The Business of Association Education
In the world of association education, many competing demands exist. Members want products and services that meet the needs of their current professional challenges, and for you to anticipate what they will need next. The business climate in which they operate is shifting under their feet and everyone is just a little bit different, making your job just that much more challenging.
Consequently, offering educational programs, products and services that meet all/some/most/a bit of your members’ needs can be a daunting task. What often happens is the association tries anything and everything hoping that if they throw it at the wall, it will stick (image of spaghetti thrown at the wall). Often times, this results in weak programs and attendance, that result in poor financials overall.
The dirty little secret of association education is that it is a business. Yes, a business. Done right, the education enterprise can operate as a revenue-generating entity for the organization. But more often times it does not.
While it is important, and even critical, to consider adult learning styles, developing programming of the highest quality possible, using a variety of learning modalities and more, there must always be a business consideration for what happens in the education arena.
There are many dos and don’ts to running a profitable, member-driven quality education enterprise. If we put our business hats on for a moment, let’s consider those essential conversations that need to be had, and decisions that need to be made. Do not be afraid to tackle big, strategic decisions about your education, with the help and guidance of a well-informed subset of the membership. That group may be your board of directors; it may be an education committee or some other entity. If you are a more volunteer-driven organization (rather than staff-driven, making most decisions as a management team) you need to involve the members in the bigger, more strategic decisions around education. Why? Because they will affect your pricing, your marketing, the attendees you are trying to serve and more. Consider including the following 8 principles into your conversations around your education portfolio:
1) We must be deliberate.
There are no absolutes that can be provided to you in terms of how every association should run its education enterprise. Every culture is different, revenue is derived differently across organizations, and some associations have a greater appetite for innovation and risk. To be sure, though, the one absolute is that you must be deliberate. For example, if it is decided that the association education should be a loss leader for membership recruitment and retention, focus on how to bring in repeat customers and a larger number of unique participants. You might decide some programming should be offered at no fee to begin to cultivate interest from nonmembers, or even develop programs that appeal to a sector of your industry not currently being served by another organization.
On the flip side, your association may have made the decision that education needs to be able to support itself. In that case, you should determine all costs associated with your programming (direct and indirect), what pricing works with the associated costs (and will be accepted by your members and other constituents) and how many individuals you need per program to present a positive bottom line. The type of strategy matters, of course, but more important is that you have a strategy for education. You cannot run the business of education without one. Not being deliberate in direction can lead to flawed decision-making affecting expense and lost revenue opportunities.
This leads us to the biggest question you may need to gain clarity on around your education:
2) Should this association’s education be a revenue generator, or a member benefit?
Surprisingly, more than a few associations have not yet tackled this question with any certainty at all. If you are not clear on whether your programming needs to show a positive bottom line, how will you plan your portfolio? How will you know when you are successful? What this means is that everyone needs to be clear on where the organization stands, not just a few internal operators. How can the association run its business well if the staff is operating under the directive of the enterprise running in a profitable manner, yet the education committee is not? In most cases, it is because this has not been discussed with our key volunteers.
If you are in a “gray area” with respect to this question, here are a few initial recommended steps:
- Begin conversations internally around education profitability. Review your financials for the past few years, and truly understand how successfully the enterprise has operated. You don’t want to set expectations that you can become a profit-driven enterprise overnight, if the past five years have shown a negative bottom line. But talk about the culture of the organization, how education is viewed in the organization and if it can become a profit-driven arm of the association. In most cases, it can.
- Once the management team is in sync on this philosophy, this may need to be presented to the board and discussed. This is largely dependent on the culture of your organization, but if there are budget implications in your decision (and there most certainly are in this case) you should have this conversation with the board. This is both philosophical and practical. Philosophical? Yes. The board needs to talk through and socialize how it views education in the organization and whether it is a benefit of membership or an additional revenue stream for the organization. Remember, too, it does not need to be one extreme or the other, but how will you potentially offer and balance your portfolio based on the revenue philosophy set for education?
- After the above conversations have happened, it becomes easier to address an education committee, a scientific committee or a programming committee. Clear philosophy around this area also then starts to drive better business discipline in all areas of education. A member has an idea for a new program? Terrific, let’s consider the business case and financial projections for these programs prior to giving the project the green light.
Again, there are no absolutes in this, other than “being deliberate.” Being deliberate sets the stage for important conversations around education. There may be times that the association believes it needs to educate members (or even non-members) because it is in the interest of the public good, patient safety or in accordance with furthering its strategic plan—maybe at no fee, even in a revenue-generating enterprise. Having a deliberate philosophy in place forces a conversation to happen that can justify going outside of the precedent set.
3) Should the association aim to serve members primarily, or member and non-member constituencies?
This question often receives a quick and emphatic response. Most associations view themselves as an entity to serve their members exclusively. And while that is largely true, there may also be opportunity, and a business case, to more actively serve non-member constituents as well.
With demographic and societal shifts, some industries are “aging out,” others are seeing more competition for their membership dollars, and often younger professionals are not joining at the same rate as their more senior colleagues. All of this feeds in to whether the association should look at serving a market other than just its own membership.
A large professional association recently learned that its only profitable programming was serving an almost exclusively nonmember audience. Its senior executive team quickly thought it had completely missed the mark. After more careful conversation and thought, it determined it was going to continue to offer those programs, and perhaps even enhance them, even though these markets were likely to never join the association. Why? Because part of its mission was to raise the bar on the industry overall. IN serving this (lucrative) sector of the market, the association was able to continue an important revenue stream and serve its mission.
4) Know the data on your programming cold
It should be the job of everyone in your education department to know how your programs are performing. There are two key areas that should be top of mind to anyone working directly in education (or its C-suite!):
- Average attendance size per class OR the overall financial scenario for each product line
- Overall quality indicators
Why are these two elements so important to the business of education? Because if either one slips, revenues (or profit) will follow. Set objectives and track them closely.
5) Ongoing Program Review
Part of the work of managing a relevant and prosperous education portfolio is consistent and thorough review. Is attendance or quality slipping? Is the course content outdated? Are we carrying outdated or underperforming programs simply because we are not being deliberate enough about reviewing our portfolio? And perhaps most importantly, are we adding new programming, and do we have the bandwidth to continue to carry the load on all for the programming we are offering?
Content needs to be thoroughly evaluated for each course every 1-2 years. Other variables around the course need to be evaluated every 9-12 months, or at a minimum, before budgeting time each year.
6) Determine which of your programs might be suitable for micro-learning.
- Consider the value of creating alternate products out of existing content. Associations often believe they need to consistently be creating. To be sure, you need to be consistently updating, but creating and creating and creating is not always the answer. Assuring that you have an updated, relevant viable product in a consumable form to your members and constituents can get you much further than you are right now. Look at what you have. Understand where you need to adjust and update. Think about how your members want to consume that content. Prioritize content by what is most critical to your constituency and their learning needs that will create a difference for them professionally.
This also allows the association to salvage viable content from educational programs rather than simply eliminate. If elements of a course are old, but other parts have content that is still very relevant and current, consider whether that content can stand on its own as a micro-learning option.
7) Developing versus importing programming
A well-balanced education portfolio will mix “imported content” with association-designed and owned courses. “Imported content” is defined as that content for which you receive a proposal, pay the speaker an honorarium, they deliver the program (once, twice, or even throughout the year) but the association does not own the intellectual property for the content.
Quality and context issues should be considered when importing programs and will require an extra level of due diligence and oversight. However, the organization likely cannot afford to develop all of its own programing and should not endeavor to do so. Instructional design is an expensive endeavor. While it is completely appropriate to develop and own the IP rights to some of your content (that is foundational to the field or profession, or that which is considered evergreen and has a long shelf life), you must consider what amount of time and how many registrations it will take to recover the cost of the course. Again, there may be other reasons to develop and own these courses (the desire to be seen as THE source in an industry and being willing to make an investment to be that source, etc.) The association should determine a reasonable amount of time by which it expects to recoup its instructional design costs for each program, which will not happen overnight.
8) Commit to capturing strong demographic data on all courses.
Are you serving the members or constituents you intended to serve? It is important that you understand the demographics of your learners implicitly. Yes, this means you may have to ask a few additional questions on post-program surveys, and also assure that you are getting to the entire membership (not just those who attend) at least every other year to understand the demographics of those who are not attending.
Some of you may be working in associations that are already doing all of this due diligence on your programming, and more. For those who are not, there is not time like the present to start. A deliberate plan will show immediate and measurable impact.
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