You're an architect, you're pitching for a job and the client asks: how much? Not to panic – former architect Robert White can help you with the bottom line.
Robert White is a practised architect, but he looks more like an investment banker. With his dark suit, slicked back hair, and hunter's eyes, you would take him for a carnivorous City type who closes a deal the way a lion brings down its prey – the kind of guy you want on your side of the negotiating table.

White studied under the personal tutelege of Peter Cook at University College London's Bartlett School and graduated in 1991. After five years in architectural practice, he gave up designing buildings and went to work for Hanscomb as a project management consultant. In 2000 he set up his own firm.

Today, White's unusual job combines the roles of designer and dealmaker: he negotiates contracts for architects. His firm, White Partners, offers architects consulting services in three areas: fee negotiations, knowledge management, and archiving. White handles the negotiations himself, and uses specialist consultants for the other two areas. Here, he gives Building some insights into the business of architecture.

How should architects look at their projects commercially?
When taking on new work, the architect needs to consider the commercial viability and also what I term as the "value plus". All angles need to be considered for opportunity. Are you taking on new work because it will advance your knowledge in a particular sector or extend your skillsets? Are you furthering an existing client relationship or starting new ones? What is the whole gain?

How should they approach the early stages of contract discussion?
They need to look at what values are important to this client. To find these, consider this client's risks. Used as a starting point, these values can produce a good contract and you will create a relationship with a client who respects you.

Can you give an example?
Take the construction cycle of a project. This is the phase during which clients are most at risk. The industry has developed a number of contractual mechanisms to deal with this. However, particularly where a budget is challenged by the brief, these mechanisms are in danger of failing to deliver. One of the most pragmatic ways to ensure full value is to advance the understanding of the work prior to contract assignment. This may take the form of producing information suitable for SMM7 level of quantity billing or in a two-stage assignment, development of the detail with a preferred bidder prior to contract. Either way, in return for a slightly increased fee, the unresolved is resolved earlier, at a time when advantage can be made of it. The budget is better spent, the risk reduced, and the value optimised.

How should architects protect their own interests in a contract?
You need to evaluate your risks; have your eyes opened to what others may or may not do that introduces some form of risk. Understand the whole. Do not be afraid to ask questions, and if you do not understand the answer ask again. The worst thing you can do with a client is pretend you understand, or assume that what he said is what you think he said. Put a drawing in front of him, tell him what you think is going to happen, and see if he can explain it back to you so that you both understand. It's amazing how asking the same question two or three times can eventually lead to the right answer. It's not a sign of weakness – clearing up any misunderstandings at the start of a project is a sign of professionalism. Talk at the beginning is a lot cheaper than at the end. Agree good heads of terms and then ensure that the contract accurately reflects these.

The management of risk is a bedfellow to opportunity. Apportionment of risk in return for reward, something popular in the current round of PFI negotiations, would be a good example. If you understand a particular building type very well, you may be the expert on a team. Look for methods of reward that reflect this expertise. In exchange for your expertise you are closer to the decision-making process. Your risk is closer guarded and rewarded.

You prefer to be involved from the very start of a client–architect relationship. Why?
There is a correct time to pitch a fee, but rarely is it at the very beginning. At this stage you have very little knowledge about the project. An opinion voiced now is almost certainly wrong at some level. Too much caution and the client may go elsewhere, too aggressive and you have committed yourself. So this stage is about understanding the principles, identifying risk and judging opportunity. It's very exciting.

Who is in control of fee negotiations, architect or client?
The controller of a fee negotiation is the one who has the perspective. So you must make sure you understand what you will be doing and how. Understand the commercial issues, the risks and the value balance, and debate the worth of each.

How much can you save an architect on a contract?
This falls into two categories. When you're working in a big office as a junior architect, you go and ask your boss what to do. But when you set up your own office, you don't have anyone to ask – a lot of people ring their old boss when they start out. What they are seeking is that perspective. But if that perspective is limited to a small number of contracts a year, how good is it? To offer access to real perspective is where savings or gains are made.

Alongside this is the story the contract tells. Visualising the story is obviously the first step of this. This is the softer side but ultimately the side that can make the biggest gains.

Producing a good contract is like producing a good design, it’s an iterative process that goes to and fro

Where are the biggest gains available?
This depends largely on the project. The standard fee scale by stage reflects the norm for the normal architect. In reality the norm rarely exists. Each particular project needs to be evaluated. More importantly, the individual firm must recognise their own income versus profit trend and reflect that in how they build their fee and scope.

You mentioned knowledge management. Why should architects care about it?
An architect can expect to be at the peak of their output between 50 and 70 years of age. Before this probably the most valuable thing they build is their knowledge. The value of that knowledge being accessible should be clear.

Is a practice's archive its greatest repository of knowledge?
Scanning and cataloguing your archive is part and parcel of architects' knowledge management, but that's not the whole story.

The easiest stage is the curation of data in the archive. With the residual value that some of these archives are demonstrating this is becoming a necessity rather than a luxury. Ultimately, though, this is a legacy issue.

Relative to the working life of a practice is what you decided to do and how you reached decisions. Not just where and when, but why was such-and-such done and what was the decision matrix that informed it. This is ultimately the greatest source of value in an architect's practice. Some of the largest multi-site offices are beginning to understand this, but are still only recording the actual finished item rather than the whole process.

How do they make the most of knowledge management?
It's about looking at a firm's psyche, which obviously is driven very much by the principals. It's not formulaic – every practice is different. Younger architects are more comfortable with sharing knowledge – they're used to computers, used to the idea that information is there for the whole firm to use. It is necessary to look at the process of how decisions are informed and made if you wish to add value.

You're not a typical architect, are you?
Most people think I'm a lawyer. The first thing I say when I meet somebody new is "I'm an architect; this is where I've come from." So they understand you're reflecting where their interests lie, you're looking at a contract from the whole perspective, not just that of commerce.

Do you miss being an architect?
Not at all. It is vital for us to understand how each architect approaches their work to assist in crafting the right contract. The advice we offer is that of an architect. I work in the world of architecture every day – I'm immersed in it. For myself the contract and fee negotiations provide an arena within the profession for personal fulfilment and enormous job satisfaction.

Do you see your work today as a creative process?
Producing a good contract is similar to producing a good design. A brief, constraints, values, options, solutions … Hopefully in that process you build up understanding and respect, and end with something that suits client and designers.

Ten ways to avoid an Enron-style scandal

Derek Higgs, the deputy chairman of British Land Company, has reported on boards of directors. He calls for:
  • At least half of directors to be independent of the executives
  • Regular meetings, chaired by an independent director, where shareholders can air their grievances
  • An annual independent evaluation of the board
  • “Significant, recent and relevant” financial experience from at least one member of the audit committee
  • The posts of chairman and chief executive to be held by different people

Sir Robert Smith, chairman of the Weir Group, has reported on audit committees. He thinks they should:

  • Have at least three members, all of whom are independent non-executive directors
  • Have at least one member with an accountancy qualification
  • Avoid conflict of interest that could arise from non-audit work such as management consulting
  • Make annual recommendations to the company board regarding auditors’ appointment and pay
  • Monitor the integrity of a company’s financial controls and audit process