The sectional title act states that trustees are solely responsible for the running of the complex – the buck stops with them. When trustees are elected at the AGM, they are the ones ultimately responsible for overseeing and management of the monies and expenditures on behalf of the body corporate. Managing Agents act upon the instructions of the Trustees. However, a curious phenomenon takes effect. Due to the way managing agents provide a service, trustees become dependent on the systems and services of the managing agent to the point of accepting or overlooking the drop in service provision or decisions made that are not entirely to the benefit of the BC. The managing agent almost seems to be doing the trustees a favor and the dynamic of the relationship becomes a dependence rather than a service provider/customer relationship. The tail wags the dog. This dynamic ultimately affects the other long-term providers such as maintenance and gardening as well as security. It’s something we have experienced and researched online by comments of other trustees in their respective complexes and communities. What is important to keep in mind though is that your managing agent is a service provider and should implement the decisions of the trustees within the law and best practices. They provide valuable administrative and consulting services on decisions trustees have to make. At no point should they dictate to you what is to be done at your complex!
Think of it though. A professional, knowledgeable and caring service provider should be acting in the best interests of their client. If that is the case, why would they push for managing their client where the method of providing the service means that you have be beholden to them since they control what is necessary to get the job done? Good service providers don’t do this – they will typically charge more than market value but will ensure that their client is taken care of by advising on what is in the client’s best interests and NOT their own if at odds! They are prepared to walk away from the client if this is not met rather than fight tooth and nail to keep their contract no matter the cost to the client. Surely there must be a way to provide the service without these traditional tactics and methods?
Any of the service providers should be following the requirements of the trustees in providing services. This is an ideal setup. However, in my experience, this presents a challenge.
Trustees just don’t have the time to see to the day-to-day running of the complex – believe me, in a sizeable complex, there are plenty of things that need constant attention. They rely on the estate manager, if the estate is big enough to warrant one, and then the managing agent who manages all service providers on their behalf. A lot of trust is placed in the operational and managing skills of the service providers. Unlike an owner who is running a business of his/her own, Trustees are not paid for their time and need to juggle putting in just enough effort to ensure things are running as smoothly as possible, and their own precious time. The motivation to do so and how well this works is placed on each one’s leadership and organizational skills, value system, and ethics.
A System:
In my time as a trustee, and having the perspective of running my own business, I got a good view of how things work. One of the biggest issues I think facing any sizeable complex is the SYSTEM put in place to keep track of and ensure the complex requirements are being met. In the 14 years of managing our complex, the former managing agent had no system through which a trustee could go to get historical information easily. How the hell does that make any sense? If significant funds are being collected and operational and capital expenditure is offset against these funds, surely there should be a system put in place which is not the ‘property’ of the managing agent held in their format but that of the BC – surely?
There is a system that does address most of the requirements called WeConnectU. As far as I know, this has only very recently been introduced to Sectional Title complexes. However, the rub here is that the information is not owned by the BC. It is licensed by the managing agent and the agent has to give permission to the BC to access their information. Should it come to a parting of ways, unless expressly stipulated in the contract, the Managing Agent can refuse to provide access to transfer to the next managing agent as would be expected. The other catch is the appointed managing agent would need to also license WeConnect to take over from the previous one. Again – how does this make any sense?
In the absence of anything else, some system is better than no system. However, in my opinion, the commercial ‘known’ systems available to complexes are sadly lacking in essential features AND it seems, locked into the benefit of the Managing Agents.
What is required however is the following:
- Owner details database
- Accounting and Administration system – invoice and statement generation on Levies
- Conduct rule warnings and penalities
- Property transfer process
- Accounting package that syncs to bank account and tracks all transactions, providing financial reporting useful for making decisions based on budget, expense projections and trends etc.
- A facilities management system tied into the accounting system
- Service providers should ideally have relevant and secure access to the system specific to their work – eg. gardening and maintenance service are provided access to the ticketing system relevant to them where input beginning to end is filled in
- Any incident in the complex should be diligently recorded on this system. The typical issues we have in our complex is repeated issues with the access control system – unbeknownst to us and the estate manager, the guards at the control room got so tired of repeat issues, they found a way around it. Issues were reported, however on hand written reports which should have been captured but due to the process, got ‘lost’. There are many issues like this that get lost in the noise in the running of a complex, due to how information is being captured. A platform as suggested and when setup properly for such issues, can provide valuable information to trustees and estate manager to assess and make decisions on.
- Owners, estate manager, trustees etc are provided with relevant feedback and metrics based on this system data to make decisions on the performance, cost implications and planning for the future of the complex.
We are currently evaluating different systems to meet these requirements. Watch this space!