Monthly Archives: June 2019

Best Practices, community associations, Culture, Customer Service, HOAs, Management, Professionalism

Sucking Up is Not Customer Service

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I had a conversation once with a young manager. She was learning to navigate the sometimes challenging terrain of management-board relationships. At the time she was working for a management firm that had, in my opinion, lost their way. At one of their company functions, a more experienced manager had shared an anecdote about golfing, drinking, and intense schmoozing with his board president. She concluded, “I guess it’s true – the best strategy for job security is being buddies with the board president.”

NO, NO, NO!

Our young manager had a misguided understanding of what customer service is all about on a deeper level in the specific field of community association management. How can managers and other professionals truly serve their community association clients?

What Are We Really Doing Here?

Miriam-Webster says a contract is “a binding agreement between two or more persons or parties.” I think there is a fundamental element missing from that definition. In order for the performance of a contract to meet the expectation of the parties, the definition should finish with the words, “…that provides mutual benefit to both parties.” A zero-sum gain approach to a contractual relationship is short-sighted. If the party performing the service is forced into a low-price box, or is otherwise constricted in the performance of their duties, the relationship often proves unsatisfactory and tends to be short in duration.

When the agreement is some form of service contract, one of the benefits to the client is they receive services that they do not have time and/or expertise to perform themselves. Digging deeper, that means a client is forming a partnership of sorts with a party who brings value to the table. The more mutual the benefit and the deeper the partnership, the more successful the relationship can prove to be.

Supervisory + Advisory = Partnership

Management contracts and position descriptions describe the work that will be performed on behalf of the client. This is proper and important, because it establishes expectations for service. It is describing supervisory functions. Yet, a contract or position description does not always describe the expertise with which those tasks may be performed. Furthermore, the greatest potential value of the relationship may be largely unstated, except perhaps in the fluffy marketing material provided in a proposal. Excellent management companies and professional managers are able to provide recommendations and guidance that can change the status quo and set the table for progress and improvements in the community. It is these services of an advisory nature that make the relationship most beneficial to the client. Yet, while most boards are happy to take management to task for deficiencies in their supervisory duties (and reasonably so), they may never get to the level of receiving or accepting advisory services. In the end, no one wins.

The Challenge? Fear & Schmooze

Some managers are afraid of getting fired. Some may be inexperienced. Some may lack confidence in their abilities. Boards may micromanage for any number of reasons. An “on-the-cheap” mentality may have led to a vicious cycle of mediocre service. Mediocre service invites micromanagement. A manager who never passes the test of capability in supervisory duties will never earn the trust necessary to be an advisor.

Some management companies are afraid of being fired. They fear telling clients anything that they think will put the contract at risk. This sometimes plays out in a blame game. Companies throw their own managers under the bus to appease an angry client and never deal with core issues. Saving the client by skewering your own people creates a cancerous organizational culture and impedes true partnership. It’s based on personality or politics, not leadership, values and vision.

All of these factors are unhealthy. They easily lead down the slippery slope of schmooze. Trading professionalism and respect for a shallow relationship based on low standards may keep the relationship going for a while. But no one is well-served, especially not the community members.
That is why I see this as so insidious. Community Association 101: Board members and the managers who serve them have a duty to care for the best interests of community members as a whole. Anything that works against that violates this fundamental principle of leadership and stewardship.

It’s Not Always Evil

Sometimes people just don’t know. A dedicated volunteer leader may not realize what is available. To illustrate: While performing an operational audit for a client, it became clear to me that volunteers had been performing management duties for a long time because they did not have a clear picture of what a professional could do. During that engagement, there was a need to find an interim on site manager. I was able to connect them with two PCAM-credentialed managers for short periods of time. Both of them blew the board away. A new world opened up to them over the course of a few short weeks.

When the Customer is Right

“The customer is always right.” 

– Chicago Retailer Marshall Field, 1905

There are times when our clients are always right. Like when expressing how they feel about something. Or when they communicate an expectation. Whether or not a feeling is justified or an expectation is reasonable is a different matter. In the moment, it’s irrelevant. That IS how they feel, that IS their expectation. We spend too much time judging the feelings and opinions of others. It’s a damaging, waste of time. Just listen. Acknowledge. Identify.

When the Customer is Wrong…or Perhaps Uninformed…

Sometimes a manager’s conundrum raises its ugly head when a client has difficulty accepting reality. There could be different reasons for this. Fear, ego, or simply a lack of understanding can be powerful obstacles. In this critical moment, a manager may feel she has a choice – tell the client the truth, or tell them what they want to hear. The truth is, a professional manager has a duty to provide their best advice, whether it will be accepted or not. The art is in the telling. Managers with high will discern whether their challenge is in the timing of the message, its presentation, or both.

Rolf Crocker, CEO/Principle of OMNI Community Management, LLC, in Fair Oaks, California, is one of my favorite thought leaders in the community association business. He has a unique perspective and a knack for helping others reach clarity. He taught me a rhetorical device to guide clients to what should be an obvious answer. A version he usually uses is as follows:

“This is the point in the conversation where I ask you if you want to hear what you want to hear, or do you want to hear what you need to hear? If it’s what you want to hear, we can talk about the weather, the market or your favorite sports team.”

This approach is genius. He’s making his point while allowing his listener the room to make light of it – for a moment.

Getting to Mutual Benefit

Boards and managers need to be deeply rooted in the fundamentals of business, ethics, and leadership. Management has to suck it up and prove value, sometimes without being paid for it at first. It’s a tough row to hoe, but “trust me and pay me” won’t always work. Once the opportunity for value is proven, boards need to see that value, respect it and pay for it. We must be responsible for ourselves, remember who we serve, and stay true to that, no matter the short term cost. Tell truth to power, tactfully but unfailingly. Forging and maintaining successful partnerships is one of the most fulfilling human experiences we can have. Please don’t blow it by throwing away principles and relying on a relationship based on influence. Those come and go. Partnerships based on respect, trust, and shared values are those that last. Done right, everyone wins.

Is this a pipe dream in the commoditized and occasionally political world of community association management? Nope. I’m proud of the relationships I forged with the communities I served. I am also comfortable with the few relationships ended by one party or the other. Those partnerships were fatally flawed and needed to end. My principles remained intact and there are no regrets. I’m not alone. There are some great managers, companies, and boards out there who get it. They are profitable in every way. Just ask Rolf.

community associations, Management Insider

Management Insider #2 – How We Got Here

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Sometimes managers entering the community association field have a hard time understanding some of the stressful dynamics of the business.  They hear that profit margins are tight.  They may wonder if their bosses are making excuses to justify low wages.  As I’ve stated before in the T-Rex Blog, management fees ARE artificially low.  A look into the past can help explain why.

Fortunately for me, my ex-boss and current mentor was there at the beginning of the early condominium boom, starting his career as a community association manager straight out of college in 1973.   When he walked me through the history of the industry, things started to fall into place.

The United States had its challenges in the ’70s.  Real estate agents wanted to sell and developers wanted to develop, but inflation and interest rates were high.  As the end of the decade loomed, mortgage rates reached into the double-digits.  The concept of converting apartments into condominium associations became appealing.  Enter the first condo boom.

Off The Rails…And We Didn’t Even Know It

This is where some of the persistent challenges that dog us today had their beginnings.  There were several factors:

  • Condominiums were sold as “carefree living.”  Someone else will take care of the grounds, the roofs, and the hallways…no worries! 
  • The transition from apartment house to condominium association shifted responsibility for interior living spaces from on-site staff to the unit owner.  Leasing activity and rent collection were no longer factors.  As a result, the site staffing typical of apartment complexes was either decreased or deleted altogether.
  • The same notion about decreased workload combined with the developer’s desire to keep condominium fees as low as possible led to a baseline of low management fees.
  • Early condominium documents sometimes treated professional management as an afterthought.  Like magic, multi-million dollar pieces of real estate that previously required professional management could now be administrated by volunteer boards with little or no management or real estate experience.

Hindsight being 20/20, in many ways we were set up for failure.

How Could They Have Known?

An Urban Land Institute lawyer and framer of early community association governing documents stood before us, a crowd of association managers and lawyers, at a CAI National Conference in the late nineties.  I still remember his words.  “As I stand before professional managers and attorneys serving community associations and working with the documents we wrote in those early years, I have one thing to say…we’re sorry!”  He explained that they were writing from scratch.   Lawyers need precedent.  They had to go all the way back to 14th-century English horse trail law to find something they could use to define common elements and their administration.

Indeed…who knew that community associations would become so complicated?  Who knew the world would become such a litigious place?  Who knew how legislated and regulated associations would become?  Who knew the promise of technology would result in an immediate gratification mindset? Who knew volunteers would want to do less over time? Who knew societal norms would decrease personal accountability and increase distrust of anyone in authority?  And finally, who would have imagined the current trend where courts would hold community associations responsible for members and residents’ civil rights, even though their governing documents provided no basis of authority to do anything substantial about it?

“I have great respect for the past. If you don’t know where you’ve come from, you don’t know where you’re going. I have respect for the past, but I’m a person of the moment. I’m here, and I do my best to be completely centered at the place I’m at, then I go forward to the next place.”

– Maya Angelou

Industry Trends

Community association management continues to mature.  I think of it as an adolescent – certainly more sophisticated than it was in its infancy, but not yet fully grown.  Business does what it does – big fish eat little fish.  As a result, national, regional, and even local companies acquire other companies to gain market share and leverage volume. At the very same time, technology makes it easier than ever before to start a management company with little overhead.  Whether company costs are minimized by volume or low overhead, the result is the same – a push to be “competitive” in the marketplace.  An unintended consequence is that a professional service became commoditized.  The industry accidentally devalued itself.  As Tom Peters would say, it’s a race to the bottom. 

It All Adds Up

So what have we learned?  Management companies operate in a space with an increasingly demanding client base.  They compete in a commoditized industry.  And they employ a workforce that may be poorly trained, under-supported and generally demotivated to one degree or another.  

Is all hope lost?  Sadly, for too many in the industry, yes.  In my travels and deep dive discussions around the country, I’ve felt their stress and heard their resignation.  I get it.  They’ve had the same concerns and expressed the same frustrations for the last twenty years or more.    

Light at The End of The Tunnel?

If the way it’s always been done doesn’t work, there’s a reason.  Get to the root and you can find a solution.  It requires thinking differently.  That makes unconsciousness a poor option.  It’s time to stop banging our heads against the wall. 

There are no easy answers.  However, there are a few practical strategies and perspectives that have turned things around for some.  These will be the subject in upcoming blogs.