Mastering Your Management Partnership Going Beyond the Contract

Management companies that work with community associations typically begin their working relationship by negotiating a contract. The parties involved do their best to carefully craft an agreement and the terms of service that will cover every task and duty that the association board expects its management firm to do. Management, in turn, identifies the roles for which board members or other vendors are responsible. But the one fact that all managers seem to agree on is that every association is different and no contract can anticipate everything. The relationship that management companies forge with their association boards and trustees constantly evolves, sometimes in unexpected directions, and responsibilities may shift. Board members might not be aware of who’s supposed to do what, and may be surprised to find out what managers actually do—sometimes beyond the scope of their contracts.

It may take time for board members to become familiar with the skills of a new management firm, and learn to trust them to do their job. Managers agree that volunteer positions on the board would then be much easier. “Boards should rely more on our expertise,” states Richard Stern, president and founder of Sutton Management in North Andover, Massachusetts. This goes both ways, however. “People on the board also have skills and we try to take advantage of that” when trustees have backgrounds in finance, insurance or construction specialties. “Sometimes we can engage (certain) experts on the board, as advisors.”

One drawback, he points out, is that “sometimes people get on the board for the wrong reasons. Trustees should take courses—like from CAI—to learn what their role really is. This is important because all it takes is one person on the board to make everyone miserable if they don’t get their way.”

Then there’s the issue of trustees making their management company miserable. “A management-trustee relationship is like a marriage, and when it’s not working out, maybe it’s just not going to happen. For a board, switching to a new management company is a last resort.” For Sutton Management, Stern notes, “I’ve only seen it happen about five times in 25 years of business. For us, it may come down to a financial decision, where you’re spending too much time (on an unresolved issue) and it’s going nowhere. Our pricing is based on how much of our time (the board) uses. There have been instances where we declined to take on an association … Sometimes they’re too far gone.”

Usually, the really problematic board members are there to promote personal agendas, Stern points out, adding, “95 percent of the problems (we have) are from five percent of the people.” The solution for board members who continuously hold meetings hostage with their personal issues is straightforward. “We keep it formal and abide by Roberts Rules of Order at meetings,” Stern states. “I like to put together an agenda and get everyone’s input before each meeting. Then, if it’s not on the agenda we’re not going to talk about it, and no one is blind-sided. Also, we insist on no longer than a two-hour meeting, or we charge overtime. That usually keeps everyone on point, and prevents them from getting diverted to unrelated topics.”

Read More...

Related Articles

Financial Firestorms

Fallout from Embezzling is More than Economic

Fiduciary Duty

Doing What’s Right for the Community

Transfer of Power

Transitioning to an Independent Condominium Board