Chambers of Commerce in 2022 - ACCE | ACCE · 2016-05-27 · Does your chamber have a...
Transcript of Chambers of Commerce in 2022 - ACCE | ACCE · 2016-05-27 · Does your chamber have a...
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Chambers of Commerce in 2022
David May, CCE, CAE
Fort Collins Area Chamber
of Commerce March 2012
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Objectives
Make sense of the forces impacting
chambers of commerce
Offer some insights on the future of
chambers of commerce
Provide ideas for action
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Macro-Trends
A look at the Big Picture
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The Fifth Wave
5 techno-economic revolutions
60-year cycles of capital
First Wave: Industrial Revolution, 1771
Second Wave: Railroads Introduced, 1829
Third Wave: Heavy Engineering, 1870s
Fourth Wave: Mass Production, 1908
Fifth Wave: Microprocessor, 1971
Deployment always ushers in a ‘golden age’...
…but disorienting economic and technological change
Source: “Re-engineering the U.S. Economy” Trends Mag
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Economic Dislocation
Rapid adoption of information technology = shortage of technically-skilled people & surplus of under-skilled people - skills gaps
Economic growth anemic 2001-2010
Net job losses
Drop in home prices
Higher unemployment
Leads to ‘blame game’
Consequently, trust of government at all time low:
77% say they trust government only part of time
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Even chamber leaders uncharacteristically glum
Overall, do you think your state is going in the right or wrong direction?
right direction 14%
wrong direction 75%
no opinion 12%
Overall, do you think the country is going in the right direction or wrong direction:
right direction 4%
wrong direction 84%
no opinion 11% (Source: Chamber Economic Outlook – WACE Poll, Oct 11 2011)
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Are we Going to Hell in a Hand Basket?
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America Will Be Fine*
High standard of life
High level of equality
Strong work ethic
Innovative and creative, technological innovation
Freedom of speech
Free markets
Rule of law
Democratic society
Still investing in future – most graduate schools / elite universities; technological breakthroughs
U.S. still leads world: 1995 U.S. produced 25% of world’s goods / services; 2010 same
American economy 2x China’s
America’s per capita income is higher than those of China, India, Russia and Brazil combined
35% of China’s population (half a billion people) live on less than $2 per day
Not Great Depression but Long Depression like 1873-1896 (gradual realignment of labor due to technological innovations) “Are We Looking at the Wrong Depression?” Stephen Davies, Mar 2012
* Eventually
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The Point?
Country has hit a rough patch
But Americans are very resilient
Don’t lose perspective, don’t caught up in all the
negative stuff
Part way through a gradual realignment of labor in
response to technological innovations*
America has huge advantages, bright future
There’s much you can’t control so focus on what you
can control - your own performance and outlook (*Source: ‘Are We Looking at the Wrong Depression?”, Stephen Davies, Freeman Online, Mar 2012)
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Chamber Trends
What Does Recent Data Say?
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Discussion
What has happened at your chamber over
the past 5 years?
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Chambers 2006-10
Membership
Number of member accounts ↓ 14.1%
$ value of members accounts ↓ 1.2%
Cancelled accounts ↑ 4.3%
$ value of cancelled accounts ↑ 30.6%
New members (accounts) ↓ 22.7%
New member revenue ↓ 15.3%
Change retention rates (accts)
2006: 84.9% 2010: 82.2% (Source: ACCE 2011 Operations Survey)
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Chambers 2006-10
Revenue
Total non-dues revenue ↓ 11%
Total revenue ↓ 6.7%
(Source: ACCE 2011 Operations Survey)
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New Member Sales
Looking at the past 3 months (July, Aug,
Sept) are your new member sales:
Way ahead of budget 3%
Somewhat ahead of budget 42%
Somewhat behind budget 49%
Way behind budget 7%
(Source: WACE Poll Oct 11, 2011)
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New Member Lead Sources
What has been your largest source(s) for recruiting new members so far in 2011? (Select up to 3)
1. Member referrals 50%
2. Member sales reps (inside staff 47%
making cold calls or contacting
referrals)
3. Chamber events 43%
4. Board referrals 25% tie
4. Unsolicited calls or online 25% tie
applications (prospect generated)
(Source: WACE Poll Aug 23 2011)
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New Member Sales Incentives Please indicate whether you offer incentives for new member sales to
either Chamber staff, commissioned sales or volunteers (check all that apply): No sales incentives in place 36%
Sales incentives for inside sales staff 34%
Sales incentives for outside 16%
independent contractor sales staff Sales incentives for other Chamber staff 17%
Sales incentive for membership campaign 2%
Contractors Sales incentives for membership 12%
campaign volunteers
Sales incentives for Chamber 23%
member referrals Other 6%
(Source: WACE Poll Aug 23 2011)
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Member Retention
Looking at the past 3 months (July, Aug, Sept) are your member renewals: Way ahead of budget 7%
Somewhat ahead of budget 45%
Somewhat behind budget 43%
Way behind budget 5%
Average member cancellation rate:
2011: 16% 2010: 16%
(Source: WACE Poll Oct 11, 2011)
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Conclusions
Economy has been tough on individuals,
business, and chambers
But, chambers have been surprisingly
resilient
Lost members but saw high level of
membership loyalty during the downturn
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The Future of Chambers
What’s Ahead for Chambers of
Commerce
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Pace of Change
“The future ain’t what it used to be.” – Yogi Berra
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Evolution, not revolution
Significant change underway, almost feels unbearable
Chambers being told we’re in a ‘race for relevance’
Yet, chambers are dealing with many of same issues they were 30 years ago
“Almost all change is evolutionary, not revolutionary.” – John Naisbitt
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Evolution, not revolution
Reality: need sense of urgency, must get better fast
BUT work fast, don’t hurry, don’t panic
Change is spooling out at a fast but manageable pace
“The way work is done and what needs to be done doesn’t
change very fast, even now…People think work is changing
faster than it is.”
Heidi Schierholz
Economic Policy Institute
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Trends:
Elevated member value expectations
Rapid movement to social media / Web 2.0
Traditional membership model is changing
Competition of chambers is increasing as technology fractures mass markets
More expected of professional staff
More collaboration among organizations
Advocacy more important, more treacherous
Funding model changing with more fund raising, less reliance on dues
Generational shift as Boomers begin to move off the stage
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Trends: Elevated Member Value Expectations
Anecdotal, no data – frequent discussion
among chamber professionals and in
professional literature
Even longstanding supporters expecting
clear demonstration of value of chamber
Value proposition must be stronger than
ever AND clearly communicated
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Trends: Technology - Social and Mobile
Rapid movement to social media / Web 2.0
Social media sites - just new tools for old ideas, but…
…they are challenging old premises
that you must be a member to receive info from the chamber
(Source: Adapted from Steve Drake, “Converging Trends Impacting Associations” March 2009)
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Trends: Technology - Social and Mobile
Smart phone sales now account for 54% of all mobile phone sales in U.S.
Mobile internet use will overtake desktop internet use by 2014
Balance of mobile app use versus web browsing has shifted among smartphone users
Point: Chambers need a mobile strategy – be clear on goal, cost-benefit, develop app vs. mobile-optimized website
(Sources: Burns Marketing; ‘Monetize Mobile,’ by Beth Ziesenis)
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Trends: Technology - Social and Mobile
Does your chamber have a mobile-optimized version of your website:
2011 2010
Yes 20% 12%
No 80% 88%
Does your Chamber offer a mobile app for
2011 2010
iPhone 22% 7%
Android 15% 6%
Blackberry 9% 8%
None of Above 72% 86%
(Source: WACE 2011 Technology Survey)
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Trends: Technology - Social and Mobile
Cloud-computing becoming the norm
Cloud computing is the delivery of computing as a service rather than a product, whereby shared resources, software, and
information are provided to computers and other devices as a utility. Users access cloud based applications through a web
browser or a light weight desktop or mobile app while the software and data are stored on servers at a remote location.
(Source: Wikipedia)
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Trends: Technology - Social and Mobile
Percentage of Chambers using various social networking platforms
2011 2010 2009
Blogs 21% 22% 20%
Facebook 97% 86 64
LinkedIn 67 58 53
Twitter 65 55 44
YouTube 51 40 30
(Source: WACE 2011 Technology Survey)
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Trends: Technology - Social and Mobile
Use of social networking has grown
dramatically
Social networking and social media are
valuable tools but not your purpose; a
means to the end
Social media technologies help you extend
/ enhance your chamber brand
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Discussion
How do you think technology, especially
social networking and mobile technology,
will impact the chamber in the next 5-10
years?
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Trends: Traditional Membership Model Changing
Variety of existing and emerging chamber models:
Traditional model – one size fits all i.e. one set of membership services that members pay different price based on size /type of company, so-called ‘fair share’ dues schedule
Affinity program model – nominal base membership fee but revenue from services / products; the “Sam’s Club” model (Detroit)
Tiered dues model – bundled offerings with some customization
Key investors model – value-focused traditional memberships offered but emphasis on accomplishing goals of major investors
Virtual chamber model – full service, but cut overhead costs by eliminating facility (Goleta Valley CA Chamber)
Free chamber model – very limited services, sponsor supported
‘Freemium’ model – full service organization, free membership with option to upgrade to a premium membership
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Trends: Traditional Membership Model Changing
Migration of dues model continues:
“fair share” to bundled (i.e. tiered) to…what?
Traditional model:
joining is the norm
annual dues allow access to information, connect with
colleagues, participate in advocacy
one-size fits all with similar type and size of businesses
paying similar amount for same thing (‘fair share’ model)
many ‘checkbook’ members – support ‘the cause’ but
limited use of membership services
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Trends: Traditional Membership Model Changing
Growing resistance to traditional model:
Young people growing up in pay-as-you-go world of
‘micropayments’ in individual transactions for specific
value
Ex. iTunes, cell phone minutes, car share programs
Some question the need to buy a bundle of services at full
price for things they may not use
Self-organizing - technologies allow us to get things we
need from each other rather than exclusively rely on
traditional organizations
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Trends: Traditional Membership Model Changing
Competition on the increase
Technology-driven de-massification – mass
markets are fragmenting into smaller more
personalized pieces
For-profits reaching into traditional chamber
offerings to pick-off value
Economic developers rediscovering ‘improving
the business climate’ as way to attract investors
Technology enables ‘free’ chambers
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Trends: Traditional Membership Model Changing
Competition on the increase (con’t)
Some associations experimenting with
‘freemium’ model:
free membership offered to all, nominal price for
an ‘active’ member
core product free, generate revenues from paid
service, advertising, sponsorship
Ex. Alliance for Women in Media
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Migration to Tiered Dues Continues
Chambers Using Tiered Dues Schedule
2011: 28%
2010: 19%
Average Minimum Dues
Tiered $341
Regular $236
(Source: WACE Poll Aug 23 2011)
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Conclusions
Paid membership model still has value for
foreseeable future
However, pressure to change the membership
model:
must deliver value in ways people want it (i.e. provide
members with something they can’t get elsewhere)
pressure to unbundle means at least migrating from
one-size fits all to tiered dues schedule that is
customizable
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Discussion
Will membership be a viable construct in 10
years?
If ‘no,’ why not?
If ‘yes,’ what do you think it will look like?
Who will be the Chamber’s key competitors
over the next 5-10 years?
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Trends: Funding Model Changing
Less reliance on dues, more on special funding
Campaign type funding is becoming the norm
Ex. Baton Rogue Moved away from membership as primary funding source
Shift from primary focus on membership events / services to initiatives to improve business climate / improve economy
150 investors provide bulk of funding through campaigns
10 percent of funding from public grants – local, state, federal
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Discussion
Do you agree with the contention that there
will be more emphasis on special funding
and less on dues?
Why or why not? Please explain
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Trends: Generational Shift Four generations in the workplace: WWII, Boomers, Generation X,
Generation Y
WWII – only vestiges remain in workplace
Boomers:
Leading edge of the generation is beginning to retire
Sizable minority will still be working in 10 years – can’t or won’t retire
Some will reposition – part-time, consulting, coaching
The majority of current members will retire during next 10-15 years
Generations X and Y
Communicate and collaborate differently
X’s tired of Boomer shadow, want to elevate their careers
Y’s want to work for less hierarchical organizations
Y’s want to use personal technology at work
Key question for chambers: Will Generations X and Y see value in joining?
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Generations of Members
Baby Boomers Generation X Generation Y
Born 1946 – 1964 1965 – 1981 1982 - 1995
Size 78 million 48 million 80 million
Why They Join Opportunities to lead and
leave a legacy
Opportunities to further
their careers
Opportunities to learn
from others
Communication
Styles
Appreciate meetings
Believe no news is good
news
Prefer clear, concise
communication – no
over-explaining, clichés,
or corporate jargon
Prefer email
Prefer frequent
feedback and problem
solving via technology
instead of phone calls or
meetings
Turn-offs People suggesting they
try something new
Chaos, distrust, loyalty
that goes unrewarded
Dismissing their ideas
because of their lack of
experience
Source: Adapted from “The End of Membership as we Know It,” by Sarah Sladek
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Discussion
How do you see the generations being involved in the Chamber in 5-10 years?
What does that mean for the governance of the Chamber? How do we facilitate a smooth shift over the next decade to include more governance participation by the younger generations?
What does that mean for membership?
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Trend: More Expected of Professional Staff
Boards expectations of professional staff have gone up
Board expecting value, members demanding it
Boards asking hard questions “What is this costing us?
Why are we doing this?”
Most chamber staffs not growing in size but are growing
in sophistication
Chambers outsourcing to get things done with staffs
managing more outside vendor relationships
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Trends: More Collaboration
Collaboration among chambers and other
community organizations is up
Merging is common topic but no evidence that
actual number of mergers is up
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Trends: Advocacy More Important, More Treacherous
Huge debate about role and price of government and who pays
Highly charged political environment
Growing expectation of transparency and accountability of government and those lobbying government
Era of anti-capitalism and government sponsored capitalism
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Trends: Advocacy More Important, More Treacherous
Local politics have been nationalized
National money, agendas and volunteers flow into local
races through national political networks
“The Blueprint: How the Democrats Won Colorado” by
Adam Schrager and Rob Witwer
U.S. Chamber increased candidate and issues advertising
and ground operations in battleground states; causes
issues for some local chambers
MoveOn.org targeted U.S. Chamber / chambers
Technology has enabled grassroots activism
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Trends: Advocacy More Important, More Treacherous
Growing anti-government sentiment in
country
Local & state government budget
challenges
More local chambers getting involved in
politics
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Trends: Advocacy More Important, More Treacherous
“We have been monitoring local chambers and
their political activities for many years. The trend
has been that chambers are becoming more
politically active.”
- WACE Opinion Poll, Steve Snyder,
July 2011
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Trends: Advocacy More Important, More Treacherous
Government involvement in chambers
Do you have any ELECTED governmental official (city, county, school, etc.) serving on your chamber's board of directors? 27% Yes 73% No
Do you have any governmental PAID Staff (city, county, school, etc.) serving on your chamber's board of directors? 37% Yes 63% No
Is your city/town government a dues paying member of your chamber? (not individuals, but the city/town as an entity). 55% Yes, 38% No
(Source: WACE, Government/Non-Profit Service on Board - November 1, 2011)
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Trends: Advocacy More Important, More Treacherous
Business needs chamber to stick up for them
More controversial, not less controversial. Don’t back down
• Develop language about advocacy program – website and one-pager in marketing kit (see FC Chamber Government Affairs FAQ)
• Explain relationship with USCC (see FC Chamber page; see front page of San Luis Obispo Chamber)
• Can hold elected officials accountable without being confrontational – scorecards; examples: NCLA, Portland
• Be clear on values and policies (Where We Stand)
• Grassroots activation network (NCLAaction.net)
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Trends: Advocacy More Important, More Treacherous
“A person who does not make a choice
makes a choice.”
– old Jewish folk saying
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2022
What Chambers of Commerce Will
Look Like in 10 Years
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Question
How will your chamber be different 5-10
years from now?
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Chambers of Commerce, 2022
Basic purpose unchanged: create a bright economic future and strong
quality of life through promotion of free enterprise
Relevance of chamber: depends on local circumstances and strength of
business community
there remains a need for an on-the-ground forum of business leaders to advocate for business and community’s economic future
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Chambers of Commerce, 2022
Funding model: memberships will exist but Chamber less dependence on
membership dues
key community builders will invest more for major initiatives that improve business climate
successful chambers will have clear value propositions and be communicating them effectively
successful chambers will be aggressive and unapologetic in fund raising – do due diligence, identify needs, build value case, ask businesses to invest, communicate results
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Chambers of Commerce, 2022
Membership model: membership will still be useful construct – confers
sense of belonging & ownership thus loyalty
chambers are brokers of power, information, talent so people will still want to use to accomplish things for their businesses, careers, community
membership dues will not be primary source of funding for most chambers
a few chambers will be using ‘freemium’ model
chambers will know individual member needs even better – data mining, wise use of membership software
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Chambers of Commerce, 2022 Membership composition:
Generations X and Y will ‘join’ but redefine ‘membership’
many chambers have fewer members and more revenue
less emphasis on trying to serve everybody to serving those who are committed to the chamber’s mission
Composition of membership will change - many new professions will emerge including: body part makers, nano-medic, old age wellness consultant, memory augmentation surgeon, vertical farmers, personal branders, and others*
Competition: more intense
more niche virtual and actual organizations
*(Source: www.fastfuture.com)
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Chambers of Commerce, 2022
Governance model:
tipping point reached – Boomers still on stage
but Generations X and Y in dominant role
board sizes relatively unchanged in small and
mid-sized chambers; some metro chambers with
mega-boards will reconfigure and slim-up
strong CEO’s leading with strong strategic
guidance by boards
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Chambers of Commerce, 2022
Issues: state-directed capitalism declining but chambers still
fighting back government intrusion in economy
workforce competitiveness
mobility
‘Silver Tsunami’
regionalism
energy
immigration
water supply (in the West)
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Chambers of Commerce, 2022
Government affairs: chambers will be very involved in advocacy
more will have political programs to counter agenda of no-growthers, environmental groups, unions, others
chambers do traditional direct lobbying of government but ‘reaching past’ elected officials to directly micro-target voters politically and on specific issues
governance structures will allow fleet decision making – one week or less on most issues
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Chambers of Commerce, 2022
Staff size and skills:
same size or smaller
chambers outsourcing services and duties to
leverage external expertise meaning increased
role of staff as resource coordinators of external
vendor relationships
all staff facile using technology
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Chambers of Commerce, 2022
Technology: old news by 2022 - all chambers will have mobile
strategies because most people access chamber via mobile devices
highly sophisticated use of web, mobile, social media to extend brand and add value to members / investors
websites more powerful and relevant
center of chamber’s communication network
content-rich sites
write once / publish in multiple places
Web 3.0 - sifters
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Actions to Consider
To stay professionally relevant:
Use American Chamber of Commerce
Executives (www.acce.org) Information Office
Be active with appropriate ACCE Divisions
Join your state chamber executive group
For those in the West, join the Western Association
of Chamber Executives (www.wace.org)
Study the WACE Toolkit (must be member of WACE)
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Actions to Consider
“Spine up” regarding advocacy i.e. expect choppy
waters and prepare to respond
If chamber not sticking up for business, who is? Without strong
business advocates bad things happen.
Have language that explains relationship with U.S. Chamber
Have language that explains why chamber involved in advocacy
and / or politics
If have political program, hire an election attorney to write
opinion letter to guide you on permissible activities
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Actions to Consider
Help your chamber identify / package /
communicate value
Press your state and national chamber
associations to spend significant attention to the
topic of the future of chambers; need them to
collect info, analyze, interpret
Read The New Rules of Marketing & PR
Read The End of Membership as We Know It
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In Closing
Chambers are important to our
communities’ success
Time of significant and challenging change
Chambers need to be at top of their game,
counting on you to be at top of yours
What you do is important, so thank you!
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Parting Thought
“If you’re not confused,
you’re not thinking right.”
-- Unknown
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Resources
ACCE’s Information Office
www.acce.org/info/
Others
Western Association of Chamber Executives
(www.wace.org)
Chamber Leader Blog (www.chamberleader.blogspot.com/)
Chamber People (www.chamberpeople.com/)
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Resources
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References ‘Far too Soon to Write off America” Ian Bremmer Dec 27 2011
“Private Employment Has Recouped Only Three-Eighths of Its Recent Loss” By Robert Higgs | Sunday February 19, 2012, The Independent Institute
WACE Polls: July, Aug 23, Oct 11, Nov 1, Dec 2011
WACE 2011 Technology Survey
“The Future, Here and Now” by Lisa Junker, Association Now, Oct 2008
Steve Drake, “Converging Trends Impacting Associations” March 2009
“Exploring the Future of Associations” Paul Borawski, American Society of Quality
Race for Relevance: 5 Radical Changes for Associations, Harrison Coerver and Mary Byers
“Goodbye, Dues” by Erin M. Fuller, Associations Now March 2011
“The New Face of a Membership Organization” by Kim Fernandez, Associations Now, Feb 2010
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References “Mega Trends for Chambers in the Next Economy”, Mick Fleming,
American Chamber of Commerce Executives
ASAE PowerPoint Presentation – Greg Melia, etc
“Chamber Choices: Factors to Consider When Evaluating Your Chamber Focus Areas,” Dave Kilby, July 2010
ACCE 2011 Operations Survey
“A Whole New Mindset” by Kristin Clarke, Associations Now, June 2007
“What Does the Future Hold” by Robert Olson August 2001
“The Future of Chambers in an e-World,” David May, February 2002
“Top Tech Trends” by Laurie McCabe, Partner, SMB Group; www.FreeEnterprise.com
‘Monetize Mobile,’ by Beth Ziesenis, Associations Now, March 2012
“Re-engineering the U.S. Economy,” Trends E-Magazine July 2011
http://en.wikipedia.org/wiki/Cloud_computing
“What Is Cloud Computing?” by Rivka Tadjer, PC Magazine, November 18, 2010
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References “Associations Next: Serious Questions for 2010 and Beyond,” Jeff
DeCagna
Lessons from the Recession, by Jim McGarry, Executive IdeaLink, Dec 2009
David C. Olson, Minnesota Chamber of Commerce, 11/2/11
The Blueprint: How the Democrats Won Colorado by Adam Schrager and Rob Witwer
“Public Sector Day of Reckoning,” Trends E-Magazine, march 2011
“Picturing It: The Year 2020” Public Management Mag, Jan/Feb 2012
“The Freeland Surge is the Industrial Revolution of Our Time,” by Sara Horowitz, The Atlantic, Sept 1 2011
“Tense Time for Workers, as Career Paths Fade away,” Rick Hampson, USA Today Jan. 2011
The End of Membership as We Know It, by Sarah L. Sladek
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References
ReMembership: New Thinking for Tomorrow’s Membership Organization,
by Kyle J. Sexton
“The Future of Chambers & Leading Them,” Kip Lilly, Lilly Foresight
Dynamics, Minnesota Chamber of Commerce Executives, Feb 2011
“The New Workforce” Trends E-Magazine July 2011
“Shape of Jobs to Come,” Fast Futures, www.fastfutures.com