Looking For Patterns

Without telling her, the superintendent of a mid-size cooperative enters the owner’s apartment – when she’s away – to install a carbon monoxide detector, which is now required by law. “Does this fit the definition of trespassing?” she wrote in an angry letter. “No notice whatever was given. We were shocked...We are just outraged – the superintendent and the managing agent have apologized, but it was: ‘I apologize, but we had to get the devices installed. There is a time limit or the building gets fined.’”

An error of judgment? Or something more? Was the problem caused by the enthusiasm of an overzealous superintendent, just following orders to get the job done? Or was it part of a bigger issue, like a careless manager who leaves most things to the last minute and then rushes to get them done?

Mistakes happen. That is a part of life. But if you don’t understand why the mistakes are occurring, you’ll find yourself facing similar problems time and again, becoming like the man who keeps dating the same kind of woman – and then is surprised when the relationship doesn’t work out (again).

Because it involves people and all their complexities, searching for the reason why “stuff happens” can be a frustrating affair. Was it a communication breakdown? A personality problem? A procedural issue? A bit of all three? And, after asking and answering those questions, it then becomes a matter of finding out whether this one event fits into a pattern and discerning the pattern itself – no easy task.

Investigating the Issue

In approaching a problem, the board often has to be as perceptive as a Sigmund Freud or as deductive as a Sherlock Holmes. Finding the mistake doesn’t mean you’ve found the core problem, however. And if you don’t – if you can’t see the bigger picture issue that is causing the difficulties – the mistake will recur, perhaps in a slightly different form.

One technique that psychoanalysts use is searching for patterns of behavior. In this context, a pattern is an action that repeats itself. “There are honest mistakes that people make and what you need to look for is a pattern,” explains Alvin Wasserman, director of Fairfield Property Services. “And if there’s a pattern of behavior of one kind or another, then it could be an indication that something is wrong.”

For instance, the super entering apartments without authorization, although serious, becomes much more serious if it is a frequent occurrence. What it could indicate is that the super and staff are unaware of the rules of behavior, and/or that there is poor communication among the superintendent and the manager and/or the super and the board. Or it could be an indication of inexperience by the manager. “It could be a sign of incomplete planning by the managing agent who should have an understanding that when you’re going into people’s apartments, you need to notify them properly,” says Dan Wurtzel, chief operating officer at Cooper Square Realty. To determine the truth, you would have to see which pattern repeats itself.

Reading Tea Leaves

But discerning different patterns can be as difficult as reading tea leaves. The best way to begin is by playing therapist or sleuth: keep track of all the smaller items that ultimately make up the big picture. That’s what some boards do already. “We believe in documentation,” says George Karpodinis, president of the 234-unit co-op at 720-730 Fort Washington Avenue. “Let’s say you get a complaint that your super isn’t responding to work order requests from shareholders. We have documentation that lets you look back over the last two or three years and see that there is a big stack of these similar complaints. It is a recurring pattern.”

Looking at all the small incidents and connecting the dots was how one 36-unit Riverside Drive co-op board came to realize that it needed a new managing agent. “There was a chap who was assigned to handle our building and, time and again in the middle of a meeting, he would snap his fingers and say, ‘Oh, yeah, I meant to do that,’” recalls board member John Young. “And, after a few months of that, we began to notice that [the follow-through] issue turned up in a more widespread way and, in some cases, for considerably more important issues.”

One of those issues concerned upgrading the elevator. The managing agent kept saying that Con Ed had a program to help pay for the conversion of the elevator – but there was no follow-through. Later, when discussing other matters, the manager began talking about the savings the building could obtain from water-metering. “We kept hearing this but [were given] no numbers [on cost versus long-term savings],” says Young. “Eventually, we changed agents.”

It’s Not Just the Staff

The board must also do some self-examination in searching for the big picture problem: is there a pattern of behavior that can be traced back to the way it operates or to the behavior of one of its members? At one Upper West Side co-op, for instance, a smooth-talking board member brought many fresh ideas to the table, initially impressing his fellow directors. But, as time went on, he became impatient with their deliberative process and adherence to traditional conservative values, especially in how they dealt with money matters. He wanted to borrow and spend and got into frequent debates with the treasurer over how to manage the finances. The debates often became personal – and nasty. He would frequently bully the treasurer while the rest of the board sat passively on the sidelines.

Some of the board members, although unhappy with the man’s approach, agreed with his goals: to shake up and energize the building. “He’s very articulate, and he’s very smooth, and his ideas have been wonderful,” admits a board director who has clashed with him on occasion. “It’s just the way he criticizes; he humiliates people if they don’t go along with what he wants to do. So all of his ideas have to be acted upon or else he starts to threaten people and does not let up.”

However, as he had considerable success in accomplishing changes – in the way finances were handled, among other matters – his arrogance and need to act unilaterally increased. Going beyond his professional expertise in finance, he also took on aesthetic questions, dealt with contractors, and advised staff members, often in direct opposition to (and without the knowledge of) the board and the superintendent.

The simple problem may seem to be the director’s arrogant approach to his fellow directors, which some may feel is tolerable because he gets things done. But once one starts looking at all the incidents and connecting the dots, a pattern of behavior becomes clear: the board is losing control of both its own agenda and one of its directors. Since the board is ultimately responsible for the corporation’s actions, by not reining in the renegade director, it is shirking its duties. In the big picture, that could have long-term financial and/or legal ramifications when a wrong decision is made.

I Can See Clearly Now

Practically speaking, to find a pattern, the board must design an objective system that will track small problems over time and then allow whoever is using the system to see the connections. “There should be a mechanism for understanding that this is a continuing problem,” observes Arthur Davis, a corporate consultant who deals frequently with co-op and condo boards. “This is hard. In other words, people should ask at each board meeting, ‘Have we gone over this issue before? Have we dealt with this last year. Have we seen this more than three or four times? And if we have seen it more than a couple of times, what do we want to do about it?’”

Doing that and keeping track of the smaller problems – whether missed deadlines, lack of follow-through, or bullying directors – are critical to uncovering the larger issues. A crucial tool in that process can be your meeting minutes – and how you design them. Robert Kruckeberg, vice president and secretary of a 22-unit Upper West Side co-op, learned that lesson.

About a year ago, he was becoming frustrated at the number of projects that seemed to be falling between the cracks. “The problem was that the old minutes didn’t really have much structure,” he explains. “They seemed to change from secretary to secretary and they didn’t keep track of when problems were resolved. There was no way of tracking problems through [to] completion.”

Kruckeberg, with some input from the board president, took it upon himself to redesign the minutes and make them more easily scanned. Rather than present a chronological account of what was discussed, Kruckeberg’s minutes, laid out in chart form, begin with a section entitled “Previous Projects Assigned,” including who is responsible for finishing them and their status (for example: “Previous Project Assigned: Return escrow funds held for Unit 4A; Responsible: Manager; Status: Done”); followed by sections on “Issues Discussed,” “Decisions Made by the Board,” and “Items Tabled.” It concludes with another chart section, “Projects Assigned,” again with an easy-to-read list of who is responsible for completing them (see box, p.12).

Kruckeberg has found that the new form of the minutes – in use for about 12 months now – made a difference in discerning patterns. For instance, when the building’s water heater broke down recently, the new minutes made it less difficult to discern the big picture problem. The board had experienced a number of breakdowns with the device the previous winter. These were duly noted under “Issues Discussed.” Just as clear, under “Decisions Made,” was the board’s desire to have its manager obtain three bids on a new heater and replacement parts. These decisions were reflected in “Tasks Assigned,” with the manager’s name under the heading “Responsible.”

Clear enough – and the picture became even clearer over the next three sets of minutes. Two of them indicated that the manager had either not completed the task, or had done it only partly (for instance, he had only obtained one bid, not three as requested). But the minutes also pointed to a pattern of actions by the board: it had been shirking its own responsibility by letting the manager slide from month to month, with the assigned task left unfinished. Kruckeberg admits the board was at fault: there was a two-month summer break when no meetings were held, and when the board re-grouped in September, the water heater matter was not even discussed. In the waning days of summer, it seemed less of an issue, so it sat untouched on the “Previous Projects Assigned” list, a ticking time bomb waiting to explode.

The redesign of the minutes made it clear what the larger problem was: follow-through. Observes Kruckeberg: “You can see over time which issues repeatedly show up and it allows you to see connections that you wouldn’t otherwise have seen. You can ask yourself, ‘Is this a just a one-shot problem or is this a systemic problem that we can begin to plan for in the future?’”

Under the Magnifying Glass

Some management firms use monthly written reports in a similar fashion. Fairfield Property Services employs a “Monthly Meeting Pack,” which includes minutes, financial statements, correspondence, proposals for contractual work, and legal status reports. It also features a response section. In that, specific issues are brought to the board for a decision. “So that item can move forward,” Wasserman explains. “That’s like a priority ‘to do’ list that we include in our meeting packs. This is how you can pick up on problems. If your meeting pack is not comprehensive, things could linger for a while without being noticed.”

A. Michael Tyler Realty has a similar monthly package, and most of its managers prepare “to do” lists for their own use. Notes Irwin Cohen, president of the company: “After that [monthly board] meeting, I come up with my ‘to-do’ list. I call it a punch list. I put it on my computer, and it becomes my marching orders. Then all of those are combined on what I call an ‘ops’ list, or an operations list, which has the summary of all of the action items. I [later] review what they have [on the minutes] against my own punch list.”

Cooper Square Realty’s monthly management report includes the agenda items, minutes, financial data, and information on whatever else is going on within the building. The management report includes month-to-month budget variances. “That way,” explains Wurtzel, “if they spent a significant amount of money on plumbing that is more than they budgeted for the month, there has to be an explanation. That information is reviewed and some of these little issues – or maybe they’re big issues – can be discussed immediately without having them fester into something monumental.”

The management report also includes an action list – basically a check-off list for the managing agent and the board about what the issues are, what has to be done, and what the status is on the day the report is issued. “As things get completed, they can be removed,” notes Wurtzel. “But if they haven’t been completed, they stay and somebody at a board meeting will say, ‘Why is this still on the action list?’”

Patterns = Problems?

In the end, you must ask, if there’s a pattern is there a problem? Observes Davis: “Maybe there is a pattern and you simply feel that that’s the best we can get out of this employee and we’ll deal [only] with that [small] issue – or ignore it. Everybody knows that [this employee] is a grouch in the morning and is often hard to talk to or communicate with. That still may be a problem but it may not be an overwhelming problem. There may be other wonderful things about him or her that mitigate that. You look at their honesty, their integrity, their reliability, how well they respond to emergencies. And, although there may be a couple of things you don’t like, if they’re not overwhelmingly negative, you can put them aside.”

Ask yourself: are the board’s expectations – of the staff, the manager, and even of itself – clearly laid out? “Everybody makes mistakes,” notes Herb Cooper-Levy, formerly the executive director at the National Association of Housing Cooperatives. “Everybody takes actions that some people will see as errors that may or may not actually be errors. It’s a question of what standard is being applied in each case.”

Finding patterns and making decisions on how to react may not be, in Sherlock Holmes’s famous phrase, “Elementary, my dear Watson.” But it is essential if a board does not want minor, seemingly one-shot, problems to metamorphose into major ones.

“When a mistake is made, the board has to find out what happened,” says Wurtzel. “Nobody’s perfect. But you don’t want to keep repeating mistakes. If the managing agent didn’t do something [he was supposed to do], the board should bring it to his attention and find out why it happened and what’s being done to prevent it from happening again. When there are staff issues, is the managing agent not doing what he’s supposed to be doing? Is there a breakdown in communication? Because everything that we’re talking about now revolves around communication. If there’s a lack of communication, you’re going to have flare-ups and incidents. And that’s how little problems can become bigger ones.”