By Tim Wilson, Chair of Finance Committee; and Russ French, Vice Chair of Finance Committee
What experience does each member expect? What level of service is required to deliver this experience? And, what needs to be budgeted to deliver this level of service? These might seem like simple questions, but they highlight the challenges often encountered when the answers are not properly aligned. In preparing the 2018 budget, we will be taking a different approach than used in recent years; the goal is to properly align service levels and budgets.
It all starts with Member Experience. This one would be easy if all members desired the same experience, but such is not the case. To some, it is a secure and beautiful residential lake community that is well-maintained. To others, it is a full-service country club with the range of amenities and services they want to enjoy. And, to others, it is a suitable balance of both. This makes our situation unique from those who are either a homeowners’ association or a country club. Despite the varying views, Member Experience should be based on the following standard.
Members and their guests will enjoy a high-quality and high-service experience every time in facilities and venues which are well-staffed, well-maintained and well-equipped at all times.
Next, Target Service Levels must be established to deliver this standard. What are Target Service Levels? Thanks for asking! This is where the process has often broken down in previous years. They are the operating practices which deliver the Member Experience and define the cost drivers in the Annual Budget. When should certain dining venues be open? What should be the wait time between ordering and food delivery? What services should be provided by the golf staff, the tennis staff, others? To what standard should our roads, amenities and common areas be maintained? Establishing and communicating these and other service levels is essential so all members know what to expect. The Annual Budget, not the Member Experience, has dictated the Target Service Levels in the past–not the other way around. This needs to change.
Once Target Service Levels are established, an Operating Budget to properly fund them must be developed and funded. Last year, the proposed Operating Dues increase was not approved for a variety of reasons. It serves no benefit to rehash the reasons, other than to recognize the impact. Certain measures were taken to reduce funding to meet the budget, which often led to lower service levels, and thus, a poor member experience, and, ultimately, member complaints. Member expectations did not go down, nor did the cost to deliver the same level of service. As members and stewards of this wonderful community, we must do better to ensure this does not happen again.
Being in the service business implies a budget which is attentive to the needs of all members. It also implies we staff and equip ourselves properly, provide a competitive compensation program which will allow us to retain an exceptional team, and account for anticipated cost increases. The Operating Deficit in this year’s budget is not going away and is going to increase as our operating costs increase. The magnitude of these cost increases is directly dependent on the service level expectations of the membership. The objective of the budget process is to provide the Quivira, Inc. team with the resources necessary to deliver the Member Experience you want. This will be our top priority this year. As members, we need to decide whether to lower the Member Experience to support a lower Operating Budget, or increase the Operating Budget to achieve the desired Member Experience. We cannot do one without the other. . . and we cannot do either without proper funding.
The Annual Budget Meeting has been set for Monday, November 27, at 7 p.m. There will be regular communications as we work through the budget process, and a Special Member Meeting will be scheduled in early November to present and discuss the Operating Budget in advance of the Annual Budget Meeting. This will also be the topic of many of the upcoming Committee and Board Meetings. We welcome your input during this very important process.