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Is Bigger Better? Acquisition of HOK and 360 Architecture How mergers have changed Business of Design

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World Expo 2020 Master Plan. Image Courtesy of HOK
World Expo 2020 master plan. Image courtesy of HOK

cabinet design, architecture, engineering and planning HOK International recently announced its intention to acquire 360 ​​Architecture, a company specialized in designing sports facilities. With the global influence of the HOK and expertise of 360 Architecture, the acquisition could make significant progress on the design of sports facilities and expand the market for each company. Regarding the architecture of the activity, acquisitions like this often lead to big corporate companies to take a wider variety of projects, giving them a competitive advantage against famous brand names in the industry . But what can we learn from the growth of the largest companies in the world?

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Is Bigger Better? HOK’s Acquisition of 360 Architecture and How Mergers Have Changed the Business of Design, World Expo 2020 Master Plan. Image Courtesy of HOK
World Expo 2020 master plan. Image courtesy of HOK

In recent years, the number of mergers has increased, with 2011 and 2012 establishing national and international records for the industry as A / E / C consulting firm in management Morrissey Goodale. [5] This may suggest a growing trend in recent years for architectural firms to take advantage of mergers, acquisitions and strategic partnerships to sustain growth in a volatile global economy and manage international projects increasingly complex. This trend can be further highlighted by the AIA prospective report for 2014, which states. "More than half of respondents AIA work-on-the-Boards survey estimated that merger and acquisition activity of firms architecture increase "[1]

[1945018entreprisesinnombrables] the practice of mergers and acquisitions has achieved growth and establish themselves in new markets. A first example of the success of this business practice may be the firm was based in Texas CRS, which has grown from a practice of two people in 1946 to become the first architectural firm on the American Stock Exchange and AEC largest company in the US by 1985. CRS acquired interior design, construction, engineering and consulting firms and has expanded its scope of the project to start working on projects infrastructure in Saudi Arabia in the 1960s [6]

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Baku Flame Towers by HOK . Image © Farid Khayrulin
Baku Flame Towers by HOK. Image © Farid Khayrulin

CRS also learned some of the pitfalls of architectural acquisitions, including how mergers can lead to clashes culture, and the loss of unique identities of businesses acquired in a merger. In some unfortunate turn of events, the company's business has suffered from the collapse of the construction industry in Saudi 1982 and the architectural group was sold to HOK and the rest of society Jacobs Engineering. [6] With this acquisition, which was once the largest American architecture firm became a nameless addition to another corporation. This purchase by HOK is only one of many acquisitions that could help it become one of the largest firms of world architecture today.

Founded in St. Louis, Missouri in 1955, HOK has grown both organically and through the acquisition of numerous companies worldwide. Before their most recent acquisition, HOK has retained 1,0 professional employees working in 23 offices on three continents. As with many other global practices, the rapid expansion of HOK was largely made possible through partnerships with other companies and its aggressive move into emerging markets.

and similar to many other large business enterprises, their capacity to diversify their practice helped them survive the economic downturns that would force many of their smaller counterparts downsize. Considering that more than half of the new architecture in the next two decades will be built in the United States and China, a global presence becomes increasingly vital. [3] This strategy has been deployed by many of the largest architectural firms, if they grew through mergers and acquisitions.

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Jilin CBD Master Planning Project. Image © AECOM
Jilin CBD Project Master Planning. Image © AECOM

AECOM is an example of a company that has initiated and supported its growth mainly by acquiring other companies. Until 09, the company operates as a collection of design, engineering, and project management companies all work under their own name without a unified identity. The new brand has made its official debut in 09 and has since operated in the areas of development planning and design, transport, energy, environment and water. In the summer of 2010 alone, AECOM was paid a total of about $ 1 billion to acquire small companies architecture and transition focus from engineering to design. [2] Throughout its history AECOM positions gradually taking on a growing demand for large and complex urban projects that require an integrated approach across disciplines.

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Piazza Gae Aulenti . Image © AECOM
Piazza Gae Aulenti. Image © AECOM

Like many complex projects of urban infrastructure are rising, demand for integrated architecture practices is higher than ever before . Large companies are often well equipped to manage large projects today in the most efficient manner possible. An example of such a project is the reconstruction work at the World Trade Center in New York. AECOM will oversee engineering, site preparation, PATH facilities, safety and signaling systems for the new transportation hub and coordinate Santaigo Calatrava designs with the necessary infrastructure for the project. The programmatic complexity involved in this business serves as an example the kind of project that could only be made possible through the coordinated efforts of large engineering and design practices.

The growth of practices such as HOK and AECOM are in stark contrast to the traditional idea of ​​an architectural firm headed by a single creative genius. In their book The CRS team and enterprise architecture , the authors Jonathan King and State Philip Langdon, "Nor was CRS a" form giver. 'It was not a Le Corbusier or Frank Lloyd Wright and Louis Kahn. but the need to train donor is limited ... the company has been able to organize and prepare for a mass society which required a large number of well-designed, but not too expensive buildings quickly. " [4]

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WTC Overview. Image © Joe Woolhead
WTC Overview. image © Joe Woolhead

This description seems to describe accurately the number of today integrate in the world of architecture enterprises. There are still many companies such as Zaha Hadid Architects and Foster & Partners who take their name from an iconic person, but we must also remember that even these companies employ hundreds of professionals to carry out their work. Sometimes these companies based on the plan will also use the engineering and project management of major companies in services, such as collaboration with Zaha Hadid Architects AECOM to design the Qatar 2022 World Cup Stadium. Despite these collaborative efforts, the work of many corporate companies is less on the iconic design service, and the delivery of functional buildings that can most effectively meet customer needs.

The architecture will always be a collaborative effort between architects design, decorators, engineers, and many other consultants. Regarding the major urban development projects, the number of parties is even greater. To take larger projects, global companies are increasingly expanding their reach through mergers and acquisitions. Rather than relying on the appeal "brand name" of a specific architect, large companies can choose to market themselves based on their ability to take on any project. This feature is made possible by the acquisition of companies with a range of specialties and operating under a single corporate identity. Whether or not we'll see more mergers and acquisitions in the future, there will always be a need for large corporate companies to make today the most demanding urban projects.

References:

  1. AIA Outlook Report: The changing environment, business and practice of architecture in 2014
  2. Hughes, CJ, Merger Mania
  3. ikenson, Ben, Secret Sauce Gensler
  4. King, Jonathan and Philip Langdon. The CRS team and enterprise architecture . College Station: Texas A & M UP, 02, p. 266.
  5. Morrissey Goodale 2013 M & A RECAP: A / E M & A activity Pumps Brakes
  6. Novitsky, B. J., fueling the firm mergers and acquisitions trend? Growth.

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