Assessing & Managing Financial Risk

Some organizations struggled during the pandemic if they were unable to pivot to virtual conferences and educational programming, while others worked hard to successfully provide members and stakeholders with meaningful educational content and networking on a virtual platform. Many of those succeeding in providing member benefits like these during the pandemic were able to capitalize on the reprieve from hard costs such as food, beverages, leader and speaker hotel and travel. While most organizations do not want to remain virtual forever, the  year or two hiatuses from in-person conferences and education allowed many to build significant reserves for the future.

So why are some of these organizations that so successfully pivoted now suffering from post-pandemic deficits?

• Conference attendees say they’re hungry to return to in-person, but with busy schedules and rising costs, the virtual options are still appealing and often win out when given the choice.
• For those that prefer virtual education to in-person, are they able to get it elsewhere for cheaper or free?
• Many employers, in an effort to cut spending, are also cutting back on employee professional development and education – unfortunately those employees are your members and stakeholders.
• Sponsor revenue is slowly coming back, but many budgets have been cut so the pre-pandemic revenue levels are a thing of the past.

 What can organizations do about this problem– how do we return to pre-pandemic profitability in a post-pandemic world?   

• This is a critical time to consider reviewing those programs or efforts that cost time and money, with no measurable benefits. Are you tracking profitability by program? If not, you should be. Take a close look at the “losers” and consider if it might be time to cut or restructure to monetize these services in a different way.
• Consider how continuing virtual/hybrid options might be cannibalizing your in-person attendance, potentially leading to lower revenue and costing you attrition if in-person minimums for food/beverage and hotel nights are not met.
• How might a restructuring of your sponsorship program attract those long-time sponsors that no longer have the budgets they used to? Talk to them to gain some valuable insights into the type of benefits they are looking to receive and structure a package proven to provide the return on investment they need while still providing a healthy profit to the organization. Communication is key here. You don’t want to lose their support.
• Focus membership recruitment on why they need the organization – what have you done for them lately? What do you have that no one else can offer them? What makes your association special? Once again, make sure you are actively communicating these benefits.
• The time to revisit your strategic plan is Are the organization’s KPIs (key performance indicators) driving where staff and leaders are spending their time and efforts? Are decisions made with these KPI outcomes in mind? Will the current KPIs lead the organization to make decisions resulting in post-pandemic profitability?

The good news is that membership dues and meetings revenue are rebounding from their 2020 lows, though not to the levels they once were. Boards and staff need to stay proactive, get creative and  remain resilient in the pursuit of your organization’s mission and ultimate goals.