Where a small organization can be a great organization
Housing association Nederweert: an organization with some 1,500 flats, until recently working with a voluntary executive board. Such small organizations have to struggle against the wind and common opinion. The general thinking is: what can you achieve if you work on such a small scale?
In a relatively short space of time, Nederweert developed from an organization with a negative solvency rating to an association with a solid financial future. From a voluntary board to professionalism. An average 25% reduction in maintenance costs; 150 flats are now managed per employee, which is better than at most associations. In addition, a highly transparent and well-conceived chain partnership was forged.
A small association has short lines of communication, which makes it easier to stay on top of the game
It’s a puzzle to many a major player. How did Nederweert manage to pull it off so quickly? – director Corry Keulen explains: ‘I do put people first, but that doesn’t mean I don’t have an agenda. A small association has short lines of communication, which makes it easier to stay on top of the game. Who knows – the same thing could also be feasible at a large association.’
Housing association Nederweert was founded forty years ago. Traditionally, all sorts of activities have been organized, none of which revolved around tenants, however. The board tells employees what to do, and they do it. The culture could almost be called paternalistic: ‘Tenants, we know what’s good for you.’ Indeed, the housing association has lovely flats, in good condition. The supervisory board found that it was time for a professional director. Which is why Corry Keulen was appointed.
Corry Keulen explains: ‘My purpose is to bring professionalism to the organization and provide the supervisory board with open and detailed feedback. I soon saw that things were not going very well financially. The losses were so big that it would be irresponsible to carry on that way. There were even plans for new construction, while no one had analysed whether that was in line with demand. I spoke out against that: the quality of the existing flats was excellent, and I did not see the planned new construction as adding any real value.’
Were you so sure of yourself? – Keulen: ‘Well, now I can laugh about it. At the time it did indeed set me thinking. But I didn’t see any other way. I’d seen things get done half-way so many times before. I thought: this is my job now, so I’m going to do it proper.’
Otherwise? – ‘Otherwise there’s no point in me being here. I believe in the power of people. Working together to make the world a little better: that’s what makes us human. I wanted to show that the same could be achieved as an organization.’
I drafted a business plan – not from the inside out, but from the outside in.
Time to change course. How did you go about that? – Corry Keulen explains: ‘I drafted a business plan – not from the inside out, but from the outside in. What does society expect of a housing association? What difference do we want to make? At the time, tenants were not yet seen as customers. A huge cultural shift has taken place, and actually it’s still going on. We had the finest flats, but we still received the most complaints.’
Keulen continues: ‘The business plan was translated into policy changes, and then we looked at the consequences of our new policy for the organization. Employees themselves had already told us that they had much less work to do under the new policy. But what that really meant for them was still a mystery. When it became clear that someone needed to step in, I immediately solicited outside help. You should never attempt to do that yourself – others are better at it. On your own, you’ll fail to get all the information you need, and you’ll most likely be biased. Bringing in a specialist may not be without consequences, however. But I thought: do it well or not at all. P5COM’s Tom Burgers seemed to me to be the most enthusiastic; I just knew he was going to be our man. He was practical and he explained exactly what he would deliver. He had an action plan and was able. I’d had enough of all the woolly stories that consultants had told me in the past.’
The consultant’s findings were as plain as day. Tom Burgers: ‘I spent a day riding along with a maintenance man and logged two and a half hours of time on the road within the Nederweert core. I believe that we rode back and forth three times for a leaky tap. During my presentation of the preliminary examination, all of a sudden you could hear a pin drop.’ Corry Keulen: ‘We hadn’t expected the hole to be that big. It’s a small housing association. Lots of people knew each other from outside work. Everyone did their job the way they were used to doing it. People were very forgiving of each other.’
Keulen: ‘We looked at different possibilities beforehand. We weighed up whether we could deploy our specialists for other activities. We also considered a close tie-up with other small housing associations, but time was not on our side. As a housing association, you have to juggle so many things simultaneously; if you’re small, that soon becomes too expensive. After a sound analysis, we finally decided to dismiss the technical manager and two specialists and also make a clean sweep of our office. If certain conditions apply to our suppliers, in future they apply to us as well.’
‘We got talking with five regional suppliers; we wanted to keep jobs in the region where possible and avoid high travelling expenses. We sought to work together on the basis of trust, with transparency as a solid foundation. So our future business partners needed to be willing to give us extensive access to their IT systems. And that’s not all we had on our wish list, by the way.’
Everyone in our sector is going to have to embrace lean production; so it’s better to be an early adopter
The question for Remco Brave, assistant director, Smeets Bouw (one of the two chain partners) was whether this was a shock to him? – Brave: ‘No, not at all; we were very happy. They wanted to implement exactly those changes that we had in mind. And I was keen to show what we ourselves had to offer. Our size helps; you need mass to make this happen. And we have room to invest in IT. If you do minor maintenance, you’ll also be asked for the bigger jobs. Those can be entrusted to another part of our company. Don’t forget that new construction is no guarantee for continuous jobs these days. Everyone in our sector is going to have to embrace lean production; so it’s better to be an early adopter The requirements and advantages in our case apply to our suppliers as well. Maintenance offers a large degree of continuity.’
Keulen: ‘It’s all about the combination of IT and skills. Remember, you never know what our technicians will run into on a service call. We were rather worried about the price at first. When Remco heard the amount per flat that we had in mind, he did grow a bit green about the gills.’
How in the world were you able to slash costs like that? Was the initial situation really that dramatic, or was there more going on? – Burgers explains: ‘We avoid a huge amount of duplicate work. Every maintenance order used to be worked out in detail by the housing association – and again by the supplier. Nederweert’s tenants now ring the chain partner directly. And we save on the expense of financial administration and control: every invoice used to be separately checked and approved.’ Keulen adds: ‘We chose to make the tenants responsible for that themselves. In the past, we dashed off after each telephone call. We no longer repair every little pull and cord.’
How is the partnership set up? – Tom Burgers: ‘The relationship is no longer the do-all and end-all of the contract. The contract is open-ended; the point is to make continuous improvement possible. Either side can cancel the contract. The housing association can cancel if its chain partner does not meet certain KPIs or if there is a breach of trust, for example.’
And when can the chain partner cancel? – Brave: ‘Er… I don’t know, actually. Listen, if we’re not happy with something, we just say it. There are short lines of communication. And for the first time, our voice is heard as well. We are trusted, which is also new. Our system contains data on the state of repair of the flats, which we feed back to the housing association, so that it has a grip on costs and routine maintenance at all times.’
How do you ensure honesty and a fair price for the future? – Burgers: ‘The housing association mainly checks the work that we do in practice now. There is also an incentive to cut costs. For each job that is completed at a lower price, both sides share in the cost saving. If a job is estimated at 100 euros and finished for 90, we share the difference. The following year we set the KPI to 95 euros. This keeps everyone motivated to be more and more efficient in their work.’
Keulen: ‘In addition, we’ve tightened up our own internal monitoring; the live-and-let-live attitude is history. It’s always easier for people to call each other to account if they’re more distanced. And if, as a director, you also make it clear what goals you seek to achieve with your people, that’s also easier to combine with a people focus. Our assessment sessions now have a solid foundation. Employees also have to meet certain KPIs. Those who fail to do so receive some special support. There are also consequences, ultimately.’
So how does Nederweert see the future now? – Keulen: ‘Not much longer now, and we’ll be out of danger.’ – Will you start building again? – Keulen: ‘Only if there is demand; I’m looking at other forms of investment first. Facilities management, alliances with care providers. Above all, I’ve learnt to keep an open mind. If you’re biased, you won’t see the other great possibilities. I used to be a little too naive; I keep a sharper eye open now. It’s a long process; you need to take good time for your vision and policy. And then you need to follow through on what you set in motion and really get the job done.’
How does the director look back on recent times? Corry Keulen explains: ‘You really can make the world a little better, also in an organization and even in difficult times. Discovering together how to make it happen. That’s what we’ve proved, and that’s what I’m proud of. But the most important thing of all is that we’ve retained the enjoyment factor. We’ve come through difficult times. And yet the organization has emerged stronger than ever. Our tenants are much happier and, overall, everyone goes to work with a smile on their face.’