COVID-19 has forced hard questions about how to handle urgent needs and think ahead. History reminds us not to get too pessimistic and to take a look at governance.
At a time like this, it can be hard to figure out whether to take the long or short view.
As I’ve been reading and writing about associations’ responses to the COVID-19 pandemic, it’s clear that most organizations have been pulled in two directions. There are the urgent and immediate needs: What to do with the conference next month? How to get staff safe and working remotely? Where are members feeling the hurt right now? But there’s also the question of long-term needs: How will we do strategy going forward? How will we operate a year from now in a radically changed economy?
The new normal will be abnormal.
In both cases, ways of operating that emphasize efficiency will be essential. I say that looking at some of the data points from a survey Association Laboratory conducted in late March on the impact of the pandemic. On the evidence, the new normal will be abnormal: 78 percent of respondents said that their association would face an overall revenue decline and at least 70 percent of respondents said that they will reduce discretionary spending, reduce domestic travel, and tap reserves to cover financial shortfalls.
Cutting costs in the short term is one obvious way to respond to that environment. But the long view matters too, and some lessons learned from the last recession can help with that.
Early last year, when chatter was increasing about the risk of a recession, I pointed to some research that the ASAE Research Foundation and others conducted during the Great Recession that offered some possible guidance. In short: Don’t get too enchanted with any one “solution,” such as virtual conferences. Give members good reasons to stick with you—because they’ll tend to, especially longer-tenured members. Don’t get too pessimistic about investments—leaders tended to fear that their reserves would be pummeled more than they actually were. And make sure you have the kind of governance setup that will help you address the coming challenges.
Now, whatever we’re going to call the economic effect of the COVID-19 pandemic will be different than the Great Recession. The financial hit may be worse, but associations have also spent the past decade building capacity for virtual conferences that makes them a more reasonable (and remunerative) option. Association Laboratory’s report notes that more members are using online and virtual education.
“The business environment has reached a tipping point where meetings, as a focus of association activity, will decrease,” says the report. “The familiarity of individuals and the use of companies of virtual meeting technologies, such as Zoom or WebEx, has become commonplace. This behavior is no longer rare or exotic. Disincentives to travel are becoming more prevalent and online learning more important.”
So the telescope may be a bit blurry. But no association ever steered itself wrong by thinking about the kind of governance it needs, and it’s a good time to be thinking about what you want out of your volunteer leaders. In a McKinley Advisors webinar with President and CEO Jay Younger, FASAE, and principal David Gammel, FASAE, CAE, much of the discussion turned on using this moment as an opportunity to look at governance.
“We’ve been given an opportunity to try new things,” Younger said. “It’s taken that fear of failure off the table.” But doing that will require leadership that’s ready to move quickly, and if your structure is overloaded with board members and committees, now may be time to reassess.
“If ever there was an argument for right-sizing your board and making sure you have a competency-based governance model with the people who are well-positioned to understand, assess, scenario-plan, and make decisions that seem to be in the best interests of the organization—if there was ever an argument for it, this is it,” Younger said.
What that kind of reassessment will look like is up to you, and a function of what your particular industry is facing. But you now have months’ worth of valuable (if sometimes scary) inputs about what your members need from you and how they expect to be served now. There are no guarantees on how to solve financial and meetings issues you’ll almost certainly face in the next year. But you can open the discussion about what governance processes you have in place and whether they’re well-equipped to take on those coming challenges.
Editor’s note: An earlier version of this article misspelled David Gammel’s name.