Part 3 of 5 in a series, "The Winds of Change," facing & dealing with change in the Association / Nonprofit world.
Does anyone really like change? Of course not. Which is unfortunate since the association / nonprofit world is going through a period of tremendous change. If leadership fails to acknowledge and adapt to this change there’s going to be trouble. And we like trouble even less than we like change.
Follow along with this blog series as we look at a few of the challenges brought about by change and some ways smart associations & nonprofits respond to them.
Beanie Babies vs. The Internet
Mike Emerson
"Eye of a hurricane, listen to yourself churn. World serves its own needs. Don't mis-serve your own needs".
It’s the End of the World as We Know It (And I Feel Fine), REM
In Part 2 of this series, we looked at the relentless nature of change and how different organization leaders respond to it. We determined there are three basic responses to impending change.
One response is to ignore change and hope it will just go away. It won’t. And I’m sorry, but if that’s your plan for dealing with change, you’re screwed.
Or, you can acknowledge that change is occurring and cling tightly to the status quo in hopes that “change” really means “fad” and once the fad dies down things will go back to the way they were. This approach might work if you’re really adept at discerning the difference between a fad and real change. Too many organization leaders aren’t that discerning until it’s so obvious that it’s too late.
A couple of examples of the difference between fads and change:
Beanie Babies. A fad. They came. They were everywhere. They’re gone. Along with the hopes and dreams of parents planning to finance their kid’s college education with massive profits derived from buying and selling little cloth animals stuffed with tiny plastic beads.
It’s amazing to look back and remember, at the peak of Beanie Baby mania, that there was a significant group of people who held firm to the idea that Beanie Babies would be around forever. Not only that, but there were fortunes to be made wheeling and dealing in the Beanie Baby market. Like trading pork belly futures.
Sadly for these folks, Beanie Babies never made it to the Commodities Exchange and the Beanie Baby day-trader market never materialized. They mistook a fad for a foundational and societal change and got stuck with a lot of really cute, but worthless Beanie Babies.
The Internet. Everything changed. It’s not going anywhere. Anyone doubt it’s for real?
Some business people didn’t see the Internet coming. But don’t be too hard on them; a lot of people didn’t see the Internet coming. But once it arrived, this group failed to realize the Internet was a Big Deal. And they were steamrollered by change they couldn’t recognize. Blockbuster Video comes to mind.
So, after we cull the clueless and the wishful thinkers from the organizational herd, we’re left with the last group; those who are willing to step outside their comfort zone to find the opportunities that invariably accompany change.
Think about it; how many markets are thriving today that didn’t even exist before the emergence of the Internet? Businesses in those markets were smart enough to see opportunities where others saw the end of the world as they knew it. And the smart ones were also nimble enough to take advantage of the opportunities they saw.
How does dealing with change play out in real life? In Part 1 we looked at a couple of responses to a real change in the association / nonprofit world; declining membership rolls and the resulting revenue hit to the organization.
One response is simply to raise dues on members. By 300% in one real-world example. The result? Members dropped like flies and the fiscal situation was worse than before. Talk about “unintended consequences”.
Another approach would be to pump up the services portfolio with minimally useful programs that ultimately dilute the value of the organization to its members. The result of this move? The complete opposite of the intent; members look elsewhere for clarity in programs and services and real value. Membership rolls continue to shrink.
So what do “smart” organizations do? They see the value of opportunities in change others can’t or won’t recognize. In other words, they don’t screw up.
Consider this. Instead of the shockwave of raising dues across the board, a smart association might revise its dues structure. For example, dues for newly formed or emerging members might be lower than those for long-established and more successful ones. This promotes membership adoption at an early growth stage when a business has the most need for programs and services an association might offer, but have little funds to allocate to association membership.
As the business thrives, gaining greater financial success, membership dues rise commensurately. A graduated dues structure encourages member retention. As a growing business derives value from association membership during this process, the association’s value to the business more than justifies the cost of membership. Even as that cost increases over time. Member loyalty is fostered and the continuing relationship is mutually beneficial.
But there’s a catch. This increase in perceived value by the member will only occur if it’s a reflection of the real value the association offers. So, instead of bloating its portfolio with dubious programs and services, a smart association might consider cutting its portfolio instead.
Yes, this sounds counter-intuitive. But by reducing its offering to members, a couple of things happen. First, because it’s not stuffed with window-dressing services and programs, the association’s portfolio is simply easier to digest; members can plainly see what the association offers and how those offerings are of real value.
And “real value” comes from services that are laser-focused on the essential needs of the membership at large. What’s more valuable to association members? A few, highly effective, dead-on target services that actually meet the needs of the membership without question? Or, to have a portfolio stuffed with a large number of less than effective programs that don’t really serve anyone very well? The answer is obvious if you think about it for even a minute.
Here’s the bottom line. The world is changing and it will never go back to “the way it was”. Association membership is dropping for a lot of reasons; changing demographics, market specialization, the flood of easily attained information in the age of the Internet. These just are a few reasons among a host of others. Yet smart associations are sailing into these headwinds of change with great success.
How do they do it? In Part 4, we’ll look at how EMDR International Association turned the status quo on its head and changed the way they had functioned for years. The result? EMDRIA faced the winds of change, realizing spectacular membership growth in a time of decline in the rest of the association market.
It's the End of the World as We Know It (And I Feel Fine), REM (1987)
