No matter what the job—be it flipping burgers at a chain restaurant or running a multinational investment firm—employees should be given periodic reviews of their performance to assess how they’re doing and identify both their strengths and areas where they could use improvement.
Given that the property management field is a client-service industry, assessing how individual managing agents serve their residents and associations is critical to a management company’s success. Firms and individual employees can benefit from this evaluation.
It’s All About Service
“Residential property management is a service business,” says Michael Berenson, president of AKAM Associates, Inc., which manages co-ops and condos throughout metropolitan New York. “If our service isn’t up to par, our clients will be dissatisfied and our reputation will be negative. Conversely, service companies like ours that regularly evaluate their own performance tend to incorporate best practices and company-wide upgrades as a matter of course. This inevitably results in better service delivery, more satisfied clients who are inclined to refer us, and an enviable reputation in the industry.”
Once upon a time, manager evaluations were done once a year. Employees would clock in their time, wait for their annual job evaluation—along with the possibility of a raise or promotion—and then repeat, same time next year.
Times have changed, however. While some management firms still do once-a-year evaluations, many have decided that may not be the best, most effective way to gauge their employees’ performances. Today, companies have supplemented annual reviews with other, more frequent methods of appraisal and evaluation.
“We do a couple of different tests,” says Steve Greenbaum, partner and director of property management, for Mark Greenberg Real Estate Co. Inc., in Lake Success, New York. “The executives of our company attend most of the board meetings along with our agents, so we get to see how they interact with the board and how they interact with the residents. We also attend every annual meeting.” Greenbaum says it’s important for his company’s upper management to attend these meetings, so that they can find out if there are deficiencies in the management and make improvements if need be.
Making these assessments, he says, “We’re very hands-on and very involved with all our properties,” Greenbaum says. “Every agent isn’t perfect. Some agents are better at construction, than they are in finance; some agents have better people skills…so we like to evaluate that” to fill in whatever gaps there may be in management, with a skilled and compatible executive.
Seasoned veteran agents or executives often can serve as mentors to their less experienced colleagues. Regardless of their approach however, any good management company will touch base with their client communities on a regular basis via such evaluation tools as surveys and questionnaires, enabling them to hear directly from clients about how they are doing and what could be improved.
Forget Yearly Evaluations
According to J. Brian Peters, senior managing director of Rose Associates in New York City, the starting point for evaluating individual managers is the level of supervision provided by the management company.
“Our company has a supervisory structure where our property managers report to officers, each of whom oversees 15 to 20 properties,” he says. “The officer is involved with each manager and property on a literal daily basis, so there is opportunity for immediate assessment and development of the property manager.
Larry Sauer, vice president of business development for Wentworth Property Management, which has offices in New York and New Jersey, says that his company also reviews management performance on both a formal yearly basis, and on a more frequent, informal basis. “We have monthly and quarterly meetings with our managers and regional supervisors,” he says.
“We do a formal review yearly,” says Greenbaum, but they also evaluate on a daily basis. “We have a manager’s meeting every week. So, besides from being interactive with our account executives and our management, on a daily basis… [We have a] manager’s meeting where we go through each property, and it’s not only an evaluation of the property, it’s also an evaluation of the agent. So, it’s constant.”
According to Berenson, “service businesses should constantly and continuously be evaluating the quality of their services and the satisfaction of their clients.” He recommends that on a formal basis, “internal company evaluations should take place quarterly, with an annual full-company evaluation in the third quarter to direct activities for the coming year.”
The reasoning behind these more frequent evaluations is to prevent surprises from occurring, and to enable the company to nip any potential issues in the bud.
The pros largely agree that what a management company should consider first when evaluating their agents’ performance is the goal of the evaluation itself. Is it to improve the manager’s productivity, to increase his or her motivation to improve communication or to develop a team effort in accomplishing certain goals and objectives? Once the goals are determined, the company can then continue with the evaluation, keeping the objectives in mind and measuring the agent’s performance against them.
“It’s always important [for property managers to evaluate their performance,] because this way you know if you’re properly serving your client…and always see if there is room for improvement,” says Greenbaum.
There are many different techniques to evaluating management performance. Some common techniques include a rating scale—awarding points from one to ten, say—as a way of evaluating performance. Other companies use a question-and-answer technique, where questions are asked of the manager’s performance and the evaluator answers in essay form. A combination of these techniques can be used as well.
“We send out questionnaires, sometimes annually, sometimes if we feel a building needs it more than others. Some buildings do it on a regular yearly basis,” says Greenbaum.
Ray Kroc, founder of McDonald’s once said, “if you work just for money, you’ll never make it, but if you love what you’re doing and you always put the customer first, success will be yours.”
To help evaluate their performance, Wentworth Property Management meets with the client at least once a month for review. Rose Associates encourages their clients to provide regular feedback to the company and to weigh in on key criteria such as their manager’s responsiveness, knowledge, and supervisory skills as well as the physical and financial performance of the property.
At AKAM, every department of the company is evaluated for a whole slue of functions, ranging from each employee and each department’s expertise to their “pride of employment.” Ultimately, according to Berenson, “our success is gauged by client and employee retention and, of course, profitability.”
Of course, all companies are hoping for perfect evaluation scores for their managers, but it’s an unrealistic expectation. While you may have a terrific property manager, it’s normal to expect that there will be the occasional problem. However, if a minor issue becomes bigger, or the regular evaluations begin to uncover more red flags, there may be a problem brewing on the horizon.
“Probably one of the earliest warning signs is assigned items not being promptly closed out,” says Sauer. “This may be related to the property manager’s knowledge—them not knowing what to do—or their workload—them having too much to do at the moment. We encourage our clients to bring any concerns to our attention immediately so that we can support the property manager’s efforts.”
Sauer says that other red flags on a manager’s performance include a lack of timeliness, or a slow responsiveness to clients’ concerns.
Address the Problem: Hello Problem! There are various steps a management company can take to rectify a negative overall evaluation, or to correct a problematic item on an otherwise good evaluation:
Make sure it’s not personal: In some cases, a property manager just might not be a good personality fit with the building residents or board. Perhaps the property manager has a Type A personality that serves her well with the intense nature of the job, but might clash with the residents who are mostly laid-back retirees. In more severe cases, that personality conflict can become a personal one between a resident and a manager.
Provide managers with additional education: Your property manager might be strong in some areas—tenant relations, for example—but may have trouble when it comes to handling building systems or dealing with financials. Once you uncover the manager’s weaknesses, provide the tools to strengthen those areas. Many companies offer or facilitate online management courses for their managers in areas where they may need strengthening and monitors their progress.
Mentor them:As mentioned earlier, a senior manager with more experience can help the less-experienced managers. They can work out problems or provide solutions.
Talk it out:Discuss—in a very matter of fact way—whether a relationship is working or not. It shouldn’t be surprised to management companies if they are going to lose a building. Some managers take it personally and want it done their way, but they need to work with the board and the community, which makes communication crucial.
Provide incentives: Although the property management firms mentioned in this article either did not have, or disclose, any financial incentives, it is possible to provide bonuses or other financial incentives for meeting goals.
Make a change: Bottom line—is if the manager isn’t doing their job, you may eventually simply need to switch managers. “Poorly performing management has a negative impact on all aspects of a property’s operation, not the least of which are investment value and quality of life,” says Berenson. “Conversely, when management is performing well, a property thrives, investment value and quality of life increase, the building’s reputation is enhanced, and the Board’s ability to perform in the property’s best interest is confirmed. For these reasons, Board should always be evaluating the quality of their management.”
A good management company should perform regular management evaluations as well as changing evaluations to meet the current needs of the management company. For example, if your evaluation method has been used for two decades, it might be time to reevaluate it and add more updated information and questions. It’s also important to remember that a management job evaluation is about how the employee conducts their job and it is not on the personality of the manager himself.
Lisa Iannucci is a freelance writer and author living in Poughkeepsie, New York.