Fairfield Properties: The Transition

THE BIG PICTURE

A new board member needs to know that he or she is going into an entirely new business. If I were going into a new business, I would seek out a mentor, someone with experience who could teach me about the business, because there are so many nuances. It’s the things that you don’t know that can cause you to fail. New board members need to know what they do not know. If they have that attitude and are willing to learn, it will be for the benefit of everyone. An experienced board member or property manager is a natural candidate to mentor a new board member.

BE SMART

Here are two examples of how a new board member can get tripped up by what he or she doesn’t know. A member of the community is up in arms because either the maintenance was increased or there was a special assessment. He thinks the board is being irresponsible and is not doing its job. So he runs for the board on that platform. Members of the community don’t always do fact-checking, and they rally behind this community member who then gets elected. Once he’s on the board, he reviews the budget, the expenditures, and the income. He sees the condition of the property and realizes that the maintenance increase, the special assessment, and securing finances to improve the property are needed, after all. He has been wrong in claiming the board is irresponsible. He has met the enemy, and it is himself.

In another scenario, a board member asked to meet about self-management. When we met he said, “I spoke to the board, and we decided that we would like to transition to self-management.” As the discussion continued, it turned out it really wasn’t self-management. He wanted to get paid for his services. We began to discuss what that would involve.

We spoke to the board member about liability insurance, workers’ compensation insurance, and theft insurance. We reviewed what the cost might be, which would probably exceed the entire fee he would receive from managing a small property. We asked if he had established relationships with professionals, vendors, and contractors. Had he established credit with them? Was he prepared to provide emergency services 24 hours a day, seven days a week? These were all things he had not considered. He left the office better informed but second-guessing whether he really should take on this endeavor.

These scenarios might have been avoided if the new board members had sought out a mentor to help them understand the job. In such situations, the best thing you can do is to realize that you cannot learn everything there is to be learned about everything in the world. But with the right guidance, you can meet any challenge, anywhere, anytime, wherever you go.