Have You Heard?
Change is challenging, tricky and something that is often met with much resistance.
It can completely revamp a business or an organization and make it better than ever. Other times, it's a company's way of cleaning house—sweeping away costly, long-term employees in an effort to save a few bucks.
Recently, the Print Services and Distribution Association (PSDA) turned itself on its head. It tossed out its long-standing business model, fired at least one-third of its staff and entered into a contract with a private company to handle its business. This summer, the PSDA announced it had signed a contract with Chicago-based association management firm SmithBucklin Corporation.
The move is not really expected to save any money. Association president George Crump confirmed it will save money on staff and infrastructure; however, those funds will be channeled into resuscitating a nearly nonexistent education and training program. He said it's something the membership has been begging for.
"This will take our association to the next level," Crump said. "The industry is changing. We had to focus on our membership's needs, deliver best practices and bring the best value and most benefits to our stakeholders. And, we needed to redevelop our management team."
The decision to shake things up within the association began in 2009, following the creation of its strategic plan for the upcoming years, according to Crump. The association's board of directors was looking at some leaders who were about to retire and others who seemed to be out of touch with the association members' needs.
During the strategic planning process, the association's 12-member board of directors determined it needed to develop a transition plan for the management and leadership of the organization. Despite the illusion that the decision was taken lightly, Crump said it took great thought and research. And the board was unanimous in its decision to move on with a private company.
"The needs of the association were changing and now was the time to change with it," Crump said. "We needed an overhaul of management. Some were there almost 30 years. If we continued on the same path using the same business model, we would have put the organization in some financial risk, long-term."
So, the board determined it needed to begin thinking outside the box, looking at what was going to revitalize the organization and keep it strong and useful for its members.
Crump declared the organization's current primary goal is to get back to basics. The PSDA wants to get back to providing high-quality education and training programs for sales and customer service professionals.
"Over time, we lost our emphasis on training and education," Crump said. "It went away . . . We were without good quality [training and] education for about 10 years."
Before entering into the agreement with SmithBucklin, Crump explained the PSDA did not have "sufficient resources and people with the skill sets, platforms and mediums to deliver a curriculum, a university-level of training."
As for staff, it has been cut considerably. Crump was unwilling to give hard numbers but said "as of right now, one-third to one-half" have been let go. "We're still transitioning." He added, some were hired into the new staff. However, some are still being evaluated so the final head count remains unknown.
The PSDA made one of its biggest staff announcements in late-August. The organization named Matt Sanderson, an employee of SmithBucklin, as executive vice president. Sanderson will manage all business operations for the association. Previously, Sanderson was a director in the Chicago office of Sikich Investment Banking, where he advised owners and senior executives of privately held companies.
Crump revealed that these changes are very positive.
For example, the move to this business model will allow the PSDA to cut its costs in terms of staff and infrastructure. He refused to discuss exact figures but said this year's projected costs for staff and infrastructure account to be between 60 percent to 65 percent of its budget. The industry standard is about 50 percent, Crump noted. Entering into the three-year contract with SmithBucklin will allow the PSDA to get that figure "under 50 percent or even the mid- to high-40 percent."
Nevertheless, that doesn't mean reduced membership fees or any other cost-savings for association members. The money generated from cutting staff and infrastructure costs will be funneled into education and training.
"It's really exciting," Crump said. "What we intend to do is take the money saved and add value to our education and training. Invest in technology and fund social media initiatives to market our brand."
Though the goal is to offer a top-notch education program, Crump could not provide any further details about its plans. He added that outsourcing will allow the PSDA to utilize shared resources and "equip the membership with the training and tools they want and need to compete in this changing industry."
Though Crump believes this decision is for the best, he recognized that not every member is going to agree with it.
Print Professional asked association members and others in the industry to weigh in on this decision. The feelings were mixed.
For example, Steve Singer, president of Micro Format, Inc., commented, "While the decision to change the business model may or may not be correct, the way it was handled—totally secret, behind closed doors—was very disappointing."
Crump said it's difficult to include a 1,400 membership in a senior leadership decision. "The membership elects the board to do what's best. We did it with counsel, significant consideration and deliberation," he remarked.
Crump noted that the organization will continue to evaluate SmithBucklin during its three-year contract. "We are looking for long-term success," Crump added. If we don't like something, immediately we can reject it."
In response to the magazine's survey, Ray Kontof, president of La Salle Copy Service, asked, "Why can't PSDA run itself efficiently? Why does outsourcing seem to be the way to correct problems? What was the old business model? Why didn't it work?"
Crump responded pretty simply.
"Because the existing model and existing staff was not well equipped for challenges of the future," he commented. "The association and membership is getting smaller and the economy is dictating change. The existing model was too big. Outsourcing can expand and contract on a daily basis. If you need a writer for only half the time, that's what you get. You don't have existing staff there if you don't need it."
In addition, Crump said, "Our members were clamoring for change. [They wanted] more efficient services, they wanted to be treated more like members and customers, they wanted better education and networking. The new PSDA will do that."
- People:
- George Crump
- Matt Sanderson
- Places:
- Chicago