Working in groups can be a challenge. Working in groups when people’s homes—and possibly their life savings—are involved can be a far greater challenge. It’s one faced every day by those brave souls who volunteer to serve on their co-op or condo board. While there is no sure-fire recipe for building a board that is 100 percent successful day in and day out, there are definitely traits and tactics that the most well-run and effective boards share.
Communication Is Key
One of the crucial components to success is for board members to understand what their duties are, says Leslie Kaminoff, CEO of AKAM On-Site, a property management company, which has offices in Boca Raton and in Miami. “The most important thing is for every board member to understand what they can and cannot do,” he says. “For example, board members cannot act as individuals, they can only act as boards. Just because you are president of the board doesn’t mean that you can go into the management office and change policy. You would need a vote in order to change policy.”
“I think communication is the primary significant trait that forms the platform on which every board is built,” says Steven Cohen, vice president for operations at A & N Management in Boca Raton. “In terms of clear and unambiguous objectives, an understanding of strategies to be employed to achieve those objectives and a thorough knowledge of the finances necessary to support those strategies are all necessary to have a successful board. I think all that can be conveyed in such a way that a good management company can communicate that information incisively and continually update and measure progress against those objectives based on those strategies. When that happens you have a board that functions very effectively.”
“A good board is educated,” adds Anthony Rodriquez, vice president of Florida Advanced Properties in Miami. “It’s nice to have entrepreneurs, business owners, lawyers, accountants, and professional people on a board because they all bring something to the table, but they should be educated on associations as well. There are numerous educational seminars offered by the state of Florida as well as by many law firms.”
Why It's Important
For most owners and shareholders, the dynamic of their board is not something they give too much time or thought to, unless a problem arises or rumors of dissent begin circulating. The way a board gets along and functions, though, can be a key component in the health and well-being of the building or community.
The board’s level of professionalism and communication skill is vitally important to the success of any building. “There should be an open line of communication between the board and the manager because at the end of the day the property manager is looking out for the association,” says Rodriquez. “We as property managers should be willing to defend that association and cover all of the bases with every aspect of management. We can only do that if we are allowed and granted that trust on behalf of the board of directors.”
“The ideal situation for a manager is for the board to make policy and procedure and the managers implement it and do everything else,” says Kaminoff. “Unfortunately, all too often that does not happen. You have board members who have their own agendas and members who want to keep employees for the wrong reasons. Just because someone’s been at the building 20 years and all of a sudden, he stops doing his job because he has a drinking problem, just because he’s been there for 20 years is no reason is keep him. The biggest thing the boards have to do is let the managers manage. There are buildings out there that real estate brokers know have trouble on the board level, it’s disseminated through the brokers. What we’ve done at times is when we’ve taken over a new building, and a board has that type of reputation—we throw open houses for brokers to meet the new board members and talk about how the building has changed and that sort of thing.”
Finding the Right Path
For boards, there are certain traits to aspire to, the characteristics that will—regardless of the situation—be far more likely to garner good results than bad. Experts believe that the traits that characterize a good board include dedication, integrity, transparency, fairness and assertiveness.
These types of boards also look out for each other and create an environment of support that allows for thoughtful decision-making and innovative approaches to problem solving.
“The most successful boards are the ones that avoid allowing their emotions and personal interests to get in the way of the decision-making process, that’s key,” says Rodriquez. “An association is a business, even though it’s not-for-profit, it is a business and should be run as a business.”
Cohen believes boards should not put too much power or control in one person’s hands and responsibilities should be shared equally. He also says it’s vital for boards to pay attention to detail.
Experts agree that the most successful boards find ways to steer clear of common problems such as becoming too comfortable or casual about their roles.
That ability to work well with management is another key component of success. “The board shouldn’t get involved with the staff, such as giving orders to the staff because it’s confusing,” says Kaminoff. “When that happens it takes the authority away from the manager because then the staffer knows it can always go to their favorite board member. A good board will let a manager manage.”
Part of building that good working relationship involves clear, ongoing and respectful communication. The same is true for the board’s involvement with their peers and fellow owners or shareholders.
Making it Better
What if a board is facing some difficulties and realizes that the way they work is not working well? There is hope. Board members can become more effective and efficient leaders by taking courses and attending seminars and trade shows. The South Florida Cooperator recently held its first trade show for board members and property managers in Fort Lauderdale in early December. Its 2013 event will be on Wednesday, December 4th at the Greater Fort Lauderdale/Broward County Convention Center.
“The thing that’s been rising over the last decade or so—but has become much more popular in the last five years or so in South Florida is that many professional service providers such as accountants, attorneys, engineers and contractors provide free courses for boards to attend,” says Cohen. “They’re advertised by email or you can find them on the providers’ business Internet sites. We belong to about four alliances of associations here in South Florida representing coastal areas. For example, there is something called the Delray Beach Alliance, which is located throughout the city of Delray Beach, and then there’s the West Boca Community Alliance, which is about 150 communities in West Boca. If you go to those websites, you’ll be able to see what courses are available in those areas for board members.”
Also, for buildings that self-manage, those sites can provide guidance on building processes that will make the board function more smoothly and with less pain on the part of everyone involved. Adhering to those processes can become second nature for the board, allowing them to move on to tackling bigger and more involved issues in the long-term. Board members should also feel free to turn to each other for help.
“I think when board members go into board meetings, they have to leave their egos at the door. They have to realize they are not there for their own agendas but they were elected by the unit owners and they are there to do what the unit owners want, not what they want as individuals. They have to represent the unit owners,” says Kaminoff. “Way too often you see boards, who are up in arms about something and the board won’t react to it because a couple of the board members are happy with the situation the way it is. They have to remember that they can’t personalize. It’s running a business and it’s like a political office. You were elected by the owners and you are there to represent the owners and not yourself.”
Striving to Improve
No matter what the circumstance, boards can improve on their own performance and, in turn, improve the performance and function of their condo or HOA, making things better not only for themselves but for their friends and neighbors as well.
“One of the things we do is hold workshops for our boards,” says Cohen. “The workshops are about different things: How to conduct a board meeting? How to prepare an agenda? How to read a balance sheet? How to establish and monitor ad-hoc committees? Some of these things may seem very simple but all are important when it comes to operating a board. If a board has to get itself back on track they can always turn to their management company to help them focus and right any wrongs.”
It takes a lot of work and a willingness to admit when things perhaps are not going as well as they could. But with effort, training, education, commitment and good relationships with management, owners and shareholders, a board can make its own very heavy burden lighter and turn the experience of leading their community into a rewarding one, both for themselves and those they serve. And soon, a good board will be on its way to becoming a great board.
Liz Lent is a freelance writer and frequent contributor to The South Florida Cooperator. Staff Writer Christy Smith-Sloman contributed to this article.