If your strategy for the future resembles your current business model, it’s time to rethink that strategy.
Imagine if when GPS Navigation was first introduced, it couldn’t tell you how to get from A to B; but, once you’ve arrived, it could tell you how you got there. You’d race out to buy it – right?
Of course not.
Yet for the past century, this was exactly how business strategies were defined. We decided where to go next based on where we’ve been.
Businesses ran on financials. What your customers bought from you. Lagging indicators. Indicators based on events that have already happened. This works fine in a predictable world. But, if we’ve learned anything these last two years – it’s that the road ahead looks nothing like the one that got us here.
Lagging indicators can’t identify new products and services you should be offering. That is where Leading Indicators come in handy. Leading indicators are predictive of potential future outcomes. They are more mutable, and harder to measure. Leadership tends to run away from ideas derived from such data. Offering anything without a firm ROI is considered far too risky. ROI doesn’t exist for innovative ideas. If it did, they wouldn’t be innovative.
So, what is a leading indicator? Microsoft CEO Satya Nadella sums it up in two words, “Customer Love“. This is what you get when you provide solutions to the problems your customers’ face.
The beauty of modern digital systems is that they are capable of providing insights into these problems when properly configured. Additionally, they enable you to identify and test solutions to those problems. Solutions that leverage the assets you already have.
The risk associated with new offerings can be eliminated entirely. Your website, member portal and online community enable you to introduce hypothetical solutions and gauge your customers’ level of interest, and their willingness to pay for them. All without spending a dime building anything.
This process for identifying new solutions is clearly documented in Furr and Dyer’s “The Innovator’s Method: Bringing the Lean Start-up into Your Organization“. They show you how to conduct “Advice Interviews.” A simple process for discovering insights into the problems your customers are trying to solve. Armed with the results, your team can ideate potential solutions. Identify two or three concepts and you can easily determine if they are monetizable using another concept explained in the book, the Hypothetical Prototype. By placing a few buttons in the relevant areas of your website announcing “We’re thinking of building X. If you’re interested, click here….” Then you sit back and count the clicks.
In working with associations, we’ve learned that this process can be accomplished in under three months. I’ve glossed over the details, but you get the point. This doesn’t require a large investment of time or money. What it takes is the desire to increase revenue streams, the curiosity to identify new opportunities, and a willingness to do things differently.
If you think about it, you’ll realize that identifying and testing innovative concepts is far less risky than maintaining the status quo.
Here are some examples of what other associations have done:
- One professional association monetizes their job board to the tune of $3.4M per year by using “featured” listings to appear above-the-fold.
- Others have similarly monetized their member directories to over $1M per year, allowing featured listings to include more pictures and information.
- Another built a market research tool that pulls together data from free public sources; normalizes it, and combines it with internal data creating a tool that empowers their members to evaluate new markets on an apples-to-apples basis. The tool is a game changer for their members. Moreover, the data derived from the use of the tool has yielded several other monetizable service offerings by providing insights into the direction their members were looking to expand their businesses.
- Still other associations have integrated and normalized external data with federated search tools that perpetually shed light on the direction in which their members’ interests are moving. Like the previous example, these tools frequently uncover insights into new tools, partnerships, products and services.
This process is easy. The hard part is getting leadership buy-in. Covid has been a wake-up call that staying-the-course is not an option. Take advantage of the shell shock. You cannot succeed until you’ve eliminated the antibodies of orthodoxy.
It’s a green field out there. There are infinite opportunities to identify, test and deliver tools and services your members need, and are willing to pay for. This is the greatest opportunity to show up on your doorstep – but you have to open the door.
June 10th, 2022
David Schulman has over 30 years of experience developing digital strategies for over 100 trade and professional associations. The firm teaches their clients that digital transformation is the greatest opportunity to come their way… ever. Associations Rewired helps associations build resilience by increasing revenue streams. Prior to starting Associations Rewired, David built and sold two technology companies.
When the winds are fair, Dave teaches sailing driven by the principle: “You can’t change the wind, but you can adjust your sails”. He has a BA in Psychology from Hampshire College and is certified in Innovation and Design Thinking by IDEO. For more information, please visit: AssociationsRewired.com.