Architecture firms are saving up to 90 percent of their rendering costs by sending projects overseas, often to India. Out go plans, in come full-color images–changing the basic economics of architectural design.
After 16 years at a major hotel and restaurant design consultancy, Janice Clausen was eager for a change. “I was managing too many projects and not doing enough design, which is what I love,” she says. In 2004, Clausen and fellow megafirm alumnus Chuck Chewning launched their own design firm in Atlanta to focus on creating luxury environments for the high-end hospitality industry. Soon Clausen Chewning Interior Design (CCID) landed its first commission, upscaling a remote island hideaway in the Maldives to become the One&Only Kanuhura resort. With thatched-roof “water villas” on stilts, dining areas and tennis courts tucked among the mangrove trees, and a tiny adjacent island to which one could travel for private dinners and day trips, the location seemed ideal.
Then, in 2004, an undersea earthquake hit off the coast of Sumatra, launching 100-foot tsunamis into the Indian Ocean and erasing whole villages from the map. The resort was ravaged. Of the water villas along the beaches, only the bathroom fixtures remained. Suddenly CCID’s breakout project became much more daunting—–particularly with an in-house staff of just three people. The two senior designers hadn’t mastered AutoCAD yet and still relied on sketching by hand.
For help, they turned to Satellier, a rapidly growing Delhi-based architectural outsourcing firm, specializing in CAD and BIM (Building Information Modeling). As Clausen and Chewning turned out elegant concepts for a reborn tropical paradise, Satellier’s architects and engineers whipped them into CAD files at a fraction of the cost of stateside production. The One&Only Kanuhura was declared Best Resort 2006 by Hospitality Design magazine, and more commissions poured into CCID’s Atlanta office—–from a three-bedroom ultraluxe apartment at 15 Central Park West to 340 guest rooms and five restaurants for a new Mandarin Oriental in Guangzhou.
When Michael Jansen, the Yale-and Cambridge-educated 38-year-old founder of Satellier, first arrived in Delhi in the early 1990s, the economy was depressed, corruption was rampant, and just getting phone service in your office was tricky business. But then the Y2K event gave a shot in the arm to India’s nascent tech industry. With seed capital from angel investors in 2004, Jansen built a five-story headquarters on a dirt road between a garment maker and a dilapidated candy factory. The original staff of 15 has now grown to more than 450 and continues to grow 100 percent annually.
Firms like Satellier are leading a revolution in architectural practice that goes far beyond outsourcing CAD. More and more, the routine production tasks that comprise much of the heavy lifting in the architecture, engineering, and construction industry (AEC) are being farmed out to startups in developing countries like India, China, and the Philippines. A 2006 survey by Larsen Associates predicted that 20 to 30 percent of U.S. architecture jobs will move offshore in the next decade. Autodesk, the makers of AutoCAD, recently told its investors that its business in emerging economies is growing at 30 percent a year, faster than any other sector—–despite the fact that the majority of users in those countries are working with pirated software.
AEC outsourcing firms are also proving to be passionate early adopters of new technologies—–such as BIM, which replaces CAD with a deep data set that tracks changes to every element in a project. Tweaking the dimensions of a window in BIM instantly updates the changes to the walls surrounding it, the materials required, the overall cost and time to delivery, and the effects of that decision on the energy efficiency for the life span of the building. A change in any component instantly updates the overall project data.
As technologies like Skype, instant messaging, video conferencing, and the ability to move terabytes of data with the click of a mouse radically transform project flow and create a 24/7 global workforce, offshoring is becoming less of a dirty little secret in the architecture and design industries; it’s just how business gets done.
With BIM “we’re not just representing buildings anymore, we’re simulating them,” explains architect David Gerber, who honed his skills working with Frank Gehry and Moshe Safdie, and is now vice president of innovation at Cadforce, another leading out-sourcing firm. “In the past, when we reduced 3-D objects to 2-D models, we were basically dumbing down all the knowledge it took to make the drawing. That’s why there have been so many lawsuits and cost overruns in architecture—–bad information. With BIM, the model in your computer operates like a building, and can be calculated like a building, including all the environmental impacts. That’s a major leap forward.” By outsourcing BIM jobs to developing economies like India and China, he adds, “we’re exporting green-building knowledge to countries whose carbon footprint is going to exceed ours within ten years. They’re going to need it.”
Even the venture-capital community is getting onboard. Last November, Silicon Valley powerhouse Sequoia Capital gave a $10 million infusion to Satellier. Most of Satellier’s big-name clients are tight-lipped, but among the high-profile projects that took shape on computers in India are the Trump Tower and MGM City Center in Las Vegas, and the Formula One racetrack in the Dubai MotorCity complex.
Cadforce, based in Marina del Rey, California, began marketing its offshore services to commercial and residential architects, home builders, and engineers in 2001. One of its early clients was architect Cliff Moser, then at RTKL Associates, who couldn’t find anyone in the office with enough spare time to help him render the drawings for an addition to his Culver City bungalow. After stumbling on the company via Google, Moser is now its VP of architecture. One of his roles is bringing project managers over from the firm’s offices in Kolkata on what Moser calls “field trips” to immerse them in Western building practice.
“It’s often the first time they have been to the U.S.,” he says. “We give them tours of parking garages and skyscrapers, bring them down to the Disney Concert Hall and Santa Monica Pier, and take them to Wal-Mart and Target. They may have drawn dozens of buildings like these but never been in one. It’s like finally seeing the inside of a space station.”
On the domestic side of the equation, outsourcing companies are also learning the value of expanding their presence so that clients can deal with them face-to-face. This year, Satellier will open new offices in Manhattan, London, and San Francisco.
Autodesk’s vice president of industry relations, Yale School of Architecture lecturer Phil Bernstein, disputes the notion that AEC offshoring is undercutting American jobs. “It’s a subtler issue than that. There simply aren’t enough warm bodies here anymore to do the work, and everyone’s as busy as they can be,” he says. “The way I gauge this is how easily my students are employed after they graduate. For the last few years, they’ve been snapped up immediately every summer.” Even so, outsourcing is changing the traditional apprenticeship process. One of the most fraught topics at a 2006 AIA roundtable on outsourcing was how the industry should respond to a world in which young architects no longer get years of on-the-job training in drafting and documentation.
But for Satellier founder Jansen, success stories like Clausen and Chewning’s are just a preview of the liberation of design intelligence, as routine tasks are increasingly shifted to the global network. “The day of the megafirm is over,” he declares by VoIP phone from a beach in Kerala. “You’re going to see the emergence of the construction-modeling firm as architects move production out of house. These companies will be metadata warehouses that do modeling directly for owners, construction companies, and AE firms. By allowing architects to focus on their core skill, which is design, they will enable firm owners to increase the dollar value of their companies exponentially.”
Jansen’s ultimate vision is “to act as the great democratizer of design in the industry. You have a lot of tremendous talent inside megafirms right now that would love to be doing their own work, but they don’t have the money to float a startup until it becomes profitable, which takes about five years,” he says. “Small, high-end firms like CCID are the future. Now with a good website and a reliable production resource, you’re in business.”
