Association Management Companies Positively Impact Association Financial Performance

Written by Bostrom

SOLUTiONS talked with AMC Institute CEO Tina Wehmeir,  CAE, CMP, about the organization’s recent study,  “Association Management Models and Their Impact on Financial  Performance,” conducted by Dr. James Gaskin,  Brigham  Young University.

The AMC Institute represents more than  180 association management companies (AMCs) that manage more than  1,800  associations. It advances professionalism and promotes high standards for its member companies. Combined, AMC Institute members manage more than $1.5B in association budgets.

Through  random sampling, the study  looked  at 167 national  and  international associations  in two categories: small ($500,000 – $2M) and  large  ($2,000,001 – $7.5M). In general, using  an AMC is associated with stronger financial performance. And, regardless of tax status and budget size,  growth in new income, net revenue and net assets are stronger for associations using  AMCs.

SOLUTiONS: Did anything in the survey results surprise you?

TW: I can’t say we were surprised. As a community, we knew about the benefits AMCs offer.  Now we have the hard research to substantiate it.  In some respects, the survey  provides us with a silver bullet.

SOLUTiONS: Why is the survey a silver bullet?

TW: Our strategy is to promote the value of both the AMC model  and  what AMCs bring to associations through the AMC Institute brand. We believe a rising tide lifts all boats and  this survey  provides us with terrific data to tell our story effectively.   We want to extend our reach and awareness and increase our market share among the 86,000 national and international associations.  To do so, we are implementing a series of strategic marketing initiatives throughout the year to raise  both awareness and  action.

For associations that are managed by AMCs, it’s a good reminder of the value they receive – and  for associations contemplating working with an AMC, it offers strong data to support this option.

SOLUTiONS: What’s on-trend  in association management?

TW: We’re seeing a lot of AMCs, particularly in the last 2-3 years, employ  a hybrid management approach.  In other words,  the association provides the executive director who works with AMC staff.  In the past this was used primarily in conjunction with a specific industry segment. However  now we are seeing this more and more frequently in all segments.

SOLUTiONS: As you look into your crystal ball, how would you sum up the health of the AMC industry?

TW: We’re seeing growth in AMCs either organically or through mergers and acquisitions, which means the larger firms are becoming larger.   On the board side, we’re seeing a “changing of the guard” in associations, which may prompt leadership/boards to explore other management strategies, and  this survey  provides us with terrific data to tell our story effectively.

We want to extend our reach and awareness and increase our market share among the 86,000 national and international associations.  To do so, we are implementing a series of strategic marketing initiatives throughout the year  to raise  both awareness and  action. For associations that are managed by AMCs, it’s a good reminder of the value they receive – and for associations contemplating working with an AMC, it offers strong data to support this option.

 

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