| Association management companies and their clients have thrived through tough economic times. Want to know why—and how your association can benefit? Don’t let a few myths stand in your way. by M. Suzanne C. Berry, CAE In a time when many for-profit companies are suffering, association management companies are growing and hiring. What is their secret? And how can associations benefit from AMCs’ strength Steve Drake, past president of AMC Institute and president of Drake & Company, recently reported on an AMC Institute survey performed in summer 2009 (“Survey Reveals More Organizations Turning to AMCs,” AMC Connection, December 2009). Respondents totaled 74 AMC Institutemember AMCs, representing more than 650 associations and nonprofit organizations. The survey concluded that more associations and nonprofits are turning to AMCs for management expertise, finding added value in the flexibility of the AMC model. Demand for management services was up in 2009, and AMC client bases were expanding. This growth was projected to continue into 2010 and beyond. In “AMC Institute Makes the Case for AMC Value in an Economic Downturn” (AMC Connection, March 2009), John Francis of The Harrington Company writes that in difficult economic times, members of nonprofits often turn to their organizations for increased support and guidance. In that same article, Francis provides guidelines for board members and nonprofit executives to effectively manage the economic downturn and maximize opportunities for their organizations, offering bestpractice scenarios drawn from AMC-managed nonprofits. AMC Myths vs. Reality Why don’t these same guidelines apply to an association in good times? The AMC model concept is just as strong in periods of growth and prosperity, but persistent myths prevent some associations
and nonprofits from taking full advantage of its potential. The following represents a list of considerations for volunteers to ponder. Myth: The AMC will make us conform to its way of doing things.
Reality: Whether a nonprofit organization’s staff is standalone or working in an AMC, the board is always in charge. Staff’s role is the same: to implement the board’s policies and strategic directions. The goal is to optimize leadership talents. Any staff would be charged to work with the board to help the organization grow and would include core work, such as assisting in finding new members and customers, developing business plans for new programs and services, considering ways to best implement the strategic plan, and providing data for board decision making. High on the list of benefits of partnering with an AMC is the value of an objective, third-party evaluation and the strategic specialization an AMC brings. Staff from an AMC often bring the value of working with other associations and experience in problem solving in different professional areas and industries by addressing issues using best practices. They are able to gently suggest “another organization conducts their electronic elections this way” or “when the widget association went to a paperless meeting, these are some of the challenges that they had, and here are some of the solutions they found.” Last, but not least, AMC staff are aware of trends in important areas such as volunteerism, generational issues, strategic planning and plan implementation, and general association management. This is simply because they have a larger sample pool to draw experience and expertise from. Myth: Our members want their own staff.
Reality: Members look to the leadership to select the best infrastructure for the organization. Members want services to be delivered in a professional, efficient, and cost-effective manner regardless of the staffing model. In fact, the majority of members of your organization will not realize that you are with an AMC rather than a standalone—unless you tell them because you are proud of the decision that you made to join an AMC. As the association grows, many boards think that only their own captive staff will be able to truly understand the industry or profession. There is a concern that without its own dedicated staff, an organization will lose its identity and sense of community. Many AMCs are dedicating a “content specialist” to client organizations if this is truly needed, thus providing the best of both worlds: industry knowledge and association management know-how and expertise. Many AMCs have concentrated their business in servicing clients in similar industries and professions. This will lead to a more effective servicing model. Myth: We won’t be able to have a flexible staffing pattern.
Reality: AMCs can respond to demands for more or less staff more quickly than a standalone organization. If you need additional professional staff to ensure that your annual conference is a success or you need marketing expertise for a one-time project, an AMC will be able to provide you with the short-term staff that you need. If you need to reduce the amount of staff time during a particular year, AMCs can frequently reassign staff to another group. In this way, if their expertise or memory is needed, staff are still available and can readily be consulted. Together with your leadership, an AMC carefully reviews the program of work and resultant costs and determines both priorities and budget resources to support the work. A stand alone organization has to work within the confines of its predetermined base of staff. In addition, AMCs can provide time analysis to make the best decisions on the continuity of programs or reallocation of resources with bench strength. The AMC model allows for specialization of staff. Does the organization want the executive director filing workers’ comp claims or focusing on the big picture? AMCs assign their professional and trained staff to specific clients, often in less than full-time assignments, to meet the optimal capacity and skill-level requirements for their client organizations. Training and sharing of information is an integral part of what the AMC provides to its clients. Expertise is provided when and where it is needed. The end result is a more efficient and effective staff. Myth: We won’t be able take advantage of new technologies.
Reality: AMCs are constantly looking to provide services in the most cost-effective and efficient way, from telephone and internet services to computer equipment, printing, database, and other software costs. In fact, most AMCs have a staff person that specializes in looking at all of this. The costs and time commitment to do the analysis, negotiate the contract, and implement the software (or whatever is being purchased) can place a burden on a standalone staff, but when shared among more than one association, they become more affordable. All of these expenses become more manageable when spread across each of AMC’s clients. Staying ahead of new technologies and developments requires concentration and focus along with a technology strategic plan. Myth: Only small associations who are not yet able to hire their own staff use AMCs.
Reality: This is simply not the case. Yes, a number of small associations have a home within AMCs, but many medium and large associations with annual budgets in $10 million range are also with AMCs. Some of these associations have grown while they have been with their AMCs and see no reason to leave. “Their” staff is doing a great job for them, so they stay. Some of these associations have recently joined AMCs due to the current economic climate. By tapping into an AMC’s resources, they are able to do more with their management dollars. While these associations are seeing the benefits of decreased overhead expenses, they are also realizing that their board agenda focuses less on infrastructure issues and more on member programs and services. Volunteers would rather spend their time on moving their profession forward than looking at which computer system to buy for the office. Use Your Resources Wisely Based on ASAE & The Center’s Operating Ratio Reports and work that the AMC Institute has done, most associations managed by an AMC spend fewer infrastructure and overhead dollars. That is good news in any economy. (ASAE & The Center reports that on average, standalone associations spend 40 percent of their budgets in this area.) In addition, in an AMC model, programs and services drive staffing, including the competency needs of the staff. In a standalone, the organization is going to have to compromise on programs if it does not have the staffing structure to effectively support them. It is not easy to add a person to do a project that involves less than a fulltime job, whereas in an AMC model, staff expertise can be reallocated from another area to perform the necessary work. If your organization is thinking of becoming self-managed, think first about the dollars that you want to commit to this and how it might change what you do for your members and other audiences. What are you willing to give up? Make sure you are getting the most out of your AMC. Do your homework and become an educated volunteer leader. This articles have been reproduced below from ASAE's Guide to Association Management Companies, a supplement to Associations Now 07/10. (www.asaecenter.org | 
