Is your association waiting to adopt new technology? Maybe you lack staff buy-in or have budget concerns. Perhaps you’re worried about losing your member data or don’t have a clear strategy for determining which software would best benefit your organization.
Waiting to adopt new technology can greatly cost your association. Digital transformation is critical in future-proofing your organization. When you choose new technology, you’ll modernize and optimize your organization by automating your tasks, and ultimately you’ll increase your technology ROI.
If your organization hopes to achieve a successful digital transformation, choosing the right association management software (AMS) is key. Read our blog to learn the true cost of waiting to adopt new technology.
Why do associations wait to adopt new technology?
Gartner reports that 89% of board directors say digital initiatives are embedded in their growth strategies. However, only 35% have achieved or are on track to achieve their digital transformation goals.
If technology investments help organizations grow, why do so many wait to invest? It’s not uncommon for associations to feel apprehensive about investing in new association management software (AMS). Here are some of the top reasons organizations wait to invest in new technology:
- Lack of staff and board buy-in
- Budget concerns
- Lack of clear strategy and objectives to adopt new technology
- Concerns about member data privacy and security
- Belief that pain points aren’t severe enough to warrant new technology
What is the cost of inaction?
The cost of inaction (COI) is the identification of organizational issues causing your association pain or challenges which can be uniquely rectified with technology.
If you choose to not adopt new technology, it can lead to great costs for your association over time. Your organization may choose inaction due to a lack of clarity or technical understanding. You might even be unconvinced of the value of a new AMS. However, choosing to adopt new technology and beginning your digital transformation will help your organization meet your goals and offer more tangible member benefits well into the future.
What is the difference between cost of inaction (COI) and return on investment (ROI)?
Now that you understand the true cost of inaction (COI) when not adopting new technology at your association, it’s important to understand how new technology can offer a return on investment (ROI).
While ROI measures the benefits of taking action like revenue generation, COI tracks the potential losses incurred by failing to act. COI is focused on minimizing operating costs, whereas ROI is focused on maximizing your incremental revenue.
When it comes to the true cost of inaction, if your organizational issues go unresolved for the long term, your entire association will suffer as a result. Your staff will feel the strain of manual processes. You might even risk lapsed membership or non-members choosing other organizations for more tangible benefits.
How to calculate the COI at your association
When it comes to calculating COI at your organization, you’ll want to consider these important factors and ask yourself the following questions:
- How many members do you have today?
- What is the average cost of your membership (annually)?
- Is your annual membership revenue at risk? (Give a percentage)
- Based on the percentage above, what is the financial impact on your organization?
- Have you experienced any technology savings from upgrades?
- Have you experienced any savings from automated tasks?
Why considering COI is important for your organization
The consequences of inaction are too great for your association. The longer you continue with your old software, the longer your organization stays in the status quo and your operations will stay as usual.
When you invest in new technology, you’ll avoid the following issues:
- Missing out on the newest technology trend
- Organizational inefficiencies because of mismanaged member data needed to make informed decisions
- Low quality member experiences, ultimately impacting membership retention
- Higher software maintenance costs, leading to costly product upgrades
- Increased security risks including data breaches and exposed member data
- Missed revenue opportunities for your association, leading to wasted staff productivity and time invested in other parts of your organization
