Business leaders to watch in 2021: Sherman Cawley, Cawley Architects

As the promise of 2021 looms on the horizon, most people are anxious to close the books on what is likely the most unsettling year — from the pandemic to politics to PPP loans — we will ever experience. Strong leadership has never been more essential than it is today. To share their best leadership practices, Az Business magazine sat down with Arizona business leaders to watch in 2021, including Sherman Cawley, president and founder of Cawley Architects.

A native Arizonan, Sherman Cawley has practiced architecture in Phoenix for 40 years, primarily in the design-build commercial arena. After founding Cawley Architects in 1994 and collaborating with the Valley’s foremost builders, Cawley Architects quickly became one of the premier design-build architectural firms in Arizona.

Here is the full transcript of the interview with Sherman Cawley

Az Business: How you were able to handle the COVID-19 pandemic at your firm.

Sherman Cawley: Well, I tell you, we watched the media very closely. The thing that’s amazing about the pandemic is that it was so unexpected. Really, I don’t think anybody had had any experience in regards to how to handle a crisis like this. We just focused on our core values, but we had a lot of absorbing to do. We needed to listen to our staff about their growing anxiety about the upcoming pandemic. We also needed, and were very careful about polling our director staff, and our principals in the office about a potential plan. We had to be very sensitive because it was also brand new, which we did. We did successfully listen to everybody. We’re an inclusive office. We like to build consensus, if at all possible. We were able to build consensus, in this particular regard, on how to handle it.

Once we had done that, we crafted a plan immediately, and I have to say, we did a good job. We were actually able to send people home and start working remotely on or about the same day that Governor Ducey declared that he would close restaurants and bars, and gyms and things like that. I think that the staff felt that we were responsible and responsive, and appreciated the fact that we had the same concerns that all of them did. We actually went home twice. Our choreography was that we went home the first time for two months, from mid-March to mid-May. Then, when Governor Ducey opened up a few restaurants on a limited basis, et cetera, we then did the same thing. We brought everybody back into the office, with great relief, for a short period of time. Until, of course, the spike started. That really alarmed staff. It alarmed all of us. Once again, we had to think, “We don’t know how long this is going to last, but we need to do the right thing a second time around.” In mid-May, we sent… In mid-June, we sent everybody home again, and literally, they have been home for four months, until this week.

We are so glad to say that we brought everybody back to the office for this particular week. We’re also glad to be back together again. We’re following all the protocols that everyone is used to, and everyone, of course, experiences in their own offices these days. Those go without saying. We’ve instituted one other. That is, for anyone who travels out of state, we do require them to self quarantine at their homes, working remotely, for five days before they come back in the office. That’s for the protection of everybody. That’s how we handled it.

Az Business: Did you have any of your employees working remotely pre-COVID?

Sherman Cawley: No, we didn’t. The one thing about our business, we’re a consulting business, and we design and engineer buildings, and we’re in computers all day long. We love the software. All of us are all in front of the screen all day long. We knew how to do that. All we needed was the infrastructure, of course, to send everybody home and work remotely, which we did. We have a great IT department. When we send everybody home, we quickly scrambled to get them the rest of the equipment they would need to work successfully. We gave microphones, and all of the webcams, and all of that, and then worked with them individually to overcome their initial obstacles. Here’s an interesting one for you. This is one that everybody ran into, universally. That is that, when the parents are home working remotely, so are the kids. Pretty soon, a lot of families ran out of bandwidth, and we had to figure that out and have a work few workarounds as we went through it. Other than that, everybody was very, very dedicated to making that format work. It really was supported by our communication.

Communication is the third most important thing we did, in regards to responding to the pandemic. Our office had very, very regimented, and consistent communication formats for weekly meetings, for monthly meetings, and even for quarterly meetings. We didn’t have anything necessarily for daily meetings. We didn’t need to. We were all in the office at the same time, we could all talk to each other and collaborate, and whatnot. We had to set that up. I give our staff great, great credit. They did a wonderful job. We are divided fairly horizontally in our office, has consultants, we have principals and directors. Then we have project managers and administrative staff. Probably, two-thirds or three-quarters of all of our staff are project managers and administrative staff. We required them to report in every day to their director. In the morning, when they got started they had to report in email form, what it was they were going to be working on, and give a complete agenda of their expectations of themselves during the day. That way our directors, who lead teams of five, six, and seven project managers, got a sense of where everybody was at during the entire day. Obviously, that’s the one thing you worry about when everyone’s remoting is, whether they really have all the resources they need, and whether they’re really working on what your expectation of their workload is. To their great credit, they all did that.

They all did that the first time. They all did that the second time. That has worked very, very well for us. Then, the other meetings, the weekly meetings, we just held virtually. The monthly meetings we always have had, for the last 12 or 15 years, we’ve gotten our office together in an office lunch, once a month, to make announcements and to bring people in on what they hadn’t heard about during the month. For instance, we have our announcements and benefits announcement, and all of those things, but then we also hear from all the other teams in the office about what they’re working on, what obstacles they’ve been running into, and the successes and achievements that they have been experiencing with their own projects. We share pictures of other projects and whatnot, because in a busy office of 25, with 40 or 50 projects that are active at any one particular time, you don’t know what a lot of the offices working on. It really builds towards a collaborative environment. We did that, but we just had to do that virtually in a happy hour format, rather than all getting together for lunch in the office once a month.

Last but not least, two other things. One very important new concept that we have adapted in our offices, something we call one on ones. One on ones are a very, very important process, now, that we go through where a director sits down with his project manager, his or her project manager, and sits down and interviews them in depth about how they feel we’re doing as an office. The obstacles that they are experiencing, the successes they feel they’re experiencing. The reason for that is, is because we set goals for them for their own careers in our office, which I’ll have a chance to talk about in a minute. We set goals for them and we want to know how they’re doing on their goals for their own careers. This is one very good way of them, and making them accountable, for trying to reach goals for their own careers. Then the other thing about that is, that we always hear about stuff that we wouldn’t necessarily know about on a daily basis. About stuff that doesn’t work, or needs to be improved, or really needs to be brought to everybody’s attention.

Last but not least for communication, we also do tours. We do tours of every single building that we design. We take everybody out of the office, everybody goes. It was mandatory when we were all working together collaboratively, as you can imagine, of course, it’s voluntary now during the quarantine periods, for people’s safety. On the other hand, those are all the ways in which we communicated during the pandemic in order to find that cohesion that doesn’t necessarily exist when you’re all working remotely.

Az Business:  What is it about your leadership that you were able to transition so seamlessly from being everybody’s in the office to have everybody working remotely?

Sherman Cawley: We’re inclusive. We’ve always been inclusive. As I mentioned earlier, we always try to build consensus for any big item that we’re going to adapt, or want people to follow through on. I think that’s very, very important. There’s a couple of other things about us. We’re enthusiastic. I personally love to be enthusiastic with everybody around the office, and by the way, we’re in a very stressful, very complicated arena. What we do as architects is actually extremely difficult. It’s very difficult. It’s easy to button hole people or to… I should say, to put people in silos, and put them into categories within an office, so they just do one thing, so you can get focused on just having one thing done by one group. We have really worked hard to resist that over our whole career. My partner, Paul and I, we’ve had a very, very successful partnership over the last 20, out of 25 years, in the office, doing exactly that. Making sure that everybody has as much responsibility as they can possibly take on. In certain cases, we even push them to do a little bit more because that way, they’re not compartmentalized into a particular role, which ultimately gets boring. They’re actually working on their own careers in our office.

I think with that attitude, where we’re all in this together, we’ve always, always been in it together, and we want to continue being in it together. I think that’s one of the things that led to our being able to successfully negotiate through this. The other thing is, we spend our whole careers in front of a screen anyway. It was fairly easy to do that.

Az Business: Were there any disadvantages to working remotely?

Sherman Cawley: Absolutely. The two disadvantages that emerged fairly quickly were that, we found that what we missed out of working remotely was those teachable moments. We missed the collaboration that evolves out of spontaneity, and all spontaneously being in the same office, at the same time. There were teachable moments we missed. There was a few things on drawing packages that went out that got missed, and we have a very involved QA-QC process, so we caught all that stuff. On the other hand, it was obvious to us after six weeks or so, that was one of the issues that was just going to happen inadvertently. You can’t tell when it’s going to happen, so you got to have the back end on your process to make sure that you’re picking that stuff up as best you can. That’s number one.

Number two is, we’re not the only ones who have been stressed through this whole process. We work very intensely, not only with consultants, design engineers, structural engineers, electrical engineers, and whatnot, but we work very closely with the cities for the permitting process. We have found over time, that the cities have really suffered. They have an enormous backlog of materials, and standards, and whatnot, every city does. It’s been tough for the cities to catch up. We’ve noticed the cities have slowed down a little bit. The way we’ve tried to help them is to just continue to provide as much information the first time around as possible, so that they’re not correcting our work, and other things like that. I would say that’s the other disadvantage of working remotely, right now, is that it’s really impacted our collaborative partners out there, most importantly, the cities.

Az Business: Have you found any advantages?

Sherman Cawley: Yes. These are universal, and these are really great. First of all, we can do it. We can absolutely work remotely. It surprised us. We would never have done that on our own because we are so intensely collaborative, but once we started that routine, we realized that it works. Right now, our office is working on a program where we’re going to find a way to have us, on a regular basis, work remotely because we found that we can do it. The second thing is, that there’s a really, really good personal advantage, which emerged for everybody out of this, which is we no longer had to commute. Everybody got that commute time back. I know that, for myself, personally, my wife and I certainly enjoyed that extra time in the evening after the workday, when we got a chance to, we had a few more happy hours during the quarantine period. To a person in our office, I think everybody appreciated the additional family time that came from that. Those are two advantages that we actually do want to find a way to incorporate into our corporate work life. We learned from that. We learned from that, so we’ll be able to do more with that in the near future.

Az Business: How has COVID impacted, not only your business, but your industry sector?

Sherman Cawley: Well, in our own business, we saw a slight downturn in regards to revenue, in the second quarter, which is of course during the intense part of the first quarantine. Revenues were down slightly. In the third quarter, they’ve picked up, and we fully anticipate that by the end of the year, we will have reached all of our financial goals. In our particular arena, which is light industrial and manufacturing, industrial facilities, we haven’t seen much of a slowdown. I do want to talk a little bit more about that in a moment. Our heart goes out to, however, all of those people involved in the restaurant and entertainment, and hotel industries, not only throughout the Metro area in Arizona, but nationwide. There has just been devastation on those areas. The reason our heart goes out for those people is because that’s what we went through, industry wide, real estate wide, during the recession, of course, in the late 2000s and early 2010s.

One of the things that I can speak to, and by the way, I also want to compliment AZRE and AZ Big Media for some very, very good articles on what to expect in the future for the next six months, in regards to a wide variety of businesses and industries. I was particularly impressed with the most recent article about upcoming opportunities. I think your readership got a really good insight into some of those really hard hit areas, like retail and entertainment. Also, some of the burgeoning industries, of course, as we all know, which is of course, big distribution. Our particular niche is light industrial projects that you would find in light industrial parks. It’s the businesses that are contractors, manufacturers of all kinds, assembly of all kinds, anything from 10 to a couple hundred thousand square feet. We love that arena, and we have succeeded in that arena, and we’re very well known for that.

I would say that the deal flow coming our way, over the past several months, really hasn’t diminished very much. Manufacturing is still strong here, and as you know, continues to get stronger. A lot of the distribution business has now burgeoned, and not only into very large distribution, which we’re all familiar with, everything over half a million square feet, but also into the smaller last mile distribution product, which is now emerging, and just led the way by Amazon Prime and those facilities. Those are all smaller distribution buildings. They’re doing fine, too. There is a reason why the light industrial manufacturing area really hasn’t suffered too much, and it’s because of housing. In the Valley area, the real estate economy used to totally depend upon housing and construction of all kinds. That, of course, was what was so devastating in the original recession that we all suffered in 2007 and 2008. We haven’t seen nearly as much of that now because our economy is so much broader based, and so much more extensive. On the other hand, housing has always led in the Valley, and light industrial has always been second right behind that. We’re not seeing too much of a slowdown.

Many of the prime movers in that arena, the design build contractors, and a lot of the design build architects, I’m sure would say the same thing, which is that there’s probably been a slow down on a few projects, which have been postponed. While lenders, especially, wait to see what the ultimate impact is going to be on their entire portfolio, not just commercial real estate, not just light industrial projects. We feel lucky this time around, and also our prognosis is that it will remain strong. Housing remain strong. We follow everything that GPEC has to publish about what the future, the near future, and even the longterm future, of the Valley is. Chris Camacho and everybody there is continuing to predict a hundred thousand new people every year, for decades to come, which burgeons well for our particular industry.

Az Business: Can you talk a little bit about your leadership style and how you’ve been able to develop Cawley into what it is today?

Sherman Cawley: I love to talk about our leadership style, because I think it sets us apart a little bit. Paul and I have developed a very, very successful partnership in regards to what we value. What we value is respect for the same values that allowed us to succeed. That was our own ambitions, and our own concern for our clients and their needs and requirements. As a consequence, we have come to the realization that in our arena, as consultants, all of working is learning. Everything we do we try and put into an educational format. In regards to doing that, and this is a precept of our office, there are two precepts that we make a point of following through on making a part of our regular routine. The first is, as I mentioned earlier, we want to support our staff members in their pursuing their own careers. We feel very, very strongly that if our staff members, our project managers, our directors, even our principals, the two of us, if we are all engaged and feeling like we’re as fully engaged as we can be in our own careers, then we will be giving back as much to the company as possible.

We feel that’s a little bit of a dichotomy from other companies, and an office firms, for instance, which compartmentalize people, or try to just restrict their activities. We don’t do that. As I mentioned earlier, we give our staff as much responsibility as possible. We want them to feel as fully engaged as they possibly can. That’s a precept for us. We really make a point of following through on that. That’s number one. Number two is that, we’re in a very, very technical arena. To design a building with thousands of components, and thousands of steps to take, these projects take a year to come to fruition for our clients, a year and a half sometimes. This is very, very complicated stuff. Because we’re working on many projects, some people in the office can be learning one thing, other people in the rest of the office can be learning something else individually. We make a huge point of everybody contributing to everybody else’s success. That’s very, very important to us. We have a huge feedback loop in our office, which starts with the individual staff member learning something new. We have many ways in which that actually gets translated into a format that everybody knows that they can rely upon for incorporating into their own projects. That includes training.

Offices like ours, try to train. Our office stumbled over the years, trying to train. Train a little bit, train now, then back off because you’re busy. All of that. It just didn’t work. It was just wrong. It wasn’t really adhering to that core value that we respected so much. We tried and fell, and tried and fell, and we have now succeeded in absolutely implementing a regularized, ironclad training session every other week for the entire staff. We did it virtually during the quarantine periods, and we’re still doing it now. Even now, when we’re back in the office, we still do that training virtually, so that we cut down on the amount of interaction between people for these sessions. On the other hand, everybody’s contributing to everybody else’s success. We’re also, because as you can imagine, we have a tremendous number of standards in the office, which allow everybody to work efficiently. All of those things that we’re learning, either new city procedures, new information about components for building construction, information from contractors about what they need for their projects, all that goes into our feedback loop so that everybody’s making a contribution. That’s another very important precept for us, that we work on regularly.

Az Business: What have you done right to maintain that leadership over the years?

Sherman Cawley: We believe in our staff, and we do have to hire well. We’ve made all the mistakes every other business owner has made out there. We’ve had underperforming staff. We’ve done what everybody else does, which is hire too quickly, and let go way too slowly. We’ve made all those mistakes. Over the years we have learned what it really takes for great staff. That is, values. We’re looking for people with great values, that really will step up. All these things we believe in, but our staff believes in them, too. The way we’re able to manage all of these concepts is that we have everybody, basically, buying in to use the overused phrase of buy in, we actually do have buy in. We have no turnover, really, in the office, and haven’t for years, because of the way in which we engage everybody else, and rely upon everybody else, to really hold up their part and follow through. There’s no way us, as principals or directors, can get all this work done at the level of competency that we really aspire to without great staff. We’ve learned, and now have, a wonderful staff that we totally believe in, and who, as a consequence of that, believes in us.

Az Business: You’re the number one ranked architecture firm in Arizona. Can you tell me what it is about the company that you’ve built, that gives you the most pride?

Sherman Cawley: I think, first of all, the success of our projects. I am extremely proud of the success of our buildings, our tentative improvements, our services. We have worked very, very hard to really deliver a great service. That, I am the most proud of. The second thing is, I think Paul and I both feel that one of our other great accomplishments, was that we kept 12 people busy for five and a half years during the absolute trough of the recession. I’m especially proud of that. We had great collaborative partners, especially our design build contractor partners, that we welded ourselves together. Quite frankly, we were one of the larger offices in the Valley during that time, simply because we had those relationships that we could count on, and really deliver for. We delivered at 120%, every one of those years. I’m also especially proud of this. Who knows, maybe when we get through this, and we all have vaccines, and we can look back on our remote working, maybe we’ll feel equally as proud of this particular event in our careers, as well.