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Using Technology to Get Organized The Paperless Office

Are you one of those people who have papers everywhere? You know, the bills and mail that you tell yourself you are going to file away next week but just never seem to get to? Disorganization in one private household can be troublesome enough—but extrapolate that situation into a property management office or a condo association, and you can imagine the chaos that ensues when papers pile up or are filed haphazardly. Important information can be mislaid or lost forever, maintenance and resident issues can lie unanswered for weeks, and penalties and fines may even accrue because of late bill payments.

The Benefits of Organization

According to Chip Hoever, one of the principals at Somerset Management Group in Somerset and a CMCA and AMS certified property manager, "The biggest problem posed by poor office management is not being able to find what you need when you need it."

And with that in mind, most boards and managers do their level best to keep their offices organized and orderly. There are the occasional notable exceptions, of course—offices where papers and documents are squirreled away into deep filing cabinets, never to see the light of day again. Boards and management companies deal with an enormous amount of information every day, and it's easy to see how things could get a little dicey.

"The issue is often simple volume," says Hoever. "We get a lot of stuff! It can be very tedious, paper-wise. When we do closings, if the parties don't send the proper paperwork, we have to clean up the mess, which generates more paper. Or when a homeowner sends an application for modification. If they don't follow directions, that's more work. Twenty-five years ago, I worked for AT&T. My supervisor said we'd be in a paperless office within a few years, but that hasn't really happened. I can't ever read an e-mail of great importance until I print it out and see it on paper."

A Helping Hand

It may be true that with the advent of e-mail and computerized management tools, the days of back offices crammed with floor-to-ceiling filing cabinets are on the wane—but there is still room for a great deal of improvement. While just a small percentage of associations and management companies are staging complete overhauls their filing and document management systems, many more have taken small steps toward eliminating piles of paper whose data can be stored more easily on a computer.

One easy way for a building to cut down on the file cabinets in their offices is to hire a company to do most of the paperwork for them and manage the operation off-site. There are several so-called back office companies in New Jersey and the tri-state area that handle the day-to-day, month-to-month and year-to-year bills and reports and keep track of associations' finances.

"We worked with ACT for our database management," says Hoever. "In the client's 'history of account' file, there's a history of all communication with that client. We file by association, street name within association, then address, then homeowner. Everything goes into their file. We can access our database from outside the office, too. Our managers carry Blackberry devices, and we download to our server, which helps too."

Another company devoted to board services support is Back Office, Inc., based in New York City.

"We're devoted exclusively to doing all of what we classify as 'back office' work, meaning all of the bookkeeping necessary for the co-op corporation, condominium, or rental property landlord to manage themselves," says Back Office Inc.'s Harold Wolf. "We do the billing, and we bill common charges for condominiums. We collect the monies from the tenants and deposit those monies into the appropriate bank accounts of each co-op or condo. We pay all of the bills for these organizations. The bills will either be sent directly to our office, or go to the offices of various organizations and they will forward them and make copies, and we issue checks and payments. We insist on not having authority to sign them, however - for obvious liability and transparency reasons."

Then each month, says Wolf, his company provides a full set of financials to these organizations, including month-to-date and year-to-date general ledgers, a summary of income expenses, a cash receipt journal, a cash disbursement journal, and a ledger of each tenant's individual account.

"These are all delivered to the client in the form of a report," says Wolf. "We send it to them so they can reference it and distribute to members of their board."

Any good back-office firm will of course interact with the client building's managers, but firms like The Back Office do not act as a management company. Their responsibilities end with the paperwork.

Compute This

Barry Korman is a managing agent who is known around the New York metro area as "The Paperless Office." He and his company have dedicated themselves to establishing a way to eliminate much of the paper that offices use by putting everything on computer.

"If someone wanted to," says Korman, "they could run their office and manage their association themselves with one drawer of files and not accumulate a ton of paperwork. For a managing agent, [computerization works because] you never lose documents - everything is scanned in and indexed, and you can do a search and find any document you need."

For example, if an association member is planning to do some alteration work on his unit, Korman can have the association's alteration agreement scanned in and e-mailed or faxed to the member, then scan in their completed request and signed contract. Digital photos of renovations can be downloaded into the association's files. When the seasons change over and you must send letters about winter snow removal or spring lawn care, it can all be done electronically.

Computerizing Cuts Costs

The cost of a system like the ones Korman uses is far less than anyone imagines.

"Anyone can do this themselves," says Korman. "All of these programs and hardware are easily obtainable and costs less than $2,000 for software and hardware and even training. When you're talking about running a building or HOA, you are talking about a huge amount of paperwork. If you scan a document and throw it away, you can copy it into several different files, and you don't need to worry about losing it. That's when you are really sophisticated. I don't know why it's not done that way more often in more associations."

"It's very cost effective," agrees Hoever. "Using the Internet does save money. I have to say, I am more efficient these days than when I didn't [have the technology I do now.] We have group lists for all our boards, so all board members get the same info at the same time. It's great for timely issues, because they can reply right away. Work orders are also done online. I have the ability to eliminate mistakes on work orders—no one's re-typing anything 40 times. And we keep group databases for our association members."

Of course, the back office companies rely heavily on computers as well.

"We use computers—we could never do this otherwise," says Wolf. "If you have to sit and do this with pen and pencil and paper, it's utterly impossible. We can do 50 properties in the time it would take someone to do one property by hand."

But as anyone who's ever cursed a frozen Windows screen knows, even computers are fallible. "There is always a danger," says Korman, "because computers can crash—so you must back up your files religiously. Buying a backup hard drive or setting up service with a server that will back things up every day is very inexpensive, and there should be no reason why you should ever lose any of your records."

Problem Solving

When paperwork continues to pile up, it not only creates a clutter but it can cause a myriad of problems down the line.

"We eliminate the major problems," says Wolf. "If there are any issues concerning a board, or anyone running a board, it's usually on the bookkeeping end—that's where the real problems tend to be."

For an example of just how bad things can get when organization and transparency aren't made a top priority, just look at what has happened with the New York City school system. Because of their inability to keep records accurate and organized, the whole system was thrown into chaos about five years ago – and a target for individuals seeking to use the system's disorganization to their own advantage.

One reason the pros advocate for outside office support is transparency. In many back office firms and "paperless" management offices, mail is processed by sophisticated scanning and authorization systems that "read" the mail, sort it, and input it into a computer system without human intervention—thus reducing the chances for mistakes, or even outright fraud. At the end of the year, the back office or management firm software will produce a report covering paid bills, tracked balances, monthly check summaries, and including a reconciliation showing what items have cleared and not cleared. All of this information goes to the board, and in some cases the residents as well.

Truth, or Fiction?

So with all that hands-free technology and software, will there ever really be an office that doesn't need paper at all?

"People speak about paperless offices, but the truth of the matter is, no," says Wolf. "It's just talk that shows you are modern in your thinking—but the issue of a truly paperless office, I just don't go for it. People like to look at actual reports and not simply have them flash up on the screen. It's not something we're promoting, and we're not against it, but I don't think it's something that will happen."

One issue that can hobble or frustrate an HOA's attempts to modernize their bookkeeping is lack of technical expertise and understanding. After all, once you have the computer and scanning equipment, it is still important to learn how to use them properly.

In fact, Korman recommends that any association trying to reduce paper waste and become more computerized should save hard copies of everything they scan or store electronically for one year, just to make sure that they are doing it correctly. Plus, he says, there is always some paperwork you'll need in hard copy form.

"A paperless office is really about 95 percent paperless," says Korman. "There are a few documents you need to keep, but for the most part, you can keep things on a computer."

What it comes down to is something that associations—whether organized with military precision or teetering on the brink of a paperwork avalanche—have known deep down forever: organization and good housekeeping are a huge part of an association's ultimate success and administrative health. So whether you overhaul your system entirely or just implement a few new measures to keep things in order, be sure you've got a game plan and everyone is on board before you start scanning.

Keith Loria is a freelance writer and a frequent contributor to The New Jersey Cooperator. Additional reporting and writing by Hannah Fons and Mary Fons.

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