Monday, January 26, 2015

Is Your Association a Skunk Works for Your Industry?

I recently listened to a podcast put out by Seth Kahan (bonus points if you know both what a "podcast" is and who Seth Kahan is) that contained the following anecdote.

A consultant, trying to shake an association executive out of his complacency, asks how he would feel if his association spent gobs of time and money developing an unique product for its membership, only to have a for-profit company sweep in, develop, and launch a competing product, at a significantly lower price, for the same audience two months after the association's launch. The exec's answer? Great! That would simply mean that the marketplace has adapted to serve the needs of our members. It is becoming a more friendly environment for our members, and we can re-focus our resources on the remaining margins that can drive widespread adoption.

I thought it was a remarkable answer. The association in question was one with a social service mission, and such an answer may make more sense in that environment, but it immediately made me think about the possible applicability to trade associations and professional societies. Are there any of those associations out there who position themselves as the skunk works of innovation for the industry or profession it represents? In other words, the association takes on the experimental risk associated with the development of new products, using reources it is able to crowdsource across its wide membership base.

If a new product works--great, some for-profit entity can take it (or buy it from the association) and use their typically better developed production and distribution channels to bring the product to the world. If a new product fails--no harm, no foul. The resources are only applied to risks that the association's members wouldn't otherwise take. And each member only put a tiny portion of its own resources into the effort. The experiments are by design high-risk, high-payoff ventures. Most won't work. But those that do will bring tremendous rewards to the industry and its association.

In my experience, most associations aren't geared to be on this kind of footing. My own association can only be said to do something similar in the sense that our members collectively fund some pre-competitive research projects inside our partner universities, seeking technological breakthroughs that no one member would seek on their own, but which all agree would dramatically advance the base technology of the industry. Other than that, we, like many others, are more geared towards servicing increasingly legacy products for what we all fear is a dwindling market.

Still, there's a lot of talk in the association market about the threats posed by for-profit competitors. Perhaps the anecdote contains the seeds your association needs to better respond to those threats?

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This post was written by Eric Lanke, an association executive, blogger and author. For more information, visit, follow him on Twitter @ericlanke or contact him at

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