Managing the people who work for one’s business is one of the most crucial tasks required of a business owner – indeed, it’s why human resources departments exist. In the world of HOAs and community associations, the responsibility for collaborating with and directing the community manager or management company falls to the board. 

Whether a given community works with a single management professional or a firm with multiple employees, the job of  that professional or firm includes handling the vendors and all the staff that perform services for the buildings and associations in their portfolio. Individual managers are accountable to their corporate chiefs of course, but additional oversight should also be performed by the board. But since the vast majority of condo association and HOA boards are made up of volunteers, and most are not HR experts, how does a board go about managing their managers?

Know Your Contract – and Your Expectations

“The board is spending owners’ money to provide a service—in this case professional management—and it has an obligation to assess [the management company],” says Thomas Skiba, CEO of the Community Associations Institute (CAI), an international membership organization providing education, resources, research, and advocacy for condo association and homeowners’ associations.

So how do boards proceed? Before you can really assess whether your community manager is doing her or his job, you have to define exactly what the job is. Vagueness and hazy expectations do nobody any favors; any professional worth their credentials will tell you that clear, concise unambiguous language and transparency go a very long way toward establishing and maintaining a productive association board-management relationship. 

According to Skiba, “The obvious place to start is, what are the obligations of the management company as per their contract? If the contract says financials [need to be] ready by the 15th of the month, that’s a quantitative assessment—it’s easy to say if it’s done or not done.

“Then, add on qualitative things,” he continues. “Is it getting timely service, or good advice? Is the manager responsive when they’re needed? When the board walks around the property, is the appearance up to their expectations? In all honesty, this is no different from assessing any other employee or vendor or contractor. [The] big challenge is making sure there’s a mechanism in place to communicate those assessments back to the manager. The more you can include in the contract where it’s in black or white, the better off you’ll be.”

Jose Bautista, a community association manager with First Columbia Community Managers, Inc., in Las Vegas, says that when it comes to new clients, sitting down together at the beginning of the relationship to map out expectations, wish lists, and potential challenges makes assessments later on a much more positive experience.

“We set up a list of expectations, what [the client community] would like to see: monthly reports, weekly reports, a log of people calling the office,” says Bautista. “A big one is communication with residents. The second one is always with the money—finances—are you knowledgeable and can you guide [the board] in the right direction? The third is connections. Who do you know out there that can help us? …Certain vendors will give you a break. Who do you know, how big is your network?”

Corbin Seti is the senior vice president of community and lifestyle services at FirstService Residential in Nevada. He agrees that board members need to know how their management works for them, and that means setting the “style of the management” in stone at the beginning of the relationship. 

“You can’t manage what you can’t measure,” he says, adding that sometimes board members may not be pleased with the performance of their management company or individual community manager, but struggle to articulate exactly what the problem is. For Seti, this poses a new issue.“If you don’t know what the problem is,” he says, “you can’t address it.”

Skiba agrees. “It’s important for a board to set up those expectations at the very beginning,” he says. “If the board says they want to hold monthly meetings, they may also set an expectation that they want the board packets three days before the meeting—and you have to be clear about that. [It’s] hard to hold someone accountable for a task if they don’t know what that task is.”

Good Management, Useful Tools, and Red Flags

When it comes time to assess how your management team is performing, there’s a certain set of criteria to look at. Seti says a manager’s duty should be to “protect, maintain, enhance.”

Bautista agrees, and notes that financial well-being is key. “How are the finances? How is your manager helping you get your reserves up to where they need to be?”

Along with financial solvency, good communication with residents is a crucial component of good management. “How responsive are they to emergency situations?” Bautista continues. “After hours and when something happens and needs attention right away?” And of course, he says appearances are always considered. “How is the property looking?”

The Institute of Real Estate Management (IREM) is a national professional organization devoted to the advancement of education, opportunity, and professionalism in multifamily association management . The organization (which has chapters in both Las Vegas and Reno) offers a number of performance review tools to help boards and managers set benchmarks, track progress, and generally understand what’s expected of each other. The tools are available for free to IREM member communities and companies, and for a nominal fee to non-members.  Those tools include: 

An 11-page Job Performance Evaluation ($12.95) that “enables the reviewer and individual to assess and document the degree to which the individual has accomplished specified objectives from the previous review. The evaluation includes descriptions of performance ratings and key areas in which the individual is assessed.”

The Select List of Recommended Performance Measures ($5.95) is a form you can customize to set an employee’s “performance goals and expectations.”

The Annual Performance Scorecard ($3.95), also customizable, is “an organized set of performance measures, grouped according to various aspects of performance.”

Your board can certainly craft your own custom criteria—but if you opt to write your own performance review form, it’s a good idea to take a few cues from those who’ve done it before. You can do a simple Google search for the term “performance review forms” to access forms from such diverse sources as the Massachusetts Institute of Technology (MIT) and Microsoft Office. Once you’re familiar with the basic format, your entire board should conduct a work session to discuss what specific, customized performance-review criteria belong on your association’s form.

Red Flags - and Addressing Problems 

Of course, along with markers that show a manager is doing a great job, there are also tell-tale signs of poor management. 

“The question is not just whether the person is likeable, and whether they have a good friendship [with the board],” says Cameron Clark, business development manager at FirstService Residential in Nevada. “You’ve got to ask what kind of results are they showing for your organization. Some things that you’d want to review: Are there a lot of insurance claims coming? Are operating costs going up? Are you hearing a lot of complaints from residents? Again, [the job] is to enhance and protect.” If your manager isn’t offering input on enhancing the appeal (and thereby the value) of your community, along with protecting its current assets, that’s a red flag in and of itself. 

Marilyn G. Brainard agrees. She’s a community association member in Sparks who has served on her association’s board as a volunteer, as well as being involved with various committees for the Nevada chapter of CAI. Brainard says red flags revolve mostly around communication. 

“If messages to the association manager are ignored, or there is a long lag time in responding (except in extenuating circumstances, of course), there may be some issues that need investigation,” she says. “Promptness in communicating with the board of directors when a problem arises is important. Also, mailings to owners should look professional; they should be complete, without spelling errors or other typos.”

“If community managers are not visiting the building, that’s a big red flag,” says one veteran manager. “I can tell if they are not visiting the building if they are not submitting their walk-through reports, and the building report says that they’ve been there a couple of times a week. If community managers are not going to the building visiting alterations and working capital projects—that’s another red flag, and if they are not getting timely, detailed financial reports that include the bank reconciliation and copies of paid bills—that another sign of potential problems.”

If a community manager consistently fails to meet the expectations and criteria initially set out by the board, and a frank conversation or warning doesn’t get things back on track, “You want to go talk with the management company, to a regional VP like myself,” says Seti. “You want to make sure concerns are addressed.”

Bautista concurs, but adds that “It depends what kind of trust you have with your manager.” Some boards or board members may feel entirely comfortable bringing up dissatisfactory performance with their manager directly; others may feel that’s too confrontational, and prefer to do as Seti recommends and take it straight back to the manager’s parent company. 

Self-Assessment and Helpful Resources 

Depending on the size of their portfolio and the number of managers in their employ, some management companies will also assess themselves as a quality-control measure. 

That is the case with FirstService Residential, which for the past 10 years or so has used a system called the Net Promoter System (NPS) to gain feedback on the performance of its individual managers. According to Seti, NPS encourages feedback within the organization, and to individual managers as well. “From that we can follow themes, and we can provide better service to that board. We can address concerns,” he says. 

 CAI also offers an array of training modules for managers, and publishes information for both managers and boards. 

“We train managers on things like how to build strong relationships, and what a board is looking for when it goes out and solicits a management company,” says Skiba. “We also do a lot of training on the other side, on board roles and responsibilities. It’s a not insignificant the job that you’re asking volunteers to do. They have responsibilities, and they need to be educated.”

Community management companies often offer ongoing training and professional enrichment opportunities for their managers as well. FirstService Residential and First Columbia Community Managers, Inc. both do. Bautista says that the vendors First Columbia works with—from CPAs to construction vendors to roofers—also offer classes for boards.

For his company, says Clark, “We saw that need. We had people who were willing and able, but there was and a gap between their desire to be effective and competent and the knowledge to do so, so we set up trainings for them. We’ve tried to develop well-rounded trainings, and we vary them throughout the year.” Continuing education workshops and seminars include dealing with different personality types, basic financial terms and concepts, and how to run more effective meetings, he says. 

Ultimately, perhaps the most important keys to a solid and long-lasting relationship between an association board and its management team are realistic expectations, education, and a steady flow of communication. And it helps to remember, too, that evaluations are not negative things. They can be an opportunity to praise an exceptional performance and they open the doors to change and evolution within a condo association or HOA. It’s always helpful to remember that everyone--whether they are a manager, board member or resident--is working toward one ultimate objective: creating an outstanding place to live.               

Georgia Kral is a freelance writer and contributor to The Nevada Cooperator.