CAM Profitability Conference Best Practices for 21st Century Executives PART ONE
Our Mission“To provide a series of thought-provoking seminars andsocial media discussion groups to educate and advisecommunity management executives on ways to betterrun their companies.Community management companies are underintense competitive pressure which affects profitlevels. The topics discussed will give insight into waysto better market management services, increaserevenues, reduce expenses and maximize profits in a ”variety of innovative ways.
Agenda (Part One) Welcome & Introductions Where is Community Management Headed? How Can We Work Smarter/Better? • Automate Repetitive Tasks • Outsource to Save Time and Money • Technology as an efficiency Tool • The Future is Mobile Data Access
Where is Community Management Headed? ~ Craig Huntington
Where is Community Management Headed? More National players will move into more areas of the country Technology will continue to drive efficiencies and your ability to compete • Software integration with: • The web • Phone systems • Paperless systems • Mobile Data Access will become the standard
Where is Community Management Headed? Employees will become more professional, educated and technically savvy Companies will start performing more tasks to increase revenues: • Collections • Landscaping • Maintenance
Where is Community Management Headed? Companies will start performing less tasks, i.e. • Accounting • HR • Outsource services that require quick response • Resale disclosures • In-house payment processing • Mass Printing
Where is Community Management Headed? More telecommuting • Might offer salary savings • Save on office rent • Spread your footprint • Needs control systems Paperless Filing will become the norm New State Laws will affect the industry
Where is Community Management Headed? The conclusions we can draw at this point in time about where community management is headed are: • National firms buying local companies continues • Move towards web based and mobile technology • Integration of internal business systems • Broaden income streams through expansion of services • More outsourcing to save labor • The industry will be more controlled by new laws
Where is Community Management Headed?
How Can We Work Smarter/Better?Automate Repetitive Tasks ~ Jeff Hardy
Automate Repetitive Tasks The Community Management companies Management business is employ these 4 general very labor intensive. categories of staff: Labor dollars are the most Category Avg. Salary Cost expensive dollars paid by CEO $117,004 any company. Executive $89,202 • Salaries Portfolio Managers $56,011 • Employer Taxes Accounting/Admin $60,805 • Employee Benefits
Automate Repetitive TasksExamples of Repetitive Office Tasks: Accounting Possible Alternatives Staff Type Estimated Time Estimated Functions Savings * SavingsEnter Cash Receipts Lockbox, ACH or high speed check Accounting/ 178 hrs p/yr per $5,212 p/yr scanning/Check 21 deposits Admin employee tasked p/employeePrint/Send Late Automate through your software Accounting/ 262 hrs. p/yr per $7,676 p/yrNotices and Letters combined with Workflow Admin employee tasked p/employee processingEnter AP Invoices Outsource to a payment Accounting/ 534 hrs. p/yr per $15,623 p/yr processor Admin employee tasked p/employeePrint AP Checks on 1. Print MICR Checks with Digital Accounting/ 265 hrs. p/yr per $7,736 p/yrPreprinted Check Signatures Admin employee tasked p/employeeStock 2. Generate eChecks 3. Outsource to a payment processor
Automate Repetitive TasksAlternatives to Repetitive Office Tasks:Accounting Possible Alternatives Staff Type Estimated Estimated Savings Functions Time Savings * Outsourcing AP to a payment processor can Accounting/ $15.61 per Invoice lead to large savings Admin **Reconcile Automate through your software interfacing Accounting/ 132 hrs p/yr per $3,844 p/yrBank & GL with your bank Admin employee tasked p/employeeAccountsGenerate Automate through your software with a Accounting/ 114 hrs p/yr per $3,345 p/yrFinancial report package builder so a few clicks Admin employee tasked p/employeeStatement generates the financial packagePackage * Based on TOPS Customer Survey Responses ** Based on Aberdeen Report
Automate Repetitive TasksOffice Functions Possible Alternatives Estimated Time Estimated Savings Staff TypeAlternatives to Repetitive Office Tasks:Savings *Community 1. Look at email as an alternative to Office Admin Save as much as $15,201 AnnuallyMailings print mail. 25% of the 2. Mailing machines that can print, overall costs merge and stuff envelopes 3. Outsource to mailing specialistAnswer Owner 1. A community web site can reduce Office Admin Might not need $25,000 AnnuallyPhone Calls calls to the office a full time 2. An automated phone attendant receptionist can save receptionist’s time and expenseMailing Financial Email as an alternative to printing Office Admin 100 hrs p/yr per $2,923 AnnuallyPackages to Officers and mailing employee taskedFiling Start scanning and storing digitally. Office Admin $29.25 p/hour Unknown butCorrespondence or avg. pay rate for significantother important Office Admin.documents * Based on TOPS Customer Survey Responses ** Based on Aberdeen Report
Automate Repetitive TasksReasons to consider going paperless through emailand electronic filing: Paper Facts*: • Average office worker uses 10,000 sheets of paper per year • 40% of all wood in the US goes to the production of paper • It takes 1 ½ cups of water to make 1 sheet of paper. • Don’t think just of the filing time, think of the document retrieval time too. • The cost of USING paper can be as much as 31 times the cost of the paper itself. * From Reduce.Org
Automate Repetitive TasksBenefits of Automation Time savings means potential labor dollar savings Better control of labor expenses (Same staff can handle more communities) Improved response to customers Lower costs keep you more competitive in your marketplace Increase PROFITS!
Automate Repetitive TasksThe Take Away Regularly reexamine internal processes and systems looking for ways to automate or at least ways to improve efficiency. Don’t Accept the “status quo” represented by the ubiquitous “But we’ve always done it this way” on any slow, repetitive manual process. Repetitive manual functions cost you money. It has an impact to your bottom line which is a danger to a company in a competitive, low profit industry like community management.
How Can We Work Smarter/Better?Outsource to Save Time & Money ~ Craig Huntington, Mickey McGuire
Outsource to Save Time & Money
Outsource to Save Time & MoneyYou Need To Accomplish More With Less People Equipment Investment Why do associations hire management companies? • They need an organization with expertise. • They don’t have the time or personnel to do it themselves. • A paid staff gives accountability for getting things done. • It’s a pain in the butt - unpaid volunteers rarely can keep up with it. • Rapidly Changing government regulations.
Outsource to Save Time & Money What does a typical management company specialize in? It sure isn’t printing, mailing, developing software, performing banking services! It’s the following: • Accounting • Property Maintenance • Support of Community Officers The cost of an employee can be measured – typically $29.25* per hour for administrative staff; others are even more costly. What is the best use of the employee’s time? • Mundane tasks? or solving problems & generating revenue? * Based on CAI’s 2010 Salary Survey
Outsource to Save Time & Money Most executives prefer to not know the real cost of performing some tasks in-house • i.e. “Suzy is here anyhow so let’s have her do it in her free time” • Management Companies lack the ability to write software • Management Companies have no accreditation to perform bank services, much less the ability • Study results from actual time and materials studies- statements: • In-house = $.91 • Outsource = $.75
Outsource to Save Time & Money Does anyone open and process their own billing statements anymore? A/R Lockbox is the perfect example of outsourcing. Now there is a process for outsourcing your Accounts Payable! There is a small fee but the association will pay it.
Outsource to Save Time & Money Choosing the right vendor can provide features and functions not available in-house • Electronic delivery • Superior company image • Professionalism
How Can We Work Smarter/Better?Technology as an Efficiency Tool ~ Craig Huntington, Jeff Hardy
Technology as an Efficiency Tool
The Way Things WereWelcome to the 1970’s!How many of you were incommunity management in the ‘70s? EVERYTHING was manual Ledger cards for tracking receivables Phones were public Inspections – a yellow legal pad Staff time was staggering and an impediment to growth Transformational technology? Desktop electronic calculator
The Way Things WereA Truly Frightening Reminder of the 70s!
The Way Things WereWelcome to the 1980’s!How many of you were incommunity management in the ‘80s? Phones were public Inspections on a yellow legal pad Communications? • Phone, letters and fax Transformational tech? • PC becomes available in 1981
The Way Things WereWelcome to the 1990’s!How many of you were incommunity management in the ‘90s? Computers used for accounting and property management People used pagers!? Inspections done on yellow legal pads and clipboards Communications? • Phone, letters, internet, email just starting Transformational tech? • cell phones became available
The Way Things WereWelcome to the New Millennia! Dotcom bubble pops Email became ubiquitous Cell phones become cheaper PDAs arrived (and disappeared) Inspections, still on yellow legal pads Communications? • Phone, letters, email, websites Social media and texting begin to appear Transformation tech? • Internet • Websites Industry specific Lockbox for AR
The Way Things AreWelcome to 2012! Smartphones replace cell phones Tablets making inroads on laptops Hi-speed cell networks Social media is everywhere Social media replaces email? People are always online Inspections - mostly done on legal pads Communications? • More than you can even list! How are you embracing these innovations? Transformation tech? • Mobile computing—Tablets/Smartphones
Transformational Technology Through the years, savvy community managers leveraged new technologies to improve efficiency. • They used the transformational technologies USA Today – 1/12/12 – “Small Business Strategies: Seven trends you cant ignore” • Journalist asked “Are you running your business like it’s 1982? If you’re not investigating the following you might be.” • The cloud • Social media • Mobile • Hiring • Credit • Analytics • Global
Technology is All About People Without you, technology is nothing It gives you more power to promote your company It allows your clients to be connected
Technology… Without YOU, IT is Nothing
Industry Specific TechnologyWhat Have We Accomplished? Lockbox No longer have thousands of payments coming to Management Company. Check writing: No longer need to have checkbooks for every community. Web pages for homeowners to find information and not call Management Company. Literally, we could not do our jobs were it not for technology.
Industry Specific TechnologyWhat is the Future for Industry Technology? Mobile devices for instant data access anytime, anywhere Automatic check reconciliation Phone interfaces AP Lockbox Electronic File Cabinets Moving Towards Paperless Offices Email will be accepted as legal notice Social Media will become a standard form of communication
Industry Specific TechnologyWhat Technology Means to You: Technology is a tool to make your job easier It improves office morale and attitudes It usually involves computers Use of technology offers the community management industry one of the best options to save time and effort The right technology can help make you profitable
Industry Specific TechnologyFinding the Right Technology Define your needs. What do you want to accomplish? Look where your staff spends an inordinate amount of time. The 3 goals to achieve when evaluating any new technology are: • Efficiency • Accuracy • Convenience If the technology you are considering does not offer all three, it is not the right technology to achieve your goals.
Industry Specific TechnologyFinding the Right Technology Beware being on the Cutting or Bleeding Edge Google and Apple are solid technology choices Don’t be afraid to “Jump off the Log”
How Can We Work Smarter/Better?The Future is Mobile Data Access ~ Mike Hardy
The Future is Mobile Data Access How many of you have a smart phone? How about a tablet? • How many find them confusing? How many of you are using them to do community management? • How?
The Future is Mobile Data Access
The Future is Mobile Data Access So what are smart phones and tablets? • REALLY SMALL COMPUTERS! • All the power of a computer in a small form • Self contained multi function device • Maximum portabilityStop thinking of them as phones – they are way morethan that!BUT…..They’ve been limited…
The Future is Mobile Data AccessSure they can allow you to… Send/receive email Take pictures (for violations, work orders) Take notes, open files GPS navigation Find a good restaurant (Yelp, TripAdvisor)But for years there’s been one thing holding them back…
The Future is Mobile Data Access It’s the Network • If your smart phone or tablet were a car it’d be a Ferrari • The network would be rush hour traffic • Don’t really go well together 3G was the first attempt at high speed networks • Just means >200 Kb per sec • Reality is that traffic on the network often resulted in lower speeds
The Future is Mobile Data Access The NEW Network – 4G • Set peak speeds @ 100 Mb to 1Gb/sec • That is a 50000%+ speed increase • BUT – not every 4G network is the same • Check your carrier • Still this is a monumental leap forward • T1 speeds via cell towers Enable that tablet and smart phone to work as it’s designed to -- FAST!
The Future is Mobile Data Access So now that the network is faster we need more of it Alcatel-Lucent (WSJ 2/7/11) may have the solution No one wants a cell tower by them – no matter how you dress them up!
The Future is Mobile Data Access So what are tablets and smart phones? • Really cool and small computers Why are they relevant? • They give you tons of power in a highly portable device The network is getting faster and broader What can they do? • Let’s dig into this a little more
The Future is Mobile Data Access To effectively leverage mobility you need to devise a strategy Mobility is a complementary technology To get the most from any mobile platform it must be in communication with your back office management system
The Future is Mobile Data Access Community management applications • Access up to date Owner information • Same with vendors • Draft work order and assign them • Perform inspections without double entry (yellow pad!) • Update architectural requests • Resource in board meetings • Document violations All in near- or real-time with your back office solution • Less gas • More productivity • Green option
The Future is Mobile Data AccessTake Action! Contact your back office software provider – what do they offer? • They are your single best resource – remember stay connected Look at the device landscape and carriers • What is right for you and your team – coverage Devise a strategy • Know how you plan to use tablets & smart phones • Realistic expectations – this is still very new!