Director's Corner
The Future of NELLCO
Attention Affiliate Members! -We need your input. Please volunteer for a focus group.
The Fall Board of Directors Meeting, hosted by
Helane Davis at Albany Law School, was very well-attended, with 22 of 25 members in attendance for some portion of the day-and-a-half meeting. We were warmly welcomed by
Tom Guernsey, Dean of the Albany Law School since 2002. Tom will step down in 2011 and will remain on the faculty. I want to once again express my deepest gratitude to Tom for his foresight and generosity of spirit in welcoming NELLCO to Albany Law School. I think it will prove to have been one of the best decisions for NELLCO in the long run. Thanks, Tom!
During the meeting Board members had ample opportunity to discuss and debate what else is needed for NELLCO's long term health and success. The changing economy and the information revolution we're currently undergoing have both had significant impact on libraries and librarians. NELLCO needs to respond to those realities in ways that are purposeful, sound and
mission consistent. As a member-driven organization we need to be sure we're continuing to provide a sufficient value proposition and that we're well-positioned for the future.
As I reported here in the previous issue, NELLCO contracted with
Organizational Design and Development Associates (ODDA) to help us evaluate our long-term viability. ODDA presented their findings to us at the Albany BOD meeting. They loooked at five key performance measures and benchmarked NELLCO against other organizations across those measures. The measures include: net profitability, operating efficiency, personnel productivity, liquidity, and leverage. The results identify NELLCO's financial strengths and weaknesses. While for the most part we compared favorably to other similar organizations, ODDA was able to foresee some potential obstacles for NELLCO over the coming years if we continue with the same rates of revenue and expenses.
Given NELLCO's significant growth (25 members in 2001; 111 members as of this writing) our expenses predictably have increased. We've taken on new projects and programs, added staff and established institutional administrative independence. However, the rate of increase in our revenue stream has not kept pace.
ODDA projects that we will deplete members' equity within the next decade if we continue to operate over the next five years as we have over the past five years. While some might interpret this as "we're spending more than we're earning, and that's bad," it actually reflects the fact that we've been growing, and spending to support that growth, without developing new or additional revenue streams. That's not bad, but it's not good business. So we need to make some changes.
Given what we've learned from ODDA, we have three options: decrease expenses, increase revenue, or both. We're opting to do a bit of both.
Decrease expenses
We are actively working to trim expenses. Our biggest category of expenditure at almost 63% of our total operating costs is personnel (salaries and benefits). This year's budget reflects a freeze on my salary as part of this effort. However, looking long term at NELLCO I see personnel as an area that will need to continue to expand if we remain on our current growth trajectory. This a reflection of NELLCO's success as an effective organization.
Our second highest category, at 21% of our operating revenue, is spent on consultants. These include accounting services, legal counsel, professional consultancy services, and most significantly outside IT and technology support. We are currently in talks with the
Washington Research Library Consortium (WRLC) to explore the possibility of a shared IT employee. Such a relationship would help us to cut our expense on outside IT/tech support. At the same time we might discover other opportunities with WRLC that would be mutually beneficial and help us to contain spending in other areas. I visited their facility and met with Executive Director Mark Jacobs and I'm optimisitic about the potential for this to be a win-win opportunity.
Increase Revenue
The sole source of NELLCO's operating budget is member dues. It's been a point of pride within NELLCO that we've been able to freeze dues over the last several years for all of our members. This year, Affiliate and International Affiliate member dues remained frozen, while Full Members saw a 10% dues increase from $5000.00 to $5500.00. That's the first increase for them in almost 10 years.
In order to increase dues revenue there are two options: increase dues or add members. Here again, we plan to do some of both. We haven't yet determined how we'll approach this but we'll keep the membership advised as we move forward and we invite your thoughts.
Another key area we are exploring is non-dues revenue. Here is where we're exploring some exciting revenue generating ideas that will provide a needed product or service to the membership. These are things like continuing education and professional development opportunities, modifying our e-resource transactions to include a small transaction fee, seeking donations for target projects, career services, etc.
Overall, the ODDA report was comprehensive, timely and money well-spent. NELLCO is a thriving organization that needs to look to the horizon and make the necessary course corrections to see us into the next phase of our organizational life. We're in a very admirable position.
Focus Group Participation
This is your chance to make your opinions heard! After ODDA's presentation the Board of Directors agreed that it was important that we gather information from the broader membership base to help us determine where we should focus our energies and resources. To that end, we are holding a series of focus groups at the AALS Annual Meeting in San Francisco. The meetings will be held on site at the Hilton Union Square. If you represent an Affiliate or International Affiliate Member Library, will be in SF from 1/6-1/8 and would like to participate in a one-hour focus group about NELLCO, please send me an e-mail. Participants will be selected on a first-come, first-served basis and dependent upon availability. No more than one focus group participant per library please. Participating libraries will receive a $100 discount on their dues for 2011-2012 and a small token of our appreciation for your time. Please consider participating. NELLCO is your organization!
I'm very excited about what lies ahead!
Yours In Collaboration,
Tracy L. Thompson-Przylucki
Executive Director
Mark your calendars now for NELLCO's Annual Meet & Greet in Philadelphia. Sun. July 24, 2011 from 5:30-9:00 pm. This year we've planned something a little different and you won't want to miss it! It won't be our traditional drop-in style event. You'll have to commit from beginning to end. But we're not quite ready to spill the beans yet. Just make sure to not to schedule any conflicts during this time slot, or you won't be able to join us!