Boards and Owners: The Relationship Management Perspective

The Board of Directors is the official policy-making body of the association that makes decisions on behalf of unit owners. The quality of board leadership is the single most important determinant in the successful operation of an association. Healthy communities produce strong boards.

The CID is essentially a volunteer organization. Fostering the owners’ belief  that their voice matters helps build strong community “buy in” (participation, or a sense of investment), which in turn will create the best pool of candidates from which Boards and committees are appointed. The managing agent should never forget that owners are volunteering their time and effort to help shape the policy and future of the shared real-property investment. There are benefits and disadvantages to having highly active and vocal volunteer participation in the association. In all cases, a disinterested or ineffectual board presents a potential danger to successful management of the real property.

The basic principle of a CID is that no one owner can act in isolation from the group. As individual owners are likely to desire what they think is in their best interest irrespective of CID policy, part of effective relationship management of the agent/board interaction is understanding that debate is a natural part of the community decision-making process. Managing agents must recognize that one of the professional management services they provide is in how they demonstrate simple emotions such as patience and the tolerance of opposing views. The board must reach consensus before the CID can act. Perhaps the most challenging part of the managing agent’s role to CID real property is in how he or she provides the best environment for group decisions as part of the service to stakeholders in the CID. The most successful boards work as a team, not as individuals, with the interest in the community as a whole and not in parts that only affect individual members.

Whether they are three-unit conversions of apartment buildings or large planned-unit developments with hundreds of owners, CIDs are real property that have to be managed. Good management is the primary responsibility of the Board of Directors, but almost all real property is a complex management challenge. Most associations are likely to engage the professional services of a property manager to help meet that challenge. The smaller homeowner associations may decide they do not have financial resources to engage professional property management and choose to manage the property themselves. But, as owners are typically engaged in other careers for income, the challenges to managing the real property will be great for these associations.

The management options for CIDs can be broken down this way:

• Self-management
• On-site management
• Financial management
• Full-agency management