Operational Report

Board of Directors MeetingJuly 28, 2007Garden Grove, California

Neal J. Couture, CPCMExecutive Director

Year in Review: 2006-2007Financial

• Increased total revenue by 9% from 2005-2006, from $5.033 million to $5.494 million.

•Exceeded goal for investment revenue by 155%.•Completed annual audit on schedule and with no

significant findings.•Completed transition of all financial services to

Wachovia, without interrupting financial controls or operations.

•Successfully managed cash flow, credit and reserves during office acquisition and relocation, and major IT project implementations.

Year in Review: 2006-2007Management

• Launched the Contract Management Leadership Development Program (CMLDP), graduating 34 students in the first year.

• Launched the W. Gregor MacFarlan Excellence in Contract Management Research and Writing Program. Raised $10,000 in sponsored funding annual commitments for the program.

• Exceeded ASAE benchmark for staff efficiency – salaries and benefits are 31% of revenue compared to benchmark range of 35%-37%, and we have 23 FTEs versus benchmark range of 39.0 FTEs – 40.4 FTEs, for associations of our size and type.

• Exceeded ASAE benchmark for staff productivity based on revenue per employee of $258,112 versus ASAE benchmarks of $185,000 - $197,000 per employee, for associations of our size and type.

Year in Review: 2006-2007Management (continued)

• Implemented new Customer Relationship Management (CMS) system on schedule and within budget.

• Implemented new project management system for managing creative services projects (edit, design, production, etc.)

•Purchased new office condominium, negotiated sub-lease of former office space, and conducted office relocation within extremely tight schedule constraints.

Year in Review: 2006-2007Conferences

•Conducted highly successful World Congress 2007, the largest in terms of gross revenue, exceeding the profit (net revenue) goal by 5.8% ($28,000).

•Exceeded profit (net revenue) goal for Government Contract Management Conference by 26.8% ($31,000).

•Exceeded profit (net revenue) goal for Aerospace and Defense Contract Management Conference by 39.4% ($17,000).

• Increased overall revenue from exhibits and sponsors 8%.

Year in Review: 2006-2007Education and Certification

• Expanded audio-seminar program, increasing the total number of sessions and the average attendance, and launched the “basics” series. The audio-seminar program has now gained recognition and acceptance across the association

• Increased education revenue by 14%, the third consecutive year of growth.

• Increased certification participation: 8.5% more new certification applications, 11.8% more recertification applications, and 15% more new certificants than the previous year.

• Obtained equivalency determinations from DAU and FAI for our certifications, increasing the value of NCMA certification to Federal employees.

• Completed an outside psychometric assessment of our examinations, continuing to improve the quality of the certification program.

• Implemented new certification examination service, improving customer experience for people sitting for the exams.

Year in Review: 2006-2007Membership

•Conducted and published 2006 salary survey, a widely recognized and cited report within the profession.

•Recovered several large group memberships, including VA.

• Increased the number of student members by 38% (to 468).

•Conducted 2006 membership survey, increasing participation from non-members to improve data.

Year in Review: 2006-2007Component Relations

•Launched e-newsletters for BOA, COF, and Students.

•Published the Chapter Guidebook.• Implemented on-line submission and review of

Graalman award applications.•Chartered Christopher Newport University

student chapter.•Conducted highly-successful Mid-year

Leadership Conferences in Annapolis, Orlando, and Las Vegas, and Leadership Summit in New Orleans, training more than 300 volunteers.

Year in Review: 2006-2007Advertising

• Significantly increased jobs website utilization: 35% increase in # of registered job seekers; 23% increase in # of job applications; 37% increase in # of resumes; 8% increase in # job ads posted, and 4% increase in revenue.

• Increased education partners revenue 55%.• Increased corporate sponsors revenue 444%• Launched e-newsletter ads, creating a new revenue

stream.• Sold out website ad space (again).• Conducted two career fairs in conjunction with national

education conferences, creating a new revenue stream.

Year in Review: 2006-2007Publications

•Published:– “The Desktop Guide to Basic Contracting

Terms, 6th edition”– “The Annotated Guide to the Contract

Management Body of Knowledge (CMBOK), 2nd Edition”

– “Leadership: Building High-Performance Buying and Selling Teams”

Annual Operating Plan 2007-2008 Financial

Revenue FY 08 FY 07

Governance 8,400 5,400

Membership 1,773,224 1,667,385

Education 1,002,564 815,064

Advertising 1,397,642 1,401,843

Certification 106,065 77,173

Meetings 1,669,475 1,527,283

Total Revenue 5,957,370 5,494,148

Annual Operating Plan 2007-2008 Financial (cont.)

Expenses FY 08 FY 07

Governance 129,300 101,636

Component Relations 264,663 277,816

Administration 1,891,353 1,944,528

Membership 321,251 273,074

Education 710,604 636,109

Creative Services 1,132,002 1,065,848

Certification 189,098 155,068

Meetings 1,149,084 992,716

Total Expenses 5,787,355 5,446,797

Annual Operating Plan 2007-2008 Financial (cont.)

FY 08 FY 07

Net Gain (loss) from Operations 170,015 47,351

Investment Gains/(Losses) 120,000 269,255

Other Income/(Expense) (104,433) (69,876)

Net Gain (loss) before Income Taxes 185,582 246,731

UBI Tax 90,000 100,000

Net Gain (loss) after Income Taxes 95,582 146,731

Annual Operating Plan 2007-2008 Management

• Implement the Content Management System (CMS) and EducationDirector system.

• Improve customer identification data (contact information, preferences)

• Implement survey feedback for transactions.•Establish a quality benchmark metric for

customer service feedback.

Annual Operating Plan 2007-2008 Conferences

•Aerospace and Defense Contract Management Conference.– 189 paid attendees (increase from 181).– Improve attendee satisfaction rating from 76% (2006) to

80%– Develop relationships with AIA and NDIA for 2008 event.– Select ADC 2009 site and execute facilities contract.

•Government Contract Management Conference– 391 paid attendees (increase from 381).– Maintain attendee satisfaction rating of 98%.– Increase the number of exhibits.– Select GCMC 2008 and 2009 sites and execute facilities

contracts.

Annual Operating Plan 2007-2008 Conferences (cont.)

•Executive Contract Management Conference– 40 paid attendees (last year’s was cancelled).– Achieve attendee satisfaction rating of 90%.– Select ECMC 2008 site and execute facilities contract.

•World Congress– 869 paid attendees (increase from 787 paid).– Maintain attendee satisfaction rating of 95%.– Increase student involvement through on-site volunteers

and conference content.– Select WC 2010 site and execute facilities contract.

•Re-assess conference portfolio, including the timing of World Congress, and location and timing of ADC.

Action Item: World Congress in Canada• Exchange rate is $1 USD - $1.043 CD• Facilities in major Canadian cities are commensurate to

United States properties.• Air travel options and pricing commensurate with

United States cities.• 85% of attendees are members.• Currently 43 members in Canada.• 25% of attendees are from local area.• 81%-92% of conference attendees indicate they are

involved mostly in domestic business.• Possible change to travel rules requiring passports for

travel to/from Canada.

Action Item: World Congress in CanadaPros• Comparable flight

availability and prices.• Comparable hotel

facilities.

Cons• Foreign travel

requirements for most attendees, may require special employer approvals.

• 85% attendees are members, but we have only 43 members in Canada.

• Weather concerns for April.

• Does not serve current strategic objectives.

Conference Portfolio: Schedule and Locations•Move Congress to July?

– Avoid weather considerations.– Increase flexibility in location selection.– April is filled with calendar challenges – Easter,

Passover, spring break, ISM meeting.– July is not peak conference season, so more facilities

would be available. May get better rates.– Avoids “April Miracle” scenario – moves Congress to 1st

month in our fiscal year.– Attendees may add-on vacations.– Have done this before – 2002 in Long Beach.– Possible co-location of Leadership Summit.– Any change represents risk.

Conference Portfolio: Schedule and Locations•Move ADC to March and vary locations?

– We have a potential conflict in 2009 – Congress in Long Beach in April (contracted) and ADC in July (no contract yet).

– Aerospace community not as concentrated in Southern California.

– Moves smallest conference to the end of the fiscal year.

•Possible change of conference brand away from aerospace and defense.

•Aerospace and defense could become a community of practice – this conference would be a product in that portfolio.

January Mid-Year Leadership Conference w/BOD

February Mid-Year Leadership Conferences (continued)

March Aerospace and Defense Contract Management Conference w/Budget meeting and BOD

April

May Community of Practice Conferences

June

July World Congress, Leadership Summit, BOD

August Academic Conference

September

October

November Government Contract Management Conference w/BOD

December

Annual Operating Plan 2007-2008 Education

•Audio-Seminars– conduct 26 seminars, serve 2600 sites and 13,000

participants– improve customer identification data (names and

contact information of site participants).– increase average evaluation ratings from 3.73 (FY2006-

2007) to 3.83.

•Contract Management Leadership Development Program (CMLDP)– improve net promoter score (NPS) from 35% to 70%.– improve mentor program.– Improve communications.

Annual Operating Plan 2007-2008 Education (cont.)

•National Education Seminar Series (NESs)– conduct 58 seminars, serve 2462 attendees– increase average evaluation scores from 4.19 to 4.3

•Books– sell 2712 units

•E-courses– implement EducationDirector learning management

system– develop and field between one to three new e-courses

of NCMA design– sell 252 e-course units from third party sources.

Annual Operating Plan 2007-2008 Certification

• Implement question item modifications in all three exams

•Validate certification data and processes in CRM

•Achieve 288 new certification applications•Achieve 495 recertification applications•Establish benchmark measure for

recertification rate

Annual Operating Plan 2007-2008 Membership

• Increase the value of membership by introducing new members-only benefits.

• Increase membership by 5% from 17,729 to 18,615.

•Recruit 4500 new members.•Retain 78% of existing or former members.• Increase student membership to 700.•Launch Expert Directory.•Expand new member orientation program.• Implement dropped member survey.

Annual Operating Plan 2007-2008 Component Relations

•Chapter Services– Improve membership information provided to chapters.– Implement chapter websites using CMS (transfer from

intranet).– Launch e-courses for chapter leaders.– Improve chapter feedback ratings.– Establish and publicize national accounts for online event

registration, teleconference and webinar services, and email services.

– Establish a master NCMA email address and account for each chapter, accessible to chapter leaders through the internet.

– Implement a Chapter Leadership Expert Directory.

Annual Operating Plan 2007-2008 Component Relations (cont.)

•Leadership Summit– Southern California area site TBD– Increase attendance to 130 volunteers.– Improve attendee feedback ratings.

•Mid-year Leadership Conferences– Las Vegas, San Antonio and Daytona Beach, FL– Increase cumulative attendance to 175 volunteers.– Improve attendee feedback ratings.

Annual Operating Plan 2007-2008 Component Relations (cont.)

•Fellows– Launch an online community for Fellows.– Implement Expert Directory

•Board of Advisors (BOA)– Launch an online community for Advisors.– Increase the size of the BOA by 25%.

•Awards– Increase the publicity of award winners, and calls for

nominations.

Annual Operating Plan 2007-2008 Advertising

• Increase advertising revenue from the Resource Guide.

• Increase website and newsletter banner ads.• Implement marketing campaign for

CMJobs.com website.• Increase magazine circulation through

complimentary subscription program with education partner customers.

• Increase exhibit sales for Career Fairs.

Annual Operating Plan 2007-2008 Publications and Creative Services

•Redesign the appearance of Contract Management magazine

•Publish a more robust and redesigned journal • Implement CMS system, and redesign the

websites•Redesign the Resource Guide•Expand the GCMC career fair to include same

services as Congress event