Peer Review: Something to Consider

Life in a design firm is hectic enough without having a stranger looking over your shoulder critiquing your work. But many times that extra set of eyes can show you how to make your business more profitable, easier to manage and less likely to be the target of professional liability claims.

Those extra set of eyes belong to peer reviewers, professionals in your discipline who have been trained to give you a positive, objective and confidential review of your business, its organization, operation and policies.

And they work well.

"The third party feedback provided by the reviewers was invaluable," said Rob Comet, AIA, of Bond Comet Westmoreland and Hiner Architects. "The process allowed us to step back and reflect — we were too close to the issues to see them objectively."

Charles W. Kopplin, P.E., of Graef Anhalf Schloemer and Associates, Inc. in Milwaukee, agrees.

"A peer review," he said, "is as important to your firm’s health as a physical is to yours."

Despite the endorsements, some firms are still reluctant to request an organizational peer review (OPR). They may think that:

• My firm is too busy, there is not enough time.
• No outsider could understand a firm the way the principals do.
• I don’t want total strangers telling me what to do — it’s my business.

Experience has shown, however, that they may be putting themselves at a competitive disadvantage by not requesting an OPR.

Professionals in every field need to constantly evaluate, challenge and improve the way they do business just to keep pace with an increasingly complex, competitive and rapidly changing marketplace. The demands placed on today’s design professionals by their clients are prompting successful firms to re-evaluate their business models.

For example, the emergence of design build as a significant project delivery method and the invasion of non-traditional competition are putting an overwhelming premium on speed in both design and construction. Organizational efficiency continues to be crucial to competing and managing risks the in the new world economy.

Realizing the relationship between practice management, risk management and good loss prevention techniques, XL Design Professionals has a long history of supporting the organizational peer review programs provided by the American Consulting Engineers Council (ACEC) and the Association of Soils and Foundation Engineers (ASFE). But, while XL Design Professionals support the programs and even provides dollar-for-dollar reimbursement (up to $6,000) that covers the entire cost for most ACEC and ASFE programs, it respects the confidentiality of the reviews and is not privy to the results.

"We feel any firm that goes through the process and applies the lessons learned will improve its management and organizational practices and thereby reduce its professional liability exposure," XL Design Professional’s Gary Prather, said. "We think it’s a win-win opportunity."

OPR programs look at seven key management areas:

• General Management
• Professional Development and Human Resource Management
• Project Management
• Quality Management
• Financial Management
• Business Development
• Computer Systems Management

You can decide which, if any, of these areas need to be given special attention as part of the peer review process.

Reviewers are practicing professionals who have been trained to work with you and your staff in a collaborative, positive manner that fosters an open and constructive exchange. During the review your firm will be examined against its own policies and procedures, not some ideal standard. The process can lead to increased productivity, improved communications and enhanced staff interaction.

"The experience gave us a much better appreciation for our culture and the need for open lines of communications up and down the organization," Comet said.

Dave Owsley, P.E., Larkin Group, Inc., Albuquerque, agreed.

"Coming from the outside, the reviewers were able to pinpoint things that allowed us to focus on changes to improve our day-to-day operations," he said.

That refining of business practices can have significant effects on a company’s exposure to professional liability claims. When XL Design Professionals recently asked its claims managers to identify the leading causes of claims, these organizational and managerial issues topped the list:

• Shortage of qualified staff
• Client communications
• Quality control procedures within the firm
• Client selection
• Technical training

Compare that list to the seven review areas an OPR encompasses and its value as a loss prevention tool is clear.

As many things that a peer review is, there are several things it is not. An OPR is not an evaluation of a firm against national or regional standards. It is not a way for the competition to get an insider’s view of your firm. And it is not expensive or time consuming.

The experience is often so positive many firms will come back for a second review.

"We had our second peer review in May of 1999," Arlyn Albrecht, of Clark Dietz, Inc., Chicago, said. "We were looking forward to preparing a new strategic plan for our firm and this second peer review was intended to provide us with good background information on where others — including our own employees — perceived we were from an organizational standpoint.

"We were as pleased with this second peer review as we were with our first one."

As the pace and complexity of business increases, an organizational peer review offers an effective — and cost effective — way to developing the organization and procedures you need to remain competitive. As Comet says, "It’s the best value in the market."