Anita Turner

Author: Anita

  • Could Non-Lawyers Help Law Firms Become High-Growth Companies?

    Could Non-Lawyers Help Law Firms Become High-Growth Companies?

    12/6/2017 UPDATE:

    The post below is the first blog post I ever wrote on May 2, 2016.  Honestly, the idea for a law firm advisory board was the reason I started a blog: I had to bring attention to it.  Last week, I read an interview of UK Legal Consultant Chris Bull by Prism Legal entitled “Will All Law Firms Eventually Corporatize?”  In the article, Bull’s premise is that large law firms that “corporatize” will be more successful long term.  He defines “corporatizing” as adopting corporate management and governance.  He describes five practices that law firms are adopting to accomplish this.  The fifth practice is “Independent Boards.”  This is an excerpt:

    More firms are appointing independent external Non-Executive Directors (NEDs).  I have been examining the trend for UK law firms to appoint external NEDs to sit on their Boards and now estimate that over 1/3 of the top 200 firms have one, sometimes more, NEDs.  In some cases the NEDs are replacing the Senior Partner in chairing the firm; some high-profile Chairs have been appointed from outside the firm’s ranks, including Tony Angel at DLA Piper… Pioneer firms brought independents into the Boardroom to advise the Partnership many years ago but the trend is now to formalize these as full-member voting roles.  The increasingly large, ambitious law firm operating in a more competitive, global and technology enabled market is recognizing that a Boardroom composed of just lawyers (with maybe one accountant to report the numbers) is recognizing that it doesn’t possess the diversity of experience or expertise required.

    Maybe my crazy idea wasn’t so crazy after all.  Read on.

    __________________________

    5/2/2016

    The business of law is changing.  In many firms, revenues are growing through increased hourly rates rather than increased demand.  Clients are reluctant to pay for associate time so the number of associates in firms is shrinking while the partner to associate ratios climb steeply.  In addition, in law firms structured as PCs, the shareholders are employees so there cannot be a mandatory retirement age.  As a result, the average age of attorneys in law firms is steadily growing so many firms are run by attorneys who have been doing business the same way for decades.  According to AmLaw estimates, less than 2% of partners are millennials and almost none of those partners are represented on executive committees.

    By law in all but two states, law firms must be run by attorneys or executive committees of attorneys – most of whom have never worked outside of the legal industry.  So how do you steer a law firm into the future when the steering committee is composed primarily of people who have never known any way other than the traditional practice of law?  How do you gain a fresh perspective on new services, new ways of delivering old services, and how to differentiate and grow in a hyper-competitive legal market?  Maybe a corporate advisory board is an opportunity worth exploring.

    An advisory board provides non-binding strategic advice to the management of an entity.  It is in an informal group with no active management role or liability.  In my suggested law firm model, it would not involve itself in client-specific matters.  Rather, it would be convened to help provide guidance from outside the legal industry.

    The advisory board I am suggesting would consist of senior executives from a broad range of industries. Per former Freshfields Senior Partner Konstantin Mettenheimer, law firms should “do all we can to learn about the complete toolkit of management from successful organizations in other industries”.

    An advisory board could consist of a marketing executive, a technology executive, a CFO or controller, an entrepreneur and a business school professor, for example.  The board members would be paid a meaningful honorarium for their services and the term would be limited in scope and length so as to be manageable for the participants.

    The board members would bring different experiences and educational backgrounds to the table.  This would provide the law firm with unbiased insight and third party perspective and perhaps even more valuable, an entirely new and objective outlook on the business.  This could help a law firm intent on embracing the future to transform rather than just adapt.

    Economist Tim Harford, in his TEDTalk “How frustration can make us more creative” observes that in a study of problem solving where teams were made up either of four friends or of three friends and one stranger, the teams that included a stranger solved the problem more effectively than the teams made up of only friends.  He believes this is a result of the disruption and struggle that was generated and the creative solutions that stem from the disruption and struggle.  It is worth noting that the groups that included a stranger did NOT have a good time solving the problem, but they solved it more effectively none the less.  Could this apply to law firms?

    The advisory board’s charter could be broad, such as “how should our law firm differentiate itself going forward?” or narrow, such as “what service lines could be added to our offerings to grow our revenue?”  or “should we hire a Chief Marketing Officer?”

    As an example, financial services company Northwestern Mutual convened an Internet Advisory Board from the e-commerce industry.  In the law firm scenario, maybe an advisory board would see value in a service currently being provided incidental to the practice of law where such service’s value could be exploited for the law firm’s gain or maybe the advisory board would suggest expanding the c suite to bring a necessary new skill to the firm.  Tony Hsieh, the founder of Zappos.com, says that his company will try any idea if it passes this test:  Is it safe to try?  Will it do irreparable harm to the business if it fails?  An advisory board may be worth a try.

  • No Go Lease Terms: Tenant Edition

    No Go Lease Terms: Tenant Edition

    No Go Lease Terms: Tenant Edition

    As a former practicing lawyer, I pride myself on providing my clients with thorough lease comments.  I also work hard to help my clients understand when proposed lease language is not detrimental to their rights and therefore acceptable.  That said, there are seven “no go: don’t even ask” terms that I will fight hard to ensure don’t make it into the final lease document.  In no particular order:

    • Replacements as an operating expense.  Operating expenses should include repairs of things like the roof, parking lot, etc.  Replacements, on the other hand, are a cost of ownership.  They should not be passed through to the tenant.
    • Lack of a clear standard for measuring space.  The only entity this benefits is the landlord who is then at liberty to “remeasure” the building at whim and change the tenant’s rental obligation.  The parties should either stipulate to a square footage at lease execution or agree on a measurement standard such as BOMA.
    • Reserves as an operating expense. I rarely see this but when I do, I am baffled.  How can a landlord expect a tenant to agree to put money aside for repairs that may not occur until some date in the future when that tenant no longer occupies space in a building?  No.  Just No.
    • Landlord’s right to withhold consent (e.g. to signage, to a potential subtenant, etc.) in Landlord’s sole and absolute discretion.  If I am going to push for a tenant right, I am going to ensure that it is exercisable.  Sole and absolute discretion as a standard essentially negates the tenant’s right.  I believe that commercially reasonable discretion is a fair compromise.
    • Landlord’s right to collect attorneys’ fees from tenant when it is not qualified by the requirement that the landlord be the prevailing party in litigation.  Without the prevailing party requirement, the landlord could, for instance, lose the tenant’s rent check, hire an attorney to write a demand letter for the rent, find the check and still bill the tenant for the attorney’s time.  Ideally, this would not happen but the landlord would have the right pursuant to this language.
    • Declaring the landlord to be the tenant’s attorney in fact if the tenant does not return an estoppel in a timely manner.  I prefer that failure to return an estoppel be declared a tenant default rather than it resulting in the landlord being declared the attorney in fact.  Here’s the scenario:  Usually, an estoppel is requested when a building is being sold.  The new buyer wants to understand whether all leases are in good standing and if not, what issues exist.  If a tenant does not return the estoppel in a timely manner (usually within a 10-day period) because they are trying to work out an issue with the existing owner (for instance, a dispute over monies owed), the landlord could declare themselves the tenant’s attorney in fact, sign the estoppel stating that there are no events of landlord default existing at that time, and the tenant will be estopped from ever raising that issue with a new owner.
    • Renewal rights without a dispute resolution mechanism.  When tenants are granted renewal rights at “fair market value” to be determined at the time of renewal, the lease must include a mechanism for resolving disputes as to the rate.  There are numerous alternatives such as appraisal or arbitration.  These mechanisms serve to keep both parties honest when it comes time to negotiate the rate as both parties will usually try to avoid the time and money wasted resolving a dispute.  On the other hand, it the lease states that the landlord determines what fair market value is, the tenant will be at the landlord’s mercy.  This can make a renewal right somewhat meaningless.

    All of the landlord positions or terms detailed above are extremes.  Thankfully, I usually see only one or two of these in most initial landlord lease drafts.  And reasonable landlords always seem to be able to draft a compromise that eliminates the tenant’s biggest concerns.   If I see several of these terms or cannot reasonably resolve them with the landlord, it can be a red flag worth heeding about the pending landlord-tenant relationship.

    In the interest of “equal time”, next week we will look at No Go Lease Terms: Landlord Edition.

  • Is it a Shipping Container or a Private Office?

    Is it a Shipping Container or a Private Office?

    If you are planning on building new offices in a high-ceilinged office or warehouse building and want to make a design statement on a budget, building with shipping containers may be a great option. While on a recent visit to Nashville, I toured general contractor Brasfield & Gorrie’s new space at 1201 Demonbreun which features two shipping container meeting rooms.  Matt Spaulding with B&G’s Nashville architect, Hastings, said the containers “are ubiquitous with construction and we thought it would be great to utilize them in the space.”

    In Birmingham, Richard Carnaggio of Cohen & Carnaggio has designed spaces for both Shannon Waltchack and Scout Branding at the Stockyards development which utilize containers for all enclosed offices.  Typically 8.5’ wide by 20’ long, containers are the perfect size for an office or small meeting room.

    Initial Installation

    I spoke with both Spaulding and Hastings to gain a better understanding of the challenges and benefits of utilizing shipping containers in interior construction.  Both architects emphasized that the first (often largest) challenge is getting the container inside the building.  With B&G’s Nashville office, the building was still open and under construction when the interior construction was started so B&G was able to install the units before some of the exterior walls were built. However, at the Stockyards, the building was originally industrial and the spaces were located on the first floor so moving the units into the space was manageable. 

    Space Considerations

    Carnaggio pointed out that tall ceilings are required as the containers are typically 8.5’ high and HVAC distribution will be above the containers.  At the Stockyards, the ceilings are tall enough (18’+) that Cohen was able to design the space to accommodate a future second level of container offices stacked on top of the original containers (connected by a catwalk) if and when growth necessitates the additional space.

    Step Up

    Another consideration when building with containers is that there is a 6” step up into a container.  At the Stockyards, this was addressed by pouring the concrete floor around the containers to that depth, running railroad ties (also 6” deep) along a center walkway and filling the walkway with a boardwalk.  In B&G’s space, a 6” high “patio” was built outside of each meeting container.

    Cost Considerations

    Containers can be less expensive than traditional hard-walled offices.  The cost for a new container is approximately $1,500 and used containers can be obtained for as little as $1,000.  Finishes and HVAC can add as little as $500, but the total still compares favorably to the standard $3,000 to $4,000 cost of building a single traditional hard-walled office.

    Design Options

    Design options are abundant with containers.  They are very adaptable in that they are essentially twelve tubes connecting six walls.  Any of the walls can be removed without compromising the structural integrity of the frame.  To add light and openness, in B&G’s space, the container’s fronts were replaced with storefronts.  In the Stockyard spaces, glass windows were inserted and barn doors added to the fronts of each container office.  Wood skins were added to the ceilings and carpet to the floors to provide better acoustics and more warmth in Scout’s container offices.  HVAC was delivered via a pipe into the ceiling of each unit.

    Spaulding said the feedback from the B&G Nashville employees has been positive: “the rooms are some of the most popular and most utilized spaces in the office, plus they’re just a lot of fun.”

  • How does “going to the cloud” affect your real estate decisions?

    How does “going to the cloud” affect your real estate decisions?

    My partner and I recently worked with a client who wanted to downsize and relocate their offices to a location more conducive to recruiting.  Their current office lease expired in 18 months.  Unfortunately, they were forced to extend their existing lease (on too much space) for two additional years because 18 months was not sufficient lead time for them to resolve the “cloud question” – should they move to cloud computing and if so, when? – a question that seems to be front of mind for many of our clients these days.

    While the cloud question focuses on how to approach information technology use and storage, it has real estate implications as well.  Because I am admittedly an “end user”, I asked my friend David Powell, Vice President of Managed Services at Logic Monitor, to enlighten me on the subject.

    Powell explained that the “cloud” refers to the delivery of hosted services over the internet, enabling companies to consume computer resources (such as storage) like a utility, rather than having to build and maintain server infrastructure in house.

    Traditionally, most companies and service firms have housed their own data and applications on servers within their office spaces.  These server rooms can take up substantial and (in some markets) high rent office space.  And, because these systems generate a lot of heat and run 24/7/365, additional HVAC units are typically added to server rooms and the business pays the added electricity costs associated with the extra hours and capacity.

    If the business’ operations are mission critical such that no power outages can be tolerated, the business must purchase a generator for backup power to the servers and, as their business and computing requirements grow, additional capacity in the form of new servers is added.  When computer rooms are expanded, more HVAC is added and the capital investments continue.

    Cloud computing is much simpler from a real estate perspective.  The only infrastructure required is a switch, a firewall and a wireless controller.  Depending on the size of the business, usually these components will fit into a wall mounted cabinet in a telecommunications closet.  This means the business saves the rent associated with a server room, the server costs, and the operating costs of additional HVAC and electrical power.

    With cloud computing, if the business moves, there are no servers to shut down, relocate and re-install.  The business simply moves its switch or, to ensure absolutely no service interruption during the move, purchases a new switch for the new location and repurposes the old switch elsewhere.

    What is the draw of the cloud?  According to Powell, cost savings in general are not usually the motivator because on a dollar for dollar basis, cloud storage is equal to or more expensive than owning and operating servers.  Real estate savings are a benefit but they are not usually of a magnitude to be the catalyst for moving to the cloud.  Rather, the cloud ensures reliability of service.  For instance, if there is a power outage at the office, the business’ employees are able to work anywhere they can find internet service.  Also, the cloud offers just in time access to additional storage and computing capacity as the business grows.  Finally, for some businesses, the cloud is attractive because a capital expense becomes an operating expense.

    Given these benefits, why does it take businesses so long to decide if and when to move to the cloud?  First, many businesses are reluctant to essentially “throw away” the money they have invested in servers.  Second, privacy and security are big concerns, especially to businesses in the healthcare and legal industries where there are strict regulations and serious liability burdens for data breaches.  These industries are still working out guidelines for cloud storage.

    A third major hurdle for businesses contemplating going to the cloud is that the cloud is a consumption model.  Powell says that this means that businesses pay for the storage they use, so businesses that do not have guidelines for storage capacity can end up paying a premium for extra capacity to house the emails of the law partner who hasn’t deleted an email in ten years or the iTunes library of an employee who insists on backing his/her entire music collection to the cloud.  Many businesses realize there are going to be cultural hurdles to clear in adopting protocols for file storage and file deletion.

    As real estate advisors, it is important for us to have a continuing dialogue with our clients throughout their lease terms so that we can help them understand the real estate effect of their business decisions.  This includes helping them understand the effect of moving to the cloud and the timeline required to do so as it relates to moving an office.

  • Are you spending too much money building your new offices?

    Is cost per square foot an outdated metric for measuring and benchmarking build-out costs?  Many companies occupying space built out five or ten years ago often struggle to decide how much money to spend on building out progressive new space.  Stories of build-outs for the cool tech giants and Fortune 500 companies often echo with a rumored price tag of over $100 per square foot.  This can scare some less well-capitalized companies away from building great space, investing in ergonomic furniture and designing to reflect their cultures.

    We suggest those companies look at a cost per employee metric, rather than a cost per square foot.  As an example, the global architecture firm IA Interior Architects recently completed a build out for a start-up tech company in the Northeast.  The costs per square foot to complete the build out were $125.  Compare this to the average in that market of $70 per square foot.  Seems expensive, right?  However, this tech company built their space to a density of 114 square feet per employee.  More traditional office build outs typically allot at least 200 square feet per employee.  This tech company spent $14,250 per employee for space that is some of the most attractive I have ever seen.  Had the tech company gone a more traditional route with more walls but less character, it would have cost them $14,000 per employee (assuming $70/sf multiplied by 200 sf/employee), and I don’t think it would have had the recruiting bank for the buck that the space they built boasts.

    Aa an added benefit, had the tech company leased 200 square feet per person, they would be paying rent on 70,000 square feet of space, rather than 40,000 square feet.  This represents a rent savings of more than 40%.

    I spoke with a number of architects at IA regarding the optimal build out cost metric.  The overall sentiment was that cost per square foot was not a good measure when the density of a planned build out was not going to match the existing density because, for example, either a company was adopting a “benching” layout or “free addressing” where employees are not assigned their own workspaces but rather use any available workspace when they are in the office.

    When we work with clients, we help them identify the appropriate metric to measure whether a build out investment is justifiable to their business.

  • Office Signage is Free Advertising: What You Need to Know

    Office Signage is Free Advertising: What You Need to Know

    Today, branding is everything.  Most companies want their brands everywhere, including at their office space.  Consequently, signage is an important deal term for many tenants and it is important in four ways: (1) the type; (2) the desirability of any signage at all; (3) the right to ensure that other tenants do not have signage that negatively impacts the original tenant; and (4) installation and maintenance cost.

    WHERE DOES IT GO?

    There are four main types of commercial office signage:

    Directory: All tenants are usually given a listing in an electronic directory in the building lobby.  The only aspect of directory signage occasionally negotiated over is the right to additional directory lines, say for individual attorneys in a law firm or different divisions of a tenant company.

    Suite: Again, all tenants are given signage identifying their own suites.  Subject to negotiation is whether the suite signage can include the tenant’s logo or instead needs to be in a building standard font.  Also, sometimes negotiated is directional signage from an elevator lobby when the tenant’s suite does not front that lobby.

    Monument: Many buildings have a monument sign in front of the building, typically fronting the busiest street, where the building’s major tenants are listed.  This signage is a more difficult ask as monument space is limited.  If monument signage is secured by the tenant, the prominence on the sign should be addressed in the lease, i.e. will the tenant be placed at the top of the monument and, if the tenant is measurably the largest tenant, will it be entitled to a larger proportion of the monument.

    Building: Many buildings offer some kind of signage on one or more of the building facades.  This can include “eyebrow” signage which is signage placed above the ground floor and typically reserved for first floor retail tenants.  It can also include signage placed at the top of one or more of the building’s façades.  Some municipalities limit the amount of building signage allowed to one or two signs per side, so this is a very limited — and therefore valuable — resource.  Usually, top of building signage is reserved for the largest tenant and often that tenant’s lease includes language stating that if the tenant’s occupancy falls below a certain level, it will lose the signage.

    Size and exact location of monument and building signage should be addressed in the lease, ideally supplemented by an exhibit containing a rendering of the agreed upon signage.

    ASSET OR LIABILITY?

    Although most businesses/tenants want as much signage, and therefore visibility, as they can get, we have worked with numerous tenants who want as a little and as low-key signage as possible.  For instance, retail brands typically avoid signage on their office spaces as they do not want to create customer confusion thinking the sign indicates a retail location.   They may very much, however, care about the next point…

    DO WE HAVE TO SHARE?

    Banks and law firms are the best example to illustrate this point.  I have found that banks typically do not like to occupy space (retail or office) in buildings prominently featuring their competitors’ signage.  When we conduct initial surveys to identify building options for a tenant, we are often instructed to eliminate any buildings already named after a competitor.  Similarly, if a bank or law firm leases space insufficient in size to warrant their own monument or building signage, we will often negotiate for language stating that, during the term of that tenant’s lease, the building cannot be named for a competitor of the tenant.

    The concern in these cases is that the tenant’s customers will be confused as to whether the tenant actually occupies space in the building.  Also of concern is the perception that the tenant is dwarfed in size by their competitor as evidenced by the initial tenant’s lack of signage.

    The remedy for a violation of exclusivity language is typically the right to cancel the lease.  With this remedy, the building owner reserves the right to lose the smaller tenant to gain a larger tenant and the initial tenant reserves the right to move out of the building.

    Exclusivity language in a lease should specifically address which competitors or types of competitors are precluded from having signage, whether there will be a minimum square footage required on the part of the initial tenant to maintain this exclusivity right, and what the remedies are for violations of that right.

    WHO PAYS THE BILLS?

    Any signage discussion should also include costs of signage.  Usually the building landlord will provide suite and directory signage as part of the initial tenant buildout.  Monument signage is typically a tenant cost; however, landlords will be responsible for maintaining the monument sign.  Whether or not the monument will be lit at night should be addressed in the lease as well because adding lights after the sign is installed can become a big expense.

    Building signage costs are nuanced and tricky.  Initial size, location and installation costs should be addressed in lease negotiations and memorialized in the lease.  I once negotiated signage on behalf of a bank for an under-construction multi-tenant office building.  My client and I will be forever indebted to a careful architect who asked us to be sure the client’s building sign would be lighted and that the initial building construction documents provided for the delivery of electricity to the sign.  This also prompted a discussion of which entity would pay for the electricity costs (the tenant) and which entity would pay for and maintain the sign (again, the tenant because the tenant wanted control).

    BOTTOM LINE

    Know whether you need signage, how much is justified based on your size, what it’s going to look like and who is going to pay for it.  And hire a good broker to help you get all of this in the lease.  If you need a recommendation, I happen to know a couple…

  • Barn Doors and Concrete Floors

    Barn Doors and Concrete Floors

    Carpet tiles used to be a progressive flooring finish but now they are yesterday’s news. Everywhere I travel, from San Francisco to New York and even right around home in Birmingham, Alabama, I see polished concrete office floors. Perhaps because they give office space an industrial and loft-like feel, they are the preferred flooring in most tech and creative company spaces.

    Besides the look and feel polished concrete lends to a space, concrete floors offer several other advantages. They are easy to maintain. They are extremely durable, nearly impossible to damage with high heels, furniture legs or chair wheels and never have to be replaced due to wear and tear. And, they can be customized by staining, texturizing, etching or painting the surface.

    Although polished concrete is environmentally friendly because no new material is produced – existing floors are just polished — initial finishing is not a bargain. Polished concrete floors are comparable in cost to carpet tiles at ~$3.50 per square foot. However, they do not require regular carpet cleaning and, as mentioned above, do not have to be replaced when new tenants move in or space is reconfigured.

    Before a client incorporates concrete floors into its space, we do advise them to consider the few drawbacks associated with them. They are hard and unforgiving when human beings slip on them or objects are dropped onto them. They can be uncomfortable to stand on for a long time. And they can be cold. One tenant, LendLease, neutralized this concern by incorporating a beautiful area rug in their lobby area that provides both visual and physical warmth to the space.

    Just like concrete floors, barn doors are everywhere these days. Barn doors are the sliding door system wherein a door slides on hardware mounted above the door opening to open up or close off a space. They add instant character and style to space. They can be rustic like the heavy wood versions seen below, or clean and modern.

    While barn doors are space saving because they do not require a specific radius for opening and closing, they do take up significant wall space. As a result, architects and designers take care to address this concern. In some instances, they are designed to serve as a piece of art or focal point. The hardware is large and pronounced and the look of the doors both open and closed is taken into consideration. Knight Eady designed theirs to look like the back fence at Wrigley Field. In other instances, the doors and hardware are designed to visually melt into the space when they are open so as to be barely visible.

    Balch & Bingham – Birmingham
    Knight Eady – Birmingham

    Barn doors are not always a good answer as a barn door hovers over an opening but doesn’t seal it completely. As such, it does not provide as much sound privacy or odor isolation. For this reason, they are rarely used to enclose loud spaces or those where food is served as food smells can permeate the rest of the space.

    Barn doors and concrete floors are both fabulous finishes to add instant character to an office space. To determine whether either finish is right for your space, talk to a skilled architect or designer who can help you get the most value for your investment and avoid any associated issues. Then let your real estate broker negotiate to get the cost of these finishes included in your tenant improvement allowance.

  • The C-Suite Study: Does an Expanded C-Suite Increase Law Firm Profitability?

    The C-Suite Study: Does an Expanded C-Suite Increase Law Firm Profitability?

    Foreword by Amanda K. Brady with Major, Lindsey & Africa

    Every law firm C-suite professional knows that lawyers are data driven—and, as business owners, profit driven. If you expect an audience and ultimately a decision from a law firm’s attorney leadership team, it is imperative to come to the table with facts. In this study by Anita Turner of Collier’s Law Firm Services Group, the data proves what many of us already believed: Professional management of law firms has become a key differentiator for success.

    CFOs and CMOs have been making headway in these organizations for the last decade, slowly but steadily proving their value. Not surprisingly, CHROs are becoming more involved in the full “talent” equation for firms focused on client service. And the increase in CIOs and CTOs demonstrates a clear recognition that these professionals are considered critical to a firm’s viability as they battle cyber-attacks on their own and their clients’ confidential data.

    All that said, unfortunately no data exists (at least, to my knowledge) to demonstrate that the key to an effective C-suite is the acceptance of these professionals as a necessary part of the strategic business conversation. Despite employing C-suite professionals, at C-suite salaries, not every firm has embraced the full value of their contribution, still insisting that lawyers know best. The landscape is changing, to be sure, and just as Colliers has revealed with this invaluable report, that change consistently inures to the benefit of the lawyers who own and work at these firms.

    To read the full report by Anita Turner, please click here.

  • Do All Accounting Firm Offices Look Alike?

    Do All Accounting Firm Offices Look Alike?

    Workspaces are changing rapidly with both the proliferation of technology and the changing demographics of the workforce.  These changes are readily apparent in progressive industries like technology and coastal cities like New York and San Francisco.  In flyover states and traditional service businesses, the changes are more subtle but they are happening.  This is evident in the accounting industry in Birmingham.

    Traditional Space

    Large regional firm Warren Averett is a proponent of the traditional accounting firm space program.  Its headquarters at 2500 Acton Road is built out predominantly with private offices for its accountants, and a mix of smaller offices and built-in workstations for administrative staff and interns.  Partner offices are a spacious 200 square feet and often include a work for area for small meetings while staff accountant offices average a slightly more modest 140 square feet.   Innovation is reflected in the presence of Vari-desks throughout the space installed since the institution of a pilot program for stand-up desking.

    The Middle Ground

    Warren Averett adopted a more open plan approach at their new staffing agency offices in International Park, down the road from their headquarters.  This space features perimeter offices with large glass side-lites and low-rise interior workstations to encourage communication and interaction.  The space has been enthusiastically embraced by the employees working in it and may influence future space planning at the headquarters.

    More Cutting Edge

    Another local Birmingham firm, Barfield Murphy Shank & Smith, has a similar traditional headquarters in the suburbs but recently opened a small office in Downtown Birmingham to have an office closer to some of the firm’s clients. The unique office space on the ground floor corner of Richard Arrington and 3rd Avenue North features double height ceilings and windows. The workstations are all bench style and there is a small glass-walled conference room within the space. So far, the trendy new space has been well-received by employees and clients. Several employees are based in the downtown office while others from the suburban office choose to work there on a regular basis just to be in the open downtown environment.

    The Blend

    RSM (formerly Sellers Richardson) leases space at The Summit.  The firm relocated to the mixed-use development several years ago to give its employees a more dynamic work environment and the move has been enthusiastically embraced by those employees.  The Summit’s restaurants, shops and theaters serve as an extension of RSM’s workspace and invite the employees to get out of the office for a change of scenery during the work day. 

    The firm’s space is a blend of traditional offices and high-walled work stations.  The entry lobby and conference areas reflect an airy progressive feel and the technology is anything but traditional.   For example, RSM recently converted to an internet based phone system.  All phone calls go straight to headsets anywhere in the office or ring to a registered device.  This Single Number Reach system allows RSM employees to be easily accessible to their clients regardless of where they are working at the time. 

    The Big Four Example

    Some of the most progressive space in the city was constructed for PWC when they relocated out of downtown to the Brookwood Building in Midtown. With this move, they also transitioned from an individual office culture to a contemporary workplace strategy. Offices were moved to the interior and glass walls were added. Traditional workstations gave way to benching throughout most of the space and aside from a few Partner offices, no workspaces were assigned. Even the partner offices are available for use by any employee when the partner is not in the office. This hoteling policy allows PWC to achieve a density of ten employees per 1,000 square feet as PWC no longer reserves desks for those employees who spend most of their time at client sites.

    PWC office managing partner Terry Sparks says that attendance is higher at this new location both because the space is more conducive to collaboration and because there is palpably higher energy level in space where interaction is so easy.  Sparks said he believes the space has also been helpful to college graduate recruiting as the space is designed for the interaction many millennials crave.

    Professional service firms everywhere are challenged with transitioning employee cultures, cost control to remain competitive and demands from clients to provide best in class services.  There is no right answer and every firm has to identify what best solves its specific issues.  We do believe that there is an opportunity for professional service firms to lead by example and exhibit and experiment with best practices now, and in the future, for their own benefit as well as that of their varied clients.

  • Telegraph Creative’s Offices: Highly Functional Eye Candy

    Telegraph Creative’s Offices: Highly Functional Eye Candy

    Telegraph Creative occupies arguably one of the hippest spaces in Birmingham, next door to Carrigan’s Pub and right off the trendy Morris Avenue.  However, when Telegraph found the 4,500 square foot location, the space itself was definitely a diamond in the rough.  It is a credit to the vision of Telegraph’s founders and the architectural team at Cohen Carnaggio that they were able to turn what was once a leftover awkward two-story space wedged between the pub and a couple of redeveloped apartment units into the creative haven they now occupy. 

    When Telegraph founders, Kevin McLendon and Chris Vines, discovered the space, they were attracted to its walkable downtown location and the Birmingham history it reflected.  However, it came with architectural challenges and difficult code requirements as to fire-rated corridors and exit stairs.  Richard Carnaggio said that his team found a way to build a fire rated corridor the length of the first floor and connect it to the spiral stairs to solve the problem.  They were even able to squeeze a small mezzanine office area in between a portion of the first and second floors. 

    On the first floor of Telegraph’s space, there is a reception area, video editing space and work area.  The second floor of the space is primarily open plan with just a few enclosed offices.  The creative team sits in a benching configuration clustered at one side of the space.  There is a custom industrial style counter height table used for stand up meetings in one area of the space and a living room configuration with a sofa and chairs in another.  Up a tight second spiral staircase, there is a crow’s nest room with casual seating. 

    Telegraph’s space includes these various seating configurations to accommodate Telegraph’s unique approach to collaboration.  McLendon says the firm uses a lot of big group/small group brainstorming where the office meets in a large group to discuss a project or challenge and then breaks up into smaller groups.  They have found that the smaller group dynamic allows all employees to have their ideas heard, including the introverts in the group.  The informal seating areas serve as spaces for small group brainstorming sessions.  They also offer Telegraph’s team a variety of choices for focused individual work.

    Aesthetically, the space is reflective of its industrial origins.  Telegraph preserved the interior brick walls and the logos painted on them from previous occupants.  They had custom tables and desks built reflective of both the industrial space and the atmosphere of Carrigan’s pub downstairs.  The floors are weathered antique-looking hardwoods and the ceilings are open and high.  The warehouse windows let in significant natural light and the glass fronts on the offices allow that light to penetrate throughout the space. 


    Presently, Telegraph’s space houses twenty employees but McLendon believes it will allow their company to grow to thirty employees before they need to consider a relocation. When that time comes, McLendon says he has already had numerous other local business owners express interest in leasing the space from Telegraph.