Property Management is a career profession. The industry allows for employment growth, continual learning experiences, and the opportunity to work with diverse people and income groups. The Property Manager can work either directly for an owner of real estate properties, or for a property management company, contracted by an owner or legal entity to care for the real estate over a specific period of time.

The Property manager has a fiduciary relationship with the management company and property owner. A fiduciary relationship is one that is based on a mutual trust and complete confidence in one another.

The Property Manager is provided an owner’s real estate portfolio to manage to its “highest and best use” in exchange for an employment contract or salary. Real estate assignments for the property manager includes apartment buildings, condominiums, hotels, storage facilities, shopping centers, office buildings, government subsidized properties, rooming houses, abandoned buildings and plots of vacant land, to name a few.

I have managed almost all of the above types of properties for over twenty years. I have managed public and private housing, for non-profit organizations, for the federal government, and for private developers and real estate investors. I also owned my own property management company for eight years. I now teach, speak, and write about property management standards and techniques. Here are some crucial skills, which I know from first hand experience, must be accepted as required attributes and learned skills in order to be a good property manager.

1. Must Know and Stay Current on Local Ordinances and State Laws

Managers are required to perform their work according to the laws of the land. The government (city, state, and federal) dictates how real estate is to be managed, from requiring a real estate license (depending on the state), to the use of the real estate (such as rent control laws). From proper trash removal to how and where we must keep security deposits, the manager has to keep abreast of the many legal requirements of managing real estate. If a mistake is made or a task is forgotten, it could cost the owner his or her property, and/or a management company’s reputation, loss of the account, or even the loss of real estate licenses.

2. Must Be Highly Ethical and Honest

Property Managers work on the Honor Code when they handle other people’s money. By collecting rent, security deposits, laundry machine money et al, the property manager holds a fiduciary relationship with the property owner and/or management company. The owner entrusts the property with thousands of dollars each month, plus the value of the real estate itself. The manager is hired to perform at his or her highest level of integrity. On a daily basis, the property manager’s good judgment and sense of what is right and wrong is called into play.

3. Must be Detail Oriented and Organized

Managers collect the rent daily, and must ensure that each rent is paid and posted to the tenants’ account as received. Financial records detailing each and every rent transaction are kept, either by rent cards, or on the computer. Lease expirations and renewals, rent increase letters, and rent invoices must be mailed on time. lines for court appearances must be kept, and clients must receive their written monthly report of operations. A skilled property manager is able to multi-task, keep site files organized, and prioritize repairs and assignments.

4. Must Have Good Communication Skills

Managers must be able to communicate with people from all walks of life, cultures, ethnicities, and personalities. Managers must be able to articulate their cases in front of judges, talk to the owner, negotiate with vendors as well as speak appropriately with tenants, who are often frustrated, upset, or angry. A good manager must be able to stay calm, and communicate in a professional manner. Familiarity speaking in other languages is always a plus.

5. Must have Good Computer Skills

Computer competency is a technical skill, like driving, typing, etc. The use of email, mail merge, and faxing through the computer is at the heart of property management today. This is especially true if the property is on one part of the city or state, and the home office is a distance away from the site. If a manager does not have a solid command of the computer and its basic programs, such as Microsoft Word and the spreadsheet Excel, you may be hard pressed to find an administrative position in this field.

6. Should Like Working with the Public

If everyone paid the rent on time by the fifth day of each month, the manager would not have rent collection work to do. If a property never had problems, such as toilet overflows, lost keys, or defective smoke detectors, a property manager would have little to do. Therefore, it is important that a manager enjoy dealing with people with problems. A manager should at least like helping tenants with dignity, and in a responsible manager. If you do not like being interrupted several times a day with a dilemma to solve, this type of job may not be for you.

7. Must Be Patient and Have a Sense of Humor

There is some pressure involved working with the public. There are days when nothing seems to go right, and if you happen to have a headache that day, it could be a long 9 to 5. A calm personality or a good sense of humor will take you a long way in property management. If you tend to be high-strung, anxious, or become angry or impatient while working with tight deadlines or with people with problems, you may want to re-consider taking on this profession.

8. Must Like to Read and Conduct Research

There are many types of leases, agreements, forms, and other legal documents that must be signed between tenants, the manager, government agencies, the site attorney, and/or the owner. Real estate and governmental regulations change; the manager must be willing to read up on them and stay current. Documentation must be read and checked before submitted to tenants, agencies, the owner, etc. If you do not like to read in order to keep up with the latest trends, legal and industry changes and terminology used, you will not be able to properly do your job.

9. Must Have a Strong Sense of Duty and Commitment

Ensuring that the tenants under your control are treated with respect, have heat and hot water, are not subjected to or committing illegal activities or disruptive behavior of their neighbors, are some of the managers’ duties. Tenants depend on the manager’s sense of obligation to the property and the families or professionals who live in it. The manager may not always have the funds to do everything all the time, but what can and should be done, such as keeping the building clean, and having a sense of urgency to get work completed in a timely manner.

10. Should be Flexible-Minded

Property Management is a fluid profession, in that it follows economic, governmental, industry, and societal changes that impacts how a property is managed. Managers who still like the “good old days” of mistreating tenants and making rental applicants jump through unnecessary hoops to get an apartment (or the opposite, by not checking anything), will find him or herself out of touch, and maybe out of a job. The ability to accept changes of law, obey fair housing laws, have a positive, or at least a neutral, attitude about people who are different, and above all, to be open-minded, is a key element of a successful manager.

11. Must Be an Excellent Follow-Up Person

A manager can never assume that a repair or rent payment plan will happen on its own. Our mantra is: “Follow Up, Follow Up, Follow Up!” This is one of the most critical skills of a good property manager. The ability to multi-task, keeping several balls in the air without dropping any of them is challenging, and difficult at times. The ability to successfully multi-task is often rewarded both financially and in promotion decisions.

How do we Manage?

I want to thank those of you who inundated my e-mail queue and
responded to my blog with your comments and observations regarding
these articles. From your remarks, it sounds like there is little management
being applied in the area of Information Technology or in the corporate
world in general. I jokingly refer to the absence of management in
the workplace as Theory Zero (0), but perhaps it is time to revisit the three
accepted theories of management and see what is actually being used.

THE THREE THEORIES OF MANAGEMENT

Before we begin, let us not forget that all of our actions are based
on human perceptions, whether they be real of fallacious. Consequently, the
three theories of management are based on perceptions, e.g., how we
perceive the character of our workers. If we believe people will act or react
to certain situations in a specific way, we will use this in our management
philosophy, be it brute force, carrot-and-stick, or permitting freewill. From
this basis, let’s consider how the three theories apply:

THEORY X (“Dictatorial Management”) – This is derived from “Scientific
Management,” a concept best illustrated by the time-and-motion studies of a
late nineteenth century industrial engineer named Frederick W.
Taylor. Taylor observed the workers under his supervision at the Midvale
Steel Company in Philadelphia brought their own shovels to work regardless
of what size coal lumps they would have to shovel. He suggested to
management that the company furnish shovels corresponding to the size
and weight of the individual load, thus increasing the total amount
of coal each worker could shovel in a day. Efficiency and production,
the Theory X cornerstone, led to the assembly line and industrial production.

The philosophy of Theory X management style is based on the view of
human nature as:

1. People have a natural aversion to work.

2. People need to be coerced, controlled, and threatened with punishment to get them to put forth adequate effort toward the achievement of company goals.

3. The average person prefers to be directed, wishes to avoid responsibility, has little ambition, and wants security most.

Theorists now ask how much of this behavior described is
inherent human nature and how much is behavior learned from
bosses who manage with those assumptions. Perhaps the
assumptions become self-validating: workers who are always
treated by an authoritarian management as though they were lazy,
tend to behave that way.

THEORY Y (“Participatory Management”) – Most observers agree that
the Theory Y management philosophy was derived from a series of
experiments in the 1930′s at the Western Electronic Hawthorne Works
in Chicago. Employees had been divided into two groups: a “test” group
that worked under changing lighting conditions and a “control” group
that worked under constant lighting. When the test group’s
light conditions improved, their productivity increased, as
expected. But what mystified researchers was a similar jump in
productivity when illumination worsened. To compound the
mystery, the control group’s output rose when the test group’s
did. It was concluded that both groups felt management was giving
them special attention and so responded with improved
performance. This discovery of human relations management was
called Theory Y.

Theory Y’s assumptions represent a much more positive
assessment of human behavior and gave rise to the thousands
of mentoring and management training programs in the 1960′s and
70′s, the purposes of which were to help managers change their
assumptions of human nature from a Theory X to a Theory Y
outlook. The basic premises of Theory Y include:

1. The expenditure of physical and mental effort in work is as natural as play or rest.

2. External control and threat of punishment are not the only means for bringing about effort toward corporate goals. People will exercise self-direction and self-control to achieve goals they find important.

3. Commitment to objectives is in proportion to the rewards associated with their achievement.

4. The average human being learns under proper conditions not only to accept but to seek responsibility.

5. The capacity to exercise a relatively high degree of imagination, ingenuity, and creativity in solving work problems is widely, not narrowly, present in the population.

6. Under the conditions of modern industrial life, the brain power of the average human is only partially utilized.

THEORY Z (“Group Involvement”) – Theory Z was introduced in
1981 by UCLA Professor Dr. William Ouchi in his book of the same
name. It is based on Ouchi’s observations of Japanese management
practices of the time. Basically, Theory Z promotes employee
participation in decision-making, thereby increasing their motivation
and productivity. This management style emphasizes long range
planning, consensus decision making, and neutral worker-employee loyalty.

Ouchi concludes that Japanese managers got more out of
their employees than U.S. managers because the whole structure
of Japanese society encourages mutual trust and cooperation. This
management philosophy is based on the following assumptions:

1. Long term, even life time, employment is expected by both managers and employees.

2. Employees need freedom and opportunity to “grow.”

3. Decisions should be group decisions involving workers and managers.

4. Subordinates are whole people at work (in contrast to being thought of as titles or units of production).

5. Management has a broad concern for subordinate welfare.

6. Open communication, both vertically and horizontally, is the norm.

7. There is complete trust among groups and individuals because they all have the same goals – the good of the organization.

8. Cooperation, not competition, is the basis for relationships within the company.

We have been conducting business in Japan since 1976 and have
personally seen Theory Z in action. For example, when we sold our
“PRIDE” Methodologies in Japan, we would have to make several
sales presentations to a single company in order for all of the affected parties
to reach a consensus as to whether this was the correct course of action
for the company to pursue. After several months of deliberations, we
would finally get a contract. Contrast this to American companies where we
would make a single sales presentation to top management and close
on the sale within a few days or weeks. However, to the credit of the Japanese,
because everyone approved of the purchase, they all made an effort
to successfully install and use it; if they failed, they would “lose face.” Western
managers, on the other hand, would shove the product down people’s
throats (a la Theory X), thereby the methodologies were viewed as the will
of a single person and not the company overall. Consequently, when the
manager left the company, “PRIDE” followed shortly behind.

WHICH IS BETTER?

Most managers favor Theory X, others Theory Y. A few are likely to become
Theory Z managers. Most, however, use some combination of the three. There
is no “right” style of management because the appropriate style depends on
the kind of people you employ and the kind of business you run.

But what is the current trend? During the second half of the 20th century
there was a definite movement from Theory X to Theory Y. But now it appears
the pendulum is swinging back to Theory X. As mentioned in my “Bean counter”
article, mentoring and employee training programs (a cornerstone of Theory Y) is
being phased out as a means of cutting costs. Further, under the “Parenting
Management” scenario, younger employees need considerably more supervision
and direction, which lends itself to a Theory X philosophy.

Even Theory Z in Japan is showing signs of erosion. Although the Japanese
economy ran well in the 1980′s, it has slowed considerably over the last
fifteen years, causing the Japanese to rethink how they compete and
conduct business in a fast-paced world economy. Japanese managers realize
they no longer have the luxury of waiting months to make a group decision
and although they still wish to be loyal to the workforce, they realize certain
sacrifices are inevitable. Further, thanks to Hollywood and the Internet, younger
Japanese workers no longer share the same values as their predecessors. Frankly,
they have picked up a lot of bad work habits from their Western counterparts. Concepts
such as lifetime employment, corporate loyalty, and hard work is slowly evaporating
from the Japanese business culture.

BACK TO PERCEPTIONS

How we elect to manage others or how we elect to be managed is based on our
perceptions. For example, if we believe a person to be lazy, we will apply
a Theory X style of management. But if we believe people are responsible,
take initiative, and are successful, then Theories Y and Z are used.

As I mentioned in “Parenting Management,” a generation gap has emerged
between management and the latest generation of workers. Management
perceives today’s young workers as immature, disorganized, undisciplined,
and shirk responsibility. Whether this is true or not is immaterial. It is perceptions
that count. Because of this, it should come as no small wonder that Theory X
management practices are on the rise again.

For those younger workers who are as frustrated with management as
management is with you, the only advice I can offer is that you make a
concerted effort to improve your interpersonal relations/communications
skills. If you have garnered anything from this article, it is that appearances
are extremely important. Your physical appearance, forms of speech and
conduct all play a significant role in how you are perceived by management. Are
you someone who is bright but doesn’t know how to apply your skills, or do
you have a proven track record for performance? In other words, it is
time to grow up. As President Calvin Coolidge observed years ago:

“Nothing in the world can take the place of persistence.
Talent will not; nothing is more common than unsuccessful men
with talent. Genius will not; unrewarded genius is almost a
proverb. Education will not; the world is full of educated
derelicts. Persistence and determination alone are omnipotent.
The slogan ‘Press On’ has solved and always will solve the
problems of the human race.”

CONCLUSION

Management is more of a benevolent dictatorship as opposed to a democracy. It
operates according to its own whims. If management wants to be tyrannical, it
will. If it wants to allow group participation, it will. And if it elects to do nothing,
it will. But understand this, management’s style is based on what the manager
believes is good for the company and how they perceive their workers. Sometimes
the actions of management will seem strange and without justification. But there
may be some very rational reasons for acting as such, perhaps for strategic or
tactical purposes. There is little the worker can do in this regards aside from
mutiny, which is rarely the proper decision. To overcome this problem,
it behooves management to promote loyalty and faith in judgment.

Management is about human relations, not numbers. If a manager stands by a
worker in the face of adversity, in all likelihood he will be building a good
employee for the company’s future. In return, the employee should pledge
allegiance to the manager. Years ago, I remember Les Matthies, the legendary
“Dean of Systems,” taught me that a man should always be loyal to his manager
while he is in his employment. If the worker doesn’t like the manager, he should
either curb his tongue or get out. Only after the worker has left, should he talk
trash about his manager and even then he should think twice about doing so.

Bottom-line, the manager’s style of management is based on his perceptions
of his workers, right or wrong. If the worker believes he is not being treated
fairly perhaps it is time to reexamine his relationship with the manager. And
that reexamination begins at the mirror. Do you perform enough work to just
get by or do you strive to achieve? Do you prefer to be told what to do or are you
self-motivated? Do you dress appropriately? What about your form of speech
and mannerisms? Habits? Remember, we as human-beings act on our
perceptions. Want to know where you are going in the company? Ask
yourself, “How am I perceived?”