Association Management Company Fee Assessment
If you are managed by an Association Management Company (AMC), we understand the need to assess the relationship and the fees that are charged.
A review of management fees every three years allows an organization to improve and evaluate its current management relationship and identify opportunities for efficiencies and/or realigning fees with industry benchmarks. We have performed management assessments for a variety of trade, business, and healthcare organizations.
Typical management assessments include a comprehensive evaluation of the management fees and staffing structure, a comparison of management models, and in-depth volunteer and staff interviews to identify opportunities to improve and if needed, repair, the volunteer and management relationship.
Some of the services include:
Hourly Rate Comparison – Association Options will determine the current average hourly rate within your AMC and determine how it compares to other AMCs.
Operating Ratio Review – Most association management companies utilize the American Society of Association Executives’ Operating Ratios report as a tool to compare their fees to those of independently managed organizations. Association Options has extensive knowledge and use of these ratios and will apply them to the AMC fee assessment.
Salary Comparison – Using the American Society of Association Executive’s Salary and Compensation Study, as well as our experience in conducting Executive Director and Senior Staff searches, Association Options will compare the management fees against expected salaries for a similar number of Full Time Equivalents (FTE’s) in similar job functions.
It is a fiduciary responsibility of any board of directors to ensure that the fees charged by your AMC are in line with industry data. This will only help to strengthen the relationship between your association and your AMC.
Full Organizational Assessments
There are three models that organizations utilize for the management of their organizations. They include, the self-managed model, the Association Management Company (AMC) model, and the hybrid-managed model.
- Self-managed – A self-managed option is where your organization employs all staff including the infrastructure of the organization.
- AMC-managed – The AMC-managed option is where an association management company would provide all the key services necessary for the operations of the organization.
- Hybrid-managed – This final option is to combine components of the self-managed option with the AMC-managed option. Our services include the review of a core team structure that is supported by an AMC or other outside vendors (i.e. accounting, membership management, information technology, etc.).
- Full-Service AMC Management Review– The AMC-managed option is where all services are provided by one entity and your organization employs none of its staff.
- Self-Managed Option Review – The self-managed option is one in which your organization would employ the entire staff team. This review will map out all potential staff, infrastructure, and other costs.
- Hybrid Management – The hybrid model is a combination of the first two models in that one staff member would be hired, typically the Executive Director, and the rest of the team would be outsourced to an AMC or other vendors. Association Options will develop the model of a core team structure that is supported by an AMC or other outside vendors (i.e. accounting, membership management, information technology, etc.).
We will then present our findings to your board where the models will be fully evaluated so that an informed decision can be made.
Association Options is not driven towards one model or another but driven by the facts we find and where that will lead us in terms of recommendations. Ultimately, this is a fiduciary decision that your organization will make with the assistance of our report and recommendations.