Ever since we announced at the Summit in Atlanta in May that STC is experiencing an unprecedented financial challenge, the Board of Directors, chapter leaders, key committees, and staff have concentrated on finding an appropriate solution. I’d like to share that solution with you here.
A Little History
I can’t tell you how many conference calls in the past four months have been devoted to examining the finances, cash flow, budget, and services for next year because I lost count after 30 or so.
As I have outlined in previous emails and columns, the shortfall is primarily due to the negative impact the recession has had on our two main sources of revenue—membership dues and the annual conference. The revenue generated by these two sources provides the funding for most of the member benefits and Society activities. The 2009 conference was successful, but it did not generate the surplus that it has in the past. Similarly, the recession left us with a loss of about $400,000 USD in principal and interest from our investments, which have traditionally been used to provide support for activities that have as yet no revenue source, such as the Body of Knowledge and other key committee work.
The recession brought to light underlying weaknesses in our pricing structure that now force us to change the way we provide benefits. For years, STC has been adding and expanding services and activities to benefit members and the profession without taking a hard look at how to sustain those activities. And with only periodic, modest increases in fees, the costs to sustain those services and activities have outpaced our dues and total revenue to the point that the Society has actually been subsidizing these activities.
We Have Cut the Budget to the Bone—and Then Some
Cutting an already tight budget is not easy. I want to acknowledge the efforts of the staff and the Finance and Investment Committee for their extreme diligence in closely examining our financial reports, cash flow, and budget papers. They cut close to $1M USD in expenses during the last half of 2008 and throughout 2009. In preparation for the 2010 budget, every expense, every revenue source, and every activity was examined. We used a zero-based model to develop our 2010 budget and essentially built it from scratch. It is realistic, sustainable, and includes only those benefits and programs that we can afford during this economic downturn. It is definitely “bare bones”—and balanced!
I also asked chapters to plan their programs through 2010 and to develop associated zero-based budgets, and then, if possible, to forward their surplus funds to headquarters to help cover the anticipated shortfall in the fourth quarter. This approach allowed the chapters to “take care of themselves first” and then to help the Society through the financial crunch time. I’m happy to report that of our 101 chapters, almost all have now responded with a program plan and budget, and many with surplus funds. I am sincerely grateful to them for their understanding that STC is one organization and that by working together, we will come through this financial crisis. A few chapters have asked for a little more time to complete their budgets, and we are actively communicating with the remaining few to complete this phase of the recovery.
2010 Dues and Realignment of Prices
STC spends, on average, just under $250 to provide services to a member, yet dues rates have been well below that amount. As I mentioned earlier, for several years the revenue generated by the annual conference and our earnings from invested reserves have covered the difference—until now. We need to change our business model and adopt a pay-as-you-go approach.
In 2010, dues will cover basic member benefits with a la carte pricing for additional features. The core benefits remain, but with some changes. Basic dues do not include membership in a chapter and SIG. You are encouraged to take advantage of the many local and virtual benefits offered by chapters and SIGs by purchasing a la carte membership for $25 USD and $10 USD, respectively. All members will receive the electronic version of our publications. Print subscriptions to Intercom and Technical Communication are available for $30 USD and $75 USD respectively. The 2010 membership fees, approved by the Board of Directors, are:
Basic Membership $215 USD
Students $ 75 USD
Retirees $145 USD
A split payment plan for dues will be offered so that members can make four payments using a credit card. Details will be explained on the website. 2010 membership renewals will open online at noon EDT (GMT -4) on Thursday, 15 October.
STC will also offer a limited number of Gold Membership packages at $395 USD. The Gold package will include membership in one chapter and one SIG, plus registration for seven webinars, one online certificate course, the Salary Survey, and a Premium listing (50-word description) in the Online Buyers Guide & Consultant Directory. The value of this package is $1,458 USD.
STC will continue to give discounted membership rates to persons located in low and lower middle-income countries as classified by the World Bank. A Basic Membership in these countries will be $160 USD, and students in those countries will pay $60 USD. And, as you can see, the membership rates for students and retirees remain unchanged.
Some of our activities will also require fees, which we will implement in stages. New this year are administrative fees for applying for the Fellow and Associate Fellow honorary ranks. All entries to our international competitions will continue to pay a fee, with some modifications to the existing fee structure likely for the 2010 competitions.
In an effort to increase revenue sources, STC will offer nonmember subscriptions (print only) at much higher rates to Intercom and Technical Communication (the journal has permitted institutional subscriptions for years).
As we go forward, we are leaner by necessity, more efficiently organized, more focused on up-to-date service delivery, and ready to move into the future as a financially stable organization far less prone to economic impact.
Help for Those the Recession Has Hit the Hardest
STC will offer unemployed and underemployed members a lifeline to their profession in the form of membership grants and scholarships for the live web seminars and the Job Seeker Boot Camp. The Board has approved a limited number of Recovery Packages, partially funded by the Marion Norby Scholarship Fund. Details on selection criteria and application process are currently being developed by a task force and will be posted on the STC website soon.
This has been a very intense period for all of us. A great deal of time, talent, energy, and scrutiny have gone into building a balanced budget and program plan that will not only get us through 2010, but lay a solid foundation for a strong future—one where STC is viable, sustainable, and relevant.
I thank you again for continuing to be part of this great organization during these turbulent times, and for your trust in and support of the leadership team.
Cynthia C. Currie
2009-10 STC President