Twelve top executives share the hardest calls they made as association leaders

Kathleen O'Loughlin joined a troubled organization when she became CEO of the American Dental Association in 2009. Finances were bleak, accounting was sloppy, there were regulatory compliance issues and the group had no management reports or strategic plan. "It was like picking up a rock every five minutes and going ‘Oh my god,'" she said.

Within a year O'Loughlin realized the only way for ADA to climb out of its budget hole was to make significant staff reductions.

"Second year here, and I wanted people to trust me and gain the trust of the employees, and I had to tell them we were going to have a significant, 20 percent reduction in budget, and most of our costs are people," O'Loughlin told CEO Update. "Trying to find an intelligent way to tell that to people and treat them like grownups was really a hard, hard thing to do."

O'Loughlin was one of 12 association top executives CEO Update recently contacted with a single question: "What was your hardest decision as CEO?"

The executives offered a range of answers, but there were common themes. One particularly difficult choice faced by many was the decision to lay off employees. O'Loughlin knew the anxiety that came with job termination because, in a previous role as head of a Massachusetts-based dental insurance company, she had pushed for consolidation with a former subsidiary that resulted in the elimination of her own position.

"I was scared to death," said O'Loughlin, a trained dentist. "Physicians, dentists and nurses have unique skill sets. One of them is not leading companies. Somebody told me to take the (doctor of medicine in dentistry degree) off my resume because it would hurt my chances of getting another job."

Telling staff goodbye

Michelle Korsmo, CEO of the American Land Title Association, said in an email that terminating someone's employment is always the toughest decision "because it's about people's livelihood."

"Hiring right is so important, but not foolproof," Korsmo said. "Constant communication on expectations and results is critical, knowing that if you have to make the call to let someone go, everyone at that table should know exactly what wasn't working. It's not easy, but it is respectful."

Peter Pantuso, CEO of the American Bus Association, said in an email that no matter the reason for terminating someone, "you know that you are having a direct impact on that person's future and livelihood as well as that of their family."

"As the CEO you need to remember that your loyalty is to the organization, and keeping the ship advancing and on course is the priority," Pantuso said. "The decisions to eliminate or reassign positions are being made for the benefit of the organization and those individuals who are continuing their career with the organization."

Laura Lott, CEO of the American Alliance of Museums, last year made the decision to eliminate several positions at the association as part of an organizational restructuring.

The group is instead focusing its limited resources on a handful of objectives, such as advocacy and member benefits.

"I made some tough decisions—personnel and otherwise—a few months ago to focus in on projects/priorities that will really move us forward," Lott said in an email. "Deciding what NOT to do is always the hardest in the nonprofit environment."

Terminating members

Letting go of staff is hard, but some groups have also needed to part ways with paying members. That was the dilemma that faced American Short Line and Regional Railroad Association President Linda Bauer Darr when she headed the American Moving & Storage Association. That group developed a code of ethics for the industry that, when implemented, would cost the association roughly 200 members.

"So we had a choice," Darr said in an email. "Either a) lower our standards or b) lose 200 members. We chose ‘b.' I believed we were doing the right thing by letting them go. We couldn't make false claims and endorse companies that didn't pass muster."

"We had agreed on those standards and it would be those standards that would ultimately be the membership hook that would allow us to grow again. And we did."

John Gray faced a similar membership schism when he joined the Healthcare Distribution Alliance as CEO in 2004.

Roughly 50 member companies were engaging in business practices that went against the association's and other member companies' advocacy priorities.

As a result, HDA's executive committee told Gray, "We hate to do this to you but in your first year on the job, you are going to have to fire about half the companies in the association."

"We had to re-establish the membership criteria and we knew these 40-50 companies could not meet it. … Much to our great surprise, after agonizing over this for a year, we sent out the letters and only heard from one company that said ‘Gee, we thought we were a good member,'" he told CEO Update.

American Cable Association CEO Matthew Polka faced a dilemma in 2008 when his group decided to file comments to the Federal Communications Commission in support of allowing cable providers to sell channels to customers on an à la carte basis. Some of the group's larger members opposed the proposal and pulled out of the association as a result.

"Looking back, although it was a difficult decision, it was also, ironically, an easy one, because we ‘put our feet in the right place, and then stood firm,'" Polka said, citing Abraham Lincoln.

"We knew the importance of making that argument at the time was the right thing to do to stand out from the crowd, and that the decision was more important to the long-term path, health, reputation and success of our members and our association than the loss of membership or finances that might occur."

Building the organization

Other CEOs have faced tough calls about restructuring their associations.

"(National Waste and Recycling Association) had gone through a great deal in the past few years, and most systems were in need of both superficial and long-term solutions," NWRA CEO Darrell Smith said in an email.

"From staffing, information technology, advocacy, budget, policies, human resources, membership, and a general sense of direction, everything was in need of reworking."

Smith implemented several changes. He created a flexible, team-oriented structure for staff. He started trimming existing contracts with outside vendors to save money. He also directed staff to rethink the group's value proposition for members and explore ways to increase the visibility of the association in Washington, D.C., advocacy circles.

Dan Berger, CEO of the National Association of Federally-Insured Credit Unions, said in an email that he has had to eliminate association activities stretching back three decades in order to refocus NAFCU's resources to the specific, current needs of the membership.

"This required a culture shift. It's been challenging, but it's also helped NAFCU grow in revenue and membership," Berger said.

"We focus on advocacy, education and compliance assistance, with a new emphasis on ‘extreme member service.' If what we are looking at doesn't fall into the three buckets of advocacy, education and compliance, we don't focus on it any longer."

Craig Purser, CEO of National Beer Wholesalers Association, said he has faced a series of tough decisions during his 13 years as head of the group, from choosing which policy proposals to pursue, to litigation. Still, the most important decisions involve hiring and retaining the best people, he said.

"While it's important that senior leaders provide strategic counsel and execute the association's goals, it is also critical that they understand the unique culture and values of our members, work well with staff internally and have a little bit of fun along the way," Purser said.

Finding solutions

Paul Pomerantz, CEO of the American Society of Anesthesiologists, said his toughest decision involved a lesson in humility.

Years ago he was a new CEO at the start of his association leadership career, but not long into his new job he came to realize the staff was unhappy because of a breakdown in communication between his office and the rest of the organization.

The first step to getting things back on track was a public apology.

"That was one where I had to go through the process of getting external information and then get in front of everybody," Pomerantz said.

"That was quite tough because, as a CEO, it is not easy to admit you're vulnerable, you're wrong, and apologize to people. It is hard to say that the things that we've done in the last year were wrong. So all the effort, all the energy, everything I've given to you has been wrong."

For Richard Yep, CEO of the American Counseling Association, the toughest decision involved taking a policy stance that could have had big financial ramifications for his association. Tennessee passed a law in 2016 allowing counselors to refuse to see LGBTQ patients. The association strongly opposed the law, but had an upcoming annual meeting in the state capital of Nashville.

"The board voted to relocate the event which meant that the staff and I had about 10 months to find a new convention center, hotels, and create all new promotional material for an event that featured more than 400 education sessions and required 100,000 square feet of meeting space," Yep said.

In the end, ACA was able to find space in San Francisco.

"It was a very difficult decision but it had a happy ending," Yep said.