank unfortunately high (17.4%), with “heroin as their most disproportionately used substance. Their widespread abuse of a powerful opiate may reflect the prevalence of chronic back pain and untreated injuries in the field.”

CJK_FortyHolyMartyrsOrthodoxChurchChurches, cathedrals, and temples have historically drawn attention for their architectural beauty. Sometimes these buildings took centuries to complete, employing tens of thousands of craftsmen, all to meet the original vision of a single architect, inspired by the great Architect in the sky. It would be a mistake to think that–with the exception of project length and the architect’s scope of services–this has changed. Modern churches and temples continue to rise all over the world, and the architects behind them are often motivated by their own faith. These buildings are often spectacularly intricate, having been designed with a whole and holy purpose in mind.

One architect who has dedicated his practice to the design of such buildings is a/e ProNet client Christ J. Kamages of CJK Design Group in California. Many of the glorious, golden domes of modern Greek Orthodox churches, cathedrals, and missions across the country can be attributed to him. Last month, Mr. Kamages’s 33-year career earned him the honor of being elevated to the AIA College of Fellows at a ceremony in Atlanta, Georgia.

As noted on the CJK Design Group blog:

Established in 1857, the American Institute of Architects is a professional association made up of Architects and a related field, which seeks to “promote the scientific and practical perfection of its members” and “elevate the standing of the profession.” Through the AIA, standards of ethics and business practice have been developed and members hold each other up to maintain the highest standards. Each year, the AIA selects Architects from its membership to be elevated to the status of Fellow. Fellowship is one of the highest honors the AIA can bestow upon a member. Elevation to Fellowship not only recognizes the achievements of the architect as an individual but also elevates before the public and the profession those architects who have made significant contributions to architecture and to society.

Mr. Kamages was one of only 147 architects to be elevated to the College of Fellows this year. Of the 85,000-architect membership, only 3,200 have received this distinction.

Congratulations to Mr. Kamages and his fantastic team. We look forward to seeing many more beautiful designs from you in the years to come!

Shout-out Credit:

Leslie Pancoast, CIC, RPLU
Managing Partner
IOA Insurance Services – Pleasanton, CA
Email: Leslie.Pancoast@ioausa.com / Phone: 925-416-7862

boxhouse

Signs of recovery in the American housing market–in architecture, engineering, construction, real estate–are increasing. Yet, in 2014, the market saw a new, disappointing record:

The number of homeowners under the age of 35 hit its lowest point ever.

Home ownership has long been synonymous with the American Dream. But where are the young people in this game? Some have turned to alternative housing solutions.

Pacific Standard magazine recently blogged the experience of Luke Iseman, a 31-year-old graduate of the Wharton business school, who lives in a white shipping container on a small lot in West Oakland. Driven from the traditional urban housing market as a renter by exorbitant rates in San Francisco, and holding more than $60,000 of student loan debt, Iseman is putting his burgeoning business savvy to good use for himself and others with the establishment of an alternative housing start-up called Boxouse. Continue reading “Boxouse: Young Americans Turn to Alternative Housing”

Blog Love: ArchNewsNow – Nuts & Bolts

nutes_and_boltsNuts+Bolts is a “an exclusive ArchNewsNow monthly series to provide A/E professionals with practical tips for a more successful, profitable practice.” All ten articles currently listed are worth a read, and we hope the series is slated to continue. The authors are architects, consultants, insurance professionals, and financial advisers, all of whom offer a timely perspective on the state of the design industry. After perusing the library, here are four posts with the potential to help you and your firm in a risk management capacity:

#1 Nuts + Bolts: Mission Possible: Increase Your Value Without Lowering Your Fees

In this economic climate – or even in a good market – it may be tempting to lower your fees to stay competitive. However, lowering your price is not something you should immediately consider when faced with reduced revenue. As an alternative, you should seek to inject as much value into your services as possible. This will allow you to increase the intrinsic worth of your services, encouraging your clients to pay an appropriate fee for quality, not just quantity. But if you’re convinced that lowering your fees is a solid strategy that will boost your bottom line, think again. Here are a few reasons not to.

#2 You Can’t SELL If You Can’t TELL

You went to architecture school to become a good communicator…right? I’ll take a risk and say that chances are you probably didn’t. But if you want to be a great architect, engineer – or any other kind of professional – you need to know how to communicate clearly and effectively. You simply can’t avoid it. You communicate every day, whether you are meeting with colleagues in your office, talking to a client on your cell phone, e-mailing a consultant, or tweeting your followers. While we live in the digital age, and communication may seem to flow easily, there’s a lot more room for error. We’ve all had that gut-wrenching feeling of hitting the “send” button on an e-mail that had the wrong content or went to the wrong person.

#6 Changing Habits: The Secret to Successful Time Management

No time to grow your business? Learn to set aside time, clearly identify goals, and change bad habits, and you’ll transform your business development efforts from a waste of time into a productive enterprise. Most budding architects are initially attracted to the design side, rather than the business side, of their profession. As a result, many architects never develop the skills necessary to build their businesses. But just as design and project management are part of your daily routine, you should set aside time for business development as well. How do you make time for business development when you’ve been avoiding it or aren’t sure how to fit it into your day-to-day practice? The trick is to fundamentally and permanently change your habits. This sounds daunting, but you can achieve it if you follow these practical steps.

#8 Best Friends Don’t Make the Best Partners

In popular culture (and at most architecture schools) the architect is often portrayed as a lone figure, from Howard Rourke in Ayn Rand’s seminal work, The Fountainhead, to Frank Lloyd Wright, to Frank Gehry. Most people perceive architects to be creators working alone in the dark. Contrary to popular belief, it takes more than a single artist to make a great building. Most architects know that. What’s less obvious is that, in reality, most successful architectural practices are not sole practitioners but partnerships.

About the Authors of the Nuts+Bolts Series:

Michael S. Bernard, AIA, Principal, Virtual Practice Consulting

Mary Breuer leads Breuer Consulting Group

Founder of integrated communications firm Hausman LLC, Tami Hausman

Donna L. Maltzan is a business development trainer, facilitator, consultant and coach

Michael M. Samuelian, AIA, AICP, vice president at Related Companies

Stanley Stark, FAIA, LEED AP, a New York City-based architect who has held senior leadership positions with major firms including HLW, HDR, and Francis Cauffman

Steve Whitehorn, managing principal of Whitehorn Financial Group, Inc., the creator of The A/E Empowerment Program®

pisaIn high-stakes professions like Architecture or Engineering, mistakes can be devastating. This is why professional liability insurance is so important! But to keep today’s post on the lighter side, we’ll point you to something happier in this vein. a/e ProNet member Professional Design Insurance Management Corporation recently shared this post, 5 Mistakes in Architecture with a Silver Lining, on their company blog:

Mistakes are part of life. Mistakes in architecture are part of many lives. However, failures lead to learning – and sometimes it leads to great discoveries.

Improvements in Design

Much of what we know today about technology, architecture, and almost every other subject imaginable comes from past failures. Some were discovered in a lab, but many others were discovered in the field. Any time a failure happens, professionals in that industry make concerted efforts to learn what caused it in order to improve future works.

Fidenae Amphitheater is one example of a structure that collapsed due to inadequate design. As people piled in to watch gladiator fights, the building collapsed due to the collective weight, teaching future engineers to account for the weight that a structure can accommodate.

Thinking Long-Term

Durability is very difficult to determine without experience. Developers can conduct numerous tests to determine whether a design will hold up for months, even years, but what about decades? Over time, we’ve all learned that certain materials aren’t ideal for a building’s design, for instance, and we’ve had to tear down multiple buildings and reconstruct them with materials that have proven durable over time.

Before an earthquake destroyed it in 1303, the Lighthouse of Alexandria was considered one of the Seven Wonders of the World. A more recent example is the John Hancock Tower, which had structural problems that led to windows falling and extreme swaying. This helped engineers learn the unique needs of extremely large buildings like skyscrapers.

Considering External Factors

Testing is almost always conducted in a closed environment, without factoring in things like weather conditions and user error. Once a product or design leaves the lab, though, those conditions become all too clear. Often it is only by actually letting the world see your handiwork that you can find its flaws and fix them.

The world learned this lesson through projects like the Tacoma Narrows Bridge, which didn’t survive a windstorm, going down in history as one of the biggest bridge design failures.

Out of Sight Shouldn’t Be Out of Mind

Often the most important elements in a design are those that can’t be seen. This is clear in the fact that the supporting foundation of a building must be carefully checked for structural integrity. Failure to be extremely cautious during the development phase could become a public safety issue later.

One of the best examples of this is the Leaning Tower of Pisa, which shifted due to being built on marshy land, emphasizing the importance of ensuring a structure’s foundation is reliable. In 1928, the collapse of the St. Francis Dam highlighted the importance of continual inspections of dams and similar structures to keep the public safe.

Consider Other Disciplines

One of the most important lessons that can be learned from history is that there is no limit to learning. One industry can learn from the mistakes of those in another industry. Even basic building design concepts can provide valuable physics insight that can be used in a wide variety of applications.

Many of the successes we have today are thanks to our past failures. Through a process of trial and error, we find out what works and what doesn’t. If we can simply learn to see small setbacks for exactly what they are, we’ll find the courage to keep moving forward despite our mistakes.

PDI has lots of other great blog posts. We suggest you pop over there and read up today.