Evolving NEPA board makeup--not to everyone's liking--crystallizes the association's future.

Only about half of the 22 members of the Newsletter & Electronic Publishers Association board of directors "meet their own payrolls"--a far cry from earlier days of the association when the board almost entirely comprised owners of their own companies.

At NEPAs June conference in Washington, D.C., some members told us that they were unhappy with this transformation of the board's makeup. One Washington-based sole proprietor, who does meet his own payroll, said, "It distances me from my own association."

In response to that sentiment, NEPA president Robert K. Jenkins said, "Toro poo poo! It's a non-starter as an issue." Jenkins, who heads the company he founded, Health Resources Publishing in New Jersey, continued, "I don't accept what this person is saying. All of the board members are activists within the association. They've headed working groups, served as chapter presidents, spoken at conferences, headed conference tracks.

"If this person feels distanced from NEPA, he or she should get involved," Jenkins said. He pointed out that the growing number of professional managers, or corporate types, on the board "is a reflection of the business. It's a reflection of the maturity of the industry--including all the M&As afoot."

Another longtime member who founded his own company, served in a number of NEPA positions, including president, and then sold his operation, said off the record, "This has been discussed for a number of years as guys who did meet their own payrolls graduated off the board. I agree it is a concern. To lie awake some nights worrying about income vs. outgo makes you far more conservative than the person getting a check on Friday whether it was earned or not.

"One worries about people who don't live or die by the bottom line making decisions for an association of our size (witness some of the locations of some of our meetings over the past few years)," he said.

Background

Howard Penn Hudson, who was instrumental in founding the association, said, "I think these people are right than an association would be more cohesive if more owners were involved. I think more owners is a good thing. But having the two groups together helps because they educate each other."

Hudson said that in the early days, George Lutjen, then head of McGraw-Hill's Newsletter Group, "very much took a leadership role in helping us--and he certainly didn't own McGrawHill. But he was able to tap into the company when needed. For instance, the association was once facing a tax problem on behalf of its members, and George brought in a top tax gun from McGraw-Hill who proved to be quite helpful--and one of the caliber that few newsletter publishers then had access to."

Regarding the growing number of non-owners on the board, Hudson concluded, "People who are troubled by this difference in the makeup of the board are not making use of the association. If they feel underrepresented, they should make their views heard."

Succession

Fred Goss, executive director of the association from 1979 to 1994, said, "A few of the old timers used to say, 'It was better when it was eight or ten of us sitting around a table, and we were all publishers, and we talked about "real problems" (instead of conferences of 500+ with seven or eight tracks).'

"But the board was always term-limited and as the founders left, it was decided that their companies should retain spots on 4 the board, which led to a second generation of non-owner managers. There was some sotto voce grousing," Goss said.

That trend has accelerated in recent years, resulting in the board's rising number of professional managers who run companies they neither founded nor own.

A greater trend in the industry

Dan Oswald, current vice president of the board and president of Lawrence Ragan Communications Inc., Chicago (founded by a former association president, the late Lawrence Ragan), typifies the industry's "professional managers." He was hired by Ragan to run the company along with chairman Mark Ragan, son of the founder.

Oswald briskly defended his and other non-owners' roles within the association: "I believe that the change in the makeup over time reflects a greater trend in the industry," he said.

"When the association was founded, it was made up of primarily small, entrepreneurial companies with few or no employees beyond the principal and his or her family. That has changed. Many of those entrepreneurs grew their businesses significantly over time. In doing so, they added professional managers that play significant roles in the company....

"Then there are others who have grown their companies and then sold them. David Foster, Tom Phillips, Mike Mealey, and Wayne Cooper all fit this description. All were sold to larger organizations, not entrepreneurs-maybe out of necessity because they were so successful that the big firms were the only ones with the resources to buy them. Does that mean that suddenly David or Wayne are no longer fit to be board members because now BNA 'meets payroll' for them?

"Mike Mealey was a longtime board member. Now that his company has been sold, should everyone from Mealey's be barred from board service because they don't have to 'meet their own payroll'?"

Mike Mealey, for his part, weighed in with this comment:

"I would say that not meeting a payroll doesn't necessarily mean you are financially irresponsible, but it does set you apart from those who have the responsibility to underwrite the paychecks."

Diverse membership is an asset

The mission statement of NEPA (see sidebar), Dan Oswald went on to point out, "doesn't say anything about members being limited to or only serving those who 'meet their own payrolls.' I would be surprised if the interests of those people who do 'meet their own payrolls' cannot be advanced with help from those who do not-and vice versa.

"There is plenty of opportunity for individuals with like situations to seek each other out within the association," he said.

Marjorie Weiner, president and publisher at American Lawyer Media in Philadelphia and immediate past president of NEPA, struck a note similar to Oswald's comments:

"Those of us who are running divisions for larger companies share most of the same concerns that our owner-members have. What I think complicates the issue is the entire diversity of our membership. We still have mom and pop operations with revenues under $1mm as members and we have owner-operators in the $10mm+ range, and we have members whose companies are corporately held.

"I think size, rather than ownership, presents some of the biggest challenges our association faces. We need to serve the needs of all these constituencies with very different requirements," Weiner said.

Keep these considerations in mind

Jim Sinkinson, a current board member who founded and owns his own company, Infocom Group, Emeryville, Calif., echoed others' comments that "the reality is that our industry is changing and the board's composition reflects that change.

"Many of the people most active in NEPA and certainly some of the brightest people in the association are employees, not entrepreneurs. Why should we not be led by these talented people? They are innovators in their own companies, and they are best qualified to innovate for the association.

"On the other hand," he said, "the association needs to remember that the overwhelming majority of its members are tiny entrepreneurships, run by people who face the profound challenge of meeting payroll every two weeks. The question is, how should I run my business differently from the guy who is funded by a large organization? In some ways, entrepreneurs have more to learn from the big guys than the big guys from the small.

"Bottom line, I think the board is well composed currently. However, I think the board needs to keep these considerations in mind as it continues to develop."

RELATED ARTICLE: NEPA Mission Statement

"The Newsletter & Electronic Publishers Association is the international trade association dedicated to advancing the interests of for-profit subscription newsletter publishers and specialized-information services.

"The mission of the Newsletter & Electronic Publishers Association is to serve its member newsletter and other specialized-information publishers worldwide through education, training, networking and advocacy to foster growth, profitability, and professional excellence."