Short Term Thinking Not Good for Non-Profits

Before I leapt into the role of being a full time manager of a single non-profit I spent years consulting with non-profits and publishing companies.  One of my clients was a trade association with a mission of providing education and services to professionals with a particular role within corporations.  As with many trade associations there were essentially two kinds of members: those who comprised the "core" membership, in this case people who were consumers of the educational and service offerings of the association, and associate members, companies that sold products and services geared towards the core members.  Not surprisingly there were several competitors in just about every service/product category, and since my main function was managing the association's relationship with the associate members and selling them advertising, sponsorships and space at the trade show, I was keenly aware of who competed with whom.

As it happened there were several consulting companies that were competing for contracts with the multitude of core members, and in order to get in front of those members the consulting companies tried very hard to be selected as speakers at the annual conference and instructors at various seminars oranized by the association.  One consulting company in particular spun off a training company and literally created a certificate program for its graduates.  That same company agreed to allow the association to market and produce a couple of two day seminars that were taught by the company's principals and had titles that were trademarked by the company. The seminars were highly profitable for the association, but you can probably guess what kind of feedback I was getting from that company's competitors.  You can also guess how many times I had to defend the association when it was accused of "playing favorites."

Today I just read that my former client has partnered with that same company to provide a professional certificate program for its members.  I can only imagine the reaction from some of that company's competitors, but in my imagining I do hear lots of screaming.  Since I'm not in touch with anyone involved with the association I really don't know what the factors were in this decision, and for all I know it could be the right decision, but I get nervous whenever I see an association get into exclusive arrangements with companies that have services to sell to the association's members. It may just be me, but I'm not comfortable with giving any provider some level of "ownership" of one of the association's core service offerings.  I wouldn't have a problem with a company being a "sponsor" of a class or seminar because that's an opportunity that can be made available to any provider, but literally sharing the service or product ownership is, to me, a big problem.  So these would be the questions I'd ask about the relationship:

  • In the case of dissolution of the agreement who owns the course?  Who owns the copyrighted work, trademarks, etc.?
  • Does anyone on the association's board of directors have a stake in the company?  If so, did they recuse themselves from the vote?
  • What happens to the relationships with the company's competitors?  Did they have the opportunity to bid on the partnership, or do they get the opportunity to engage in similar partnerships with the association in the future?
  • Is the offering something that the association is absolutely unable to provide itself under any condition, or is it simply something that the association can't currently provide due to budget/staff constraints? If it's the latter did the association consider putting together a plan showing what would be required to offer the certification itself and then approach all of the companies to see if they'd be willing to underwrite it in some fashion – most likely long-term sponsorships or grants?

Honestly I think that last question is the most important.  If the association made the move simply because it was more convenient in the short term then I feel rather strongly that it was an erroneous decision.  I can't think of any organization that is successful in the long term when it signs away the right to one of its core products and at the same time risks relationships with some long time, key supporters of the organization.

Again, I don't know the specifics of this deal and I don't know what all the variables the board of directors faced in making the decision, but given what I know about the organization's background I really have a hard time buying that this is the best thing for the organization long-term.  Maybe it's necessary for short-term survival, but let's just say I'm glad I'm not selling ads or sponsorships on their behalf right now.

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