Your Non-Dues Revenue Strategy
“Non-Dues Revenue” is a buzz word these days. Professional associations, and other not-for-profits, are trying to generate the revenue they require to meet their members’ expectations of programming, service, and growth while revenue streams, including membership, seem to be shrinking as the competition for people’s attention, loyalty, and engagement increases exponentially across all the given things an individual can be doing at any given time.
What are “non-dues revenue?”
Your organization is likely engaged in a number of these activities already whether they are innovative and successful, or not. Very few organizations can exist these days solely on membership dues.
Conferences, seminars, and workshops are an effective way to create value for members, attract new members, and raise the association’s profile, and the industry or profession it represents, while earning revenue from registration fees.
Sponsorship and advertising are also common types of non-dues revenue activities. Associations leverage their membership base to corporations seeking to raise their profile and engage with the association’s members.
Other common activities include selling online courses, trade shows, accreditation, books, consulting services, and research.
What your organization is doing is not as important as how strategically is it being done to maximize the return on investment for the association, and the value generated for the membership and other stakeholders.
If you don’t have a business plan, or your business model does not consider sustainability, risk, or how revenues support and further your mission, maybe it’s time to ask some critical questions to assess the current and future success and profitability of your revenue strategies.
For any development strategy, a Needs Analysis, Risk Assessment, and Competitive Analysis will help you accurately determine overall funding considerations such as organizational requirements, member needs and expectations, outcomes, rationales, benefits, criteria for success, resource allocation, sources of revenue, risks inherit in receiving and not having certain levels of funding, and frameworks for evaluation. These assessments will also help you determine the best course of action. For example, are you utilizing sponsorship opportunities to your best advantage? Do you understand the lifecycle of the options you choose to consider? Are you evaluating the impacts of your program(s) on all stakeholders, your industry, and your organization?
I don’t want it to sound complicated, or like too much work, but with good information, and a strong understanding of your organization’s capacity and propensity regarding revenue sources and needs, you will be able to strengthen your association’s strategic vision by being able to make effective investments of time energy and resources towards the revenue streams that best serve your members, your mission, and your capability for success.
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Client Newsletters.....to go High Tech or to go Old School?
We recently re-launched our client newsletter Boardwalk, which hit mailboxes in early February (not on our mailing list? Please send an email to email@example.com and we’d be happy to add you!). As part of this move, we debated the merits of a hard copy newsletter vs an email newsletter, and opted to go the ‘old school’ hard copy route for a number of reasons:
- More so than with an electronic newsletter, we feel the hard copy newsletter will give us better opportunity to show off our desktop publishing and design skills
- There are just so many e-newsletters out there…..we felt this might help to set us apart
- There was a personal preference from a majority of the staff for a hard copy vs e-newsletter….including myself, I often forego e-newsletters, however I will take a hard copy magazine or newsletter to read on the long commute home
- Given the pending anti-spamming legislation (Bill C-28) coming into effect in the near future, the requirements around email distribution vs hard copy distribution are much more onerous
- The hard copy format better accommodates for potential advertising
So, has the re-launch been a success? Hard to tell at this point, however we did have one newsletter recipient reach out to let us know that a particular article had resonated with him. The key elements we have looked to incorporate into this quarterly communication piece are as follows:
- Article(s) on issues of relevance to volunteers working with member-based industry associations (our last issue included an article on how to engage generation Y in volunteerism, board bullies, and the value of industry conferences)
- Book review – each issue will feature a review of a business book
- Volunteer recognition – the winter issue featured an interview with two Gen Y volunteers, as well as a profile of a student volunteer
- Alignment to the A+ brand
We’re excited for this new initiative and are thrilled to have another way to reach out to our clients and showcase our expertise.
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Bullying in the Boardroom
The third week of November is National Bullying Awareness Week in Canada (www.bullying.org)
Bullying is not just in the playground, or school hallways at schools, sometimes it is even perpetrated by board members of not-for-profit societies and professional associations. I get a lot of questions on how to manage individual members of a board who are applying pressure, intimidation, ostracization, or other disrespectful, or malicious behaviour to get their way when other members question the status quo, decision making process, or stand for certain ethical practices. I can’t say I have the answers, and it turns out there is very little research out there on this phenomenon in the not-for-profit world... read more
Examples of bullying behaviour might include a dictatorial chair applying excessive pressure to make certain business or policy decisions, self-dealing where a board member applies intimidation to achieve inappropriate favors and benefits, or even sexual harassment.
Just as in childhood bullying, the bullied tend to keep quiet rather than confront and expose bullying behaviour. The rest of the board are apt to continue to perform their board duties for some time (likely because they are conscientious people, or for fear of being branded a complainer or whiner). It is similar in the workplace where employees will continue to work in a toxic environment for fear of losing their jobs. But, these are not employees, they are volunteers. They do not “need” to stay (and mostly new volunteers don’t in my experience).
I was once on a board where most of the board members seemed to have become complicit with bullying behavior when it was discussed in an in camera meeting, even supplying reasons to justify it; “He’s always been that way,” “I know he means well,” “I don’t really mind…” While, at the same time, several of these board members outside meetings would vent, or share their misery, over lunch or a drink.
I have also experienced a form of dissonance where non-bullying board members attack or stand against an individual member trying to raise red flags about bullying behaviour. Some board members refuse to see it, or take action.
So what is the recourse? There is no easy solution when it comes to board bullies. It is in the best interest of boards to implement measures such as a code of conduct, an evaluation process, and/or term limits for board membership (though these may be difficult to institute if there is a bullying member against these safeguards). Training and education on the ethical and legal roles and responsibilities of boards, and individual board members, may help people understand some of the issues from a governance standpoint rather than a personal standpoint. We also need more research and understanding on this form of bullying. If you would like to share your stories, and solutions, with us (confidentially, of course) I am open to setting up an online, or in-person group discussion around some best practices that we, the bullied, have discovered to prevent bullying in the boardroom.
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Email Don'ts....Keeping it Professional
If all email is to believed, I am sure we have all been multi-millionaires a hundred times over thanks to the generosity of some long lost relative, or that poor persecuted prince from Nigeria. The advent of email communication has improved workplace efficiencies and provided for instant access in a remarkable way, however it also comes with its share of headaches, such as scammers and spammers. But what do you do when the email in question is not from some high ranking Nigerian official looking for your assistance in accessing $26 million, but from a work associate?
Okay, it is unlikely that a work associate will send you a phishing scam email, however it is highly probable that at some point during your career, a colleague will send you an email that will have you shaking your head and thinking to yourself “did they actually just type my name into that ‘To:’ field, and send this email to me?” While a huge fan of email myself, if not for email the 200+ emails I receive a day this communication would be coming in via phone and fax (shudder), I occasionally find myself facing down an email communique that can only be described as downright unprofessional.
Case in point:
- Inappropriate jokes – while I consider myself to have a great sense of humor, and love a good joke, if I have only met you once for a brief five minute discussion in a business setting, that likely does not warrant me a spot on your jokester email list. Wait at least until we meet for a second time.
- Requests for financial support for your daughter’s Girl Guides cookie drive – if we are on friendly terms, by all means email away….use discretion here. A good barometer for this: if I don’t know enough about you or your life to know that you even have a daughter, then it is probably wise to leave me off the request
- Foul language – just don’t. There were 470,000 entries in the 1993 edition of Webster’s dictionary, so I am fairly certain you can find a myriad of alternate words that are not four letters. Emails are forever, they can be forwarded, they can be printed out, they can be shared with entire contact lists, so conduct yourself accordingly.
- ALL CAPS RAGE – avoid the use of all caps, which is akin to shouting at someone. There are much more effective and professional ways to communicate your displeasure. A woman in New Zealand was actually fired back in 2009 for her email style sins, which included the use of all caps and red text (http://news.cnet.com/8301-17852_3-10322998-71.html).
- Proof your emails. While I cut some slack for those sending emails on their mobile devices, I am still an advocate for reviewing your emails for accuracy and spelling prior to hitting send. I will completely dismiss a resume or job application that comes in with typos in the email cover note.
- I recently received an email invitation to a new church opening from an individual I met once three years ago…the sentence “if you are not into building faith in God/increasing your own inner peace/light, please completely disregard this email” was actually used. No further elaboration is required here.
- Not sure if that email is too harsh/irate/inappropriate? Step away from it for an hour, or vet it through a brutally honest co-worker. Once it’s out there, it’s out there!
Email is not a passing fad, it is here to stay (or will continue to evolve with new social media tools). Observe the common sense rules of ‘netiquette’ and type away!
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Membership Ins and Outs... and Ins
You don’t need to reinvent the wheel, but you do need to know there is one.
Membership is a conundrum for some organizations, and a mammoth undertaking for others, but understanding the big picture increases capacity and reminds organizations that member communications, and tactics, need to be relevant to the member depending where they are in the evolving relationship with the organization. One of the most compelling resources out there today explaining this is Marketing General Incorporated (www.marketinggeneral.com) with a systemic view called The Membership Lifecycle. Often associations have one or two tactics for dealing with their membership issues, with little experimentation or innovation, and use cookie cutter messages without realizing the different phases of member association with your organization.
We might not remember how, or when, it happened, but there is a time in everyone’s life when they discover the existence association that sooner or later would draw them in. Unfortunately, some organizations rely on chance; assuming that they offer a desirable product, and those that need it will find them. What is actually needed is a strategic and proactive plan to establish a brand designed to attract people’s attention, drive traffic to the website, and generate prospects for potential membership. Targeting markets with a clear value proposition informs choices. Realization of the economic value of membership at the Awareness stage is derived from both the economic and social structure of the situation, rather than just from the inherent characteristics of the association itself and its “desirable” product. The goal of the Awareness stage is to build recognition and generate new relationships by delivering information or resources that only qualified prospects would value. Potential members are qualified as they sign up to receive content prior to being recruited as members. As reliance on, and confidence in, the association grows over time, membership becomes a natural next step.
There also comes a time when the association needs to ask for membership in the organization. Inviting new members to join should be done with a compelling message expressing unique value (vision and robust mission), tangible value (benefits), and relationship values (context for cultivation and intimacy). The goal of the Recruitment phase is to successfully capture the attention of your prospects, and have them choose to become a member of your organization. Offers and incentives to new members often make it easier for them to buy into the more practical reasons for joining an association.
The Engagement stage is the process of moving members from observers to users. The most likely memberships to lapse are first-year members, so while membership engagement across the association is important, it is imperative that associations to find ways to engage first-year members positively and often. Strategies for Engagement include welcome notices and packages, affirmation of value, encouraging new members to use benefits, communicating the vision, and/or special program for new members. An engagement plan is vital to associations for retention and growth; to meet the expectations of current and new members so that they feel they have been part of a relationship, and in a two-way conversation. “Members who are actively involved with an organization appreciate the value they receive much more than those who are not involved,” (Rossell, 2012). Members who have felt engaged are more likely than non-engaged members to renew.
Many associations rely on the deadline for membership renewal to be the impetus for members to renew. This is especially detrimental if there has not been any contact with the member since the last renewal, members forget about renewal, or members did not see value in the membership (and you didn’t hear about it). Relationships with members need to be carefully nurtured in order to strengthen the feelings of engagement and affiliation with the organization. Associations have the opportunity to use the Renewal phase to build upon their engagement strategies to “confirm the value that has been delivered… and request a continuance of the relationship,” (Rossell, 2010). Frequency of contact and quality of content combined with early renewal attempts promotes Renewal success by reminding members why the association is relevant to them.
A lapsing member is not always a dissatisfied member, or even purposeful, but when it is, it is important to find the breakdown and reinstate former members to paid status. The Reinstatement phase in another opportunity for relationship building. Reaching out to members after expiration is an important way to get feedback as to why they did not continue, reverse longer-term membership losses, and keep your contact database up to date; these ex-members have in-depth knowledge about who you are, and your vision for your industry. It is important to stay in touch with former members and try to recruit them again.
Recruiting and retaining members, new and old, takes effort but it is not complicated or difficult. Although people usually buy memberships because they believe in an organization and want to help further its goals, and reap the benefits, there are many important stages that have their own relationship goals, strategies and key messages, so one-size-fits-all tactics are not the answer. It is a valuable exercise for all associations to have a membership plan that includes tactics and strategies related to the lifecycle, and review it regularly to ensure they are actually reaching and building relationships with people in each phase.
Rossell, Tony. "The Membership Lifecycle: A Systematic Approach to Membership Marketing." DAXKO Connect Virtual Customer Conference. Peach New Media. 22 Oct. 2010. Webinar.
Rossell, Tony. “The MGI Membership Lifecycle.” Spring 2011. Marketing General Inc. 2011. 15 Jul. 2012 www.marketinggeneral.com/resources/white-papers/white-paper-library
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Membership Retention - How Does Your Organization Measure Up?
The old business adage that it is easier to keep a customer than to get a new one applies to the world of member-based associations in that it is easier to keep a member than to get a new one. Your members are your organizations’ reason for being – are you keeping them happy? While our last blog focused on ways to attract new members, this one will touch on ways to keep the members you have.
Does your organization track its membership retention rate? The American Society of Association Executives (ASAE) reports that the average renewal rate is 83% for member-based associations. How does your association measure up? ASAE provides the following formula for measuring member retention:
Total Number of Members Today – 12 Months of New Members/Total Number of Members in Previous Years = Renewal Rate
The first year of membership is often referred to as the conversion year, since this is the time when a new member is most likely not to renew. They may have decided to try the association out, or perhaps they joined through an incentive program, however if the value is not there for them they are unlikely to renew.
So, how do you weather the conversion year? Two words - engagement and communication.
ASAE provides some interesting statistics that help to emphasize the importance that membership engagement has on retention:
- Members who attended a membership meeting in the past year were 19% more likely to renew
- Members who attended four or more meetings were 30% more likely to renew
- Members who placed a product order in the past year were 28% more likely to renew
Are you providing regular opportunities for your membership to get together? If not, look to incorporate this in, as face-to-face is the best way to engage your members. Are you reaching out to your members to involve them in the various volunteer opportunities your organization may have available? In a study done by Statistics Canada in 2010, 45% of respondents indicated that they didn’t volunteer because no one had asked them to do so. So, ask away….what better way to get your members more entrenched with your organization then by making them an active part of the team.
Which leads to our second point – communication. Ensure that your members know what is going on within the organization. Remind them time and time again why they joined your organization, and of the value that your association brings. Make sure that this communication goes two ways though – reach out to your membership on a regular basis through surveys and polls to ensure that you are in fact meeting their needs and to identify new growth areas for the organization.
Keep your members engaged, keep them informed, and keep them involved in regular two-way conversation, and you can look forward to a long, happy, healthy relationship.
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Wooing New Members
In honor of Valentine’s Day, an article on wooing new members seemed appropriate. Bringing in new members seems to be a universal struggle for many groups. The nonprofit sector continues to grow and new professional associations continue to emerge on a regular basis – new organizations vying for your customers’ money, time and focus. How can your organization attract these potential members over the ‘other fish in the sea’?
In the spirit of the day, let’s look at some time-honored dating advice and see how it applies to the wonderful world of membership recruitment.
- Have fun together: Show that your organization knows how to have a good time by mixing up your business and technical educational offerings with lighter fare – fun social events that will give these potential members the opportunity to network with peers in a less formal setting. New member mixers are also a great way to introduce these new members to your organization and let them know how to maximize their membership experience.
- Open communication: How will the object of your affection know that you wish to woo them unless you tell them? Find a way to communicate to your target market exactly why they should belong to your organization. Once they join the organization, ensure that a board or committee member reaches out to them to welcome them aboard. And once you have them engaged, keep the lines of communication open. Mix it up! With so many communication tools available, from social media to member newsletters to regular surveys, there is no reason to suffer from the dreaded ‘poor communication’ relationship killer.
- Use your networks: When looking for a love connection, it is recommended that you start with your own personal acquaintances and networks. Same thing applies when looking for new members. Provide incentives for your current members to bring new members into the fold. And ensure to recognize and thank those members who are referring new members to the organization.
- Be sensitive and caring: Let’s face it…..potential members have options. If you want to court them, you will need to demonstrate that you can meet their needs. Within your membership there are likely subsets…..identify these subsets and find ways to tailor the membership experience to make it even more personalized and relevant.
- Flattery will get you everywhere: When you finally win over a new member, let them know how pleased you are to welcome them to your organization. And continue to recognize them throughout your relationship. Social media has given organizations a whole new (and free) means for recognizing members, so take advantage.
Of course, while it is important to give focus to wooing these new members to your association, it is even more important to cherish those relationships with existing members. It’s been said time and time again that it is easier to keep an existing customer than to get a new one, and this applies with association memberships as well. Our next blog will address various ways to engage and recognize your members, and how to nurture that critical relationship. Keep the honeymoon going!!
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I delivered a board governance workshop this past weekend, and as per usual when I came to the module on policy development, I sensed fear in the eyes of the participating board members. What is it about policy development that sends people into a tailspin?
As part of the easing-in process for this workshop module on policy development, I ask the board to come up with a list of reasons on why it is a good idea to have policies. The group is always able to identify a solid list of reasons why associations should have written policies:
- Promotes consistency in organization’s actions
- Directs future activities of the board and staff
- Ensure that actions tie back to the organizational mission
- Allows the board to delegate authority while maintaining control
- Provides proper guidelines for decision-making while reducing the opportunity for bias
- Clarifies the boards’ governing style
- Efficiency – reduces repeat conversations
- Outlines clear expectations
- Proactive rather than reactive
Inevitably though, despite the many pros to policies as noted above, this is an area with which many organizations struggle. Why is that?
For starters, policy development can seem like a daunting process. But it doesn’t have to be. There are many great tools out there to help organizations with getting a start on a policy manual. Need to develop a travel policy? There is no need to reinvent the wheel. Pick one of the many existing sample travel policies available online, and make it your own. Get your staff, committee members and those board members most in the know in any one particular area involved in the process. As a board, identify the highest priority policies – this will vary from organization to organization, although as a rule policies around financial management, board governance and programs tend to be most critical.
Take care not to confuse procedure with policy: a policy is a pre-determined course of action, whereas the procedure documents how the policy will be carried out. As part of the policy development process, identify the process for policy approval and incorporate a regular review of policy (a policy on policy-making, if you will). Policies can be amended at the board level, unlike bylaw changes which require membership approval, so don’t get bogged down in trying to develop the perfect policy that will stand the test of time – no policy is set in stone, and policies can be changed to adapt to changing business environments.
Beginning the process of policy development will force your board to operate at a governance level – where your board members’ time and focus is best served.
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What am I agreeing to?
How can you ensure that you get volunteers with the coveted skill set that your organization is lacking? And how can your organization ensure that the time and energy of your valued volunteers is being best utilized? It all starts at the beginning – with a well-crafted volunteer position description.
I participated in a webinar hosted by VolunteerMatch earlier today, “Writing Accurate and Useful Position Descriptions” which emphasized the importance of this critical activity. At a minimum, a good volunteer position description should include the following:
- Position title
- Description of reporting relationships (who do they report to? who reports to them?)
- Description of role
- Primary responsibilities
- Secondary responsibilities
- Skills and experience required
- Time commitment
- Specific deliverables, if applicable
If your organization does not already have a good set of volunteer position descriptions, get your volunteers involved in writing their own descriptions. This could be an eye-opener – you may find that the position expectations of the volunteer differ from that of the board. Tie the role back to the organizational mission – show how the responsibilities of this position fit in big-picture and what the impacts are to the association.
Key to providing a valuable volunteer experience is to be respectful of volunteer time – this can be accomplished by ensuring that the required skill set for a chosen role is identified. This in effect creates a career path within your organization and allows a volunteer to maximize their growth as well as providing a realistic snapshot of position expectations. Your volunteer needs to know what they are agreeing to.
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$10 million is the new hefty price tag for unsolicited email blasts!!
Under Bill C-28, anti-spamming legislation which will likely come into effect in second quarter 2012, an organization can be fined up to $10 million for transgressions to the act – which translates to 10 million reasons to ensure your organization is in compliance. For member-based associations, this legislation will impact who is appropriate to be included on your email distribution lists (which will involve database housekeeping and likely additional development) as well as ensuring that specific parameters around email communiques are met.
The latter is simple enough to adhere to. Email correspondence (and text messages – this legislation also applies to this form of electronic communication) will be required to identify the sender as well as who the message is being sent out on behalf of. Subject lines must accurately reflect the message content and full sender contact information (including postal address) must be included in all emails.
The former, however, will require a bit more planning to ensure compliance – particularly for those organizations who reach out to former members or event registrants as part of their standard sales marketing efforts (whether it may be for potential membership sales or promotion of upcoming events). There are two types of consent to consider under this legislation: express and implied. In order to obtain express consent (which is the level of consent all organizations should be striving to obtain from their stakeholders) a documented positive confirmation (an ‘opt-in’) is required. Procurement of this express consent will give your organization free reign to email the individual on your full range of products and services. Implied consent is a limited consent recognized for two years as derived from an existing business relationship. For example, Joe Brown purchases a publication or an event registration from your organization – this implied consent will now be in effect for two years from the date of purchase, thereby giving your organization two years to be legally allowed to email Joe Brown in regards to other products and services relating to your organization (assuming that during that period he has not requested an unsubscribe – in which case emails to Joe Brown must cease within 10 business days of his request). Data management systems will need to be enhanced to recognize these new date allowances.
Although there will definitely be some work involved for organizations to ensure they are in compliance with C-28, this is also an excellent opportunity to reach out to these individuals as you strive to obtain the coveted express consent. Tell them why they want to be on your list for email blasts. Tell them about why they should continue to receive your email communiques. Tell them about the advantages your organization provides and how they will benefit from being kept in the loop. Furthermore, if your organization is not currently engaging in social media, now is the time! Posting information on your LinkedIn or Facebook page is not considered spamming, and as more organizations start to move away from the traditional email marketing model I predict we will see an increase of activity in the social media world (I also predict we may see a slight increase in direct mail marketing for anyone taking bets).
There are much better ways for your organization to spend $10 million, so ensure that you are in the know. Further details on C-28 can be found at http://www.ic.gc.ca/eic/site/ecic-ceac.nsf/eng/h_gv00567.html.
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Do you have gender diversity on your board?
Do you have gender diversity on your board? The Financial Post Women in Business issue was released yesterday. This issue recognizes Canada’s top 100 female business minds from private, public and nonprofit sectors. Among the female rah rah-ness, there was some very interesting information in this issue:
- Norway, Spain and France have quotas in place for female board participation on corporate boards; 96% of Canadian CEO’s oppose bringing this same model to Canada
- The Association of British Insurers issued a report in September which encouraged gender balance on boards stating that women “appear to be better at explicitly identifying criteria for measuring and monitoring the implementation of corporate strategy as compared with all-male boards” and “boards with better gender balance pay more attention to audit, risk oversight and control”
- Further to this last comment, hedge funds run by female investment managers returned an annual average of 3.2% more than male-led funds (9% and 5.8% repectively)
- 15% of Canadian board seats are held by women
- Walmart, love it or hate it, is quite engaged in empowering their female staff - there is a strong emphasis on building female leaders, which is evident in the fact that half of the leadership team (including the CEO and President and CIO) is female
- More women than men are earning MBA’s, however these same women start, on average their first post-MBA job making US$4600 less than their male counterparts (this wage gap widens to US$31,258 mid-career)
I enjoyed reading about these inspiring women, and was particularly impressed by the career diversity represented – the list includes professionals, entrepreneurs, corporate directors, future leaders. The best quote of the issue came from Gale Blank, CIO of Walmart Canada: “I’m putting on my epitaph ‘Don’t do a half-ass job’. I was a waitress for many years, but I was a good waitress.”
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What is your board's biggest challenge?
What is your board’s biggest challenge? Spent yesterday morning in a CentrePoint workshop on ‘The New World of Volunteer Boards’, and had some interesting discussions with the group around what issues have arisen on their boards in the last five years. Their comments seemed to mirror my own observations over the last five years. First and foremost is an increase in member demands on volunteer board members – this coupled with increased career and family demands on those same volunteers has led to constrained resources across the board. Board recruitment was also identified as a pervasive issue – identifying ways to attract those volunteers that will fill in any skill set gaps on your board. And of course, once you have those board members in place, how do you keep them engaged? This is particularly challenging when you have cross-generational board members who may be looking for different things out of their volunteer experience. Other concerns the group noted included:
- Mission drift
- Board members with personal agendas
- Increased competition from other associations
- Poor governance structures
- Prolonged decision making process
With increasing demands for accountability and transparency on nonprofit boards, strong board leadership is now more important than ever. I look forward to providing recommendations for how to tackle these, and other common organizational issues, in future postings.
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