[SPEAKER_00]: If you want to grow the reach, revenue, and impact of your learning business, you're in the right place. [SPEAKER_00]: I'm Celisa Steele. [SPEAKER_01]: I'm Jeff Cobb, and this is The Leading Learning Podcast. [SPEAKER_00]: If you lead or work in a learning business, you already know the ground is shifting under your feet. [SPEAKER_00]: Slowly in some places and breath takingly fast in others.
[SPEAKER_00]: The familiar offerings, things like conferences, catalogs of courses, CE tied to life's insurer, those still work, sort of. [SPEAKER_00]: But that model is hollowing out.
[SPEAKER_01]: This year we spoke with 27 association CEOs about the role education and learning play in their mission, their economics and their future and one thing we heard remarkably consistently is that the old model isn't broken enough to force change, but it's definitely not strong enough to power the future. [SPEAKER_00]: We have an executive briefing called where mission and margin meet, and that combines what we learned from those CEO conversations with some of our own observations.
[SPEAKER_00]: And in this episode, we're gonna share a remote-style diagnosis of the core problems, many associations face in their learning businesses. [SPEAKER_00]: Things like the shift toward employer-driven demand, the explosion of supply, the drag of governance, the technology issues, and more. [SPEAKER_00]: think of this as a bonus audio chapter to accompany the executive briefing.
[SPEAKER_01]: And we hope this diagnosis gives you useful insight and for a fuller picture of how associations are thinking about learning and education, we encourage you to download and read the full executive briefing. [SPEAKER_01]: But let's dive in. [SPEAKER_00]: Okay, so I said we were going to do a remote style diagnosis, so Jeff, I think at the beginning of the conversation here, we should explain who remote is, what a remote style diagnosis is.
[SPEAKER_01]: That probably would be helpful. [SPEAKER_01]: So Richard remote is one of our favorite strategic thinkers and writers on strategy. [SPEAKER_01]: We lean on him pretty heavily in our own work in developing strategy for organizations. [SPEAKER_01]: He has a [SPEAKER_01]: very elegant and deceptively simple approach to strategy in which he really breaks things down into three key elements. [SPEAKER_01]: Diagnosis, guiding policy, and coherent actions.
[SPEAKER_01]: Diagnosis is what we'll focus on today, so Diagnosis means [SPEAKER_01]: really understanding the situation. [SPEAKER_01]: And until you do that, you can't or at least you shouldn't start making the choices that are going to allow you to solve the problems or pursue the opportunities that exist in that situation. [SPEAKER_00]: Jeff, you said, deceptively simple, and I think that's a very good way to characterize Romalt's work.
[SPEAKER_00]: I think so much of good strategy is deceptively simple, and understanding the situation to get to a diagnosis that involves simplifying the complex. [SPEAKER_00]: the situation, everything that's happening in the world and the environment in which any learning business operates, all of that's relatively complex, but you have to be able to home in on what exists and what's evolving that really matters and makes a difference for your learning business.
[SPEAKER_01]: And then once you've got that diagnosis, you can move to creating what remote describes as the guiding policy, which is the overarching approach to what you're going to do given that diagnosis. [SPEAKER_01]: So how will you make choices to solve the problem or take advantage of the opportunity that's before you? [SPEAKER_01]: And the guiding policy can be boiled down to just a few sentences usually that say, this is how we're going to go about our work.
[SPEAKER_00]: And then the coherent actions are going to translate that guiding policy into the trackable and manageable things that need to be done. [SPEAKER_00]: And I think one of remote key insights about strategies that you can't separate it from execution for strategy to work things have to be done. [SPEAKER_00]: And that's why coherent actions are part of what he covers.
[SPEAKER_00]: But for today, we're really going to focus on that first part on that diagnosis, not the guiding policy, not the coherent actions. [SPEAKER_01]: And we're going to base the diagnosis on what we heard in the association's CEO interviews, and what we know from broader work with learning businesses. [SPEAKER_00]: And we're focusing on the diagnosis in particular because we believe that big parts of this diagnosis will apply pretty broadly to many association-learning businesses.
[SPEAKER_00]: The guiding policy, the coherent actions, those are going to be more specific to any given association. [SPEAKER_00]: Now that said, for this to be a true diagnosis for your learning business, you're going to need to go deeper on the points that we're going to raise. [SPEAKER_00]: You're going to need to think about how they really apply in your specific situation. [SPEAKER_00]: but we do believe that the eight points we're gonna cover are broadly descriptive of the situation.
[SPEAKER_00]: Many most associated learning businesses are operating in. [SPEAKER_00]: And so the first point in our diagnosis, actually, already came up. [SPEAKER_00]: It came up in the intro. [SPEAKER_00]: And it's the observation that the old model still works well enough that it's actually blocking or form. [SPEAKER_01]: That's right. [SPEAKER_01]: This is the classic we don't have a bleeding at the neck problem here that you that you hear business leaders talk about.
[SPEAKER_01]: For decades, associations have been at the center of their professions learning ecosystems and they could charge reasonably for required CE or draw on member loyalty to get folks to come to conferences and courses and they could make enough from that to fund the rest of the work that they do or at least help to fund that work. [SPEAKER_00]: But more recently, we're seeing attendance and renewals and attention all dropping off.
[SPEAKER_00]: They can't be counted on as certainly as they could have been counted on in the past. [SPEAKER_00]: You know, many associations aren't getting the same level of attendance at conferences, or the same number of enrollments and courses. [SPEAKER_00]: Renewal isn't necessarily a given anymore. [SPEAKER_00]: And then, of course, on top of all that, simply getting member or learner attention has gotten much, much harder.
[SPEAKER_01]: So a lot of the leaders we spoke to said revenue from education is flat or even declining. [SPEAKER_01]: At the same time, learner expectations are rising. [SPEAKER_01]: They expect more polish and the latest and easiest tech. [SPEAKER_01]: They expect convenience and speed and this slow bleed, remember it's not a bleeding at the neck problem, it's a slow bleed that's creating a false sense of stability. [SPEAKER_01]: So the business isn't imploding.
[SPEAKER_01]: It doesn't look like an immediate emergency and as a result, words and executive teams. [SPEAKER_01]: maybe postponing fundamental or structural changes, postponing, honing up the investment needed for education, if it's going to continue to play the significant role in the association's value, and in the association's revenue structure that it has in the past. [SPEAKER_00]: So that's the first point.
[SPEAKER_00]: The second point in our diagnosis is a shift in power and focus from individual learners to employers. [SPEAKER_00]: Many of the CEOs that we interviewed are seeing great potential in serving not just those individual learners, but the employers where those individual learners work. [SPEAKER_01]: And arguably, this has always been true.
[SPEAKER_01]: I mean, you have an individual purchasing, but the employer has always been standing behind them as a source of reimbursement, or at least as important and freeing up the time for the learner to participate. [SPEAKER_01]: But the employer role is becoming more forefronted.
[SPEAKER_01]: A lot of companies, corporations, governmental agencies, whatever, are looking to outside sources to support what they're doing in training and training is one of those things that can fluctuate up and down with economic conditions and if employers can look to an association in their field that has the expertise that has the curricula that are going to serve their people, that's incredibly valuable and both employers and associations are starting to realize that value more now.
[SPEAKER_00]: And that point leads into our third point in the diagnosis, which is that supply has exploded. [SPEAKER_00]: There are so many more choices out there now, both for your B to C and B to B customers. [SPEAKER_00]: I mean, Jeff, you're just talking about employers recognizing associations as potential sources for training. [SPEAKER_00]: That's true.
[SPEAKER_00]: But it's also true that in some markets employers actually compete with the association, they have enough in how staff, you know, working in Ellen D that they're not going to decide to turn to an association to help them with onboarding or upskilling. [SPEAKER_00]: I mean, that's one example of some competition, but of course there are many others.
[SPEAKER_01]: Yeah, I mean, the markets flooded with free webinars and YouTube videos and vendor academies and massive open online courses and of course now we've got AI which can generate pretty much whatever you want in terms of a learning experience on demand. [SPEAKER_01]: But in the midst of that explosion of content and options, what scares is trust.
[SPEAKER_01]: And some of the CEOs talked about their associations, providing a stamp of quality in their marketplace, and many perceived trust as their last defensible advantage. [SPEAKER_00]: Yeah, a lot of associations are the owners or developers of standards, or they develop an owner certification. [SPEAKER_00]: They often have peers or experts reviewing content. [SPEAKER_00]: And I think all of that contributes to that idea of being a stamp of quality.
[SPEAKER_00]: So an association can say, hey, this material's been vetted. [SPEAKER_00]: It can therefore be trusted. [SPEAKER_00]: And that's not necessarily true of a YouTube video or a chatGPT answer, for example. [SPEAKER_01]: Yes, and we know credibility alone isn't going to pay the bill for developing content. [SPEAKER_01]: There's been too much of a culture that's developed over time among members of expecting to be trained or educated for free.
[SPEAKER_01]: And associations of caught between being a source, but then also being a validator of quality. [SPEAKER_01]: And at the same time, there are under tremendous pressure to offer content for free or inexpensively. [SPEAKER_01]: It's a difficult economic position to be in. [SPEAKER_00]: Yeah, what it takes to truly stand behind a stamp of quality can be quite expensive of the time in the energy that many people have to put into that review and validation that can cost a lot.
[SPEAKER_00]: So we have exploding supply and there's this issue of trust and for the moment associations tend to have an advantage there compared to the alternatives. [SPEAKER_00]: And what we mean by this is that many associations have landed on their current portfolio unintentionally. [SPEAKER_00]: It wasn't built intentionally. [SPEAKER_00]: They inherited a patchwork of the legacy programs. [SPEAKER_00]: And maybe there's not a whole lot of apparent logic.
[SPEAKER_00]: And I mean, both economic kind of pricing logic and then also logic from what content is covered. [SPEAKER_00]: So there's not a whole lot of logic about what's in their portfolio. [SPEAKER_00]: There's kind of just this attitude of, we have these things, we inherited them, we're going to keep them running. [SPEAKER_00]: and I know that a number of the CEOs that we talked with said they have really big catalogs but really a small percentage is being used.
[SPEAKER_01]: And we know that so much gets driven by committees and associations or individual subject matter experts who advocate for one course or another. [SPEAKER_01]: And as you said, it turns into a patchwork of offerings.
[SPEAKER_01]: The typical association portfolio is going to contain maybe one big or a few, you know, profitable offerings that may be a conference or maybe a certification, and then there will be some break-even offerings, you know, maybe a little online learning or some webinars. [SPEAKER_01]: And then there's typically a long tale of low-margin or just flat-out loss-making programs, and there's often no disciplined pruning. [SPEAKER_01]: It's very hard for organizations to sunset anything.
[SPEAKER_00]: Yeah, one of the CEOs said that the missing capability is purposeful abandonment. [SPEAKER_00]: And I like that phrasing, purposeful abandonment, kind of a nice fancy way of saying sunsetting. [SPEAKER_01]: We've talked about four of our eight points so far, so one, the old model is chugging along, not well enough to pave the way to the future, but also not badly enough to force reform. [SPEAKER_01]: Two, market power has shifted to employers.
[SPEAKER_01]: Three, supply has exploded, but authority and trust have not, and there's still a lot of authority in associations, and then four, the portfolio logic is broken. [SPEAKER_01]: Now the fifth point in our diagnosis is that technology and specifically AI are changing both production and consumption and doing it faster than most associations feel able to retool.
[SPEAKER_00]: I mean, at this point, it's easy for a learner to turn to chat GBT or an equivalent, maybe upload some source materials or point to an association publication and say, hey, give me some questions to help me prepare for the exam or help explain this concept to me. [SPEAKER_00]: Now those are things that associations have traditionally done, historically done, they've provided the exam prep, they've created micro learning.
[SPEAKER_00]: And so all of this raises an existential question for associations. [SPEAKER_01]: It really does. [SPEAKER_01]: I talk to a CEO who did this herself and good for her for doing it.
[SPEAKER_01]: She thought, [SPEAKER_01]: we're offering this exam prep towards a certification but maybe a learner could just go ask AI to create that prep and so she tried that and yes indeed AI created some completely viable exam prep for that certification and that shows that AI isn't just about delivery of efficiency and being able to crank out content.
[SPEAKER_01]: It's also that AI flooding the market with credible looking instruction which weakens associations claim to be the trusted source [SPEAKER_01]: unless associations build technical literacy and proprietary data advantages. [SPEAKER_01]: So back to trust, there's trust and authority and associations need to be able to use technology and AI tools to help surface and reinforce their trust and their authority.
[SPEAKER_00]: And I think that points naturally to an idea of an association taking all of its vetted content and creating a locked down AI model that only draws on that vetted material. [SPEAKER_00]: And I know at least two CEOs that we talked with were thinking along those lines of kind of creating a cordoned off large language model to be able to deliver immediate and personalized learning support that is vetted and grounded in that vetted, trusted content.
[SPEAKER_00]: But at least for those two, that was just an idea at this point. [SPEAKER_01]: We're seeing some associations implement AI, but more still in that, just talking about it phase. [SPEAKER_01]: And I'm also a little concerned that most of them are thinking about private AI as in terms of a member benefit, or something that built into their website.
[SPEAKER_01]: I'm not sure they're really thinking about it as professional development, as education, as something that could have a business model associated with it. [SPEAKER_00]: So the sixth point in our diagnosis deals with governance and along with governance we'll throw culture in there as well. [SPEAKER_00]: A lot of associations are structured in a way governed in a way that really rewards the status quo and it rewards continuity rather than experimentation or innovation.
[SPEAKER_01]: And during these interviews and in some other conversations I've had with CEOs I'm hearing leaders of organizations really question whether they should even be in the education business because they're having such a hard time with with governance and culture feeling like they're having to fight against governance and culture and in the meantime for profit competitors are running circles around these associations.
[SPEAKER_00]: The ability to experiment, I think, is going to be critical for association learning businesses who want to move beyond diagnosing this situation and get to those other parts of strategy that we mentioned at the beginning, the guiding policy and, of course, a set of coherent actions.
[SPEAKER_01]: And once CEO, I talked to you mentioned a radical restructuring of his organization, including looking at how committees are formed and dissolved, they had to change bylaws so they could be more responsive in agile. [SPEAKER_01]: Another talked about a constant battle to cut back on committees, but no sooner do they cut some back than others spring up. [SPEAKER_00]: Yeah, I remember that he said it was like playing whack a mole.
[SPEAKER_00]: So, that question of whether association should remain in the learning business at all is interesting because we asked the CEOs if associations were to stop offering education, what would the result be? [SPEAKER_00]: And several of them said, you know, I think somewhat sadly that they're not sure that people would miss it, would anyone even notice if they were to stop? [SPEAKER_00]: And personally, I think that [SPEAKER_00]: for many associations.
[SPEAKER_00]: If they were to stop offering education, that would be missed. [SPEAKER_00]: It would be noticed to me, not always, but I think often. [SPEAKER_00]: That said, even if it were to be noticed, I do think there is a broader recognition issue at play.
[SPEAKER_00]: I think associations aren't recognized in the way that [SPEAKER_00]: they perhaps should be when you think about the pivotal role that they play in adult life-long learning and continuing education and professional development, all that training that needs to happen after someone completes higher education or maybe not even higher education if a degree is an involved.
[SPEAKER_00]: So there's a lot of work and value that associations are delivering, but I think it's not [SPEAKER_00]: broadly recognized by society, and that's really the seventh point in the diagnosis that the understanding of association's role in education and learning is underdeveloped outside of the association world. [SPEAKER_01]: It really is, it's an interesting thought experiment.
[SPEAKER_01]: I suspect that if you were to turn off the tap completely on all association education [SPEAKER_01]: people would notice, pretty immediately, that it's no longer there, because associations are playing a critical societal role in adult life long learning. [SPEAKER_01]: And life long learning is increasingly recognized as essential in the world and in the economy in which we all live.
[SPEAKER_01]: But, [SPEAKER_01]: You don't often hear associations CEOs out there talking about that, making that point. [SPEAKER_01]: You don't see associations referenced in articles around life-long learning, I've noticed this for years. [SPEAKER_01]: One of the CEOs made the point that so much of what associations do tends to happen in back rooms and conversations about advocacy that maybe happen in the hallways of conferences.
[SPEAKER_01]: So what associations are doing is not necessarily visible in the way that you might see, for example, a university promoting what they're doing with continuing education and professional development. [SPEAKER_01]: I mean, for the university, that's their whole identity. [SPEAKER_01]: That's their business. [SPEAKER_01]: versus it only being part of what associations do, so universities are going to be out there in the press and media around that.
[SPEAKER_01]: They are out there in the press and media around that. [SPEAKER_01]: But a university doesn't have the kind of professional field industry and depth that an association has or that ongoing relationship in contact with a set of members of the people who are working in that field or a profession. [SPEAKER_00]: So that brings us to the eighth and final point in our diagnosis of the current situation for learning businesses and it has to do with capabilities and capacity.
[SPEAKER_00]: We heard clearly from most of the CEOs that we talked with, they know they need to be more data driven. [SPEAKER_00]: They know they need to have some sort of organizing concept like a competency model that drives what they're offering and they need to map their offerings to that organizing idea. [SPEAKER_00]: They know that they need to engage with employers and get really crystal clear on what those employers need and value.
[SPEAKER_00]: They know that they need modern technology that's going to help create that wonderfully smooth that user experience and provide ready access to rich data that they can mind internally to help make decisions. [SPEAKER_00]: All of that is clear, but having access to the money, the know-how, the time, the energy, to do all of those things, that's less clear. [SPEAKER_01]: and really that loops us back to the first point we made around the historical traditional model.
[SPEAKER_01]: It's just not broken enough for boards and executive teams to say, all hands on deck, we must invest the time and money in steering the ship in a different direction, hiring more people, hiring people with different capabilities, putting the technology and processes in place to be able to deliver excellent meaningful modern learning experiences.
[SPEAKER_01]: All that is different from just standing up a catalog and running people through an e-commerce system or standing up an event and taking registrations. [SPEAKER_00]: Yeah, I mean, you tied this back to the first point. [SPEAKER_00]: I think it also ties to the sixth point, which was about governance and culture, because part of what's at play is that acting in the way that these CEOs know they need to act really is often not what's familiar and comfortable for associations.
[SPEAKER_00]: This requires an agile mindset. [SPEAKER_00]: It requires an ability to make decisions quickly and then to act quickly. [SPEAKER_00]: It takes experimentation and being okay with some failures as long as you're learning from them.
[SPEAKER_00]: And a lot of what's needed to get the capabilities and capacity that these associations can be slowed down by those governing structures that are committee heavy or maybe rely on set monthly meetings and maybe decisions can't really be made outside of that meeting time table. [SPEAKER_01]: It gets back to the title of the executive briefing where mission and margin meet.
[SPEAKER_01]: There's a certain culture, a certain infrastructure, a certain operating model that goes with a mission-driven organization like an association that tends to be different from what you might find and say a commercial training provider or really any solely revenue-driven business. [SPEAKER_01]: associations have to balance mission and margin and that's a leadership challenge and it's one that many of the CEOs we interviewed are facing up to and wrestling with and good for them.
[SPEAKER_01]: Unfortunately, I think that more broadly across the association sector, that's not necessarily happening.
[SPEAKER_00]: Yeah, we're seeing association learning businesses grapple with that mission and margin question that you just pointed to Jeff, you know, they're thinking about how do they make sure that their portfolio is supporting their mission without draining the organization, maybe even contributing back to the organization and how are they making sure that what's in that portfolio truly is what should be there, what will serve the learners, what will serve the employers, what will serve society at large.
[SPEAKER_01]: So to some of the diagnosis up, the individual member retail model that once sustained associations is giving way to more employer-driven demand. [SPEAKER_00]: Abundant and often free digital offerings that are now available have created a very different dynamic in the marketplace. [SPEAKER_00]: There is so much choice now way more than there was a decade or two decades ago, certainly more than 50 or even 100 years ago when some associations were being formed.
[SPEAKER_00]: And because of all that competition, it's no easier and harder to even get the attention of your learners. [SPEAKER_00]: And then even if you do get their attention, even if they do recognize that they need to learn something, you're just one option in a field of many options. [SPEAKER_01]: Credibility remains high for associations at this point and it helps them stand out at least for now. [SPEAKER_01]: But that credibility and trust and authority need to be bolstered and guarded.
[SPEAKER_00]: There are governance issues and cultural habits that may be holding associations back from addressing the competition from pursuing opportunities like B2B models. [SPEAKER_00]: There are patchwork portfolios that need to be made more intentional.
[SPEAKER_00]: There's an under-investment in technology including AI and other aspects of capacity and capabilities and that under-investment is preventing organizations from being able to adapt [SPEAKER_01]: So the strategic core of the problem is a structural mismatch. [SPEAKER_01]: Association still operate as catalog providers in a market that now needs architects, really.
[SPEAKER_01]: Architects, designing, trustworthy employer and aligned, tech enabled learning pathways and infrastructure rather than simply maintaining a catalog of programs. [SPEAKER_00]: Be sure to visit leadinglearning.com slash episode 467. [SPEAKER_00]: There you're going to find a link to the full executive briefing that's based on these interviews that we did with association CEOs. [SPEAKER_00]: You'll also find show notes, a transcript, and options for subscribing to the podcast.
[SPEAKER_01]: If you enjoy the leading learning podcast, please share this episode or another with a colleague or co-worker you feel would appreciate and get value from it. [SPEAKER_01]: And please spread the word about the executive briefing too. [SPEAKER_00]: What we covered today is part of a larger story the CEOs that we spoke with offered sharp and honest insight about what's holding their education businesses back and what's needed to move forward.
[SPEAKER_01]: We hope today's episode and the executive briefing sparks some internal conversations and maybe some overdue shifts in your own learning business. [SPEAKER_00]: Thanks again and see you next time on the leading learning podcast.