VP Product Prioritization

6 Jan 2010Executive Committee

Process Recap

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• VP Product Reviews (June and July 2009): Drilled into VP Net Margin, showing financials for individual products on a

total cost basis. Revenue sources/direct expenses category breakdowns were provided.

• Institute Product Review (August 2009): Review products and their relationship to each other within the context of

the whole Institute to provide VPs with a “total financial picture”.

• VP Presentations (September-November 2009): Outline major program areas for each VP and their priorities

What’s Next?

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Action When

1. Conduct Institute Product Review Summer Exec Committee Meeting

2. Share VP plans and priorities August through December

3. Establish program priorities for FY11 ASM Exec Committee Meeting

4. Conduct VP Product Reviews, as needed January/February

5. Staff develop FY11 budget using VP plans February through May

6. Draft FY11 Budget presented May Board Meeting

7. Fine-tune budget using priorities May through July

8. Final Budget presented to Board Summer Board Meeting

Our Challenge

1. How do we absorb $1M in Operations in FY11? Absorbed all IT costs in FY10 Costs of doing business are increasing No significant new business on immediate horizon Existing products are not growing

2. What is the right mix of products and services to keep our business financials in balance and our members happy?

3. Where will we find sustainable growth? Expense management is not a growth strategy. Relying on vended and one time events is a risky operational plan. Acquisition of small conferences can’t bring sustainable growth. Can we leverage our infrastructure and expertise through strategic

acquisitions/mergers?4

Our Goal for Today

• To develop an integrated list of product priorities, spanning all VP areas, which: • Supports AIAA’s overall mission and objectives • Can be sustained through AIAA’s operational budget• Eliminates the need for support from the Institute’s

investment portfolio• Serves as a roadmap for creating the FY11 budget

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Product Priority by VP: Financial Performance Key

• Using the VP presentations, create a list of priorities within each VP• Classify financial performance of products:

Green: Margin greater than $50K Yellow: Margin between -$50K and $50K Red: Margin below -$50K

• Margin defined as Revenue less Direct Costs less Salary/Benefits (no indirect allocations applied)

• FY10 Strategic Plan items (indicated with “*”) have been included within Public Policy and Communications activities, consistent with VP presentations

• Financials based on FY09 actual results and FY10 Strategic Plan budget

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Product Priority by VP

Member Services TAC Standards Public Policy

Professional Membership TC Sponsored Events Domestic Standards Grassroots*

Young Professionals Vended Events CCSDS Secretariat Public Policy Events*

Honors & Awards TAC Committee CCSDS Meeting Inside Aerospace

Section Activities Paper Subscriptions SMC Contract Government Relations*

Regional Leadership Conf Publications ISO SC-14 Secret. Lobbying

Historic Sites Journals SC 14 TAG Government Fellow*

Western Office Education Books International Outreach

Fellows Dinner Progress Books Intl Activities Comm. Aerospace America

Education Library of Flight Books IAF Communications*

Student Programs Alliance Books ICAS Business Development*

Pre College Pubs & Service Center Embassy Events Corporate Membership

Professional Development International Pubs Space Ops Secret. Awards Gala

Education Alley List Rentals7

FY09: Product Margin (ex allocations)

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Member Services Educ TAC Pubs Stds Intl

Public Policy Outreach

• Product Margin = Revenue less Direct Expenses less Salary/Tax/Benefits.

9

Product Net Margin (with Allocations)

10

Member Services Educ TAC Pubs Stds Intl Public

PolicyOutreach

• Net Margin = Revenue less Direct Expenses less Salary/Tax/Benefits less Allocations.