PROPRAC 342: InterProfessional Relationships

SUBMITTED BY:
Balindong, Abdulazziz
Genio, Veverly Samms S.
Mariano, Seorgino Franco
Moreno, Mark Andrew S.

Penilla, Christian D.
Samar, George
Sangel, Marikristil B.
See, Ian K.

AR1144

INTER FIRM ALLIANCES

Pertains to the collaboration of two architectural firms participating on a

particular project.

For two firms considering an alliance, the greater the need for ongoing task
coordination and joint decision making between the partners in an alliance,
the higher the anticipated level of interdependence and coordination costs.

Each form of alliance governance structure provides differing degrees of

control over and coordination of the activities in a partnership.

As a result, firms will seek the governance structures or alliances that will
provide the necessary ongoing over- sight and coordination. The higher the
interdependence among partners, the greater the amount of information they
must process while the alliance is in progress.

Partners in such alliances must evolve mechanisms through the governance

structure to process the requisite information.

Alliances with more hierarchical controls are capable of providing greater

coordination and information processing capabilities than those with fewer
controls.

Contractual relationships such as alliances can include several hierarchical

elements embedded in their structure, including

(1) a command structure and authority systems to put it in place, as well as

systems for certifying which communications are authoritative,

(2) incentive systems that facilitate performance measurement and link

rewards to performance,

(3) standard operating procedures that allow quick decisions to be made by

anticipating those decisions in advance

(4) dispute resolution procedures that bypass courts and markets by

specifying a hierarchy of entities or individuals to which appeals can be made,
and

(5) non-market pricing systems, such as cost-plus systems, which enable

greater precision in remuneration when changes in specification are made.

These hierarchical elements are present to varying degrees in different

governance structures for alliances.

While incentive systems and non-market pricing highlight some of the agency
features of hierarchical controls previously discussed by transaction cost
economists, the other elements concern the coordination capabilities of
hierarchical controls in alliances

For instance, the command structure, authority systems, and standard

operating procedures all make it easier to coordinate tasks between partners
by clarifying decision-making procedures and anticipating issues before they
arise.

Hierarchical elements in alliances can effectively address the anticipated

coordination costs resulting from interdependence for several reasons. The
standard operating procedures, command structure, and authority systems in
hierarchical governance structures in alliances typically include planning,
rules, programs, or procedures, which March and Simon identified as key
means for task coordination.

Planning involves presetting schedules, outcomes, and targets; and rules,

programs, and procedures emphasize formal controls in the form of decisions
made a priori for various likely scenarios.

All of these serve the common purpose of minimizing communication,

simplifying decision making, reducing uncertainty about future tasks, and
preventing disputes.

In alliances, hierarchical controls institutionalize, or formalize, interactions

between partners. In addition to regularizing meetings between partner
representatives, such hierarchical controls may also formally designate roles
for the partners.

In joint ventures, which may involve the greatest extent of hierarchical

controls, this type of control is implemented at the time of inception, when
formal roles are allocated.

Formalization makes the division of labor and the interactions between

partners more predictable and allows joint decisions to be made more by
rules than by exception.

Because hierarchical controls clarify boundaries on decisions and activities

they simplify decision making.

Design team Arrangements

Most work done by architects is carried out in teams settings: project teams,
ownership teams and special task teams in a firm. The quality of the
teamwork, including team communications, directly affects the design work
of individual architects. Despite the obvious importance of developing
competent, cooperative teamwork, many architecture teams fall far short in
their communications and performance. This topic explores the roots of these
problems and the nature of effective teamwork. Included in the discussion
are explanations of basic team building, strategies and skills that can help
architecture teams performs at higher levels of productivity and creativity.

Following are examples of the kinds of team settings in which architects and other building design
professionals often work.

Project Teams. Most projects involve a team of architects, engineers, contractors,

subcontractors, owners, and users. Effective teamwork on projects contributes to profitability and
quality, as well as greater ability to achieve the original design intent.

Ownership teams. Teams of principals and partners govern many architecture firms. Ownership
teams can support positive organizational culture, information sharing between departments,
productivity, and financial performance.

Studios, departments, and markets. Many firms organize work by studio, department, or market
teams that specialize in a building type or client group. Good teamwork can improve the personnel
assignments, professional development and mentoring, and employee job satisfaction.

Special projects. Many firms use teams to tackle special projects such as marketing initiatives,
operational issues, and practice opportunities. Successful teamwork on such efforts can improve
the quality and value of project outcomes.

Some architects thrive on teamwork in their practice, while others struggle with it. In particular,
architects who prefer to work as loners can be both uncomfortable and ineffective when it comes to
working with a team.

Along with these important advantages of working in teams, groups and teams often face predictable
problems.

Predictable slippage. Many architecture project and ownership teams suffer from this problem. While
all teams have the potential for synergistic results, many actually suffer from performance slippage. With
synergy, 1+1=3. With slippage, 1+1=1 . Slippage occurs in architecture teams that enlist talented
individual members but fail to produce at a level equivalent to the total of their talents. These teams
resemble all-star teams that showcase strong individuals but fail to deliver a strong team performance.

Individual negativity and passivity. People change their behavior when they participate in a group, and
the changes can be worrisome. People tend to be more critical, negative, and passive in a group that
when they communicate in a one-on-one situation. This attitude can be seen in design reviews, which
have the potential to provide useful criticism but often become so negative that such content is lost.

Individual focus. Even when a team leader advocates teamwork, many group members are actually
thinking, How does this affect me? For example, principals in architecture ownership teams can
struggle to balance their individual interest with the good of the firm.

Groupthink. Many group suffer from conflict avoidance, premature agreement or short-term or farfrom-optimal thinking. Architecture project teams, for example, may conduct project status meetings
that seem well organized and smooth but actually fail to uncover and address glaring project problems.

Questionable ethics. Groups and teams of all kinds have the ability to coerce individuals- even
individuals with strong personalities- into going along with the group sentiment. This occurs in old
boy ownership teams that systemically neglect problems in the organization of the firm, career
development, and advancement issues and mentoring of younger professionals. Even the most ethical
individuals can (and do) strong-arm the weak to get their way.

Ineffective leadership. Many of the potential problems noted previously stem from ineffective team
leadership. Strong leadership requires skills for managing group discussions, addressing and controlling
groupthink, and making passive participants more active.