« Postscript: School fails to heed Murray's speech advice, has to close doors | Main | Friday Happy Hour Video: I Love You (You Love Me) »

June 04, 2014

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00e55283a630883401a73dce0082970d

Listed below are links to weblogs that reference Guest Post: IABC's former president analyzes the association's current financials:

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

It should be an interesting AGM this year. I'll be there. Thanks, Julie, for putting this together, and thanks David, for posting it.

IABC has a history of going through these kinds of financial issues, but getting through them requires -- in addition to what Julie listed -- transparency. I'm looking forward to hearing candor from the association's leaders when these questions arise at the AGM.

That’s an interesting and insightful post from Julie.

Our financials were posted, as usual, in April and we have been responding promptly to member questions as they have come in.

We are going to cover all this off in full at the AGM for members, and still will of course, but since this has been raised here’s the low down:

The bottom line is that our half-million-dollar-plus deficit posted for 2013 recognises two significant investments : in back office infrastructure, and in creating member value for the next few years.

The most expensive issues the Association has dealt with in recent history comprise:

• Data infrastructure: in ten years from 2001 to 2011 there was very little investment in data infrastructure on either the hardware or software sides. Thus the need to replace came together and, in the case of the hardware catching fire, quite suddenly. This has been an £$$$k investment, but of course critical to our operation.

• IABC is modernising its website – this costs. It’s not been helped by the fact that the vendor originally selected for the job has not delivered to IABC’s satisfaction, so this has prolonged the time and the costs.

Of all associations, IABC is expected to have a proper website, so needs to invest properly. The new website, and all its back end, will go live shortly.

• We also found that the website, which was launched in the period 2001 – 2011, had a number of one-off programs, written for just one thing – this has been disproportionately expensive to replace but we now have with a much simpler approach going forward.

Some of these approaches to data handling are still being uncovered – and not just on the website.

We are committed instead to quality, and standardised software that integrates with other programs and can be upgraded appropriately and cost effectively.

• Board expenses are up because of a decision taken a couple of years ago that Board members should not be disproportionately out of pocket as a result of service to the Association. The Board is now competency-based rather than filled by those who can simply afford to serve from their own pocket.

Our Association is proudly international, as are our Board, and increasing costs of travel and accommodation has resulted in increased expenses although of course, we maximise use of virtual meeting techniques where sensible to do so.

• Severance agreements for staff who were let go. The staff changes were costly, but they were one-time expenses and were necessary in the case where many staff no longer fitted the changed skills requirement of the Association.

Many staff had been at IABC for over a decade, so severance was higher than normal, and while it was a bold move by the former ED, Chris Sorek, to effect such changes all together, and caused some concerns among our members at the time, the incoming staff are creative, innovative and have already set about challenging old and inefficient ways of doing things which are no longer delivering the value needed for IABC and its members – both professionally and in cash terms. It is extremely unlikely IABC will go through staff changes of this extent in the near future.

• IABC has continually lost money on our former Accreditation programme (ABC), going back for several years. In five years, this posted a loss of $270,000 with the greatest losses in the latter years.

The losses were due to a relatively small number of applications versus a significant staff time and expense of processing applicants; coordinating evaluators; the expense of hosting evaluator circles to evaluate applications en masse; and to try to get everyone through the pipeline expeditiously.

This was one reason driving our closure of the ABC programme but it is being superseded by the Global Certification Program which is more relevant for today’s professional environment, more portable (you don’t have to be an IABC member to enrol and keep it) and, we intend, should be to globally-accredited ISO standards. Moreover, the business model delivers both significant value to the profession and revenue to the Association

• The single greatest ongoing expense for IABC is remains the office lease, which is currently at a whopping $430,000 pa. This was signed in the last decade and locks us in till 2016. But we are urgently looking for ways out of this – and ahead of 2016 if we can.

We are also actively examining, including with staff, how we expect our Headquarters to operate in today’s modern working environment - which is more virtual and less reliant on expensive office space, including in very expensive San Francisco.

A real estate professional has been looking (at no cost to us) at whether we could sublet part of the space, a fair amount of which is unused, and whether we could get smaller space in the same building to bring down the cost.

So far, those efforts have not paid off but we continue to persevere.

The bottom line is that we want our staff to have a safe, productive working environment and don't need to spend $430,000 per year to provide it!

IABC has had the resources (as investments and reserves) to address these challenges. The money will be replaced as the investment in our website, our programmes and our staff are realised.

We are also looking hard at our general business model - of receiving revenue from conferences and membership dues which then cross subsidises the value given back to members through programmes and professional development etc.

Associations around the world recognise that this type of model is becoming increasingly ineffective on financial grounds.

This reflects fewer general loyalties of younger generations, leading to less desire to be ‘a member’ of associations as such and, following the Global Financial Crisis, a reassignment of what is ‘value’ in delivering the costs of professional programmes etc.

IABC’s International Executive Board is focused on creating alternate business models as part of our 2014 - 2017 Strategy (which has been open to member consultation during the last year) and our new Executive Director, when onboarded, will also be required to focus on short-term revenue generation as a primary objective, to help us make up the difference on lower income from membership dues and conference income.

Finally, the one thing we continue to need to get better at is, ironically, communication.

Our member communication is now much better than it was – and thanks to our hard working staff for that. The journey continues however – there is way more to go - and I personally am committed to further and rapid improvement.

Russell, thanks for your response here, which allows communicators inside and outside the association to glimpse the state of the association and its prospects for the future as you, the incoming chairman, see it.

Also yesterday, IABC announced a new executive director, to be formally introduced at the conference this week. As wise members have been calling for, Carlos Fulcher has an association management background (at the Drug Information Association, and the American Society of Plastic Surgeons).

http://news.iabc.com/pdf/IABC_Exec_Director_FINAL_6_June.pdf

This is no doubt a dangerous moment for the association, which by your own admission has financial, logistical and even existential problems. After all, a membership organization that believes it is living in a world of non-joiners must question its own legitimacy.

I don't really think it's as bad as all that. I think communicators will always need a professional community with more gravitas and social richness than a LinkedIn Group ... and I think people will always need to belong to something: for the sense of security, order and meaning that it provides.

It's not membership that people object to, it's membership in IABC. You need to remake IABC into a club they can be proud of, rather than an outfit that's struggling to identify and retain strong leadership, failing to offer relevant programming, bumbling operationally and chronically and lamely claiming its problem is "communication."

That's gonna take more than plastic surgery. It might even require some drug information. It will definitely take some bold and no doubt controversial leadership from you and Carlos Fulcher.

Do you think you can pull it off?

We'll be watching. And wishing you the very best.

The comments to this entry are closed.