President’s Message

Thank You for 22 Great Years

As I read through this issue of Vision magazine, I think to myself, wow! While the Vision Editorial Committee and CACM staff were working on this year’s Emerging Trends issue, it spurred me to look over past trends issues and reflect on how our industry and practices have evolved. What a pace the past 23 years have given us!

I am amazed and continue to be in awe of you as professionals, as you’ve persevered through all the changes that have come our way in this ever-changing industry. You have proven that community managers are tough, smart and skilled, and truly care about their association clients. Equally deserving of praise are our dedicated affiliate members for the support and technical expertise they bring to the community management profession. Together we have made this industry what it is today. When I look at other states and their law-based practices, it’s clear that California community managers are tasked with working under some of the most complicated and technical requirements in the nation. With more than 1,200 laws impacting California community associations, you must exhibit a high level of skill, expertise and dedication to be successful in this profession. And, I’m amazed at how you answer these demands and provide unparalleled value to your associations. Now it’s time for me to give my thanks.

It has been an honor and a privilege to be CACM’s President & CEO for the past 22 years. When I reflect on what has kept me motivated to help build CACM and represent community managers in Sacramento, it’s truly been all about you and your success. I am proud of the progress we have made as an organization and as a collective industry.

Of course, the people around me have also helped tremendously in keeping the momentum of this great organization going. I have been blessed to work with dedicated volunteer leadership who remain committed to CACM and our efforts. Thank you to all members of the CACM Board of Directors throughout the years who have demonstrated what great heart and soul can do for an organization. They are simply the best.

In addition, my staff of incredible professionals has never wavered in their efforts to do their best for our membership. The results of their entrepreneurial spirit and service-based skills have brought CACM and our industry international recognition, and I am very grateful for their commitment.

Sometimes a simple thank you means more than can possibly be communicated from a plethora of emotions. So, I shall just say thank you and wish you all a blessed journey.

Read more about Karen’s 22-year legacy in the community management industry on page 44.

Karen D. Conlon, CCAM President & CEO

THE BUNGLING OF UNIVERSAL RESPECT PRINCIPLE (a.k.a., BURP!)

By Vicki MacHale, CCAM

I take great pride in the level

of professionalism found

within our industry, which is why it’s so offensive when

managers are referred to as

secretaries or administrative

assistants by a board of

directors. Nowhere have I

ever seen a cumulative group

of individuals working so

hard to assist others, and often with little reward

beyond a paycheck.

Let’s be honest: There have always been a handful of “those” companies who work off the numbers and provide low-level service at low pricing. They accomplish this through slacking on service, hiring inexperienced managers at low salaries, foregoing employer paid education and skimping on infrastructure, administrative support and technology. On top of this, these companies load managers with as many as 10 accounts (or more) and then leave them to sink or swim. Somehow these companies convince the overseers of multi-million dollar corporations that it is possible to get twice the amount of service for 50 cents on the dollar.

It typically doesn’t take long for these boards to realize they are sliding downhill quickly. Rather than internalizing the cause and effect of their decisions, these boards once again seek another company that promises increased service at an equal or lesser price. When faced with the same lack of service and support, they conclude the entire industry is a sham. To counteract their bad decisions, they begin a governance model based upon micromanagement, further solidifying their continued failure. Pretty soon you have an association with five different companies in six years that is filled with discontent and quick to bash every company in sight.

When (if) the board finally decides to pay real prices for real service, the assigned manager will undoubtedly spend several months holding the board’s hand, responding to numerous calls from previously ignored members and working non-stop to

YEAR… earn trust and get things back on track.

Unfortunately, this lack of service, knowledge and professionalism is becoming the norm, and it isn’t just me who’s taking notice. In trying to be objective and view this from all angles, I believe there are several factors that have led to this decrease in professionalism within our industry. I call it the “Bungling of Universal Respect Principle,” a.k.a. BURP. A Downward Spiral?

The formation of large conglomerates, buy outs and public companies began just prior to the market crash. For several years, development disappeared, pricing was driven down and it became a dog-eat-dog world in terms of marketing and building business. For the first time in many years, we’ve seen underhanded marketing tactics and service providers being pressured into undervaluing their service for the promise of market share profit.

Most damaging are the larger companies who are giving away 90 days’ (or more) of free service (along with a set of Ginsu Knives) upon contract execution! While the used car salesman tactics may work in gobbling market share amongst naive boards, it certainly has backfired in the eyes of our clients. Even as the market continues to gain strength, our clients continue to struggle with the long-term effects of bad debt, out of control utility increases and an overall perception that everything is still on sale. Price over value continues to take center stage and we are playing right into their hands.

Gluttony is becoming more common in terms of providing low-cost management services and adding profit through other mergers and acquisitions, or adding ancillary in-house service divisions or smoke and mirror hidden charges. Longtime, trusted service providers are struggling to keep clients or find new ways to provide superior service, as they are being cut out by those companies with in-house service. Some have stopped bidding

RECENTLY, A CLIENT TOLD ME HORROR STORIES OF HAVING SEVEN DIFFERENT MANAGERS IN LESS THAN A

projects managed by certain companies because their bids are always undercut by at least 10%. In effect, a false bidding process is being provided to clients. BURP!

To add insult to injury, inexperienced staff members are being put in place who are failing at an alarming rate. Recently, a client told me horror stories of having seven different managers in less than a year; the association’s newest manager has 11 accounts and a parttime assistant and still can’t keep up. My first thought was, “WOW” and my second thought was, “Why is this manager airing dirty laundry?”

An experienced manager will never throw his or her company under the bus; but then again I’m finding

IF ALL OUR INDUSTRY LEADERS DON’T GET THEIR ACT TOGETHER AND BEGIN TO BRING PRIDE OF SERVICE BACK INTO THE MIX – WHICH INCLUDES FOCUSING ON EDUCATING THEIR MANAGERS – THE RESULTING STATE OF THE INDUSTRY WILL UNDERMINE EVERY BIT OF RESPECT WE HAVE SCRAPED TO ACHIEVE.

The Bungling of Universal Respect Principal

Continued from page 9

there is very little pride amongst companies right now. This is not the employee’s failure, but the employer’s. Note to all: If you turn over 40% of your company each year, you have accomplished a great big public BURP!

Future Forecasts

I’ve recently taken over several accounts from wellrespected management firms. I can’t believe what I have found: accounts with no voting policies and procedures; collection policies that have not been updated

in years; improperly filed liens; rules and regulations (recently adopted) that are outside of state statutes and the governing documents; incomplete files; and, most shocking, financial statements still done on a cash basis with an annual review stating everything is great! Sorry, but shame on any management firm that is allowing this to happen; again, don’t blame the managers because they don’t know what you aren’t willing to teach them.

But, let’s digress. Perhaps some of you long-timers will recall that six years ago I wrote an article titled, “A Thanksgiving Feast” where I forecasted the metamorphosis occurring within our industry via mergers, acquisitions and buyouts. I followed this masterpiece up in 2011 with an article titled “Leveling the Playing Field.” Now here we are in 2014 and the forecast has become a reality. Listen to me, I’m pretty smart. (If you are rolling your eyes at that last statement, don’t worry, I’ve been married 30 years and survived teenagers; I get unconditional love from my dogs.)

Seriously, while I called much of this years ago, what I didn’t really grasp was the ramifications and degradation that would happen in our industry as a result. I’m making another forecast: If all our industry leaders don’t get their act together and begin to bring pride of service back into the mix – which includes focusing on educating their managers – the resulting state of the industry will undermine every bit of respect we have scraped to achieve.

We need to get back to being a group of educated professionals who have

experience and state-specific knowledge that surpasses that of any board member. We need to nurture and respect our staff so we can provide superior service to our clients. Our profit should result from our collective ethical business dealings rather than through less than stellar attempts to gain market share. Our staff should be proud of the company name that backs them.

We have the ability; we used to ethically market our companies while supporting the industry. This is within our grasp. I know we can do it! Let’s excuse the old BURP and prepare to change the meaning to “Bringing Up Respectability and Professionalism.” We’ll do it together, in one great big public BURP!

Vicki MacHale, CCAM, is the Executive Director of ARK Management, a subsidiary of Stos Robinson Companies, in Cardiff by the Sea.

SOUTHERN CALIFORNIA 2801 West Coast Highway Suite 270 Newport Beach, CA 92663 714.427.0664

NORTHERN CALIFORNIA 2950 Buskirk Ave. Suite 300 Walnut Creek, CA 94597 925.407.2159

ARIZONA 3001 E. Camelback Rd. Suite 130 Phoenix, AZ 85016 602.235.9399 WWW.CHAIXLAW.COM CONSTRUCTION DEFECT LAW IS OUR ONLY BUSINESS

Over 25 Years experience Free site inspectiOns Free initial Meeting cOntingencY Fee all expenses advanced

Protecting Your Investment

Brandi Reynolds Client Services 800.379.6911 brandi@chaixlaw.com