A Busy Board Member’s Guide to Selecting an Association Management Company RAYBOURN GROUP INTERNATIONAL 3502 Woodview Trace Suite 300 Indianapolis, IN 46268 800.362.2546 I 317.328.4636 ext. 120 I Fax: 317.280.8527 I www.raybourn.com 1. TABLE OF CONTENTS Introduction..........................................................3 Association Staffing 101 .........................................4 Conducting the Search: 6 Steps for Success.................6 Step 1: Gut Check......................................6 Step 2: AMC Search Task Force..................7 Step 3: Develop a Scope of Work...............8 Step 4: Determine Your Short List..................9 Step 5: Evaluate The Proposals..................10 Step 6: Managing the Transition................11 Conclusion........................................................11 2. InnovationIntroduction + Excellence = Results Is your organization stalling on its goals? Are you coming up short on turning your vision into reality? Is your current staff not meeting expectations? Is your executive director preparing for retirement? If you’re serving on a Board of Directors facing any of the above scenarios, it’s very likely that the organization is demanding more time and resources than you’d envisioned when you volunteered to serve. Though you are an expert in your field, you may find that association management requires a set of skills you’re not familiar with, and that it’s difficult to focus on the bigger strategic goals of your organization when you are so entrenched in the day- to-day details. If these scenarios sound familiar to you, it’s time to seek the help of an association management company. An AMC offers efficiencies that can help you meet your goals while reducing the amount of volunteer resources required. This can translate to happier members, a more financially sound organization, and a more productive board. But when it comes to finding an AMC, where do you start? This e-book lays out the process for selecting an AMC, including exactly what you need to do before, during and after the search to ensure your organization builds on the successes you’ve already worked so hard to attain. Read on to find out how an AMC can help your organization thrive. 3. Association Staffing 101: Captive staff or AMC? There are two approaches to finding professional administration, employee reviews, and ensuring that management for an organization: Captive staff or adequate financial controls are in place to protect through association management companies. Here is the organization from fraud, theft or embezzlement. an overview of these two models and their pros and There are also risks and liabilities related to hiring and cons. personnel issues. MODEL 1: CAPTIVE STAFF All of these add up to time-consuming tasks for board members. The board must be hands-on in ensuring The “captive staff” model is familiar to most. In this efficiencies, minimizing risk and overseeing finances of model, your organization would set up a headquarters capital assets. All of these tasks take away from serving with a physical office and hire staff members. your core mission and your members. While this model may be considered a traditional approach, there are drawbacks. If you’re concerned about these drawbacks, it makes sense to consider an association management First, your organization’s overhead may be expensive. company. Beyond rent and utilities, you must consider the cost of office equipment—copiers, printers, technology, mail MODEL 2: ASSOCIATION machines—and maintenance of these. MANAGEMENT COMPANY (AMC) Consider the AMC model as the “sharing economy” And it’s often difficult to find the most successful mix of for non-profits. AMCs allow your organization to share staff that will successfully fulfill your organization’s needs. staff, resources, office space and equipment with An organization may hire an executive director—who other non-profit organizations. By partnering with an then spends most of the time doing administrative AMC, organizations increase efficiencies and reduce work—or hiring a sole administrator, who is then unable operating costs. to provide strategic guidance and leadership. In either case, it’s not uncommon for this paid staff member to AMCs are able to provide exactly the services you quickly burn out because of the variety of demands and need, when you need them, how you need them. tasks, or for the person to not perform to the board’s Rather than having to hire one person to do it all, expectations. your organization is able to utilize professionals with expertise in any given area. For example, you may Additionally, if the organization’s CEO leaves and need an executive director for 10 hours a week, needs to be replaced, the board must become an administrator for 15 hours per week, and a familiar with non-profit salary benchmarks, benefits communications specialist to update the website, 4. MYTH-BUSTING: AMC MYTHS develop publications and maintain social media for 15 hours week. You will pay the appropriate rates for Myth: AMC staff won’t care as much about my professionals who are experts in these areas, rather organization as captive staff or volunteers would. than overpaying a full-time executive to do those things. Fact: AMC professionals care deeply because association management is their profession and passion. They All finance, hiring and human resources is done through understand the importance of missions, the commitments the AMC, which reduces liability for the Board of of volunteers, and the investments of members. Look for an Directors. AMC that supports ongoing staff professional development to ensure that your team is dedicated to providing best You’re also splitting overhead costs with other practices in servicing and growing associations. organizations, which brings them down substantially. And because of the volume of work an AMC does, Myth: By hiring an AMC, the Board is giving up control. AMCs typically are able to negotiate favorable deals Fact: The association belongs to the members, not the staff. with vendors that captive organizations are unable to While AMCs may make recommendations, final decisions replicate. rest with volunteer leadership. Look for an AMC that values This economy of scale enables organizations to thrive partnership and transparency; this will lead to a better while still maintaining unique identities and meeting understanding of how decisions are made to best serve the member needs. organization now and into the future. The benefits of using an AMC are irrefutable. Myth: My organization can’t afford an AMC. According to 2016 research by AMC Institute, the Fact: AMCs are extremely economical because you only trade association for the association management pay for the resources you need at the time you need them. industry, organizations managed by an AMC on Look for an AMC that offers this flexibility. average have: Myth: We will lose our identity if we go with an AMC. x 3 31% Fact: Everything your AMC does should reflect your brand, more net asset consistently higher higher revenue growth income for products/ growth mission and membership. AMC’s should not provide services “cookie cutter” management solutions; look for an AMC that has grown brands in a variety of industries to ensure Since 2008, organizations utilizing AMC services grew your organization’s unique identity will be well-represented. their membership 300% versus Look for an AMC whose staff will walk and talk as if they just 23% growth for standalone are your own. organizations. 5. Conducting the Search: 6 Steps for Success Ready to start your search for an AMC? STEP 1: GUT CHECK Before you begin, know this: The single, most important Here are questions your board must answer before question to ask as the board is: WHY? proceeding: Why do you want new management, and what are the • What problems is our organization facing? Why outcomes you expect as a result? do these problems exist? • What impact do these problems have on Are you looking to grow membership? Become more our organization? This includes financial financially stable? Become more recognized in the ramifications, effect on membership, impact on industry? Offer new programs or services? Grow volunteer resources. conference attendance? Provide better member • What is the impact if we don’t address these customer service? Reduce the volunteer commitment? problems? Loss of revenue, loss of members, loss Gain new volunteers? Grow the profession? of credibility? • Are we willing to pursue management options You may want to do all of the above, and that’s okay— that will help us address these problems? but you must first establish exactly what outcomes you want in order to successfully find management that can Once the board has reached consensus on these key fill these needs. issues, it’s time to get to work. AMCs offer a wide variety of services; if you aren’t in agreement of what success looks like, you may select an association management company that is very capable in some areas but lacking in those that matter most to your organization. This becomes frustrating for all parties. 6. STEP 2: AMC SEARCH TASK FORCE With MANAGEMENTthe task force in place, you can now begin the developmentTRANSITIONS: of your Scope of Services. Next, create an Association Management Company A WORD OF CAUTION Search Task Force of 3-5 key volunteers who will manage the search process. If your organization currently has paid management, The Task Force should include current board members. the board should be transparent about considering The advantage of this is twofold: 1) The task force new management before initiating a formal search. will be fully aware of issues facing the organization; 2) There will be buy-in from the board on the search It will be a difficult conversation, but it is best to process. You should also consider inviting key let your existing management know the underlying influencers to serve on this task force such as past reasons you are considering searching for new presidents, a current executive director (if he or she is management.