1800 READERS: THE MAGAZINE FOR MICHIGAN ASSOCIATION PROFESSIONALS
MSAE.ORG | SEPTEMBER/OCTOBER 2017
Better Together MSAEâ€™S NEW INITIATIVE TO SPOTLIGHT ASSOCIATION PRIDE
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P R E S I D E N T ' S M E S S AG E 4
A NEW MSAE MSAE unveils its new structure.
A S S O C I AT I O N KNOWLEDGE 6
FUNCTIONAL EXPENSE ALLOCATION CHANGES FOR ASSOCIATIONS Associations are learning about the allocation changes — and raising questions.
WHAT’S YOUR FLAVOR? 11
Tips to assess your association’s mobile app-etite
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Keep Learning in Third Thought
Visit www.thirdthought.msae.org to enhance your membership experience. You can search through more than 1,200 MSAE magazine articles, MSAE podcasts, and sample documents all tagged by subject area. Or find resources categorized by the following areas: ▸▸ Personal Awareness — improving your leadership abilities and self-awareness ▸▸ Association Knowledge — gaining expertise in all aspects of association management ▸▸ Industry Understanding — understanding the importance of the industry, profession, or cause your association represents
P R E S I D E N T ' S M E S S AG E
A New MSAE By Cheryl Ronk, CAE, CMP
Cheryl Ronk, CAE, CMP
(firstname.lastname@example.org) is the president of MSAE. President's Message is a regular feature in Association IMPACT magazine. If you’d like to stay up to date between issues, follow her blog posts on LinkedIn at http://bit.ly/2nrYCGX.
If you have recommendations or questions please contact me at email@example.com or 517.332.6723.
nsuring a knowledgeable and successful community is MSAE’s mission and it is core to our long-term success. Because we are a memberfirst organization, MSAE has continuously experimented with the best means to deliver a unique and enriching experience to members. In this era of rapid technological, social, and economic change, how we serve members must reflect the new realities of our society. That’s why after conducting a comprehensive analysis of overall operations, the MSAE board has approved the New MSAE. Like many organizational redesigns, we are looking toward future member needs. This will result in increased investment in some places and redeployment in others. The board approved a budget that rightsized MSAE for the future and positions the organization to have a successful change in CEO leadership coming Fall 2018. As a result, MSAE determined which programs to sunset and which to expand. Here is a glimpse of what is rolling out in the coming year: AA Offer four key events, all reinvented for member experience enhancement: Annual Convention, Legislative Conference, Fall Symposium, and Winter Symposium. AA Focus on programs specific to the association sector and member needs. AA Expand the use of Third Thought.® AA Evolve the Law Symposium into a legal resource response with live and recorded webinars. AA Expand in-person and online communities of practice, and use the ideas generated there to create programming. AA Offer more webinars. The changed scope of work, made it necessary to redesign every staff position. The new positions were created to reflect the changing landscape of association management, provide enhanced sharing of resources, and facilitate a higher level of collaboration:
PRESIDENT/CEO CHERYL RONK, CAE, CMP, FASAE To implement the strategic plan and create a progressive, future-focused
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organization that attracts members. Make MSAE the one organization no association employee can afford to be without.
CFO OF MSAE AND GENERAL MANAGER OF MSAE SERVICE CORPORATION DENISE AMBURGEY To provide opportunities for members to receive unique services or save money in services. To maintain the operations of the organization.
STRATEGIC MARKETING MANAGER SHAWNNA HENDERSON To create and implement marketing plans.
CERTIFICATION MANAGER KRISTY CARLSON, CMP Responsible for the certification programs we offer and to help customers achieve and maintain their certifications.
CAREER ENRICHMENT MANAGER MARYANNE F. GREKETIS, CMP Responsible for design, marketing, and implementation of those elements that expand one’s knowledge of association management through tracks of learning.
MEMBER SERVICE COORDINATOR KELLY CHASE, CMP Responsible for the customer touch for our offerings to members and assists with education design.
ASSOCIATION COMMUNITY MANAGER ANGELA DEVRIES Responsible for the interaction among and between members and customers, maintaining and growing the member base.
ASSOCIATION INDUSTRY ADVOCATE POSITION AVAILABLE To foster a healthy public policy environment for our members. This structure will allow MSAE to serve stakeholder in an affordable way. We are excited to serve you in our new capacity and eagerly await a chance to engage with you as the New MSAE.
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A S S O C I AT I O N KNOWLEDGE
Functional Expense Allocation Changes for Associations
Associations are learning about the allocation changes — and raising questions.
By Wendy L. Thompson, CPA, and Timothy P. Crossen Jr., CPA
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onprofits with fiscal years ending December 31, 2018 and later will implement the new nonprofit accounting standard, FASB ASU 2016-14, Presentation of Financial Statements of Not-for-Profit Entities (ASU 2016-14). This new standard is comprehensive and the first significant change to nonprofit accounting in 20 years. This article focuses on changes relating to functional expenses. Under the current standards, only voluntary health and welfare organizations must present a statement of functional expenses that displays, in a grid format, natural and functional expense classifications. Under the new standard, all nonprofits will be required to provide an analysis of expenses by their nature and function. For organizations other than voluntary health and welfare, this will be a brand new statement or extensive footnote; we recommend a statement for most organizations. In practice, these organizations should have already had a supporting schedule in their financial statement work papers showing how
they got from the natural expenses to the functional classifications currently required to be disclosed. However, many organizations may have instead relied on estimated or historical percentages to calculate functional classifications.
If your organization has not previously prepared a statement of functional expenses, first consider how you will accumulate the allocated expenses. One option would be recording expenses directly into your accounting software, which may require a change in your chart of account structure. A second option would be maintaining your current chart of accounts and allocating expenses during the financial statement preparation process. Regardless of the method, changes to your internal control structure may be necessary to track and record the information needed to properly allocate these expenses for both natural and functional categories.
Preparing Functional Expenses
The first consideration for preparing functional expenses is what line items make up natural expenses. In most cases,
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...all external and direct internal investment expenses (that are not for programmatic investing) must be netted against investment return and shall not be included in the analysis of expenses by nature and function. this will be a straightforward exercise, and your existing natural categories may be sufficient. However, under ASU 2016-14, there are a few changes worth mentioning. First, all external and direct internal investment expenses (that are not for programmatic investing) must be netted against investment return and shall not be included in the analysis of expenses by nature and function. Second, all other expenses shall be reported by their natural classification. For example, if special event costs are netted with revenues on the statement of activities, those special event costs must also be included in the natural classification, such as rent or food, in the analysis of expenses by nature and function. Third, gains and losses are not expenses and must be excluded from the analysis. The second consideration is understanding the differences between the types of functional expense classifications. Every natural expense has to be allocated into one or more functional categories. Every organization should have three types of functional expenses (program services, management and general, and either fundraising or membership development.) If your organization is required to do GAAP financials, this allocation must be done in grid format with each natural expense listed as a separate row and each functional category as a separate column.
Program Service Expenses
Why is the organization tax exempt? What
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good does the organization do that merits tax-exempt status? What things are done that directly result in that good occurring? What are the expenses needed to do those things that directly result in the good occurring? Examples include: AA Salaries of direct program workers
AA Salaries of those who are direct supervisors of the direct program workers AA Salaries of those who are in charge of tracking eligibility for program services AA Benefits related to those individuals
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+ AA Costs related to those individuals
having a place to work, for example rent, telephone, utilities + AA Costs that directly benefit the program
A fundraising expense is any expense incurred for the purpose of obtaining contributions. A contribution is something of value provided to the organization whereby the donor receives nothing or something of substantially less value in return. Note that if an organization has contribution revenue, there is a presumption that it has fundraising expenses unless all fundraising is performed by volunteers (these situations should be documented).
EXAMPLES OF FUNDRAISING INCLUDE
AA Salaries of fundraisers or fund development AA Salaries of grant writers, if those grants are contributions AA Benefits to those individuals
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AA Costs related to those individuals having a place to work such as rent, telephone, and utilities AA Postage and printing costs for appeals to the public for contributions AA Maintaining donor lists AA Publicizing and conducting fundraising campaign
Membership Development Expenses
This is similar to fundraising, but instead of obtaining a contribution, the organization is obtaining an exchange transaction for membership revenue where the purchaser receives something of commensurate value for their payment. If there is membership revenue, there would be an expectation of having membership development expense (which is neither a program service nor a management and general expense.) Examples include: AA Salaries of those trying to obtain additional members
AA Salaries of those who are responsible for assisting members with membership benefits AA Benefits to those individuals AA Costs related to those individuals having a place to work such as rent, telephone, and utilities AA Costs of membership recruitment materials
Management and General Expenses
These are expenses necessary for the operation of any organization. However, they are necessary based on the organizational structure rather than based on the mission of the organization. Think of things that all entities have to incur as expenses that do not fit into items listed previously.
AA Salary of the executive director AA NOTE There is a rebuttal presumption that the executive director is management and general. If they are directly conducting or directly supervising programmatic services — not just supervising all employees — or fundraising, a portion may be allocated to another functional category. AA Any type of general record keeping such as board minutes, payroll, accounting, budgeting, financial statement preparation, audits, or tax returns (Note: This includes accounting, even accounting that is specific to individual grants that are for program services. It does not include tracking eligibility for a particular program.) AA Legal services AA Procurement (purchasing) personnel AA Incorporation fees AA Annual reports AA Financing AA Soliciting non-contribution and non-membership income, such as soliciting customers for goods AA Administering contracts including government or foundation grants
Prior to ASU 2016-14, some organizations had a generic note that indicated expenses were allocated using percentages and that
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management believes this is a reasonable approximation of actual costs. Under ASU 2016-14, the financial statement notes must include more detail as to which types of expenses are allocated, and under what method. Essentially, the functional expense allocation disclosure must state what natural classifications were allocated and an explanation of what methodology was used to allocate them. Direct allocation is the preferred method when it is reasonably efficient. This is assigning each expense (i.e., invoice, line item on an invoice, individual employee) to a functional category based on direct usage. Indirect allocation is used when the direct method is too burdensome. This is using a rational and objective basis to allocate expenses based on financial or nonfinancial data to the functional expense categories. Note: smaller, less-major natural expenses are typically allocated in proportion to some major natural expense.
Salaries and Wages
This is almost always one of the largest expenses for an organization. Here are two ways to allocate salaries and wages: 1. If you have employees who work on one functional category, you may be able to allocate directly based on the salary descriptions. 2. FOR EXAMPLE employees who solely fundraise could have their entire salary charged to the fundraising function. 3. If employees work on multiple functions, a time study will be necessary. Time studies can be ongoing, where employees track their time daily to each functional category (including specific programs). This is a direct allocation. Time studies can also be performed over a brief period of time. For example, employees can track their time working each function (including specific programs) for one week to one month and use that allocation for the year. The period chosen should be representative of functional activity occurring throughout the year.
Benefits relate directly to the employees for whom the salaries and wages relate, so the allocation of benefits should be similar to salaries and wages. This allocation is almost always done on an indirect basis proportionate to the salaries charged to each function.
or a phone call) or run a study similar to the salary study to track usage. For less significant costs, you can make a determination of how those costs are used in conjunction with other costs. For example, if the larger the office the more copies are being made for a person, you might allocate copier expenses based on occupancy cost.
These costs include rent, utilities, insurance for the building, repairs and maintenance, depreciation, etc. These also are typically significant expenses that will use an indirect allocation: 1. If occupancy usage is commensurate to salary you can allocate based on the same percentages as salary. FOR EXAMPLE the executive director might be paid twice as much as an entry-level program staff person; if the executive director’s office is approximately twice the size of the entry-level program staff person’s cubicle, this would be an efficient and effective way to allocate. 2. If occupancy usage is not commensurate with salary you may allocate occupancy costs based on each function’s use of the building. Determine the square footage used by each individual, and use the individual’s time study results to allocate their square footage’s costs of occupancy. FOR EXAMPLE Occupancy is $100,000; total square footage is 10,000 square feet; Sally uses 100 square feet; Sally’s salary is allocated 50 percent program and 50 percent fundraising. Therefore you would take 100 square feet of Sally’s space, divided by 10,000 total square feet, times $100,000 occupancy costs, times 50 percent, to get $500 charged to program and an additional $500 charged to fundraising.
For other significant costs, either track directly how much went to a specific functional category (such as having to enter in a code each time you make a copy
1. Determine if the chart of accounts will be updated to provide functional expense information throughout the year or if Excel spreadsheets will be used to do allocations at the end of the year. 2. For those items that may not currently be tracked by natural expense classification, such as cost of goods sold and special event expenses, determine the best method to capture that information, which may include updates to the chart of accounts. 3. Review the definitions of program, fundraising, membership development, and management and general to ensure that your
Keep Learning in Third Thought®
Search for the resources listed below in the digital library on MSAE’s knowledge management platform: www.thirdthought.msae.org
Read ▸▸ Cost-Reporting for Nonprofits ▸▸ Hot Tips for Presenting Financial Data To Your Board
Listen ▸▸ Financial Management for Nonprofits
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understanding matches the new definitions. Consult with your CPA firm early and often for clarification, especially if you have audited financial statements. 4. Determine cost allocation methods for material expense accounts, and create internal controls over those allocation methodologies.
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MSAE’s CFO explains why the association uses ClickTime for functional accounting. By David Klein Through ClickTime, MSAE has gained a deeper understanding of its operational expenses, improved program management, and increased employee productivity through understanding where they spend their time. Powerful Insights Drive Business Strategy By tracking time, budget, and employee cost data in one unified system, MSAE is able to more effectively manage its business and focus on what matters most — delivering on the mission to help Michigan associations.
“The data in ClickTime shows us what it costs our organization to run a particular event or educational offering,” says Denise Amburgey, chief financial officer at MSAE. Through ClickTime, MSAE has streamlined its operations and increased productivity across the organization. “ClickTime offers so many benefits, it’s amazing,” says Amburgey. “It has helped us understand the true cost and effectiveness of our educational programs and events. It helps with budgeting decisions.” Improved Reporting on Employee Time Rather than manually sifting through spreadsheets or taking educated guesses on where employees are spending their time, ClickTime enables MSAE to understand which programs require the most or least amount of employee resources.
5. Start communicating to users of the financial statements about the changes. Especially communicate if there will be expenses that were previously program or were previously not included in the functional expenses that will now be supporting service expenses. Each organization must determine what it is doing to comply with the new Financial Accounting Standards Board (FASB) standards and how to make it beneficial overall for evaluating the financial health of the organization and its specific programs. Wendy L. Thompson, CPA (wentho@ yeoandyeo.com) and Timothy P. Crossen Jr., CPA (email@example.com) are part of the Not-for-Profit Services Group of Yeo & Yeo. P.C.
“Our supervisors can now see which programs our employees are spending their time on,” says Amburgey. “Before ClickTime, this type of analysis could take hours or minimum time, in that employees would guess. We used time logs on a spotty basis but could not truly allocate staff time.” The reports in ClickTime not only help with the management of employee time, they also provide an easy way to share critical information with auditors. In fact, the auditors required a more sophisticated time log and that motivated the team to start using this software. “At year end, I run a report for each employee to determine where they have spent their time,” says Amburgey. “We share this report with our audit firm, and they allocate the time to each program on our IRS Form 990.” Word-Class Support and Easy-to-Use Timesheets “ClickTime is simple. It’s easy for everyone on our team. Whether we are using the mobile app to track time or reporting on program budgets, ClickTime is clear, intuitive, and built for an organization like ours,” says Amburgey. “The ClickTime support team is responsive and helpful,” she continues. “They take the time to walk us through new features and help us get the most out of our time-tracking data.” 10 ASSOCIATION IMPACT ® < VOLUME 34 > 2017
Try ClickTime for Free MSAE can provide you with ClickTime access for a special member rate of $6 per user per month for association members. Not ready to commit? Visit get.clicktime.com/msae/ for a free trial. Contact Denise today at firstname.lastname@example.org or call 517-332-6723. You are welcome to see our system and the reports.
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What’s Your Flavor?
How to assess your association’s mobile app-etite By Kate Achelpohl
elieve it or not, your members spend more time today on their mobile apps than they do watching TV. They even spend more time on their mobiles apps than they do surfing the Internet. In fact, your average member likely checks his or her mobile phone about 150 times a day. Still wondering if your association needs an app? The truth is, maybe you do — maybe you don’t. So, how can you assess your association’s mobile app-etite? “In some fashion, your content has to be read on a mobile device. How that’s done takes on the business strategy of an organization. It truly all goes back to the membership and what the organization feels they’re going to best engage with,” says Kim Kett, vice president, national accounts, GTxcel, a provider of digital, mobile, and content management solutions for media companies. “You need to focus on the best mobile experience.” “Mobility via the app brings better communication with members,” claims Greg Nasto, former CEO and managing partner, Mousetrap Mobile. “Everything is at a person’s fingertips now because we want information now. Millennials are teaching us that.”
Arm Yourself with Data
The ingredients you choose to put into your app will determine the experience your members have with it, so creating the unique flavor of your association’s digital content must be based on sound decision-making. The decisions will start with what you know about your members and how they access your content. “Like any editorial product, building an app starts with awareness of what your audience wants,” says Mario Medina, editor of ALOA Security Professionals Association’s Keynotes magazine and creative director of Madison Miles Media. Check your web and email analytics, he says, but ask members about their habits, too. Here’s what you need to find out: AA How much mobile traffic does your website attract? AA Where do members view your emails? AA How much time do they spend on mobile apps, and which ones? AA How and where do they want to receive your content? AA Do they want to continue to receive longer pieces in print format? “You need to be willing to put in the work on all sides to create a great experience for the reader,” says Jen Smith, creative director, Network Media Partners, an association publication design firm.
“It’s your communications strategy. “What is your app providing that your website is not?” she continues. “If you feel strongly that you need to have an app, what can you do to make it different? To make it a different experience, with different value than your website?” Armed with the data, you have a better chance of getting your association’s management on board — a step that can’t be emphasized enough. “You really need to get the buy-in of the C-suite,” says GTxcel’s Kett. “It’s important that upper management sees the value — there will be an additional cost. One of the key things the publishing team should do before they even talk to developers is determine what type of investment the organization is willing to make in this.” Bottom line: An app is no one-and-done project. You — and your leadership — need to understand you’re in it for the long haul. You’ll need staff resources, budget, and a EDITOR’S NOTE A gentle reminder that Mousetrap Mobile’s Greg Nasto passed away shortly after this interview. He was a great friend and supporter of MSAE, and we miss him. This article was originally published in Association Media & Publishing’s May/June 2016 issue of Signature magazine.
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marketing plan that goes far beyond the launch. To make that work, start at the top.
Be Ready with the Resources
And then there’s the staff element. Creating issues to be published within the app and then publishing onto the app stores can be time consuming. Furthermore, there are at least seven operating system-native platforms, including Google Play, Apple’s App Store, Windows Store, and Blackberry World, and you have to adapt and post each issue to the platforms you serve. Some of the platforms provide you with the tools, but you still need people with the expertise, time, and bandwidth to actually publish the apps. As an alternative, there are partners who can take on the service part of it, where your publishing team hands off the content to a partner, and the partner publishes it across the various platforms. The National Business Aviation Association entered the app world in January 2013, offering a digital edition of its Business Aviation Insider that was a straight replica of its print version. NBAA soon found the digital flipbook model was lacking in terms of its design and ability to engage readers. In fall 2014, NBAA worked with Bates Creative to design a new, more interactive app, which it launched in May 2015. The whole process — from the initial discussions with Bates and their formal critique of NBAA’s existing magazine to the launch of the app — took about nine months, according to NBAA’s Editorial Director Amy Freed Stalzer. “We ended up redesigning the print edition at the same time, so we decided to fold it all in together and make it a coordinated effort,” she says. Now, a year later, Stalzer’s team does two design variations for each issue of Business Aviation Insider. Once NBAA’s in-house designer finishes with the print edition, it goes to Bates to be redesigned for the app and reflowed into Adobe DPS templates for iPad and Android tablets. Each version is augmented with digital-only sidebars, video, galleries, animation, and links to the NBAA website. The association’s publishing team made a commitment to put in the work to create a great experience for the reader, but it costs time and money.
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Budget is always a factor in publishing decisions, and developing an app is not inexpensive. Depending on the complexity of the app, it can run in the tens of thousands of dollars. Mousetrap’s Nasto was great at pointing out that apps can be a revenue stream, too. “Mobility lends the highest opportunity for sponsorship today. Period. Mobile advertising is it — it’s not the future, it’s today,” Nasto would remind customers.
Drafting Your RFP
“I always come back to this: What’s the purpose of your trade association, and how are you serving your members? The app has to stick within those four walls,” says Morgan Reed, executive director of ACT | The App Association, an organization that represents more than 5,000 app companies and information technology firms that participate in the mobile economy. In practical terms, this means defining deliverables and objectives clearly, remembering that design needs to flow from your audience and your purpose, and making intentional decisions about features. “Your app is a living thing; it isn’t a document,” Reed says. “It’s going to have to continue to grow, continue to be relevant. Are you making sure you’re thinking about your app growing and changing with the way people interact with their devices? That’s why defining deliverables matters so much.” The thought piece of your app-building process can take months — NBAA’s Stalzer says exploratory discussions were a significant portion of their development period — but it’s critical to your success. And that thought process should translate into a request for proposal (RFP), say Chris Adams, Sheridan technology lead, and Theresa Lighty, Sheridan project manager, Technology Solutions. “I would consider an RFP a prerequisite. It’s just good practice. That way, you are providing the app partner with a very defined list of requirements that can easily open up a great conversation with them. It’s also beneficial because it defines what your needs are as a publisher,” Adams says. Another benefit of writing an RFP is that it forces you to think through the project and why you want the app. “Maybe
a mobile app isn’t the way to go. Maybe you just need to mobile-optimize your website. That’s something that should be thought through in the beginning,” Adams adds. Lighty says the RFP should look to the future, including details such as any changes you might make in your workflows or the software you’re using. “If you don’t have a provider that can support you where you are now and where you’ll be in the future, you need to think about a different provider or what they can do to offer you that support.” But before you even reach out to developers, do your homework. Check their track records, and whether they’re keeping up with technologies and making sure their solutions are at the front of the market. Transitioning to a new product or a new developer down the road can be very difficult, ACT | The App Association’s Adams cautions.
Choosing a Platform
Will you build a native app, a hybrid app, or a web app? Good question, you say? Simply put, a native app is built in the language of the device, whereas a hybrid app is built in HTML but wrapped in native dressing. A web app runs through your web browser, but behaves like a resident app. You’ll need to educate yourself and your team on the platform, what you need to build it, and what you need to submit to apps stores for approval. Your choices will affect workload and budget. For example, if you make a custom native app, you’ll have to update code whenever the platform is updated. With hybrid apps, you sign up for a service and use customized versions of templates, which can save money — if it’s the right product for you. Appin-a-box products such as ShoutEm and Mobile Roadie are hybrids. “Do your homework on the available platforms and ask questions. Whether you’re working in-house or hiring an outside agency to develop your app, there’s a lot of technical information that you’ll need to gather and understand to get it done,” says Matt Martz, project manager, Bates Creative. “Be sure to have a clear set of goals for your app before you begin the process to ensure all parties are on the same page from the onset.”
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The developer or agency you choose should be able to provide a roadmap of milestones for the process, he adds. And that’s another aspect to consider: the scope of the app. “Publication apps have been evolving more and more into their own aggregates of content over the past few years, and that will continue to occur,” Martz says. “It’s clear that digital flipbooks don’t bring in the engagement with users that’s needed for them to be successful.” Martz says his firm has seen a growth in the number of association publications that are leveraging their apps as offline mini-websites to serve multiple areas in an association. “This is a strategic way of bringing various departments together to not only fund the app but to also keep the content fresh and engaging for members,” he points out. NBAA, for example, put its publication at the center of its native app — a starting point rather than a destination. Members can access a library of magazine issues and select resource content such as advocacy publications, operational references, and news stories residing on the NBAA website. Articles in the magazine library contain interactive graphics, links to NBAA member resources, photo galleries, and expanded sidebars. “In looking at updating, we wanted to move away from the digital replica to something more optimized for mobile,” says Stalzer. The app is a content hub for your association, another channel for you to use in pushing content out to your members — magazine content and potentially other kinds. The app also offers the ability to download entire magazine issues for offline reading, which becomes important when readers don’t have access to Wi-Fi.”
How will you offer your app? Will it be a stand-alone item? Will it be free? Will it allow in-app purchases? Will it be included as part of a subscription? “The majority of app developers know publishers will want some type of subscription component — anywhere from registration or membership — so the app will have to communicate with the member
database. Make it part of the discussion,” says Sheridan’s Adams, noting that in his experience, at least half of publishers want some sort of authentication component. And what if you want a combination of free and authenticated content? Make sure to review that point with the developer and address it in your RFP. “This is so critical for associations. Associations have proprietary information, behind a wall, so then you have to build in entitlement services for your app,” says ALOA Security Professionals Association’s Medina. “Who will have access to the app, and which content are they entitled to get? Can a member continue to use it after membership expires? Entitlement is a tricky issue to consider and can be an expensive part of the whole development process.”
The Launch Is Only The Beginning
Network Media Partner’s Jen Smith says association publishing teams must also recognize that there’s a change in mindset involved in all this: Your job will morph — from magazine editors to content providers. “If you’re determined to have an app — and you have done the research with readers and members — do it for the medium. You want to give readers a good experience that they’ll enjoy. Create content for the medium, not a medium for the content,” Smith says. And, as with any ongoing project, track the results. Review your analytics regularly to see what resonates with your readers. “If you build it, they will come,” only works in the movies. As you develop your app, develop your marketing strategy. “The best app in the world won’t do anything if it’s not promoted right. That means ongoing, sustained efforts,” ALOA’s Medina says. Stalzer says NBAA uses content marketing to promote the app. NBAA launches each bimonthly issue of Business Aviation Insider in the app and works through a series of tactics: posting articles (with an ad for the app) on the website, in the newsletter, social media, directed promotions, and targeted emails. “In any way someone might access our content, we try to make it easy for them to find the app from there,” she says. “We made a decision that we wanted to
make our content as available as possible to our members on multiple channels.”
Apps will change along with consumer demands, says Sheridan’s Adams. “What you see today isn’t going to look and function the same in two to three years from now. At least, I hope not,” he predicts. ”They’ll look different, they’ll incorporate new features. The ones that do that successfully will be the ones that continue their existence into the future.” But, he says, what makes a great app today will likely remain the same: AA Engaging, relevant content — some of it unique to the app AA A balance of impactful, targeted advertising AA A clean and intuitive design interface AA An easy-to-use subscription and/ or membership component As for NBAA, Stalzer sums up the association’s app experience like this: “It really showcases our storytelling. The photography looks beautiful. Readers go in, spend time with the content, then go back and use it again and again. People go back and use the older issues in the library, so the more issues we have, the more valuable the app will become. “Some of the best content we have appears in this space.”
Kate Achelpohl (email@example.com) is a freelance writer in northern Virginia and a member Association Media & Publishing’s Content Creation Committee.
Keep Learning in Third Thought® Search for the resources listed below in the digital library on MSAE’s knowledge management platform: www.thirdthought.msae.org
Read ▸▸ The Mobile Era ▸▸ Make Way for Mobile
Listen ▸▸ Theme of Trends in Association Research and Marketing
ASSOCIATION IMPACT ® < ISSUE 5> 2017 13
Better Together MSAE launches new initiative to celebrate and build pride in the association profession.
ssociations create identity and unity in an industry or profession. They are the muscle behind the members’ collective effort toward a common goal. Because of associations, we have better informed lawmakers and officials, not to mention the impact associations have had on the public for centuries. Associations often lead the way in developing professional codes of ethics and product standards. So, it’s no surprise that the individuals who choose to dedicate themselves to this line of work as association professionals are very proud of what they get accomplished on behalf of their members. It is a kind of servant leadership that puts very smart, humble but confident people in a field where they can do the most good. That said, because of the members-first attitude assumed by most associations, professionals in this field have grown accustomed to shining the spotlight somewhere else. As the association for Michigan association professionals, MSAE is launching a new initiative called Better Together, with various activities over the next 12 months designed to showcase the association profession and the pride many people feel to work in it. “I am very excited about the ideas we have for promoting the association
profession over the next several months,” says MSAE President Cheryl Ronk, CAE, CMP. “Too often, association professionals are the quiet heroes who do so much for those they serve, and MSAE is excited to take a leadership role in telling their stories.”
The Public’s Perception
Gail Frahm, executive director of the Michigan Soybean Association, points out that an awareness of associations and what they do has changed significantly over the years. “Older generations understood associations. They wholeheartedly supported them because that’s what you did. It was part of your work, part of the job,” she says. “People belonged to associations because it was the right thing to do.” People, in what Frahm calls the middleage group, saw their parents working with and supporting associations. “What you believe in, you belong to,” she says. But the middle-age group started asking, what is the association really giving them? What was the association offering that was worth taking time away from their families? And then, she says, the younger generations took it one step further. “They don’t want to waste time. They want to get out of an association exactly
what they want out of it. If they don’t get it, they will go somewhere else. If they do get it and there is nothing else they want, they will go somewhere else,” she notes. Frahm says this shift has largely been predicated by technology. “The speed and access to information has changed so dramatically. In our parent’s day, if the information wasn’t in an encyclopedia, you belonged to an association to get that information. Now, you just Google it. Anything you are looking for you can have in seconds. That leaves people saying, ‘Why join?’” Still, Frahm says the younger generations are in associations for the social networking. ‘But every association really should spend the time going out to talk to the younger generation,” she notes. “Engage them. Find out what is important to them. Show them how your association fills that need, or figure out a way to make your association able to fill those needs.” Cassandra Jorae, administrative manager for Michigan Economic Developers Association, believes that most people have an awareness of associations, but that awareness is probably limited. “The general public knows that associations like the Heart and Lung Association exist and help people with
illnesses, but I don’t think they know about the personal and professional development opportunities that come with membership,” says Jorae. “The benefits of joining an association are so heavily promoted via word of mouth that many don’t learn about them unless someone tells them. Some are fortunate to have family members that guide them in that direction and there are some professors that recommend it, but I can’t think of any other places outside of workplace affiliations that people are made aware of what associations do.” Jorae says associations need to be actively reaching out to college students to get them involved in their profession earlier on. She points to MEDA’s Get Hired for a Day program, which is a free, short-term mentoring opportunity for emerging leaders in the profession. Students can take part in the program without being a member, with the hope being the exposure to the association will entice them to join later on.
“Associations should think like sponsors — look for opportunities to support activities where your target market already exists in which you are able to address the audience or have a booth,” she says. The association profession is built on the idea of togetherness and making great things happen by sharing ideas, best practices, and insights, Jorae says. “Even though, in some associations, members are competitors, they can agree that a good, overall strategy for promoting their profession is best for all businesses and organizations involved. That collaboration helps with areas like advocacy and building the future talent pool,” she says. Darren Ing, director of Michigan Association of Recreation Vehicles and Campgrounds, and Michigan Manufactured Housing Association, and Self Storage Association of Michigan, has his own take on recognition for the association profession. “I’m not sure the public needs to have an understanding of what we
do,” he says. “We have a consumer face, but we’re not presenting ourselves. We’re presenting our members. At the end of the day, what’s important is that we helped the industry. It’s more important that the industry understands what the association does to protect and promote it.” That being said, there is always an effort to inform and educate the public. “As overseers of an industry, associations are a clearing house of information. Among other things, we can offer information on how to find what they are looking for, what to look for in a product or service, and how to buy it,” Ing says. “The more people learn about the industry, the more we are promoting the industry. Successfully educating consumers means more success for our membership.”
Pride in the Profession
Association work holds a special place in Darren Ing’s heart. “I’m a Michigan native.
ASSOCIATION IMPACT ® < ISSUE 5> 2017 15
C O V E R STO R Y
I enjoy the fact that I’m helping to protect and promote industries here in Michigan that provide services and amenities that support Michigan businesses and residents,” he says. “I’m helping promote people who are enjoying Michigan and they in turn are getting people excited about visiting, relocating, or investing in Michigan.” Ing says working in an association provides him opportunities he probably wouldn’t get in a for-profit business. For example, he points to the RV and camper shows the association hosts across the state. He notes they are similar to shows that businesses host — but the big difference is the measure of success. “For me, the sole goal is to promote our members and the industry. A successful show for me ends with happy consumers and successful members who go on to make the industry stronger,” Ing says. “A for-profit show is solely to be successful and make money. There is nothing
wrong with that, but it’s not fulfilling. “I am proud and humbled by the fact I’ve been a part of increasing consumer awareness and creating a buzz that has made Michigan a top 10 state in our industries,” he continues. “All three of our industries — manufactured housing, RV and campgrounds, and self-storage — are seeing growth, both in membership and economic success. It might sound selfserving or cheesy, but I enjoy the fact that through my work I’m providing benefit to my members through what we do behind the scenes, through legislative action, and raising consumer awareness. I’m proud of it.” The pride Cassandra Jorae takes in the profession personally, comes from what she can do to help others succeed. “I enjoy being able to help others do their job more efficiently and effectively,” she says. “Each and every service we provide to the members gives them something that they can walk away with. We provide benefits
that can build a person in the short- and long-term. After I put months of planning into an event, it’s highly rewarding to watch it happen and get positive feedback as well as see relationships form.” For Frahm, choosing association work was somewhat of a no-brainer. “I’ve been involved with agriculture my entire life so far. My dad was a firm believer in keeping agriculture at the forefront of people’s minds, of bringing awareness to consumers. I’m doing my job because I love working with farmers and I want to carry on the work of my father.” Simply put, she does the work so that her members have a voice. “When I graduated high school in the mid-1980s, crop prices were in the tanks. They were terrible. I wanted to go to college and, of course, kids usually look to their parents to get help started down that path. My parents couldn’t. There was no money. In fact, they had negative income. “My father was out there all year, busting his buns trying to feed a family of seven and squeeze by and he came up with negative income,” she continues. “There are very few industries where people do the work because they love the work, they love the land, and they want to help people, to feed people, and then they still come home with a negative income. Farmers do. And then they do it again. “I’m in it — proud to be in it — to help farmers,” she says. “Through our association, we can connect with farmers, give them a larger voice, spread their stories, and spread awareness to people.”
Share Your Story
“I know the quality of individuals that comprise the MSAE membership, and I know that they have numerous stories to share about their successes and pride in their work,” says Ronk. “The new Better Together campaign is a way to celebrate those successes in a tangible way. I look forward to being inspired by our members in the coming year.” Ronk encourages anyone who would like to be part of the Better Together interviews to reach out to Shawnna Henderson at firstname.lastname@example.org.
16 ASSOCIATION IMPACT ® < VOLUME 34 > 2017
Better Together Profiles
AT A GLANCE
The Better Together Profiles at Glance will showcase more examples of association professional pride in this and upcoming issues of Association IMPACT.
GAIL R. FRAHM
Michigan Association of Recreation Vehicles and Campgrounds, Michigan Manufactured Housing Association, and Self Storage Association of Michigan
Michigan Soybean Promotion Committee and Michigan Soybean Association
Michigan Economic Developers Association
Time in association management
Experience in current role
Most proud of as an association professional
Continuing to grow our membership and provide new and innovative services for our members.
Being able to accomplish so many valuable projects on behalf of soybean farmers. It’s all about keeping them farming and providing valuable management techniques to increase their bottom line.
Being able to meet the education and networking needs of our members. Members come to me regularly for assistance in finding resources, advice on training, help with making connections, and many other areas because they know that I am happy to help them and will do so as promptly as I can. I thoroughly understand, and care about, what they need to get their job done, so I love doing my part.
If I had magical powers in the association sector, I would...
Have the ability to make nonmembers and members see the benefit and value that associations provide.
Have a never ending stream of unsolicited corporate support.
Provide each association manager with the resources for the appropriately sized and skilled staff that they need to meet all of their goals and tend to their members’ needs on a timely basis.
First-choice superhero power for accomplishing goals
See into the future.
To be in more than one place at a time. There’s so much I want to do, but not enough hours in a day to do it.
Time travel because knowing what will happen in advance would sure help with meeting and strategic planning. Teleportation would also be very helpful as I have a 45 minute to 1 hour commute. I could accomplish so much more with two extra hours per day.
Association/ personal theme song
“Welcome to the Jungle” by Guns N’ Roses
“I Will Survive” by Gloria Gaynor
“Unwritten” by Natasha Bedingfield
ASSOCIATION IMPACT ® < ISSUE 5> 2017 17
F E A T U R E STO R Y
KEYS TO A
SUCCESSFUL PAC According to these MSAE members, the keys include effective leadership, thoughtful strategic planning, constant communication and marketing, and strong investor relations.
BY CHRIST INE WRIGH T 18 ASSOCIATION IMPACT ® < VOLUME 34 > 2017
F E AT U R E STO RY
Political Action Committee (PAC) can be an important tool for a trade or professional association classified as a 501(c)6 by the IRS, as they are the only legally sanctioned way to make political contributions from your membership. Having a PAC shows your members you are serious about advocacy, and gives your association a voice in the political arena. A PAC is also a great vehicle for supporting and building relationships with officeholders and candidates who understand your industry and will advance your government affairs priorities. But what makes a successful PAC? MSAE asked two members to share their perspectives. They concluded that for your PAC to be an effective tool for your association, it needs effective leadership, thoughtful strategic planning, constant communication and marketing, and strong investor relations.
Effective PACs need boards comprised of people who understand the mission and how the PAC can lift up the association. The PAC board works hand-in-hand with the association board. Do your board members understand their role and help facilitate the success of your goals?
Boards of directors can be a great source of talent, guidance, and knowledge. Effective PACs need boards comprised of people who understand the mission and how the PAC can lift up the association. The PAC board works hand-in-hand with the association board. Do your board members understand their role and help facilitate the success of your goals? Are they effectively advocating on behalf of your association? Rob Campau, CEO of Michigan Association of REALTORS®, says his organization’s leadership looks for PAC board members “who have demonstrated some skill and understanding of fundraising in the political arena, and some admirable professional traits.” Association boards generally create the vision and strategic plan for the PAC, and therefore need to see the bigger picture of how the PAC fits in with the goals
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ASSOCIATION IMPACT ® < ISSUE 5> 2017 19
F E A T U R E STO R Y
We also have 100 percent participation from our board of directors in the MRA PAC, which sends a strong message and helps the MRA effectively communicate its message. – Justin Winslow, President and CEO, Michigan Restaurant Association
of the association. The PAC board involves the members in the political process and is great at raising funds, he says. Justin Winslow, president and CEO of the Michigan Restaurant Association, also recognizes the importance of the role his board plays with MRA’s PAC “by their willingness to communicate our priorities with elected officials in their respective communities by hosting policy roundtables or making their establishments available for fundraisers.” He adds, “We also have 100 percent participation from our board of directors in the MRA PAC, which sends a strong message and helps the MRA effectively communicate its message.” The lead executives on the staff side of a PAC are integral as well, but they oversee more of the day-to-day operations based off the strategic plan that is put together by the board, he notes. A strong leadership team that embraces its role as advocates is the foundation of a successful PAC.
A well-run PAC operates under a strategic plan that is regularly reviewed and modified to set realistic goals under changing
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F E AT U R E STO RY
political climates. Developing an annual strategic plan for your PAC that identifies opportunities for improvements and growth, a lean yet aggressive operating budget, and a realistic timeline are essential to success. This also requires maintaining relevant information about your PAC’s past performance and future opportunities. The Michigan Restaurant Association relies on a three-year strategic plan for direction, but the board of directors “engages in an annual retreat to review and amend the plan, and it is also woven into the agenda of quarterly board of directors meetings,” says Winslow. He goes on to praise the senior staff, which meets regularly “to discuss progress on the implementation of the plan, with each member understanding which goals are theirs to enact.”
Communications and Marketing
Carrying out creative marketing and communications strategies brings in contributions and keeps them coming. Have you developed a brand-identity and key sales messages based around your mission for your PAC? Are you continually educating your members, staff, and potential donors and providing incentives and recognition for those who support the PAC? Using a blend of communications methods increases the chance of your message getting heard. At the Michigan Association of REALTORS®, about one-third of board members phase out each year, “so there is a constant need to tell board members what we do and the value we’ve proved,” says Campau. They use constant emails, newsletters, brochures, and other means of communication with information on their advocacy efforts. The association also recognizes the members that contribute to the PAC. They hold special events with politician appearances, including exclusive receptions at both their state and national conventions. They also feature headshots of supportive Realtors in their magazine and website, and their donors respond well to such publicity. The Michigan Association of REALTORS® uses the PAC as a quantifiable metric of member involvement, so it seeks out frequent feedback to gauge overall commitment. “A terrific message will
produce nothing if it is not delivered in a manner that attracts attention,” Campau adds.
A terrific message will produce nothing if it is its not delivered in a manner that attracts attention.
A PAC must invest influence and monies wisely to grow and continue to attract support from members. Are your PAC’s investments proving to be effective? PACs invest revenues mostly in candidates who have demonstrated an understanding or support for their specific industry, and they are careful to educate those who provide those revenues about why and to whom those in-vestments were made. Your contributors will want to know this, because you are using their money to make those investments. The Michigan Restaurant Association carefully vets potential investments by having a “fully digital candidate questionnaire, which weighs heavily in deciding which new candidates for public office to endorse and financially support,” says Winslow. He continues that for sitting legislators, “We score votes deemed important to the industry, with a minimal threshold of support necessary to earn an endorsement and corresponding financial support.” At the Michigan Association of REALTORS®, a large membership base offers sufficient resources to interview every candidate, looking for the most thoughtful and well-versed candidates possible from the perspective of the association, says Campau. A successful PAC must have a board of directors that understands their role as leaders within the organization, a comprehensive strategic plan that is updated regularly, several methods of communication and marketing, and monies invested in thoughtful candidates. When these strategies are employed, your PAC will be another way to engage with members
–Rob Campau, CEO, Michigan Association of REALTORS
and promote the mission of your association and build relationships with officeholders at any level. Christine Wright has a bachelor’s in political science and government from Michigan State University and a master’s in advanced international and European studies from the Centre International de Formation Europeenne. Formerly, she worked for Michigan State Representative Jim Tedder.
Keep Learning in Third Thought® Search for the resources listed below in the digital library on MSAE’s knowledge management platform: www.thirdthought.msae.org
Read ▸▸ Don’t Have a PAC? Don’t Worry ▸▸ Association PAC Raffles ▸▸ Protecting Intellectual Property Assets
Listen ▸▸ Impact of Term Limits on Legislation
ASSOCIATION IMPACT ® < ISSUE 5> 2017 21
I N D U S T R Y U N D E R STA N D I N G
Certainly Certifiable CAE QUIZ
Are You Certainly Certifiable? 1. How much revenue should an association have in reserves at a minimum? a) 50% of operating revenue b) 60% of operating revenue c) It depends on internal financial policy d) It depends on board policy
DOMAIN 2: GOVERNANCE & STRUCTURE
2. Who is accountable for the governance of the organization? a) The members b) The CSE c) The CEO d) The Board DOMAIN 3: MEMBERSHIP DEVELOPMENT
3. Members who resign while owing dues: a) Have a legally enforceable obligation to the association b) Have no obligation to the association c) Have a legal obligation to pay dues, plus interest, if they choose to rejoin the association d) Have legal recourse to obtain a refund of dues for the year of resignation. DOMAIN 4: PROGRAMS, PRODUCTS, AND SERVICES 4. You are charged with raising money for a new, larger, state-of-the-art headquarters for your association. The type of fundraising you are most likely to conduct is: a) Annual fund b) Special fund-raising campaign c) Capital campaign d) Major planned gift development DOMAIN 6: ADMINISTRATION 5. Which of the following are appropriate topics for a trade or business association meeting? a) Fair profit or margin levels b) Pricing procedures c) Whether pricing practices used are unethical d) Methods by which to become more profitable
22 ASSOCIATION IMPACT ® < VOLUME 34 > 2017
For over half a century, the Certified Association Executive (CAE) designation has been a symbol of excellence in association management. Take the Certainly Certifiable CAE Quiz to test your knowledge of some of the domains of association management. Answers at the bottom of the page.
About the CAE The program is designed to elevate professional standards, enhance individual performance, and designate professionals who demonstrate the knowledge essential to association management. Candidates must be employed full-time for 3 years as a CSE OR 5 years as an executivelevel, association manager. Candidates must also have 100-hours of broad-based, association professional development.
Visit http://bit.ly/2eOFcNj to learn more.
Need Help? With the highest success rate in the nation, MSAE’s Virtual Prep Course has helped more than a 1/3 of CAEs in the nation earn their designation. We offer a process-based approach that incorporates study guides, reading comprehension questions, flashcards and practice tests.
Visit msae.org/cae to learn more.
Answers: 1. D 2. D 3. A 4. C 5. D
DOMAIN 1: STRATEGIC MANAGEMENT
BOARD OF DIRECTORS MSAE STAFF Barry Cargill, CAE, Chairman Executive Director Michigan HomeCare & Hospice Association
Cheryl O. Ronk, CAE, CMP President/CEO
Denise E. Amburgey Chief Financial Officer of MSAE & General Manager of Denise McGinn, CAE MSAE Service Corporation
Chairman-Elect Maryanne F. Greketis, CMP President Career Enrichment Manager Association Guidance
Lorraine Goodrich, CPA Strategic Marketing Manager Treasurer CFO Angela DeVries Automotive Industry Action Group Association Community Cynthia H. Maher, CAE Secretary Executive Director Michigan Plumbing & Mechanical Contractors Association
Kelly Chase, CMP Member Service Coordinator Kristy Carlson, CMP Certification Manager
Mike Wenkel, CAE, Past-Chairman ASSOCIATION IMPACT® Executive Director Michigan Potato Industry Commission Carla Kalogeridis
Jared Burkhart Executive Director Shawnna Henderson Michigan Council of Graphic Design Charter School Authorizers
Steve Carey, CAE Advertising Sales Executive Director BRD Printing National Truck Equipment Association
CONNECT WITH NEW PEOPLE THROUGH ASSOCIATION IMPACT MAGAZINE Did you know associations represent most industries, from homebuilders to healthcare? Take a second to think of an industry and we bet there’s an association for that! There’s even an association for associations — MSAE is proud to be Michigan’s. Our publications represent the most effective, inexpensive way to market to the association sector in Michigan. Contact Kent Lenzen at firstname.lastname@example.org for a personalized quote or complete marketing plan.
Scott T. Ellis Executive Director Association IMPACT® is published Michigan Licensed Beverage Association bimonthly by the Michigan Society of Association Executives, 1350 Paul A. Long Haslett Road, East Lansing, President & CEO MI 48823, (517) 332-6723. Michigan Catholic Conference Subscribers should direct all Michael Moss, CAE inquiries, address changes, President and subscription orders to that Society for College & University Planning address. Articles written by outside authors do not necessarily Andi Osters reflect the view or position of the Assistant Director Michigan Society of Association Michigan High School Athletic Executives (MSAE). MSAE’s Association position on key issues will be Kimberly R Pontius, CAE clearly stated. Manuscripts are accepted at the approval of MSAE, Executive Vice President which reserves the right to reject Traverse Area Association of or edit. Appearance in Association REALTORS® IMPACT® does not constitute Jack Schripsema, CTA endorsement of the advertiser, President & CEO its products or services, nor ® Greater Lansing Convention does Association IMPACT make any claims or guarantees as to & Visitors Bureau the accuracy or validity of the Richard P. Seely, CAE advertiser’s offer and reserves Account Executive /Medicare Advisor the right to reject any advertising Member Insurance Solutions, Michigan deemed unsuitable. Advertising Dental Association rates available at www.msae.org. Bob Thomas, IOM, CAE, CMP Senior Director of Operations & © MSAE 2017 Executive Director Michigan Chamber Foundation, Michigan Chamber of Commerce Ara Topouzian President/CEO Troy Chamber of Commerce
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Three association professionals share insights on the association community and their pride for the profession. Also featured: Functional Ex...