By Kenneth H. Marks
Is your association taking advantage of market churn and chaos to refresh your growth strategy? Regardless of size or industry, everyone has felt some impact from the recent years' economic turmoil. For many, it has been devastating requiring them to significantly shrink their associations, lay off staff, or even close their doors. For others, the impact has been more of a mild distraction, causing worry and distress in markets and niches that have otherwise continued to flourish. To take an optimistic view, the exciting part of a crisis like we have experienced in the last two years is the ability to easily effect change.
Think about it. When the economy is good and leaders and members are happy, it is often difficult to spur improvements, reinvent what's inevitably going to be obsolete or make bold moves. The risk of rocking the boat or the inertia to stay the course when things are working can be difficult to overcome. But when crisis hits, everyone expects action. This can create an environment enabling leaders to make strategic moves and strengthen their association's position.
What is your association doing differently to take advantage of the opportunity to change? What strategic move has your board and staff leadership team embraced? Start the process by reviewing the direction of the association.
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Clarify the goals and objectives of your members, donors, and other stakeholders.
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Revisit the association's strategic plan with a fresh set of eyes and consider the basic growth strategies that are used to navigate the ramp and emergence of new opportunities.
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Identify the "secret sauce" of the association, and how it needs to be competitively positioned and differentiated.
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Focus on activities and strategies to sustain or move the association into a leading position to grow value and provide for even greater long-term success.
Once the direction of the association is clear, leadership can develop the strategy to meet the future desired state. This should result in initiatives that will move the organization forward.
A common question is "how do we think about growth strategies?" From a big-picture perspective, there are two fundamental approaches: organic (internal) and external.
Organic strategies involve leveraging the strength of the existing organization and building from within. For example, this approach could mean accelerating membership participation in your annual meeting through new marketing initiatives. It could also mean developing new products and/or services, geographically expanding, or finding new ways of delivering content and services to the membership.
External strategies tend to involve other organizations and investment outside of the current operating budget. With one or more of numerous strategic aims, a common external growth strategy is the acquisition of another association to quickly capture members, add capabilities, or access new technologies. Sometimes the same objectives can be achieved with less risk and similar benefits by entering into strategic partnerships or joint ventures.
Associations in a defensive posture may consider merging with a competitor to gain cost efficiencies or shed weaknesses while gaining complementary strengths. Keep in mind that combining two poor performing organizations doesn't necessarily make a better association. In fact, I suspect there is evidence to the contrary.
Strategy must be coupled with solid operating execution. All the plans in the world don't matter if the association can't do what it commits to with the resources it can harness. Consider increasing the operating tempo of the association and challenge performance expectations. In good times, many organizations reach a level of operating performance that is okay, but not stellar, and the staff settles in. It is all too easy not to drive the extra mile required to excel when there is no external pressure or the situation isn't critical. With the increased level of unemployment and flux in the labor markets, the opportunity may exist to upgrade talent and augment the team to assure a strong foundation to build on. Execution starts with having the right team.
Lastly, don't be afraid to trim the weak players that is, trim services that are not working, or suppliers that are draining the organization or distracting the association from focusing on the value-creating forward-looking organization.
Kenneth H. Marks, is a managing partner of High Rock Partners and lead author of Handbook of Financing Growth (John Wiley & Sons). He can be reached at khmarks@HighRockPartners.com.