Dealing with this struggling economy in your neighborhood

Signs of our struggling economy surround us. The media headlines are full of stories about the latest large retailer closing stores. This year, less than a week before Christmas a friend's husband was laid off and his former employer shut the doors without warning. The closing was so poorly planned that he only received his last paycheck and health insurance until the end of December. Homeowner associations are feeling the pinch as well. Association dues are left unpaid while vendors raise their prices. What can the association do?

Like most things in life, your attitude determines whether you succeed or fail. The motivational speaker Zig Ziglar said "Your attitude, not your aptitude, will determine your altitude." The first step to successfully dealing with the poor economy begins with the attitude of your association's board of directors and your management company, if you have one. Do you use words like "dead beats" or "problem children"? If you do, then as we say in our house, you may need an attitude adjustment. If you see your owners/members as "dead beats" or "problem children" then that is what they will continue to be, but if you change your attitude your "dead beat" may turn into your neighbor, someone you waive to as you drive through your community.

Once you change your attitude, the next step to dealing with the economy is to change your problem solving style. Is your board constantly "putting out fires" or do you prevent or minimize your "fires" by taking a proactive instead of a reactive approach to solving problems? Proactively solving problems requires you and/or your manager to first identify not only the known problems but the potential problems, develop a plan to solve the problems and then take the necessary actions. A proactive approach to problem solving will also allow you to solve a problem when is a small problem and not a "blazing inferno."

Effective proactive problem solving requires communication. Communication goes beyond what the latest gossip is in the neighborhood. Good communication between members, the board of directors and/or association manager, helps the board identify potential problems from the owners' perspective, provides new solutions to problems, and helps "sell" the board's policies. Communication does not start and end with your owners, communicating with vendors may help you reduce your costs by changing the frequency of the service or identifying what you truly need done versus what are the "extras" that are not necessary. This is a great time to ask your accountants, insurance agents, attorneys, landscapers, etc. questions like "what can we do to lower our expenses?" or "how do we reduce our delinquencies?"

Proactive problem solving may require you to "think outside the box" to find a solution. For example, if the aesthetic of the neighborhood is deteriorating, a simple and cost effective solution is organizing volunteer work days where the owners pool their resources and work together to make repairs or perform maintenance. Another example would be to negotiate with vendors to lower their costs by scheduling work on certain days within your community. If a vendors knows the entire first week of September will be taken up with service calls by your owners you may be able to negotiate lower rates for your owners. You can also help your owners survive the economy by organizing coupon exchanges, on-line yard sales open to members only, starting a produce co-op, etc.

Dealing with a tough economy requires all of the strategies mentioned above plus the elimination of a "one size fits all" approach. For example, if your collection policy is limited to a fixed number of payments, that may not work for the owner struggling financially. Speaking of collections, is your collection policy working? If not it may be time to reevaluate when and how you take action.

Making the best of our current economic situation is not "business as usual" instead it requires association boards and managers to first adjust their internal attitudes before making external changes to problem solving.