How to use KPIs for community associations.
There's a lot to be said for taking measurements – without them, the world exists in a fuzzy haze of probabilities. While KPIs, or “key performance indicators” aren't crystal balls, when properly implemented, they help companies and community associations bring a little clarity to their future.
KPIs for beginners
KPIs are kind of like giving your association a complete blood panel in order to maximize performance. KPIs can effectively reveal shortcomings and successes; the key to obtaining functional results is choosing what to measure.
Typically, between three and seven KPIs are recommended for keeping tabs on the performance of your association. KPIs should be quantitative (numbers oriented), directional (are you in the red or black?), practical, and actionable.
When selecting KPIs, community associations need to determine which factors help assess progress towards its goals. Each performance indicator must be critical towards accomplishing those objectives. Otherwise, you risk clouding your vision.
Which types of KPIs should community associations consider?
Community associations can manage their KPIs into three main genres: board, community, and financial. Here's a breakdown of each:
Board KPIs: The first step in analyzing the performance of your board is determining standards. Objectives for the number of annual meetings, attendance, and duration of meetings should be clearly defined and gauged against the actual performance numbers.
Community KPIs: The objective here is to determine community engagement. How many people are running for elected positions? Are you conducting surveys? If so, what were the results? Do community members feel welcome to share ideas and participate? Without resident engagement, a community association is just a concept at best, and tyrannical at worst.
Financial KPIs: An accurate assessment of your association's income to spending ratio, and all the details in between is vital towards proper management and building community trust. Things to consider in this genre include timeliness of financial reports, the accuracy of financial reports, net income, delinquent payments, and the average number of tenants.
Once your association has identified relevant KPIs, it must ensure the data is properly collected and put to use. The following tips will help community associations successfully execute a KPI based strategy.
Be inclusive. Your KPIs shouldn't be a secret. When everyone involved understands what measurements determine the success and failure of their association, they're significantly more prepared to meet their objectives. Furthermore, member engagement promotes individual incentive. When people play a creative role in developing a plan, their emotional investment dramatically increases: they feel more important and responsible.
Keep your finger on the pulse. If you aren't recording your KPI measurements, you're just spinning your wheels. Community associations should assign a specific individual with the task of monitoring KPI results.
Share the results. If a boulder drops off a cliff and there's no brain around to process the ripples in the air, does it make a sound? Of course not, and neither will your KPIs if the results aren't distributed to your team. Community associations should track performance with a system that's accessible to everyone involved.
Incentivize. While everyone in your association should be intrinsically motivated by their stake in the community, incentives can provide an extra boost in morale. Identify which members play key roles in achieving the association's objectives and offer a reward for their success. Or, on a larger scale, if the association, for example, meets their budget goals, throw a community-wide party.
KPIs should evolve. Even if you luck out on your first KPI implementation and achieve some level of perfection, your community is destined to change. Your KPI strategy needs to adjust to changes in your community, otherwise, you may end up measuring irrelevant indicators.
KPIs for Florida community associations
Even if you're experienced with KPIs, there's nothing wrong with garnering feedback, and suggestions. An outside perspective is likely to show you aspects of your approach you hadn't considered, or that might not be in line with Florida real estate law.
The real estate attorneys at PeytonBolin never stop learning. Through business coaching and professional development programs, we stay on top of current trends in Florida real estate management.
If you're considering putting KPIs to work for your community association, connect with us for a free consultation.