Making the Grade - Community Association Managers Give Performance Assessments Mixed Reviews
By: Nena Groskind
The prospect that the evaluation will become little more than a gripe session ─ an opportunity for board members to air a laundry list of complaints, large and small, that may have accumulated over weeks, months, or even years – is another concern for many managers.
“An Accumulation of Scars”
“The relationship between boards and managers can be an accumulation of scars,” David Abel, CMCA, senior manager at First Realty Management Corporation, observes. Pete Garrett, CMCA, AMS, PCAM, a principal in Maine Properties, Inc., AAMC, and the current president of CAI-New England, agrees. “Board members have very long memories,” he notes, which makes it difficult to know if the deficiencies they identify are current or reflect long-ago complaints they didn’t express at the time.
Also problematic, managers say: Owners, whose input should be solicited as part of the review, can’t always distinguish between areas that are the manager’s responsibility and those that are beyond the manager’s control. “Sometimes we’re blamed for implementing decisions that the board has made,” Garrett says, noting, “I’ve gotten poor marks [in an evaluation] because owners were unhappy with a landscaping contractor the board selected.”
Still, most managers agree that well-structured evaluations can have many potential benefits, with “well-structured” being the operative and essential phrase. The primary benefits:
• Evaluations force boards to articulate their goals for the community and their expectations for the manager.
• They formalize the give-and-take between managers and boards, allowing them to identify small irritations and resolve them before they become irreparable.
• The evaluation criteria create a guide managers can use to ensure that they are “on track,” as well as a yardstick against which boards can measure the manager’s performance.
• A formal evaluation process forces board members and owners to be specific about their complaints.
• The performance assessment allows boards to describe what they think managers have achieved and identify areas in which they may have fallen short; it gives managers an opportunity to articulate their concerns and to highlight what they think they have achieved.
Making the Invisible Visible
Their response to the performance review is especially important, managers say, because much of what they do is invisible to owners and board members. The best managers operate quietly, which can make some boards question the value of what they are doing, or whether they are doing much at all.
“Board members don’t know how quickly I respond to lender questionnaires,” when owners are selling or refinancing their units, Garrett notes. Echoing that concern, Abel notes that when a board member got an immediate response from a contractor he had called repeatedly, the board “thought I hadn’t done anything. They didn’t realize they got a call back because I’d called the guy five times already.”
That experience and similar ones have made Abel more aware that “we can’t take anything for granted.” So even if boards don’t conduct regular performance reviews (his clients typically don’t), Abel makes a point of meeting with them periodically to report on the services they are receiving. “We act as if we are presenting a proposal to a prospective client,” he explains, but instead of describing what the company will do for the community, he describes what the company has been doing and details the goals they have achieved.
Their major concern about evaluations, managers say, is not that they will be critical, but that they may be mindlessly so. “It’s not a matter of being unwilling to hear criticism,” Abel insists. “We can always do better.”
But if the feedback is to be useful, Abel and other managers agree, the evaluation has to be informed and constructive, which isn’t always the case. For that reason, some industry executives think performance reviews should be handled by third-party consulting firms, which are likely to be both more knowledgeable and more objective than many boards. There are firms that provide this service, but there is no reason boards can’t do the evaluations themselves.
Industry experts generally recommend that boards review their management firms or managers annually – more frequently if dealing with a newly hired firm. They also suggest that boards submit a written review to the manager, who should be able to respond in writing before meeting with the board to discuss the results.
“Not a Confrontation”
“This is an evaluation, not a confrontation,” one manager emphasized. “The purpose is to provide feedback to the manager, and that feedback should include achievements and strengths for which the manager should be commended as well as problems, disappointments and weaknesses that need to be addressed. The goal should be identifying ways in which the board and the manager can work together more effectively going forward.”
“No one should be afraid of being evaluated,” Robert Rothwell, chairman-elect of CAI’s Community Association Volunteer Committee and a member of CAI’s national board, asserts. “There may be one or two bad apples who only want to knock you down, but most board members [and owners] are sincere about [the evaluation process]; they want to live in a good community and they know if the board and manager are good, the community will be good, too.”
Robert Riddick, current chair of CAI’s Community Association Volunteer Committee and a member of the CAI board, has served several terms as president of Sunnymead Ranch PCA, a huge (10,000 members) planned unit development in southern California. Like Rothwell, he is a strong advocate of regular performance evaluations. His board used to do those reviews annually but now does them only every three years, he says, “because we have a great relationship with the on-site manager and the management company.” But the manager is required to submit a “state of the association” report every year, which the board discusses with him/her in an executive session and then presents to owners in a public meeting.
“The management team is sensitive to our concerns,” Riddick says. “We don’t dog them, but we do keep them honest.”
Rothwell, who sits on the board of his 100-member community association in Nevada, says they review the manager’s performance annually, in conjunction with the contract renewal. “These are very positive meetings,” he emphasizes. “The manager knows we aren’t there just to criticize or degrade him. We’re there to talk about how he can become a better manager so he can help us make ours a better community.”
Good for the Gander
Garrett thinks that feedback is equally important for association boards. “What’s good for the goose is good for the gander,” he says. “No one likes to be hung out to dry, but board members need to hear that owners may not be as happy with them as they assume.”
The boards that assess Garrett’s firm typically send a questionnaire to owners and then summarize the results in a report giving numerical grades in several categories. But it is written evaluations, which aren’t always included, that provide the most useful feedback, Garrett says.
“Did I get a ‘2’ in rules enforcement because I didn’t enforce some rules – and if so, which ones – or because some owners were angry because I cited them for violations?” He also thinks owners should be required to sign the questionnaires they submit. Anonymous forms make it easy for owners to state unfounded complaints and make it difficult for boards to distinguish legitimate concerns from those of chronic complainers, he explains.
Garrett interprets evaluation surveys on something of a curve. “We treat them like RFPs,” he explains, eliminating those at both extremes. “People who give the lowest marks in all categories typically have a bone to pick,” he has found, while owners who say all categories are “excellent” probably haven’t given the questionnaire a lot of thought. “We concentrate on the ones in the middle.” He has found that his maintenance staff consistently earns higher marks than he does, not, he assumes, because his work as a manager is subpar, but because they interact more frequently with owners and “have more opportunities to exceed expectations.”
Patricia Brawley, CMCA, AMS, PCAM, a management consultant with Community Solutions, who advises community associations and management companies, thinks the feedback performance reviews generate can be helpful. But these periodic assessments are no substitute, in her view, for the regular communication needed to keep management-board relationships on track.
An Ongoing Dialogue
The dialogue between the manager and the board “should be ongoing,” Brawley says. If problems develop, “you don’t want to wait for a performance review to address them.” If the board and manager are “in sync,” she adds, “both will have a sixth sense that tells them that things are going well - or not.”
That board at Rothwell’s community supplements its annual performance reviews with monthly questionnaires sent randomly to 10 owners. The board reviews the comments and discusses them with the manager in an open meeting. How do they distinguish owners who have “real” concerns from those who complain chronically about everything? “We consider that anything owners take the time to put on paper is real to them,” and merits attention, Rothwell replies.
Riddick’s community, which conducts formal performance reviews only every three years, requests owner feedback monthly in the association’s newsletter. The board also meets twice annually with the principals in the management company, including the CEO, to talk about how things are going. That direct communication is essential, Riddick says. “If we can’t pick up the phone and call the CEO, there’s something wrong with the relationship.”
Brawley agrees. If the board’s only contact is with the portfolio or on-site manager, she notes, by the time the president of the management company learns there’s a problem, “it may be too late to do anything about it.” The president may not know anything is wrong, she says, “until a colleague tells him the board is soliciting bids from other companies.” And if the board’s only loyalty is to the manager, Brawley says, the manager may take the relationship and the contract with him if he leaves. Establishing a personal relationship with the company’s owner reduces that risk.
Designing the review
It is essential for both parties to understand from the outset what the evaluation will be based on, Cummings emphasizes. That “common understanding,” he says, “creates a kind of buy-in on both sides.”
The best place for boards to start in developing their evaluation criteria, Brawley suggests, is with the job description in the management contract. “What deal did you make with the manager initially? What expectations did you identify?”
Every board is different, she notes, and expectations can change as the composition of the board changes over time. “That’s why the manager’s job is so difficult.”
She suggests establishing a set of written objectives annually, possibly when the budget is created. Reviewing and restating the board’s objectives regularly, she notes, will ensure that managers aren’t “blind-sided” when they change.
The time to establish an evaluation program, Brawley suggests, is “when there are no issues. Establishing an evaluation process because you have issues to resolve isn’t going to be helpful.”
Objective and Specific
The evaluation should be designed to emphasize the positive (what the manager is doing right) as well as the negative, and the criteria boards use should be general enough to avoid pettiness, but specific enough to provide clarity and guidance to managers. (The sidebar on page x suggests some of the criteria boards might want to consider.)
Broadly subjective questions, such as, “Is the manager doing a good job,” aren’t helpful, managers say, because different people will define a “good job” differently. More targeted and less subjective questions: (“Does the manager respond to questions within 24 hours?” “If you requested information, did you get it? Was it helpful? Did the manager follow up?”) will provide insights boards can use in evaluating the manager and information managers can use to improve their performance.
Although she agrees that specific questions are helpful, Brawley also thinks the evaluation should focus broadly on the job the manager is doing, not simply on how the manager is doing it.
“Responding promptly to requests, submitting timely reports, treating owners respectfully – those fundamental tasks are all endemic in the manager’s job,” Brawley says. If a manager isn’t performing them, “the board should be considering a termination, not an evaluation.”