Breaking. Members Hire Tomorrow’s Associations because they have no other choice. Global uncertainty and technological advances are forcing Members to make more informed decisions on how to spend their precious time and money. Members expect their Associations to be nimble, future focused, and having the speed and foresight to help move an Industry forward. Organizations recognizing this shift are transforming from yesterday’s Associations to Tomorrow’s Associations.

Members hire Tomorrow’s Associations because they sit at the cutting edge of change and:

• In a time of political gridlock, they are perceived as increasing spheres of influence. They’re also transforming themselves into more potent and influential extensions of an Industry.
• Utilize market research to pinpoint challenges and build strategic opportunities to overcome those challenges. In doing so, they help create a more favorable climate to drive Industry growth.
• Relentlessly look for whatever comes next in their Industry.
• Seamlessly move from yesterday’s challenge toward tomorrow’s opportunity.
• See their organizations as the front line and last line of defense for an Industry.

Using relevance as their foundation, these organizations conduct research and engage boards and members to identify and address the next set of Industry challenges. They also understand the Industry’s business model from product design to marketplace, and the staff teams approach everyday as an act of invention:

Helicopter Association International – Keeping the rotors turning is all that matters for HAI. Led by Matt Zucarro, an Industry veteran, and President & CEO, the Association relishes its role as the Industry’s advocate in chief. “We don’t let anything get past us” notes Zucarro as his experienced team is ready to address any market or regulatory obstacle that will prevent the rotors from turning. Simultaneously, they aggressively promote the economic value of the Industry in meetings with legislators and regulators in domestic and international markets. The Association remains closely connected to Industry trends through insightful research and direct Board engagement.

 Matt Zuccaro

Since 2005, the Association transformed itself into a well-capitalized, forward looking, and fast moving extension of the Industry. Implementing a strong bias for Industry growth, HAI annually conducts the world’s largest helicopter exposition, the HAI Heli Expo Trade show which includes business networking and technical resources that address Member business challenges and opportunities. In addition to the Trade Show, the Association delivers resources geared toward helping Members address flight and operational safety with an Aircraft Risk Assessment Tool and a Safety Accreditation Program.

The Advocacy program is the first and last line of defense for the Industry. When the FAA (Federal Aviation Administration) grounded operators due to a technical revised interpretation of regulations, HAI and their members worked successfully to speed up and streamline the exemption process. In doing so, the Industry was able to get back to work.

While addressing today’s challenges, Zucarro and his team are helping to position the Industry for the future:

• “Autonomous flight is coming, technology is going to allow it, it’s a matter of public acceptance.” HAI is working with Federal Agencies and other Associations including the Association of Unmanned Vehicles (AUVSI) to help define the future through unmanned flight.
• Although workforce shortages plague the Helicopter Industry now, the HAI team is collaborating with the Industry to build the Industry’s workforce of the future. Concrete strategies are being developed through the Helicopter Foundation to promote careers and help lead more pilots and technicians to choose careers in the Industry.

The International Sign Association – Annual Strategic Planning with its Board and 3 Steering Committees plus ongoing market engagement keep the Association aligned with the present and the future. Insisting upon transparency, the ISA team shares progress reports with Board Members four times each year. This level of market research plus Industry focused surveys, keeps the Association connected to today’s and tomorrow’s “Up at Night” challenges.

Led by Lori Anderson, President & CEO, the organization delivers business value in measurable ways:

• The International Sign Expo – Business to business networking and emerging technologies.
• Actionable Industry Research – Quarterly economic reports, wages and benefits surveys, and research that identifies the economic impact of a sign.
• Local sign code guidance – Plus legal support to help the Industry achieve sign approval.

 Lori Anderson

Starting in 2013, the workforce shortage topic continually appeared in ISA’s research. Since then, utilizing an innovative digital approach, the Association is working to help the Industry educate, attract, and retain workers. Through strategic partnerships and adding skilled staff, the Association created a platform to help assess and teach skills to current and prospective workers. Though this online learning platform candidates can earn up to 15 digital badges. The strategy, since 2015, has helped students achieve approximately 7,000 badges. The workforce program is continually evaluated and updated to support the Industry’s workforce needs.

ISA also leverages its “Sign Manufacturing Day” to create student awareness of the Industry. Starting with just 8 companies and 200 students, the program now has eighty four companies participating and 3,500 students. Lori Anderson notes that “these programs help companies recruit interns on the spot.”

Health Industry Distributors Association – Leading and convening all aspects of the Industry in a Healthcare Supply Chain Collaborative.  CEOs from Distributor Companies gather at HIDA to utilize this cooperative platform, brainstorm, and develop strategic solutions that optimize supply chain efficiency. The organization also incorporates Manufacturers in its market focused efforts through the HIDA Educational Foundation.

The Association is also familiar with Industry’s products and business model. Understanding member pain points through direct engagement and market research, the organization evolves as market place challenges and opportunities change.

  Matt Rowan

It’s current suite of products are designed to help members stay connected to what’s new or anticipated in their marketplace: Business Intelligence on Supply Chain Strategies, Telemedicine, Market Reports, & Segmented market reports.

Through Industry focused Advocacy:

• The Association is collaborating with federal agencies to provide help during an emergency event. This will help federal emergency responders engage the commercial healthcare supply chain during crisis by centralizing key attributes of commercial medical-surgical distribution centers in an online tool.
• Successfully had 120 products manufactured in China exempted from additional import tariffs.

Matthew J. Rowan, President & CEO leads the Association.

Alison Bodor

Transforming into one of tomorrow’s Associations is no small task. Each Industry or Profession is different and making big changes could take more time. Consider starting with actionable market research and collaborative board discussions. Doing so will help build a foundation that leads to the larger transformation. For example, Alison Bodor, President and CEO, American Frozen Food Institute is leading a longer term change. Along with her team, she continually utilizes market research to inform and guide strategic discussions around food safety and Frozen Food consumption with the Board and their members. One of the near term deliverables is a new research report by AFFI and the Food Marketing Institute (FMI) titled “The Power of Frozen.” The report examines consumption drivers, purchase drivers, channel drivers, opportunities for collaboration, and shares opportunities for how companies can drive continued growth in the Frozen Food category. Thoughtful approaches like AFFI’s plant the seeds of transformational change.

Members Hire Tomorrow’s Associations

Tomorrow’s Associations including Helicopter Association International, Health Industry Distributors Association, International Sign Association, and other leading organizations including, Global Cold Chain Alliance, American Bakers Association, and the National Marine Manufacturers Association are all unapologetically getting it done for their Industries as they:

• Leverage actionable research to position Industries for new opportunities.
• Advance the innovative aspects of products to elected officials and consumers.
• Champion Industries and position them for Market Growth.
• Promote the economic impact of Industry products and services to domestic and international legislative and regulatory bodies.
• Cite how Industries increase employment and influence community quality of life, and in several cases, help to attract the next generation of workers.

Because Tomorrow’s Associations have a strong bias for action, their CEOs move forward as they see opportunities that far outweigh threats and risks. “Turn every threat into an opportunity. In order to do that you need to surround yourselves with the right talent. Take some risk in a period of uncertainty not avoid it” notes PWC’s CEO Bob Moritz. Yes, uncertainty should be an immediate call to action for yesterday’s Associations. Breaking. Members Hire Tomorrow’s Associations because they have no other choice.

To learn more about how your organization can become one of Tomorrow’s Associations click here.

Associations have endured downturns before, what’s different this time is the valuable lesson learned after the great recession, that Members hire relevant Associations. Boards and their CEOs aren’t interested  in hemorrhaging balance sheets that come from dues losses and shrinking Trade Show revenues. Regardless of the economic climate, organizations are committed to keeping their organizations relevant. From 2009 forward, leading Associations find ways to maintain their relevance and are perceived as the Industry or the Profession. If a global downturn occurs, Associations should prepare and conduct a rigorous and research driven relevance test.

Associations who want to pass the relevance test should initiate conversations with their Boards or Executive Committees to:

• Talk through and quantify the sources and the business impact of market challenges.
• Brainstorm with leaders on how the Association can be helpful in a strategic manner that benefits the entire Industry or Profession.
• Build nimble strategies to address new or critical Industry or Professional challenges and opportunities.
• Develop metrics and key performance indicators with Board leaders to measure how relevant your Association is to the member’s marketplace.
• Report back regularly on how aligned the Association is with these metrics and key performance indicators at Board meetings.
• Have ongoing strategic conversations about Industry or Professional challenges and opportunities.

Relevance is about being connected to the member marketplace with resources geared toward helping your members overcome challenges & achieve success. Associations who utilize this approach understand that Members hire relevant Associations, which means these organizations are built to withstand downturns and thrive during healthy economies. What makes these Associations especially relevant is how their strategies and products position them as either “Industry or Profession solution partners” with their Boards and members:

Heidi Biggs Brock

The Aluminum Association – Heidi Biggs Brock, President and CEO, works with her team to continually refine the organizations focus and stay connected with the Aluminum Industry’s evolving challenges and business outcomes. The Association utilizes actionable data to brainstorm with Executive Committee members about current emerging challenges to ensure that they are focused on quantifiable outcomes that move the needle for the Industry. The strategies that the organization develops have Key Performance Indicators and are reported through a Scorecard in the Aluminum Association’s Annual Report.

 Donna Orem

National Association of Independent Schools – Provides services to more than 1,800 schools and associations of schools in the United States and abroad, including more than 1,500 independent private K-12 schools in the U.S. In formulating its strategies, NAIS embraced an underlying premise that in today’s marketplace “people no longer buy products or services. Instead they hire them to make progress.” Based on the Clayton M. Christiansen “Jobs To Be Done” approach in his more recent book Competing Against Luck, the NAIS team utilized this approach to develop value propositions that addressed the struggles that heads of schools and administrators face and to understand how those struggles change as they progress through their careers. The Association is led by its President Donna Orem.

Melissa Hockstad

American Cleaning Institute – The organization is positioned to help its members overcome challenges and find pathways to business growth through each of the following Industry focused strategies:

• Thought leadership and Industry promotion.
• ACI Annual Convention that provides opportunities for the Industry to market and sell products. The most recent Convention had record setting attendance.
• Industry centered Advocacy to help members protect their intellectual property and product category reputation.

The organization’s President & CEO, Melissa Hockstad, engages members on a regular basis as part of an organizational “listen in” program and connects with her Board to surface any new opportunities to support Industry growth.

     Julia Hamm

The Smart Electric Power Alliance’s key focus is to bring all distributed energy resources to the conversation in order to develop, share, and build practical solutions for the entire Industry. The membership comprises utilities, large energy users, as well as for-profit and non-profit corporations and SEPA’s overall focus is on grid modernization. The Alliance conducts Industry focused Board meetings where executives share knowledge, address Industry challenges and devise solutions. In addition, the Alliance provides unbiased and actionable research and Advisory Services to Utilities to help them address the challenges of a clean energy landscape. Led by Julia Hamm, the organization’s President and CEO, the Alliance maintains its neutrality, does not advocate or take positions on issues, drive trends, or pick favorites.

Each organization’s Industry or Profession focused approached positioned them for a possible downturn because they understand that Members hire relevant Associations.

Members Hire Relevant Associations

As Associations think through a possible global slowdown, the 22^nd PWC Annual Global CEO survey provides insights that could be beneficial in the rigorous relevance test that you are about to conduct. The survey reveals that in 2019:

• Data about customers and clients needs and preferences is viewed as critically important in CEO decision making.
• 436% increase in the number of CEOs who expect global economic growth to decline.
• 16% decrease in CEOs who say they are “very confident” in revenue prospects for the next 12 months.
• Some of the top ten threats include: over regulation, policy uncertainty, availability of key skills, trade conflicts, cyber threats, geopolitical uncertainty, protectionism, populism, speed of technological change, and exchange rate volatility.
• CEOs seeking growth will pivot inward to drive revenue growth and focus on operational efficiencies, launch a new product or service, enter a new market, new mergers and acquisition opportunities, collaborate with entrepreneurs or startups, or sell a business.

Strong U.S. economic performance shouldn’t shield concerns voiced by global CEOs who in many cases are Association dues decision makers. Reinforcing these results is the monthly Wall Street Journal Small Business Survey conducted by Vistage. Of those surveyed, 14%  expect the economy to improve while 36% expect it to worsen among owners of firms with revenues ranging between $1 and $20 million.  The PWC and Wall Street Journal surveys introduce new information that should be the impetus for your organization to conduct a rigorous relevance test soon.  Waiting only adds to your Association’s risk, the timing to transform your organization into an Industry or Professional Solution Partner is immediate. Note to self: Members hire relevant Associations.

To learn more about how your organization can become a relevant Association click here.

The challenge for Association CEO’s is to understand how Private Equity Hires Associations, Private Equity Fires Associations. Simply put, the new Private Equity owners are not necessarily maintaining their Association memberships. Following the company purchase, new owners use concrete strategies that improve operations, products, revenues, and market position. Utilizing proactive and innovative strategies will determine whether or not Private Equity Hires Associations, Private Equity Fires Associations.

Private Equity Investment is Exploding

U.S. investment in Private Equity skyrocketed to $57 billion in the first quarter of 2018 alone. In 2017 there were 3,283 transactions in the United States, totaling $511.66 billion. These numbers reflect a post great recession high. Associations who haven’t yet experienced membership losses yet should expect to see these challenges land at their front door soon. Bobby Franklin, President & CEO, National Venture Capital Association (NVCA) in Washington, DC indicates that PE has the resources it needs to continue acquiring companies. According to PitchBook 2017 Annual PE and VC Fundraising report, Private Equity funds have almost $1 trillion in dry powder (investment capital) and that could foretell more company acquisitions.

Private Equity Background and Their Objectives

Understanding the threat is the critical first step for Associations, notes Steve Caldeira, President & CEO of the Washington, DC based Household & Commercial Products Association (HCPA). Earlier in his career, Caldeira worked firsthand with Private Equity while at Dunkin’ Brands (2007-2009). The company was purchased by three PE Funds; Bain Capital, The Carlyle Group, and Thomas H. Lee Partners. It has been reported that each of the firms profited approximately $600 million upon sale of the company. Caldeira notes that these firms have a clear vision once they purchase companies:

• Maximize return to its investors – Through due diligence and strategic rigor, they vastly improve the company’s operational performance and brand marketing to enable revenue growth and measurable profits to maximize its exit position.
• Exit – Selling the company to a different firm or company or even possibly cashing out through an Initial Public offering.

Having this background is the starting point for the understanding of how and why Private Equity Hires Associations, Private Equity Fires Associations.

Private Equity Hires Associations, Private Equity Fires Associations: PE Too Has a Value Imperative

Nowadays executives don’t join anything without a direct connection to helping them achieve business outcomes. Busy executives will find other ways including starting their own coalitions or launching their own Associations to create an environment more conducive to business success. Private Equity is in many ways similar. Keep in mind that the key differences that define the Private Equity approach are highly disciplined strategies combined with a well established success formula for their investors. Understanding these differences will help Associations why Private Equity Hires Associations, Private Equity Fires Associations.

Two Steps to Engage Private Equity Owners

Steve Caldeira faced the Private Equity challenges as an Association Executive at two leading Trade organizations: International Franchise Association and now at the Household & Commercial Products Association. Understanding the Private Equity mandate, Caldeira applied a two step process that bridged critical gaps through an understanding of differences to work toward common goals:

1. Early Engagement – Meeting with the new Private Equity owners to understand the regulatory and tax impediments that keep them up at night. Then mapping these concerns to the Association’s federal and state advocacy teams.
2. Volunteer Leadership – Inviting new owners to participate on the Board of Directors (with a potential pathway to the Officer level) or to participate in key Association committees. These opportunities help the new owners leverage the Association as an extension of their firm’s business strategy. They also create understanding (as well as business to business opportunities) for promoting dialogue between Private Equity owed companies and other members of the Association.

Organizations, in addition to the International Franchise and Household & Commercial Products Association, are utilizing the board leadership opportunity in similar ways, with many PE owned companies sitting on Association Boards. Associations with PE owned companies sitting on Boards include:

• American Hotel & Lodging Association (AHLA) (Caesars Entertainment, Hilton, La Quinta)
• National Retail Federation (NRF) (The Container Store, Macy’s)
• American Beverage Association (ABA) ( Pepper Snapple Group)
• American Frozen Food Institute (AFFI) (Pinnacle Foods)

These two approaches are effective strategies in so much as they are determining factors as to whether or not Private Equity Hires Associations, Private Equity Fires Associations.

Private Equity Owners Also Insist Upon Clarity and Deliverables

Corey Rosenbusch, President & CEO, Global Cold Chain Alliance, Arlington, Virginia remains focused on the potential loss of dues and non-dues revenue as Private Equity companies consolidate memberships. Thanks to pro active strategies the Association has not lost a single private equity firm from membership when they entered the space.  Moreover, each of these companies have stayed engaged after they were purchased.

GCCA is delivering impressive results for Private Equity owned companies and overall membership through the mitigation of costs of regulatory compliance. For example, members achieved a decrease in the number of violations and OSHA fines per inspection.

The Association also identified two other high ROI opportunities to support the new Private Equity owners with:

• Technical resources – Helping reduce costs.
• Talent development initiatives – Assisting with workforce challenges.

Rosenbusch notes “GCCA continually identifies new and innovative opportunities to maximize the ROI for the organization and for our Private Equity owned members.”

Private Equity Hires Associations, Private Equity Fires Associations

Make no mistake about it, Private Equity is increasingly becoming a force to be reckoned with for all Associations. The high volume of available capital and Private Equity investors hungry for strong returns means Association CEO’s must create opportunities to engage their new Private Equity owners. Not doing so is risky and could result in considerable erosion of the membership base. Utilizing proactive and innovative strategies are the best tools that will determine whether Private Equity Hires Associations, Private Equity Fires Associations.

To learn more about how your organization can effectively work with Private Equity click here.