Adjusting Budgets Impacted by Crisis
March 31, 2020
Rebound!
May 19, 2020
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Written by Bob Harris, CAE and William Pawlucy, CAE

 

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After a devastating weather event neighbors emerge in shock, asking “are you okay?” 

 

Recovery starts fast.  You hear the chainsaws clearing driveways and streets.  Piles of rubble begin to line sidewalks.  A weather event comes on fast and ends abruptly.

 

The coronavirus pandemic and severe economic disruptions present new challenges for associations.  Damages and duration are unknowns.  Associations are concerned about membership, meetings and their own sustainability. 

 

Associations, chambers and the nonprofit sector are well-positioned to lead recovery for their communities.   They have been resilient during wars, weather events, economic downturns and prior pandemics.     

 

“Associations were made for times such as these,” said a Ukrainian executive director facing conditions like the USA.

 

Association Strong

Associations are experienced at organizing.  They are skilled at harnessing the expertise of volunteers.  They know the power of coalitions and collaboration.  They are proficient at creating action plans and driving results.   Innovation and strategy are their nature.

They have the technology to connect members with solutions. They are experts at leveraging resources.   They are the primary advocates for member interests to the government and press.  They have established internet and social media platforms.

It may have been said best in April by the managing director of the International Monetary Fund, “…we will get through this, but how fast and how effectively will depend a lot upon the actions we take.”

 

Recovery is a Process

Approach recovery systematically.  Identify and muster resources.  Assess the internal and external conditions.  Organize your SWOT – internal Strengths and Weaknesses, external Opportunities and Threats.   Avow to be the champion for the membership.

Galvanize the board, staff and committees.  Agree upon the mission, “Organization sustainability while delivering value to members.”    Let the association or chamber be the loudest champion for the community it represents. 

Work systematically — prioritizing, implementing and evaluating.  It is a mammoth task, so remember the answer to eating an elephant, “one bite at a time.”  

This article should guide discussions amongst board and staff.  Share it with the executive officers.  

Tasks will be immediate, medium or long-term through 2020 and 2021.   Revamp  committees and strike forces to advance the recovery.  

 

Recovery Grid

Create your “Recovery Grid” as a template or spreadsheet identify the strategies, track assignments and gauge progress.

Recovery Grid – ASSOCIATION STRONG
Tasks Notes,

Timeline and Prioritization

Workforce Assignments
Example
#1 Evaluate and create a contingency budget. Survey program damage, evaluate 2020 expenses, draft anew this month.    Treasurer, finance committee and exec dir.

 

INFORMATION

 

All Clear – Wait for the government all-clear signal before planning reunions and meeting in person.  Take abundant precautions to protect people.   Don’t be surprised if you need to purchase face masks and a non-contact thermometer as part of your meeting tools. Listen to municipal, state and federal government on guidelines for the number of people allowed in a group or recommended safe practices.   If meetings and travel are restricted for a period, use the time to bolster internal operations.

 

Board Meetings – Most groups were meeting quarterly.  Determine if more frequent and focused meetings are needed during the recovery phase.   Empower the executive committee and CEO to make decisions within their purview.   Revamp meeting agendas to be shorter, avoiding the lengthy reports and updates on traditional agendas.  Rules of order may have to be relaxed.   Maintain a focus on the mission: Organization sustainability while delivering value to members

 

Poll the Members – Poll members’ needs.   Find out who is doing what to lead their recovery efforts. Take the best practices and share with your members while finding solutions for the gaps identified.  Inventory other industry organizations about the resources they’ve found for recovery.  Set a mechanism for 24/7 sharing.  

 

Keep Members Informed – Members want to rely on a credible source.  It should be their association.    Set up regular weekly updates, virtual town halls, pull out inspiring stories, and allow your members to share and empathize.  There are many platforms for communicating and connecting with members. 

 

Assess the Damage – Most organizations now realize the damage in the forms of cancelled conferences, sponsor abandonments, slowed dues.   Categorize them by department or the goal areas of the strategic plan.  Have leadership and staff discuss the economic and societal impacts.   What can be salvaged? What restructuring must take place?  Adapt, revamp and salvage programs and events.  

 

Restart – While working away from the office, processes such as maintenance contracts, cleaning services, consultant agreements, website renewals, filings, etc. may have lapsed.   Review what must restarted to return to an efficient organization.  Under the circumstances, some contracts may need to be renegotiated.

 

Triage – In healthcare, triage is used to determine the best treatment options for an array of patients.  As the economy recovers, so will subsectors within the association. Triage needs and deliver solutions as the sectors recover within the association.  A coordinated response for sector-by-sector will be important rather than trying to be everything to everybody at once.  Triage to set short, medium and long-term priorities.

 

PEOPLE

 

Team – Recovery will be a mammoth task for some associations, needing a dedicated team.   Of course, it will include the elected officer and the executive directors.  Maintain a can-do attitude, setting a vision of the desired outcome.  Make best use of technology and virtual collaboration until meetings return to face-to-face.  As with all association efforts, create a program, evaluate and adjust.  This is the time for a program of work including assignments and timelines.

Staff – Staff may have suffered during the furlough or layoff.   Discuss their needs and ensure they know what to do if they are infected or a family member.  Offer support to get them reengaged with their jobs working at the office or from a distance.  Review the personnel manual to be sure the association and staff conform, being lax with areas such as time off and personal needs.  Flexible work arrangements should be discussed.  Tend to their well-being.   Look for financial assistance to prevent layoffs or downsizing.

 

Leadership – An association has a variety of people working for it, some paid professionals and others committed volunteers.  Inventory and unite the team, everyone will have a hand in the process.  Decide which teams are best for varied projects, for example the treasurer will study finances to write a contingency budget. The desire is for everybody to be strategists and innovators.    The board will set strategy and direction, strike forces will tackle specific areas, and staff will administer programs. They all need a clear vision of their responsibilities in the recovery process.

 

Committees – Revamp the committee structure.  Appoint strike forces and quick action teams to respond to immediate needs.  Give them the information and tools for collaboration, asking them to develop solutions for association and membership.  They may need to conduct assessments, focus groups, and create initiatives. Empower and enable them to get their work done as part of the recovery effort.

 

Governing Documents – The governing documents, especially bylaws and polices, provide a framework for board processes.  They may have to be relaxed for a period.   For example, elections will be delayed, the nomination process interrupted.  Current directors may need to serve an extended term of six months or another year.    Prescribed dates for nominations, budgeting and the annual meeting should be reconsidered, if laws are not violated.  Work with legal counsel and know your state statutes.  Check with the Division of Corporations to determine if an annual meeting formality can be postponed or conducted on-line.   

 

RESOURCES

 

Contingency Budget – Adjust the current budget based on immediate and short-term needs.   Adjustments will be made for cancelled programs or sponsorships cancelled or postponed.  Maintain a positive outlook, this is not a slash and burn exercise.  If reserves and assets exist, think how they can be used or leveraged.   Read the article Adjusting Budgets Impacted by Crisis for tips and advice.

 

Dues – Expect hardships to be expressed by members.   Some may not be able to pay their dues.  You don’t want the coronavirus to dismantle years of building a successful membership.   The customer-member relationship is invaluable.  Flexibility and adjustments may need to be made.   Consider extending current members by a period of months.  Waive dues for members who simply cannot renew now.   Allow for making smaller payments. 

 

Grant and Resources – The Congressional recovery packages, as well as state and municipal governments are making resources available so you can retain staff and continue operations.   Associations and chambers are often good administrators of programs.  From the Paycheck Protection Program to the COVID-19 Economic Injury Disaster Loan Program, it is incumbent on the organization to be alert to the programs for their use and the benefit of members as there will be future phases of potential assistance.    Ask your CPA to research available funds.   

 

Publications – Make use of established publications.  With public doubt and unrest, use channels of communication to demonstrate strength.   This may be the best time to transition to digital editions.   Evaluate the essential publications and drop those with declining value.  It may be difficult to eliminate publications because some members preferred printed copies.  This may be the catalyst for a review and revamping, consider expediency of news, advertisers, return on investment. 

 

STRATEGY

 

Risk Management – Now is the time to review association risk.  There may be claims made from damages.   Ask insurance counsel about upping coverages where it may have been lacking.   Use the time to consider pandemic impact and how risks can be mitigated. Did the organization have the proper coverages, policies and practices?

 

Strategic Plan – A good existing plan can serve as the framework for recovery.  Determine which strategies are critical for 2020.  Some goals can be put on pause. Most likely the plan has three to six areas of core competency or goals.  Prioritize. For example, is professional development a priority over business and member survival?  The framework can be used for creating short and long-term initiatives, redeploying people and resources.  

 

VALUE

 

Fast and Furious – You don’t have to be first, but you must show progress and results.   Members will find other resources if they feel they can’t wait for their association board and committees.   Delaying recovery efforts in hope that “things will be better next month,” is a bad tactic.  Position your association as a model for coordinating resources and solutions. Responsiveness at this time can be considered a valued member benefit.  Maintain a speed that shows the association is working diligently.

 

Repurpose the Foundation – If there is a subsidiary foundation focused primarily on education, ask its board to add “pandemic recovery” to their mission.  Inform members that the foundation has expanded to serve their needs with grants, waivers and support.  Position the foundation as an active tool and partner of the association.   

 

Advocate – The association best knows the pain and needs of members.   Government relations should continue to represent member interests.   There may be needs to fight for tax relief, incentives, and relaxation of laws.  Position the organization as the members’ primary advocate. Most importantly, find innovative ways to get your message to lawmakers during times of quarantine and a lack of public meetings.

 

Value Proposition – Continue to communicate value to the membership.   They need to know the association is strong and the programs remain in place.   If the value proposition is weak, use this time to assess programs and better communicate the return on dues investment.   When it is time for dues renewal, be in a position where members find the association an indispensable partner.  Don’t let programs such as education and member support suffer because 100% of the team is focused on recovery; maintain a balance to continue customer service excellence.

 

Stop – There are programs that have lost relevance but continue because they are someone’s pet project.  With tight resources, appoint a task force to prioritize activities, events, programs and initiatives.   Anything with minimal relevance may need to be dropped or revamped.   It is called purposeful abandonment.

Lessons Learned – Lessons will be learned through this process.   Capture the lessons that are innovative for future use and preparedness.  Create a platform for sharing successes with other organizations that are struggling.  Write inspiring stories about innovation and survival. Highlight members who are doing unique things to recover.  This too shall pass, and future generations will be inspired by the resiliency, innovation and determination.  

 

Celebrate – If a recovery plan is set, with deadlines and assignments, be sure to celebrate milestones and victories.   Don’t lose sight of the goal of returning the association, and its membership, to a prosperous position.  This process will be tiring, be sure to take care of yourself.

 

Regaining momentum after a sustained period of uncertainty and depression may be difficult.   Do not lose hope.  Use the guide to strategize and prioritize.  Deploy resources and engage the leadership for a coordinated recovery.  Keep members and the community informed.

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Note:   Bill Pawlucy, CAE, is president at www.associationoptions.com. Bob Harris, CAE, provides free governance tips and templates at www.nonprofitcenter.com.