After years of extraordinary growth from well-established revenue streams, health related professional associations are facing an era of unprecedented challenges. This period of uncertainty has been brought about by the profound changes that are rapidly reshaping the entire health care landscape.
At its core, associations face a “crisis of relevance.” This crisis stems from the gap between traditional association offerings and the unprecedented challenges of modern medical practice. As administrative and clerical duties occupy an ever-increasing percentage of a clinician’s workday, professional satisfaction has plummeted. Many members feel that their professional societies have done little to address these and other challenges of modern practice. As a result, clinicians, especially those early in their career, are less likely to see association membership as an essential component of their professional identity.
The erosion of member affinity, amidst the ever-increasing pace of medical practice, affects not only membership and meeting attendance, it also threatens scholarly publishing. The annual revenue from English language STM journals approaches $10 billion. This market is driven by approximately 33,100 active scholarly peer-reviewed, collectively publishing over 3 million articles a year. (STM Report, 5th Edition)
The primary market for these scholarly journals, institutional libraries, has reached capacity; their budgets are simply unable to absorb either more titles or price increases from established titles. The glut of journals, the costly subscription bundles offered by commercial publishers and the assertive rise of open-access publishing have resulting in slowing revenue growth across the industry. Consequently, associations are no longer able to extract ever more favorable licensing terms from commercial publishers. This market downturn is mirrored by a downturn in interest. The tradition of consuming the full-text medical literature is in decline. It’s difficult, if not impossible, for today’s clinicians to sort through the multi-channel array of new information, assess its validity, and incorporate this new knowledge into practice. We’ve reached “Journal Max” as traditional scholarly content is now over-supplied, overpriced, and under consumed.
While the financial bulwarks of member dues, the annual meeting attendance and journal revenue are under threat, the retreat in the pharma and device markets completes the perfect storm. Consolidation in the industry has led to a reduction in annual meeting spending as well as journal advertising. Apart from robust pipelines in oncology and immunology, the vagaries of the pharma and device markets have led to ever tighter budgets for professional education. In addition to the economic headwinds affecting industry, political and societal forces are causing all parties to rethink the appropriate relationship between associations and commercial entities.
The simultaneous downturn of member dues, publishing, annual meetings, and industry support can be categorized, albeit rather dramatically, as the four horsemen of the association apocalypse. The cumulative effect of these forces, coupled with an under-investment in meaningful new business development, has led to declining revenue for many. For the smaller associations, the effect is much more profound and represents a very real threat to their survival. Several associations are “one bad meeting” away from financial insolvency.
At its core, this is a crisis of relevance. The modern challenges of medical practice are evolving much more quickly than the member solutions offered by professional associations. The wider the “relevance gap” becomes, the harder it is to close. The first casualties of this slow rolling crisis will be the smaller niche societies. However, these macro-economic trends will affect all associations, no matter their size or their proud legacies.
Despite these realities, I’m bullish on the future of professional associations. I believe in their mission and the essential role they play in advancing quality care. I’ve also seen striking examples of associations innovating their way forward, reigniting revenue growth, re-energizing member affinity, and charting exciting courses for long-term fiscal health. In subsequent posts, we’ll examine some of the best practices from leading associations. We’ll look at the cultural as well as the technical and business processes that are essential for revenue innovation. We’ll also examine innovative growth strategies from mature commercial organizations.
As the business axiom goes, “What got us here, won’t get us there.” I’m confident that with committed members, courageous leadership and dedicated staff, professional associations will be able to fully meet the challenges of today and carry out their essential roles, well into the future.