Chapter Restructuring: A Board's Most Difficult Job?

Chapter Restructuring Associations Now January/February 2016 By: Joe Rominiecki

For an association with a troubled chapter system, the path to resurgence is no walk in the park. It begins with a board of directors both bold in vision and open to all possible solutions. With so many members and volunteers holding a stake, it may be one of the toughest leadership challenges a board can take on. Here's how three associations have done it.

Imagine your association as the human body. The board of directors is the brain, making decisions. The staff is the heart, steady at work. And your network of chapters, components, or special-interest groups is the circulatory system, carrying all your energy out to the surface, where the action happens.

When that system of veins and arteries isn't healthy, it puts a lot of strain on the body. And, just as when the doctor prescribes a full-scale lifestyle change to reduce your risk of heart disease, the call to fix a struggling association chapter system will be both undeniable and supremely imposing.

"You've got to do the obvious sometimes," says Paul Stalknecht, president and CEO of Air Conditioning Contractors of America (ACCA), "and sometimes the obvious is a very professionally gutting experience."

We're loyal to causes and people. And that's not how chapters are built. So we have to rebuild them for the knowledge age. Peggy Hoffman, Mariner Management and Marketing LLC

Association boards, be warned. Chapter networks in many membership organizations are showing their age, says Peggy Hoffman, president of Mariner Management and Marketing LLC. Hoffman specializes in volunteer management and says she has seen an uptick in associations seeking guidance on chapter governance overhauls in the past five years.

Chapters "were built for the industrial age," Hoffman says. "We're not loyal to organizations anymore. We're not even loyal to our professions. We're loyal to causes and people. And that's not how chapters are built. So we have to rebuild them for the knowledge age."

Easier said than done, but this is what association volunteer leaders signed up for, right?

Look Before You Leap

"It's probably one of the most strategic decisions the board can make and probably one of the most significant, because you're totally changing not only the organization itself. You're also changing the culture within the association community," Stalknecht says.

In March 2015, the ACCA board of directors voted to eliminate the requirement that members join their local chapters and the national organization simultaneously. The move came after several years of deliberations over stagnating membership growth, but ultimately it was the board's decision whether and when to "rip the Band-Aid" off, as one staffer put it.

With so many volunteers invested in an association's chapter operations, the stakes— and emotions—are high. To justify a change to the association's fundamental structure, a board must have both a detailed understanding of its current state—strengths and weaknesses—and a clear vision for where it wants to go.

At the Alzheimer's Association, that vision is to match the "steep trajectory" of Alzheimer's in coming years with an expansion of research funding and patient and caregiver support, including a goal to double revenue to $450 million by 2019. Alzheimer's Association Board President Stewart Putnam calls this the "burning platform" that galvanized the organization to adapt its chapter structure toward pursuing its vision.

After more than a year of exploring options and gathering input from executives and volunteers at its 81 chapters, the Alzheimer's Association board voted in October 2015 to unify all its chapters under the national organization; chapter staff became national employees and chapter boards were freed of fiduciary duties to focus on local fundraising and program implementation.

But it wasn't reorganization just for the sake of reorganization. "We didn't box ourselves in with a position from the outset," says Putnam. "We said, 'What does the organization need to do if it's going to be as effective as possible and the leader in the Alzheimer's space to really make significant progress against the disease?' "

With that vision in sight, a board will also need a firm grasp of its bylaws and what's required to enact a change, such as a delegate or member vote. And then it must be ready to act in unison and own the decision.

Rules of Engagement

Before reaching any formal decision on a chapter change, however, an association has an informal, but perhaps equally important, decision to make: how to involve the chapters themselves in the process of designing their future.

To Hoffman, the choice is clear. Engage the chapters, and even at-large members, to develop a solution that meets the needs of all stakeholders.

"What we can do in that discovery process by having the chapters involved is we can understand what is truly not working or broken and make sure the system addresses that," she says.

Our data was telling us that the primary reason people left the organization was the chapter experience. Jay Donohue, CMP, CAE, International Association of Administrative Professionals

This was the path the Alzheimer's Association followed closely. Once the board knew a structural shift was needed, it formed two task forces, one with 14 chapter executives and one with 14 chapter board volunteers. It also surveyed volunteers and staff. Those efforts resulted in two proposals in February 2015: a more integrated version of its existing federation model and a single, unified national model.

The board conducted further listening sessions, and another work group of 14 chapter board members was formed to offer additional input. Meanwhile, Putnam and CEO Harry Johns met with nearly all of the chapters at least once before October, when the Alzheimer's Association delegate assembly met and voted. That nonbinding vote was evenly split among the chapters, but it was enough support for the board to vote later in October to proceed with the unification plan.

ACCA's board, meanwhile, studied its challenges for about three years, during which the board sought input from chapter executives and volunteers on what to do about its complicated membership structure. The association had chapters in about half of the United States, each charging different dues amounts.

In its final six months of deliberations, however, the ACCA board chose to not include chapters in discussions. "They had already done that for the prior two years, and they wanted the board to make the decision based on facts and to take the emotion and politics out of the decision," Stalknecht says.

At the International Association of Administrative Professionals, declining membership and outdated, onerous governance requirements led the board to more drastic measures. Complicating matters, says IAAP President and CEO Jay Donohue, CMP, CAE, was that the existing system of 464 chapters had become a liability. "Our data was telling us that the primary reason people left the organization or did not renew after their first year was the chapter experience," he says. IAAP also had a nearly 500-person house of delegates vested with decision-making authority on nearly everything, from dues amounts to policies and procedures.

The board had one point of power in the bylaws, however: It could terminate memberships. Believing the organization was "nearing the state of being obsolete," says Donohue, the IAAP board chose a complete rebuild. It terminated all memberships, adopted a new set of bylaws, and reinstated all members in a single day, installing a new governance structure that replaced existing chapters with a system of "branches" and "local area networks."

It was, to say the least, controversial, and the type of move an association board takes at its own risk. IAAP has thus far survived the transformation, though not without some bruises, but Hoffman says she has seen top-down chapter changes to which members have "revolted," sending the association back to the drawing board.

Brace for Impact

The transition process for a chapter change can be challenging, even in the best of cases. "It is important for board and headquarters staff to remember the members are quite a few steps behind," says IAAP Board Member Dawn Becker. "The board had the luxury of skipping the grieving process; the members did not."

In the rollout phase, responsibility belongs to the association staff to execute the transition well. In fact, planning likely must begin well before an official decision is made, as one of the first questions members will ask is "How will this work?"

Chief among tactical concerns is a communications plan. IAAP, for instance, hired a communications consultant to assist. Board members announced the change alongside staff, and they attended town-hall meetings with chapters to answer questions and listen to concerns.

"I would want to make it very clear to my peers in the chapters," says Hoffman, "that the board is watching and has their best interest in mind and that they have given the staff the resources necessary to make this successful. But, if at any time there were concerns that needed to be addressed, the board remains available and ready to talk."

And it helps—at all stages of the process—when board members have their own chapter experience to bring forward, says IAAP Board Chair Wendy Melby. "I think one of the strongest messages we conveyed to the members was that, as board members, we are also IAAP members," she says, "meaning that these changes were also affecting us."

[This article was originally published in the Associations Now print edition, titled "Chapter Checkup."]

Joe Rominiecki

Joe Rominiecki is a contributing editor to Associations Now.