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Example In the late Eighties, a new nonprofit association became the focal point for a global movement. City governments, real estate developers, port authorities and communications companies saw their future in a new kind of port: a development that would house leading-edge companies in media, finance, and other industries that were increasingly dependent on advanced global communications. It would provide an on-ramp to the Information Highway that was beginning to transform business. Projects were designed, launched and completed in cities from New York to Tokyo, Rotterdam to Rio de Janeiro. The annual General Assemblies of the association attracted senior executives and technologists from real estate companies, port authorities, construction firms, telecommunications carriers, hardware manufacturers and municipal governments around the world. The city of Tokyo took an interest-free loan from the Japanese government, funded by the privatization of the national telephone company, and spent $3 billion constructing two artificial islands in its harbor, fully wired with optical fiber and boasting its own satellite communications hub. Enter the Internet And then, in a few short years in the 1990s, the movement hit a dead end. The business model underlying the development projects developed a gaping hole. What need was there for a purpose-built development offering advanced communications systems when the Internet – growing at explosive speed – put global communications on every desktop? The Tokyo project became a hugely expensive white elephant and similar projects around the world were severely downscaled or canceled. From significant annual surpluses, the association plunged into growing deficits as members canceled and events failed to draw audiences. The Board considered closing the organization but first asked Alan/Anthony if there was a way to renew its mission and make the organization relevant again. Finding the Core Our analysis found that the association had a significant share of remaining members in satellite communications. While other associations existed in that space, there was none addressing the specific needs of companies operating the ground-based side of the business. It was a niche that played a vital role in connecting the globe but was largely made up of small-to-midsize companies operating far from public view. We proposed a long-term plan to make this group the core membership of the association and were engaged to manage the group. In the first year, we slashed $100,000 in expenses to restore the budget to balance. We then began building programs to attract and retain commercial satellite service providers while continuing to service the needs of the remaining real estate, construction, port authority and government members. Managing Major Change It was a challenging and delicate transition that required nearly a decade to complete. During that time, the association suffered the potentially catastrophic loss of 40% of its members generating half of its revenues – but more than replaced them with new members from the core sector. Total membership rose 60% over the period and average revenue per member climbed. By 2010, the association had become a respected voice representing the interests of its member, and delivering programs that reduced their operating costs and improved their operations. The Board, once an eclectic mix of officials and executives from many industries, had become a cohesive group of satellite communications decision-makers who led their sector of the industry. |
