Being an Effective HOA Board Starts with Your Manager

By Lance Stendal Best Practices Comments Off on Being an Effective HOA Board Starts with Your Manager

In my experience, most Board Members want to do a good job, too often it’s the manager who gets in the way.

We have a strong belief that the role of the Board is to set policy and vision for their community. Ultimately, this means the main job of a Board of Directors is to make decisions. If you are professionally managed, how you make those decisions is greatly influenced by your manager and the management company you hire.

Be Prepared

When I was younger I was a Cub Scout and one of my takeaways, aside from how to lubricate a Pinewood Derby car to make it run faster down the track, was their motto “Be Prepared.” If you are professionally managed, your manager should be making sure you are prepared for the meeting by giving you all of the information you need to make a decision at least three days in advance of your Board Meeting in their Management Report.

This gives you an opportunity to review, ruminate, and, if needed, send questions to your manager before the meeting so they can do additional digging for you. The information they provide should be primary source material along with a written summary/analysis of the problem, your available options, and, if appropriate, recommendations, written by your manager or hired professional expert. This is a Management Report, not just a collection of proposals from contractors with no explanation or discussion.

Too often we see our competitors provide a fraction of that, which I understand because frankly it’s a lot easier. Doing that I could “write” a Management Report in under an hour but instead our managers will easily spend two, three, or sometimes more hours crafting a Management Report. To me this is what you’re paying for – professional analysis and advice and not someone to assemble some documents.

For me this is inviolate. In college, I interned at a non-profit called The Jefferson Center and worked their briefly after college. It was a pretty cool place for a young poli-sci minor like myself and I still really like their concept of the Citizen Jury. Their primary thesis is if you educate people they can move beyond the rhetoric of an issue and make informed decision that are best for the organization/community.

Whenever things get so far wrong as to attract their notice, the people, if well informed, may be relied on to set them to rights.

Thomas Jefferson to Dr. Price, 1789

This concept needs to apply to your Board Meetings too. I don’t think the manager will know everything, nor should they, but they should be out there marshaling available knowledge and resources on your behalf and focusing them for your meeting. The Management Report becomes the crucible where that information is brought together and affords the Board the opportunity to become knowledgeable about an issue so it can make an informed decision at the meeting.

Now Hiring: Mind Readers, with Experience

I sometimes think we should be hiring mind readers. When we analyze an issue for one of our clients we often tell our managers to put themselves on the other side of the table at the meeting. They need to contemplate the issue from the perspective of three to seven Board Members and anticipate the questions that might be raised. Nothing is more frustrating than sitting in a meeting needing to make a decision and realizing you don’t have all the facts because the manager went in with some assumptions and a Board Member asked a really good question.

Okay, so your manager is not a mind reader, how do they overcome that? By being prepared and the easiest way to do this is to continually ask “But why . . .”. Like a curious five-year-old, you need to ask follow up questions. Understand the topic inside and out. Challenge the contractor’s assumptions. Question the contractor on their recommendation. Get a second opinion and do it all over again.

We tell our managers they need to look at plan A, B, and C. When they’re done with that they need to give some thought to plans D, E, and F.

Problem is, being a curious five-year-old only gets you so far in this business, experience still matters. Frankly, a 30-year-old isn’t going to have the same perspective and analyze an issue like a 50-year-old, but too often the 30-year-old is who is assigned to an account. Why? They’re less expensive. Experience matters.

Your Turn

Having a manager with that mentality will help the Board achieve efficiency with its meetings and make better decisions for its community. But it’s not all on the manager though – a Board Member needs to want to be prepared. I can tell when a Board Member hasn’t read the Management Report and I think about how much time I spent crafting that Management Report. I get real joy when I see a Board Member has taken the time to jot notes in their copy of the Management Report.

Sometimes it’s hard to spend the time, that’s okay, we’re all busy and you’re not getting paid for any of this. Dig into one or two of the most important issues, that’s where you will likely have the greatest impact anyway. Worst case? Call the manager and ask for the Cliff’s Notes version over the phone. So long as you’re not doing that for every meeting I would definitely spend a few minutes going over an issue with you.

When recruiting Directors we remind them that being a Board Member does not require any specific knowledge or talent, the best Board Members are usually those that have an honest interest in their community and are willing to spend a couple of hours a month on it.

BTW, if you’re spending more than a couple of hours as a Board Member you may have a problem, more on that later.

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