Boards are often sources of insight and innovation needed for organizations to thrive but sometimes Boards are made up by members who have trouble identifying new opportunities for future growth. Focused leadership and external advice is needed to help find the model for long term success and gain Board approval for needed changes.
Situation and Complication
A 30-year-old not for profit trade association was facing an uncertain future. Membership revenue was declining driven by falling member numbers and lower spending per member. While still well above breakeven, the revenue trend portended financial trouble in 3-5 years.
Underlying the downturn were two fundamental issues. First, the member organizations were rooted in an increasingly outdated business model and slow to adopt new technology and marketing techniques needed to successfully compete in an increasingly digital world. Second, the focus of the association was also firmly fixed in the old world and board members, made up of the very leaders who needed to change, had trouble identifying and articulating a new vision for the future.
Without a shift in focus or new business model, the trade association would almost certainly face irrelevance and ultimately face financial distress.
Working with the leader of the association, a Navigare principal (and member of the Board’s Executive Committee), developed a plan to fully assess the current situation, establish a solid picture for the likely future and produce multiple strategic alternatives for consideration by the full Board of Directors.
External resources were engaged to build a comprehensive member survey and conduct a series of interviews with key members to develop deeper insights into current issues and outlook for the future.
Simultaneously, brainstorming sessions with engaged members were held to build a list of opportunities which were then filtered to establish a short list of potentially viable solutions. Each of the short list options were discussed and modeled to assess likelihood of success in a series of intensive reviews.
At the end of the process, 3 viable options were presented to the Board with a recommendation for creating a partnership with key market competitor that was more firmly established in the digital market but whose members would benefit from the experience the association brought from the traditional marketplace.
The Board approved the recommendation and the strategic partnership was established. Cross-pollination of the 2 member groups helped each of the partners to build revenue and the long-term prospects for the once troubled association were significantly improved. As an outgrowth of the strategic assessment, the organizational structure was streamlined and material cost savings were realized further enhancing the financial outlook.