Property Management Software Options

NARPM National Convention October 2010 1

Agenda & learning objectives:

1. Background on your presenters 2. Systematic software selection process 3. Making the business case to change 1.

Sidebar: Software features tailspin 2. Sidebar: Select “Must Have” features 4. Selecting a software solution 5. Run a prototype of the solution 6. Discussion of specific software solutions 7. Question and answer

Learning Objective: Construct a simple framework for

evaluating property management software solutions, and provide a variety of supporting resources for this critical business decision.

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A little background on the presenters

Derek Kalles

Derek graduated from the University of Washington with a degree in Economics and Business Administration with a concentration in Information Systems. Derek's professional experience includes working for business and technology consulting firm Accenture, ChevronTexaco, and Salomon Smith Barney. Derek has been involved with the property management industry on both the local and national levels. As a member of NARPM, Derek has been a member of the Finance Committee that reports to the national board and with an advisory committee targeted toward members under the age of 40 (SoFAB). In the community Derek is as a Court Appointed Special Advocate (CASA) for abused and neglected children, a committee member for the Washington State CASA (waCASA) non-profit organization, and is a board member of the University of Washington Economics Alumni Organization (UWEAO).

Michael Quinn

Michael graduated from the University of Washington with a Bachelor of Science in Computer Engineering. Michael's professional background includes working at IBM, Rational Software, and the founding of BlueTux Web Development Company. Michael's involvement in the property management industry over the last couple years includes working in partnership with the National Association of Residential Property Managers (NARPM) to develop their national website. His experience in technology and property management provide our partnership unmatched skills to develop sound infrastructure to grow our business for today and into tomorrow. Michael’s impact extends beyond the board room as a former member of the Port Angeles Chamber of Commerce, United Way of Clallam County, Olympic Medical Center Foundation and Serenity House of Clallam County.

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Making a software selection using a systematic approach – stay focused on YOUR business

  Create a business case Create feature and function list Research software solutions that appear to meet your needs Evaluate solutions based upon business case (this includes pricing of software) and feature and function list Execute a prototype with YOUR company data with one or many solutions Verify references and finalize agreement * For more information on software selection approaches see additional handouts

Making the business case to change software

• Develop the primary reasons you want to change solutions ▫ You don’t have a software solution now and are using paper systems or other business management software (e.g., Excel, QuickBooks, etc) that is missing required features and functionality to properly run your business* ▫ Invest in your future growth and operational efficiency ▫ Keep up with your competition (savvy buyers out there) ▫ Save time = Save money (labor is your biggest cost) • Evaluate the TRUE costs of making the switch (Is it worth it?) ▫ The software licensing costs (one-time and on-going maintenance) ▫ The data conversion costs (many vendors provide these services) ▫ Post conversion data entry and cleanup (no conversion gets 100% of data transferred) ▫ Team In-efficiencies while learning software (higher with more complex software) ▫ Team training (Internal and/or paid) ▫ Owner, Tenant, Vendor and other customer training ▫ Fixing problems internally and externally * See handouts on software feature evaluations

Sidebar: Software features can send you into a tailspin and cause you to lose focus of the goal

• Do not let ONE feature get you DOWN ▫ Evaluate every feature to its monetary value (almost always relates to time) ▫ Focus on biggest time saving features  Self-service of Owners/Tenants/Vendors to information    Minimize those phone calls (e.g., prospective tenants, tenants, owners, vendors) Minimize paper handling with electronic communications Minimizing additional applications needed  Integrated portals for information access  Integrated work order management  Software that allows “custom” information tracking • Some features just do not matter in the long-run – evaluate using a systematic business case approach ▫ Focus on “must have”, not “nice to have” features  Example: Check scanning straight to a tenant register. While this is nice, it might save us about 30 seconds per check. If we process 360 rent checks, that is a savings of 3hrs/mo. This lost savings is probably offset by other features that really save like portals, integrated ACH, work order management, etc. The point being, this is how you evaluate whether a feature is required.

• Consider a third-party to help in your decision ▫ Software selection specialists ▫ NARPM members that have done this before

Sidebar continued: Select “Must Have” Features

• Most common “Must Have” features to watch for ▫ Owner/Tenant/Vendor Portals ▫ “Custom” Information tracking abilities ▫ Prospect portals and application processing ▫ Work order management solutions ▫ ACH rent processing and owner disbursements (3 rd Party Apps add time) ▫ Quality customizable reports required to run your business ▫ Streamlined accounting (A/R and A/P) processes ▫ Etc.

Selecting a software solution for your business

• Installed Software - Pros and Cons ▫ Access from remote locations/offices requires more work ▫ You have to manage backups yourself ▫ More capabilities and features (for now) ▫ Is often times faster to move around the software ▫ Often times no integrated portals ▫ You have more control setup (good and bad) ▫ Generally, if you stop paying you still get to use it ▫ Have to upgrade the software yourself • Internet Service (Website) Software - Pros and Cons ▫ This is the future of applications ▫ Access from anywhere with browser ▫ Sometimes less ‘rich’ feature set (but not for long) ▫ Backups handled for you ▫ No purchase, just month to month fees ▫ Integrated online services (screening, portals, listings, etc) ▫ Upgrades happen automatically for you • Don’t lose sight of your REAL business needs ▫ Smaller businesses may want less complex software (easier use versus higher efficiency) ▫ How technical is your team? (complex software may just slow you down) ▫ How much do you plan to grow? How much will total cost of solution be now versus anticipated size in five to ten years?

▫ Is the switch really worth it? Where, specifically, is your current solution failing you?

Running a prototype with your company’s data could save you thousands of hours and dollars

• Give one solution or a couple a “Test Run” ▫ Purchase, conversion, and training costs are high! Investing some time and money in a prototype is the smartest thing you can do.

▫ Consider putting 10 units into the new software and give it try for a couple months. Dummy data only goes so far, remember you are trying to evaluate if you can run your business on this solution.

▫ Don’t feel rushed – take your time evaluating your options. Seek insight from multiple sources (e.g., software vendor, selection experts, references, NARPM members, etc.) ▫ Have a fellow NARPM property manager give you a live tour of how their business is running on the solution. Go to their office and see the solution in action.

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Thank You to the software vendors and other strategic vendors for providing supporting materials and insights for this presentation

What software solutions exist and make sense for your business

• Internet-based versus Installed software • Where do I start… * Handouts will be provided on the various software solutions available

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Question and Answer

In closing thank you for your time. Our presentation only touched the surface of some very big topics, so please feel free to contact any of us if you have additional questions.

?QUESTIONS?