If you have been working in community management for a long time, you have probably noticed it has become vastly more complicated. For example:
- Declarations and bylaws that used to fit into a small folder and now are as long as War and Peace.
- Building codes are much more complicated.
- Regulations governing common interest communities have expanded.
- Digital communications have created an expectation for immediate, accurate, and complete responses.
- Boards and residents are more demanding.
- Information from the internet has made everyone an “expert.”
- Buildings have become more complicated.
In the “old days,” community managers could handle most tasks themselves and had more time to work on them. These days, things are more complicated, so there is less time to complete them. Enter the experts and consultants. Today, there is a specialist for every need. They include:
- Investment managers
- Interior designers
- Landscape designers, arborists, and pond consultants
- Reserve analysts
- Computer and IT consultants
- Access control and security specialists
- Fire system and life safety consultants
- Elevator specialists
- Fitness, recreation, and swimming pool specialists
- Construction project managers
- Management consultants
- Board training consultants
In some cases, the decision to call a consultant is obvious and easy. When the issues are technical, and outside of common knowledge, you can call in a specialist. HVAC systems, IT networks, fire alarm systems, and elevators are common examples of systems that require special expertise.
But many problems that managers and boards face are not highly technical or beyond common sense understanding. So why call in consultants for these types of problems? A few examples, taken from real life and barely changed to protect the innocent, show some of the reasons:
- In a high-rise building, the board has decided to redecorate the hallways. All that is really involved is new paint, carpet replacement, and new light fixtures. Sounds easy, doesn’t it? That is precisely the problem—everyone in the building suddenly has strong opinions about the carpet and paint. Management calls in an interior designer to deflect responsibility away from management and the board. Two years, $30,000 in design fees, and six design options later, the exasperated board selects one option. Most of the board resigns in disgust after being excoriated by residents for not listening to the community and making a poor color choice.
- A pipe bursts in a unit, destroying the Distressed Kiawah Hickory hardwood flooring the owner installed six months ago. The association is responsible for replacing the flooring, but only to the value of the builder’s grade carpet that originally came with the unit. The owner never read the bylaws that explained this and is livid when told that $1,500 is all they can get when they paid $8,000 for the hardwood. They submit an estimate of $5,000 for carpet from Diablo Flooring along with a letter from “their attorney” that promises to have the manager in court next week if the association doesn’t pay up. Management and the board know that this will go nowhere but calls in their attorney. Thousands of dollars in fees and months later, the court rules in favor of the association.
- The board is interested in “going green,” but only to the extent that is economically advantageous over a five-year period. A resident in the community who worked for a few months as a teenager installing solar panels, and who has way too much time on his hands, bombards management and the board with proposals to go off the grid, install EVA charging stations throughout the property, compost all organic waste generated by the residents, and install green roofs on all of the buildings. He supports his contentions with voluminous documents and analysis, all gathered from the internet by Googling around for a few hours. management and the board see that the projects are too ambitious and impossible for the community to finance. The resident is not easily dissuaded and gathers support from a few other residents. They are taking up all of management’s time and are just enough this side of crazy to spark the interest of a growing number of community members who wonder why the board won’t implement all of these great suggestions. Management calls in an energy engineering specialist to analyze the various proposals and $15,000 in fees later, the community decides that the board was right after all.
- In a large community, the board decides that modern technology and social media offer a path towards hearing and addressing all resident concerns and complaints. They direct management to “reach out” through Facebook and Twitter. They purchase a large, costly suite of integrated software called Link Up Your Buildings that pulls together in one community cyber square bulletin boards, service requests, community documents, budgets, newsletters, service directories, and a special message to everyone on their birthday. The manager can’t get anything done because all available time is spent reacting to the tsunami of pointless comments, rambling treatises, complaints, service requests, and funny notes from the newly-empowered residents. At 4 pm one hot Friday afternoon, Link Up misses a few steps during a power bump. Many residents lose air conditioning. The barely functioning Link Up is overwhelmed by the outpouring of comments, anger, and requests from residents. Link Up bites the dust, and the manager cannot revive it. Network and IT consultants are brought in at great expense to “improve the digital infrastructure.” And to top it all off, the community is forced to hire a full time “outreach coordinator” to handle all of the digital feeds.
- The local government has passed a law requiring community board members to receive training in order to serve. In order to field board members in a community where most are reluctant to get involved in community governance, the board is forced to hire a board training consultant and to offer perks to board members in compensation for the time and effort required of them. These are new expenses that contribute to increased assessments.
In the not-too-distant past, these problems either did not exist or would have been handled by the community manager. These incidents illustrate some of the reasons—other than the need for technical expertise—for the proliferation of consultants. Consultants are often hired for these reasons:
- Deflecting responsibility to another party
- Managing the sense of knowledge and entitlement that the information age has created
- Meeting a higher level of resident expectations
- Responding to an increasing tendency towards disputes and resolving conflicts through administrative procedure instead of deliberative discussion
Here are some tips on dealing effectively with experts that come both from the experts themselves and experienced managers.
Know the difference between a consultant and a trade contractor
There are times when a contractor is all that is needed. If there is an obstruction in a pipe causing drain backups, you call a plumber, not a mechanical engineer. If there is a frequent problem with drain backups at widely scattered locations and no amount of snaking or hydro-jetting seems to solve it, maybe a plumbing engineer should be consulted to see if there is a feature of the system that is creating the problem.
Trade contractors are good at solving specific and well-defined problems that don’t require the manager to choose among a variety of differing options. Contractors earn their living by selling a specific product or service, and if the best solution to the problem does not lie within their normal scope, guidance from an independent consultant may be appropriate.
Understand how consultants are paid and how to manage their fees
Most consultants sell services, not products. They earn their fees by spending time in investigation, analysis, writing reports, meeting with clients, and responding to questions. Managers can control fees by:
- Asking for fixed fees for well-defined tasks.
- Dividing large projects into phases with defined scopes of services and associated fees.
- Asking consultants for their advice on the best and most economical way to structure fees.
- Having consultants submit detailed itemizations of their fees on open-ended projects.
- Asking about how they handle emails and act accordingly. Digital communication is fast but can consume large amounts of consultant time. Most consultants have some way of being compensated for emails.
While some consultants may be touchy about discussing their fees, asking what they are doing, how they are doing it, and what it costs are fair questions.
Beware of conflicts of interest
When consultants analyze problems, recommend a solution, and then offer to sell you the solution, beware of a conflict of interest. Most consultants are independent and will provide unbiased opinions. When a significant part of their compensation comes in selling you a product or service that fixes the problem, there is a tendency to always find the solution in the product or service that they sell. In this case, there is little difference between the consultant and the gutter salesman whose answer to every drainage problem is to install new gutters.
Learn how to solicit proposals from consultants effectively
It is fair to solicit proposals from more than one consultant. To get proposals that can be compared fairly:
- Break the scope of services into discrete segments if possible and ask that the proposed fee be divided accordingly.
- For discrete and well-defined tasks, request fixed fees.
- For tasks where fixed fees are not appropriate, ask for not-to-exceed fees for specified scopes of services.
- Ask for hourly rates and estimated costs for reimbursable expenses where fees are on a time-and-materials basis.
- Keep requests for proposals as simple as possible. Lengthy narratives that minutely tell a consultant how they will perform tasks are usually not effective and will most often result in higher fees.
- Define what you want in deliverables. Do not ask for more than you really need. For example, since most documents are generated digitally and viewed on screens, asking for paper copies will probably increase fees. If you don’t need the paper, don’t ask for it.
- If you are not already familiar with the consultants, ask for their professional qualifications and references.
- Solicit proposals from no more than three firms. Consultants talk to one another and if they know that four or more have been contacted to submit proposals on a project, they will not be interested in bidding or will not give the proposal sufficient
- Ask for appropriate insurance. Consultants should be able to provide appropriate levels of liability and/or professional liability insurance.
In evaluating proposals, the lowest proposed cost is not always the best value. In choosing a consultant, take into account the cost, the level of service that will be provided, the professional qualifications of the firm and individuals doing the work, and proposed technical approach (if applicable).
Use consultants who understand the decision-making process at common interest communities
Working with condominiums, cooperatives, and community associations is very different from working with commercial owners and property managers. Most consultants do not understand how common interest communities work and how decisions are made in these environments. This has caused a lot of frustration for both the consultants and communities. In general, it is best to work with firms that know how to work with community associations. This problem has been addressed by CAI in their Educated Business Partner program. See www.caionline.org/LearningCenter/Education-for-Business-Partners for details.
Choose consultants who can communicate with you effectively
Most consultants are technically competent. What most often distinguishes the best consultants from the others is their ability to listen to their clients, understand their needs, and effectively communicate the solutions. Beware of consultants who are evasive, use a lot of technical jargon in oral and written communication, or avoid face-to-face meetings.
At the risk of revealing some of the dark secrets of the consulting and technical world, it is almost always true that hard-to-understand speech or writing conceals fuzzy thinking. If the consultant cannot communicate even the most complicated technical issue in a way that a community manager can understand, there is a good chance that the consultant doesn’t really understand it either.
Provide a designated point of contact
To avoid misunderstandings, communications between the consultant and community should be routed through a single person, usually the community manager. If community members contact the consultant directly, there may be misunderstandings and fees will increase with the time the consultant uses in responding to many people.
Consultants and experts play an important role in effective community management. Knowing when and how to use them well is an essential management skill.
By Doug White, P.E.
Doug is a principal at Thomas Downey, Ltd., Consulting Engineers. He has over 30 years of diversified experience in engineering design of buildings, structural engineering, building investigations, reserve studies, forensic engineering, construction project management and administration, and construction cost estimating. Doug is a technical expert on building structures, structural repairs, façade restoration, water intrusion, waterproofing, roofing, failure investigations, historic buildings, and building construction. He is a registered professional engineer in the District of Columbia, Maryland, Virginia, Kentucky, and North Carolina.