Lessons From the Recession
Executive IdeaLink, December 2009
By Jim McGarry

Fifteen association CEOs reflect on lessons learned from the "great recession" that will help organizations move forward into what many are calling the "new normal."

"These are the times that try men's souls." Thomas Paine's words are very applicable to the environment many association leaders find themselves in during the current recession.
Yet, the media, government, and pundits are now beginning to send out more positive messages, and organizations are making their plans for the future. This article reflects the thinking of fifteen association chief staff officers as we emerge from the "great recession" and move forward into what many are calling the "new normal".

Permanent Change
These CEO's are very carefully monitoring the recovery and believe that this experience has changed association management forever. Steve Anderson president and CEO of the National Association of Chain Drug Stores (NACDS), says "The whole concept of association management is moving at warp speed into the future. Organizations will look completely different than they used to. There is not a cookie cutter approach to planning but something unique to each organizations culture."

All of the executives have become more focused on monitoring their own leading indicators for the future, whether in the form of dues, meeting attendance, or grassroots support. We have heard it many times, but the strategic plan for the association is even more critical in this type of environment. "You can't prepare the day something happens. You can't start to plan in the middle of a crisis," says Craig Wolf, president and CEO of the Wine and Spirits Wholesalers of America (WSWA).

Engaging the volunteer board and listening to the membership is essential, says Bill Harley, president and CEO of the Outdoor Power Equipment Institute (OPEI). "An association cannot lose connection [with members] while looking for ways to cut cost. We need programs and products that will benefit our members. We simply cannot let those important core programs languish in bad times," he says.

Membership Loyalty
Many of the executives say they were surprised and pleased by the loyalty of their membership. After years of evaluating return on investment, most organizations did not report the membership fall-off that one might expect in such a difficult financial environment. But they also realize membership in their organizations cannot be taken for granted, and the value proposition must now be stronger than ever.

Vince Sandusky, executive vice president of the Sheet Metal and Air Conditioning Contractors National Association (ACCNA) says, "We must sharpen our core services to create enough value so that members will not abandon us in these economic times."

Some have even experienced membership growth, proving that, in this economic environment, the association membership is a valuable competitive tool.

Loyalty of current members is important, but CEO's are continuing to seek out new growth potential, as well. Robert Holleyman, president and CEO of the Business Software Alliance (BSA), is looking internationally for new opportunities. "We are exploring areas for growth such as BRIC [Brazil, Russia, India, and China]. Many of these economies are still growing and represent new targets for programs, products and services." China's economy alone is expected to grow at 7.5 percent this year.

One area where associations are experiencing membership declines is through mergers and acquisitions. In this case, Chuck Yuska, president and CEO of the Packaging Machinery Manufacturers Association (PMMA), recommends looking at the whole supply chain for new opportunity. "There is growth opportunity by looking into these other sectors." The supply chain needs to know what is going on in the industry and build stronger bonds, he says.

Lean and Mean
A common theme that emerged is to pay very close attention to staff levels and not overstaff in good times or cut too deep now. Don Santa, president of the Interstate Natural Gas Association (INGA), recommends to "stay lean and budget for the base load in both good and bad times and budget for outside resources to handle special needs."

In order to serve his members better and keep the staff engaged, Bruce Parker, president and CEO of the Environmental Industry Association (EIA), has "cross trained staff to build in redundancy, staff loyalty and efficiency. Our only real asset is our people and the human mind. We need to keep them excited and engaged for the future."

Association leaders are very focused on having the right staff in place and very bothered by having to make cuts to adjust to new budget realities. The overall feeling was to first start with the member value and strategy, then apply the staffing model. "It is much harder to lay off competent people," says Anne Bryant, executive director of the National School Board Association (NSBA). When a position does become available, even with the current unemployment levels, it is still difficult for associations to find qualified people. "We have not noticed anything different in the talent wars. We need very specific skills, and it is hard to find the right people," says Sam Gerdano, executive director of the American Bankruptcy Institute (ABI).

Of the many lessons learned, new uses for technology to engage membership will be a strong focus moving forward. "People have come to expect instant answers, while at the same time we are dealing with a bigger and more diverse universe of stakeholders," says Santa, of INGA.

This economic environment has prompted a reexamination of member perceptions. There have been a lot of focus groups and member surveys to take the members pulse.

"When we ask members questions about the value of our programs and services, we must listen and take action. We have found that we need to find ways to get back into the local delivery business through the use of technology," says Matthew Shay, president and CEO of the International Franchise Association (IFA).

For years associations have been using webinars and distance learning, but now, "Communications and technology strategies are becoming more important as members travel budgets become constrained," says Bryant, of the NSBA. "We are using technology to drive content as a primary way to operate. This is coupled with a greater synergy with state associations as we co-market and deliver programs."

"We have adapted our strategy to allow members to participate [at our conferences and meetings] both in person and remotely," says Kevin Burke, president and CEO of the American Apparel and Footwear Association (AAFA).

New Communication Tools
Every executive is taking social media seriously and exploring how it will enhance their association's member outreach and involvement. Getting started does not have to mean hiring an expensive senior-level staff resource. "We hired a kid to do Facebook, Linkedin, and Twitter," says Yuska, of PMMA.

Many organizations are very active using social media in government affairs, allowing for real time communication with their members as Congressional hearings and bill mark-ups take place to rally the grassroots efforts. "We are also using social media to make our committees more effective. We place a lot of emphasis on a personal connection with our volunteers," says Tracy Mullin, president and CEO of the National Retail Federation (NRF).

Association members themselves are using the new tools to communicate their experiences to their colleagues. "We actually have attendee bloggers from our conferences," says ABI's Giordano. These bloggers are an opportunity to expand the reach of the conference content and help promote the value of future events.

"These new technologies are allowing us to expand the association brand. Members are more effective at receiving the information they want, and we have been able to create a lot more self-service options that members seem to like. This has also allowed us to engage the chapters more effectively," says Christine McEntee, executive vice president and CEO of the American Institute of Architects (AIA).

"Associations are becoming much more aggressive in how we approach things. This is a function of rapid communications. Organizations must start by reinventing their marketing and communications strategy to position the industry for the debate, [and] next put Government Affairs in place to implement strategy," says Anderson, of NACDS.

Lobbying Becomes More Critical
At the same time we have had the recession, the change in administrations has led many to reexamine their lobbying strategies and staff. Many organization found their relationships and staff were tilted to be too reliant on Republican relationships. During the last couple of years there has been a focus on bringing Democratic lobbyists on staff. Now that we are close to one year into the new environment, the executives are finding balance is very important. "However, good lobbyists must have the skills and relationships to be able to work both sides of the isle effectively. We can never have enough lobbyists," says Burke, of AAFA.

As the new administration's political agenda takes hold, there are many new issues about which to form policy positions, inform membership, and establish new grassroots efforts. "From a business perspective, there is no issue that is not on the table. We must prioritize and focus on PAC growth to impact relationships and gain influence," says WSWA's Wolf.

"The sphere of issues is expanding, but the traditional issues have not gone away, giving the government affairs aspect of the organization more importance," says Santa, of INGA. Advocacy and government affairs are clearly going to continue as a prominent role for association executives into the future.

Conclusion
Altogether, it was great to hear the enthusiasm for the future from these successful and experienced executives. There were many lessons learned from the "great recession." It is clear that the importance of associations not only remains strong but also grows in the midst of turmoil. Technology continues to provide new opportunities and challenges, and keeping up will require new staff with new skills. Most of all, the executives feel that there is an excellent future for job growth, industry advancement, and political influence within the field of association management.

Jim McGarry is principal of The McCormick Group, specializing in searches for
association and not-for-profit executives and government affairs professionals. McGarry also spent ten years as an association executive. Email: jmcgarry@tmg-dc.com