Last November, the FPA National leadership made its bombshell announcement that it was planning to dissolve its 86 independent chapters and nationalize them into a single consolidated entity. The new initiative, dubbed the “OneFPA Network”, was being rolled out under the auspices of trying to create better alignment and integration between National and its chapters… by literally integrating them into a single unit.
Yet while the FPA’s independent chapter structure arguably is a relic of a bygone era – when the association’s predecessor was first being founded, there were no computers or fax machines, so chapters had to be decentralized – the backlash from the membership was fast and fierce. Some raised concerns that the shift would amount to a power grab by National. Others suggested it could be a money grab for the cash in chapter coffers. Few trusted the way that FPA was unilaterally rolling out its chapter dissolution plan.
And so after a nearly-4-month “Listening Tour” for chapter feedback, the FPA has now announced “We Listened. We Learned. We Adapted.” And is rolling out a new second iteration of the OneFPA Network plan... that does not include a requirement for chapters to dissolve, and will instead begin to more gently “beta test” some of the integrated technology, accounting, and staffing initiatives. But only after a 45-day Public Comment period, that gives all stakeholders an opportunity to share their thoughts and concerns.
Yet while the second version of the OneFPA Network plan is certainly more palatable than the first, its "Participatory Governance" structure is literally not participatory governance at all (as it doesn't actually give any governing and oversight power to its chapters in the first place), and it’s also sparser than the prior version on many of the key details, from what the Key Performance Indicators will be for the chapter beta test (and whether it’s even possible for the test to “fail” or if the OneFPA Network is still a fait accompli), to what the Master Services Agreement will be that the chapters must sign in the future (a key point of contention in the original plan), and even what the overriding goals and key metrics of success are for the entire OneFPA Network in the first place… so members can provide feedback on whether or not they believe the OneFPA Network really is the best path to making FPA more viable, strong, impactful, and relevant.
Though perhaps the greatest concern is simply that as a culmination of its Listening Tour, the FPA leadership observed that “Stakeholders want a greater voice”, “Better technology is required”, “Chapter autonomy is paramount”, and “Collaboration among FPA and its communities is needed”. All of which were actually previously cited in a key 2014 Consultant’s Report to FPA. Which, ironically, was used by the FPA to justify the OneFPA Network in the first place… despite now recognizing that its OneFPA Network proposal failed to achieve any of those objectives as stated 5 years ago (and still today).
All of which raises the question of whether the FPA is still jumping the gun by asking for feedback in a Public Comment period about how best to implement the OneFPA Network in the future… when the real question should be whether the OneFPA Network is the right step to take in the first place, what goals the leadership is really trying to accomplish, and whether there might be a better way to get the same results… without spending $1M of FPA’s cash reserves and thousands of hours of volunteer energy for an initiative that may not substantively solve any of the problems that FPA actually faces.
At a minimum, though, it’s time for the FPA National leadership to get clear and concrete about what their goals actually are, and how exactly the OneFPA Network may accomplish them. Or not. So if the FPA once again fails to grow as a result of the OneFPA Network, the leadership will at least, for once, be held accountable for its results.
FPA Releases The Second Iteration Of Its OneFPA Network Plan
Back in November at its annual Chapter Leaders Conference (CLC) in Colorado, the Financial Planning Association announced its ambitious new “OneFPA Network” initiative.
The core of the plan, as the “OneFPA” name implies, was to consolidate what is technically still a decentralized aggregation of 86 separate chapters that each affiliation with a single National organization, into a single nationalized “One FPA” entity instead.
In the process, the FPA would be able to more efficiently centralize its technology and staffing, along with a layer of redundant chapter-by-chapter level accounting (and Form 990 filings), by dissolving its various chapter affiliates into a single National organization. And to account for the fact that chapters would lose their autonomy in the process, the FPA proposed a new “Participatory Governance” structure that would create a “OneFPA Council”, comprised of chapter leaders, who could provide better and more direct strategic feedback to the FPA National Board and staff leadership… and would populate 50% of a number of key FPA committees that further guide the strategic direction of the organization.
However, from the moment the OneFPA Network plan was released, it faced significant pushback from the members and chapter leaders themselves.
Industry commentator Bob Veres expressed concern about the “consultant-speak” in the plan, with phrases like “The OneFPA Network aims to harmonize the power of unity and the benefits of diversity to serve our members’ interests with more alignment and greater integration” and “Through Centralized Functionality, we will leverage the power of unity to integrate key administrative functions, empowering volunteer leaders to focus on their passions in support of a strong member experience” and “Through Participatory Governance, we can harness the power of FPA’s collaborative and diverse culture by engaging more volunteer leaders in our strategic direction setting process.” And raised the concern that what FPA might really be after was not simply “alignment” and “integration”, but what was rumored to be millions of dollars of cash reserves in the coffers of its 86 chapters that would automatically revert back to becoming assets of the National organization when the chapters were dissolved.
Similarly, prior articles on this blog also highlighted that despite the discussion of “Participatory Governance”, the actual structure of the key OneFPA committees being created all entailed a “tie-breaker” voting chair that would be appointed by the National Board (effectively ensuring that National still controlled all of its committees), National had also retained the right to disband or otherwise alter any of the governance committees at any time (which eliminates their ability to actually disagree with the National organization on anything of substance), and despite verbal assurances from National Board members that chapters would retain control of their own finances and budget decisions, the actual governing documents published with the OneFPA Network plan stipulated that National would have oversight of whether chapters spent their dollars in accordance with National’s strategic plan (regardless of what the chapters themselves wanted to do), National would determine the future of the chapter dues structure, National would determine how sponsorship dollars would be split between National and chapters in the future, and National would take control of the decisions about whether to hire or fire chapter executives.
In turn, FPA also spent several months conducting its own virtual “Listening Tour” with its chapters, ultimately reaching an impressive 77 out of 86 chapters with individual meetings between the chapter and National leadership to discuss the proposal, where many chapters expressed interest in at least some of the proposed initiatives, but many also expressed similar concerns about the level of control that National would exert over their financial and other chapter decisions in the future… and the rather unilateral way that the FPA was rolling out the OneFPA Network in the first place.
Overall, the FPA itself acknowledged that by the end of the feedback process, it recognized that:
- Stakeholders want a greater voice
- Better technology is required
- Chapter autonomy is paramount
- Collaboration among FPA and its communities is needed
Accordingly, FPA gathered all the feedback, provided it to the OneFPA Network Transition Task Force, which in turn presented a “second iteration” of the OneFPA Network Plan to the Board, that was approved on March 21st and is now being rolled out.
In the new second iteration of the OneFPA Network plan, the FPA is restructuring into a new four-prong approach:
- Participatory Governance. FPA will proceed with creating its OneFPA Council comprised of chapter leaders (now re-dubbed the “OneFPA Advisory Council” to clarify its strategic advisory role), which will meet in person for the first time at the upcoming Chapter Leaders Conference in November. In addition, a new OneFPA Nominating Committee, 50% of which will be comprised of OneFPA Advisory Council members, will be formed in early 2020 (ostensibly to support the 2020 National Board selection process).
- Beta-Testing Centralized Functionality. Rather than proceeding with the dissolution of FPA chapters and centralizing chapter functionality by the end of the year, the FPA will start a 2-year beta-test of its centralized functionality plan with 10 chapters later this year. Chapters will be able to apply beginning July 11th, with final beta-test chapters selected by September 18th, with a focus on standardizing accounting without actually requiring centralization (e.g., developing a standard Chart of Accounts for chapters, and creating centralized information/reporting standards), testing and implementing new technology as it’s developed, and trying to find additional areas for “enhanced coordination” including in marketing, advocacy, media/PR relations, member recruitment/retention, and programs. Chapters will be required to sign a new Master Services Agreement, as an extension of their existing Affiliation Agreement in order to proceed, but will not be required to dissolve and assimilate into National in order to participate.
- Commitments and Agreements. Given the concerns that chapters raised after the original OneFPA Network proposal, the second iteration of the Plan stipulates that the FPA will more formally “add policies to the appropriate governance documents that substantiate core aspects of participatory governance”, create a new “Master Services Agreement” to outline future roles, responsibilities, and expectations between chapters and National (to reinforce chapter autonomy in the areas that chapters expressed concern), and increase information-sharing among FPA and its chapters through reports on the beta-test experience and the status of FPA finances and strategic priorities.
- Communication and Timing. To improve on the poor process of communication and rollout of the original version of the OneFPA Network plan, the FPA committed to offering two webinars for the full membership (on April 30th and again on May 24th), in addition to conducting a 45-day Public Comment period from April 16th through May 30th, and supporting discussion in the All-Member forums. Based on the feedback, the FPA National Board will make a final decision about the plan on June 20th, with the final plan to be unveiled on July 11th, followed by 3 months of finalizing the new participatory governance structures and rolling out the beta-test application process for chapters.
In essence, rather than proceeding with the plan to dissolve chapters and compel their Nationalization, the FPA is opting instead to run a “beta-test” of the integrated chapter experience with a subset of 10 chapters who are willing to submit the process, ostensibly in the hopes of demonstrating that the beta test really can deliver the intended results, and that chapters can then be persuaded in the future to fully agree to the OneFPA Network plan of dissolution once its “proven” that Nationalization really does provide better outcomes. Key Performance Indicators (KPIs) to evaluate the beta test will be established by a third-party consultant in the coming month and shared with the membership in June for feedback.
The Second Iteration Of The OneFPA Network – A Positive Step, But Scarce On The Details That Matter
Overall, the good news of the FPA’s newest version of the OneFPA Network plan is that the leadership clearly heard the concerns being voiced by the membership. As FPA themselves put it, “We Listened. We Learned. We Adapted.”
Accordingly, rather than trying to force chapters into the vision that National has set forth – “the OneFPA Network is the future, and chapters will be dissolved by the end of 2019 to make that vision a reality!” – the FPA is instead trying to work with the chapters to actually implement some of the key initiatives and show they’re able to execute successfully (as yours truly and others first suggested). Given the level of distrust that already exists between chapters and National, “let’s test it out and prove that it works” is certainly a better approach than the FPA’s prior (very unilateral) rollout. And some initiatives – like creating a standardized Chart of Accounts that all chapters can adopt, and then use for consistent chapter benchmarking – have already been long overdue as an initiative to better determine and share chapter best practices.
In the meantime, perhaps in acknowledgement that FPA National is weak in its connection with chapter leaders – so much so that it was seemingly blind-sided by the backlash against the original plan – the FPA is taking the positive step forward of proceeding with the OneFPA Advisory Council, in an effort to actually create what will hopefully be a more effective communication bridge between chapter leaders (and what they want) and the National organization. Given the depth of the “Us vs Them” divide that already exists between National and chapters, arguably any proactive increase in communication is a positive step. And the decision to add at least some chapter leaders from the OneFPA Advisory Council onto the FPA’s National Board Nominating Committee – albeit still under the ultimate control of the National Board – may even help to improve the National Board’s selection process (or at least reduce the perception that it is very insular).
Except the caveat is that no one actually knows how any of FPA’s proposed initiatives will actually work.
Participatory Governance With No Actual Governing Power?
The new OneFPA Council is the key element of what the FPA calls a more “participatory governance” approach to working with chapters, where representatives from each of the 86 chapters (plus representatives from NexGen and other key communities) will be convened twice per year (including once in-person in Denver) to work with the National leadership to craft the FPA’s direction and strategy. But it’s not entirely clear how FPA actually expects to get constructive feedback from such a massive “Council” of representatives. As most people have experienced, it’s hard to find group consensus with a committee of just a dozen people, never mind nearly 100 of them all trying to provide their $0.02 at once. And the FPA already brings together more than 200 chapter leaders to its annual Chapter Leaders Conference in Denver as is, and has since FPA’s founding; what is it about the new OneFPA Advisory Council of nearly 100 chapter leaders providing feedback in Denver every fall that will automagically make it a better mechanism than already gathering more than 200 chapters leaders in Denver every fall where the same opportunity for feedback was already present? FPA doesn’t appear to have any actual plan for why or how the OneFPA Advisory Council will be any better of a feedback mechanism than its existing Chapter Leaders Conference.
Similarly, while the OneFPA Advisory Council is a core pillar of FPA’s new “participatory governance” approach, it’s not clear that the new system will have any actual role in the governance of the FPA at all. As technically, real governance is about establishing policies that create oversight and a balance of power to ensure accountability for achieving objectives, while the OneFPA Advisory Council won’t literally govern anything. The Council is now endowed with any oversight responsibilities, it is endowed with no powers to hold other parts of the organization accountable, and in fact, there isn’t even any assurance that the OneFPA Council will continue to exist in the future, since it’s not enshrined in the FPA’s Bylaws. In other words, the National Board could just decide at any time to completely disband the OneFPA Council. Which makes it utterly ineffective as an actual form of “governance” of the organization, because the National organization can simply eliminate it the first time the Council objects to something that National wants and intends to do anyway.
In fact, in Section IV, Subsection C, paragraph 3 of the original version of the OneFPA Network, it was explicitly stated that the Board reserved the right to “review [and therefore potentially disband] annually which FPA HQ committees, councils, and task forces are required for the following year,” and the FPA went so far as to even state that the OneFPA Advisory Council was being established in order to “create a sense of greater ownership for all leaders… resulting in a model leaders are far more likely to accept.” Suggesting that the real purpose of the participatory governance model was not actually to cede any governance power to the chapters (as the actual structure of the Council did not endow chapter leaders with any actual governance powers in the first place), but simply to make chapter leaders feel like they had more control (even if they didn’t). None of which was altered (to actually provide governance power to chapter leaders) in the second iteration of the OneFPA Network plan.
A Master Services Agreement With Terms To Be Determined?
Similarly, the second iteration of the OneFPA Network plan notes that there will be a new Master Services Agreement that all chapters who participate in the beta test will be required to sign – ostensibly as a roadmap for the new agreement that all chapters would be required to sign if/when the chapters are ultimately Nationalized – but the actual Master Services Agreement has not yet been released for public comment or review. Instead, it won’t be made available until June, which at least is before chapters must actually make the decision about whether to become beta-test chapters. But is after the close of the Public Comment period.
Which is important, because it’s the actual details of what chapters will truly be required to do – or not – that created so much contentiousness around the first draft of the OneFPA Network to begin with. After all, while the National Board maintained throughout that chapters would retain control of their finances in the original plan, it was the details of the plan itself that revealed chapters would still have to cede their budget and spending decisions to National’s strategic plans. And while the National Board maintained that chapters would retain control of their sponsorship relationships and dollars, it was the details of the plan itself that revealed National (not chapters) would determine how sponsorship dollars would be split between National and the chapters in the future. And while the National Board maintained that chapters would retain control of their chapter executives, it was the details of the plan itself that revealed that National would actually retain the decision to hire and fire chapter executives and that chapter leaders would merely have "significant input’ (but not control) in evaluating staff.
The key concern is that what the National Board said was their intention was not how the arrangement was actually enshrined in the relevant legal agreements that chapters were subsequently going to be asked to sign after they were dissolved. And so while the National Board once again maintains that these concerns will be addressed and resolved in the new version of the OneFPA Network plan… (just as they promised last time), the actual Master Services Agreement to which chapters would be bound regarding these issues has not yet been published.
Thus, members are being asked to provide feedback during a public comment period about the OneFPA Network plan, when there’s no way to know whether the governing documents that chapters will be asked to sign this time will be better aligned (or not) to the promises that National was making last time as well (but previously failed to deliver on). And while the FPA has now said that the Master Services Agreement will be released for feedback in June… that’s after the Public Comment period for the OneFPA Network itself will have closed. Which means if chapters have any concern that the Master Services Agreement is so stringent that the whole OneFPA Network plan should be scrapped… it will be too late to provide that feedback.
A Beta Test Of The OneFPA Network That Can’t Actually Be Failed?
Even more concerning than the requirement for FPA members to provide feedback on the OneFPA Network plan without knowing what the Master Services Agreement will be that chapters would ultimately have to sign if the beta test is successful, is the fact that the FPA hasn’t even articulated what criteria will be used to determine if the beta test is a successful “test” or not in the first place. Which makes the “beta-test” look more like a fait accompli – an outcome that is already assured – than a bona fide test of whether the OneFPA Network initiative really does result in superior outcomes for chapters and the FPA overall (or not). Simply put, a beta-test without goals or metrics for success is just window-dressing.
To be fair, the FPA has announced that it will share the Key Performance Indicators (KPIs) for the beta test in June, again in advance of when chapters will actually be expected to decide whether or not they will volunteer to be in the beta test. But the key metrics for success are not being shared as a part of the Public Comment process itself. So it’s not even clear if the purpose of the beta test is to try to make chapters more efficient (where the key measure is productivity and cost savings), or if the purpose is growth (where the key measure would be net change in members), or if the purpose is deeper member engagement (where the key measure is not an increase in total/new members, but an increase in how much existing members engaged with the chapter’s programs), or if the purpose is greater buy-in and satisfaction of chapter volunteers (which might be measured by some kind of NPS score for volunteer engagement).
Which means, once again, the FPA membership is being asked to provide feedback in a Public Comment process about whether it thinks the second iteration of the OneFPA Network plan is a good idea, and whether the beta test approach is the right way to go… without any understanding of what, exactly, the beta test is even meant to actually test. Or whether it really is even intended to be a true test – that can be passed or failed – or is simply a pilot program for what will still be forced upon all chapters in a few more years.
Is The OneFPA Network Just National’s Solution In Search Of A Problem?
Notwithstanding the concern that FPA is launching a “beta test” of the OneFPA Network without any indication of what it takes to determine that test a success… perhaps the biggest problem with the OneFPA Network is that the National organization hasn’t shown or explained to the membership what “success” the whole OneFPA Network plan is intended to achieve, either.
What, exactly, is the OneFPA Network supposed to accomplish? The FPA says is “Why” is “To ensure FPA’s viability, strength, impact, and relevance for current and future members and volunteers.” Which implies that FPA believes its current path is not financially viable, that it is not strong, that it is not having the impact it wants, and that it is not maintaining the relevance it needs to maintain to be successful in the future.
On the one hand, it’s good to see the FPA finally acknowledge that there are problems with the path it has maintained for the past several years – a concern previously raised (but strongly rebutted by FPA at the time) on this blog. From FPA’s long revenue and membership decline over the past decade, to its even-more-concerning decline in the market share of the CFP certificants it purports to represent, the reality is that the FPA has not been on a very good path for years. For which, arguably, something did need to change.
Yet it’s not exactly clear what the OneFPA Network plan is expected to change about this trajectory. In response to concerns expressed for years that the FPA is not growing, the organization has in recent years insisted that it’s more focused on member "quality" than "quantity," and that there’s nothing wrong with the fact that the organization isn’t growing. But is the OneFPA Network change supposed to make the FPA start growing again? Is that actually a KPI for the success of the OneFPA Network? Or is the FPA going to spend its dollars and resources on a strategy that it still doesn’t actually expect to result in any growth?
If instead, the purpose of the OneFPA Network is simply to centralize resources in the hopes of saving costs and gaining better economies of scale, then what is the FPA’s targeted cost savings from the initiative? How much in savings does the FPA believe it can produce, to recover the estimated $1M of implementation costs for the OneFPA Network (not to mention the countless hours of staff and volunteer time)? Who will be held responsible if the FPA spends $1M on a OneFPA Network plan that doesn’t actually produce at least $1M of future cost savings (since the FPA can’t make it up on growth if the plan is not to grow)?
And if the FPA’s plan is not to grow, then how will the FPA increase its “impact” and “relevance” – key terms framed in its “Why” for the OneFPA Network in the first place? Will FPA reallocate budget towards its advocacy initiatives and away from other projects, in an effort to grow its impact and relevance with its existing membership? How will “impact” and “relevance” be measured? By the number of bills that FPA helps to lobby for and get sponsored? By its recognition in trade publications as a key “influencer”?
Alternatively, if growth is the plan, how much growth is the FPA aiming for in order to materially increase its impact and relevance? How much growth must be achieved to stamp the OneFPA Network a success? What level of growth would be deemed “insufficient”, such that it would result in a leadership change to someone else who can better execute growth for the FPA? If the FPA grows revenue but not membership – e.g., by creating a more engaged membership that pays higher dues, or by engaging more valuable sponsors – is that still a “success” of the OneFPA Network, because revenue increased, even if membership (and the associated impact and relevance) do not?
And from the perspective of FPA members, how are we supposed to have any buy-in to the vision of the OneFPA Network, when the National leadership hasn’t even concrete articulated the objectives? How are we supposed to give (Public) Comment and feedback on whether we believe the second iteration of the OneFPA Network plan is viable to accomplish the goals, without even knowing what the goals are to be accomplished? If we believe there’s another, better way to spend $1M of FPA’s cash reserve resources than the OneFPA Network, when do we get to share that perspective? And how can we even assess whether there might be a better way to spend $1M of FPA’s cash reserves, and thousands of volunteer hours, if we don’t even know what the objectives are of the OneFPA Network plan that we’re supposed to be comparing to?
Perhaps most important and concerning of all, though, is simply the question: how will the National Board possibly fulfill its fiduciary duty to the organization and its members to hold staff accountable for the implementation of the OneFPA Network, when there are no Key Performance Indicators or stated objectives for success of the plan in the first place?
Groupthink, Us Vs Them, And FPA’s Ongoing Execution Problem
Ultimately, the reason why the discussion of Key Performance Indicators and metrics-for-success matters so much is that, as someone who is so passionate about FPA and its crucial role in the profession, and who believes strongly that FPA can and should be growing more… I’m simply not convinced that the OneFPA Network can deliver on growth for the FPA.
But it’s not clear that the National organization thinks the OneFPA Network can grow the FPA either, given the National leadership’s own recent statements about how bleak (or at best, uncertain) the future of FPA is. Yet when the FPA is getting ready to spend $1M of cash reserves, and thousands of volunteer hours on efforts, we as members have a right to know what FPA is trying to achieve. And raise the question of whether those resources might be better spent elsewhere.
Instead, though, it seems that FPA National is persisting in the OneFPA Network because it’s simply what National wants to do… in pursuit of what still seems like an inevitable goal of consolidating and nationalizing its chapters. Regardless of whether any other goals are achieved.
Thus perhaps why the National leadership didn’t even think to announce the metrics of success of the beta test in advance. Because it may not actually be intended to be a beta test; instead, it’s simply a pilot program for centralizing the first 10 chapters, on the way to following through with the other 76.
And even more to the point, the existence of the beta-test itself means we’re still on the OneFPA Network train. According to the FPA’s own statement in its video: “Your feedback is instrumental in helping us shape the OneFPA Network.” In other words, the purpose of the beta test and the whole Public Comment period is not actually to determine whether to proceed with the OneFPA Network, and whether the organization is pursuing the right goals with its resources. Instead, the only purpose of the feedback is to determine how to implement the OneFPA Network plan of nationalizing the chapters that the National leadership has already decided is the future.
Of course, if the chapters themselves were bought into the OneFPA Network and its vision, then by all means, the focus of the feedback period should be on the “How” to get it done. Yet instead, what FPA observed from its own Listening Tour:
- Stakeholders want a greater voice
- Better technology is required
- Chapter autonomy is paramount
- Collaboration among FPA and its communities is needed
All of which is notable, because the entire OneFPA Network proposal itself emanated from a Consultant’s Report drafted for the FPA back in 2014, which highlighted a number of challenges and concerns facing the FPA, for which the leadership decided that the OneFPA Network was the answer. And what were the issues that the Consultant’s Report highlighted 5 years ago? They included:
- Differing [National vs Chapter] Perceptions Contribute to Competition over Cooperation (i.e., chapter stakeholders don’t feel their voices are heard)
- Technology Resources Need To Be Leveraged
- Chapters Value Autonomy, while National Desires Greater Coordination
- Opportunities for Autonomy/Coordination Can Be Win/Win
In other words, all of the feedback that the FPA said it listened to, learned from, and was adapting to, was a repeat of the same feedback that already had already receive 5 years ago in the first place.
But rather than actually address those issues over the past 5 years, the FPA instead spent its time, effort, and resources to develop its OneFPA Network as the solution to the problem. Only to roll it out, and experience a significant backlash as it was unequivocally told that was not the solution that chapters were asking for. And so what has FPA’s response been? To continue forward with the OneFPA Network anyway, just in a slower and more deliberate manner… which, ironically, will make it just take even longer to implement the actual solutions that chapters and other stakeholders have been asking and begging for all along!
For instance, as Bob Veres recently noted in his own coverage on the second iteration of the OneFPA Network plan, one of the key requests that chapters have made throughout is for FPA to improve its centralized membership database and the capabilities it provides to chapters. It was a request 5 years ago that surfaced as a part of the Consultant’s Report. It’s been discussed amongst chapter/National meetings for years. It’s still a request of chapters.
But instead of just investing the resources to improve the FPA’s membership database, instead chapters have had to wait 5 years for the requested database improvements while National worked on the OneFPA Network plan. Now most chapters will have to wait at least 2 more years while the FPA “beta-tests” the initiative and technology changes. And then, even if the beta test goes well, the database changes still have to be rolled out to the rest of the chapters. The end result – FPA chapters nationwide may not actually have access to a more robust membership database until sometime around 2023, for a request that was already recognized as a pressing issue in a Consultant’s Report in 2014.
And the FPA wonders why it struggles with growth and buy-in from volunteers? Perhaps the problem is simply that the National organization has become so focused on its objectives that it’s taking 9 years just to get a better membership database implemented? Such that the FPA is coming up with its own solutions and trying to retroactively fit them to what chapters are asking for help with, instead of just focusing on solving the problems that chapters are asking for help with?
Of course, the reality is that it’s not uncommon for large membership associations (or really, any large organization with a diverse group of stakeholders) to struggle to gathering and keeping perspective on a wide range of demands from their stakeholders. Yet rather than trying to broaden its perspective and scope, the FPA has made itself increasingly insular, instead.
For instance, when this blog published an article criticizing FPA’s execution and failure to grow in the past, the organization responded by changing its attendee policy for the FPA Chapter Leaders Conference to ban my future attendance (after having been a participant for 10 years), and has written more than one public letter to its membership over the years engaging in personal attacks against those who publicly call on the organization to do better. Other high-profile commentators like Bob Veres have similarly been ostracized by FPA National leadership over the years for raising concerns about the direction of the National organization and its failure to grow.
In other words, FPA has created an environment where stakeholders only have the choice to agree with everything that FPA National proposes, or be branded against them. Which unfortunately helps to explain how the National organization was so “blind-sided” by the backlash it created with the OneFPA Network proposal. Because the “with us or against us” culture its created, that initiatives like its own HDR (Honest, Direct, Respectful) policy have failed to address, is making it impossible for a diverse range of perspectives to actually reach the National Board and staff leadership until it’s too late?
Where Should FPA Go From Here? Real Goals With Real Accountability.
So given these dynamics, and with the OneFPA Network plan still on the table for implementation, where should the FPA go from here?
The FPA’s approach, as epitomized in its recent “FPA Faces The Truth” message from Executive Director Lauren Schadle, is that FPA is in trouble, and it can’t just stand still. It must do something. Even if the FPA doesn’t really know what that something is. And has no idea if it will work. Something must be done.
Which is laudable, in recognizing that when an organization faces real challenges, it’s time for real change. But that isn’t a reason to use the crisis as an excuse to push through an initiative that membership isn’t sold on being necessary in the first place. And it especially isn’t a reason to push through an initiative that is somehow simultaneously both “transformative” and without any substantive metrics for success to even determine if, whether, or when the “transformation” has been achieved.
Because in the end, even if the decision of the FPA and its leadership is to do something and not nothing, there are still choices. Choices about where to spend the $1M that’s been earmarked for the OneFPA Network. Choices about where to spend the thousands of hours of volunteer time being put into the Transition Task Force, the beta-tests, and hours upon hours that the National Board is focusing on these issues. Which not only represent real costs to the OneFPA Network… but also opportunity costs that must be evaluated against what else the FPA could be doing with all that time, dollars, and volunteer energy.
As the truth is that there’s no need for the OneFPA Network (or a beta test thereof) to put resources towards a better membership database. Just engage the vendor to make changes to the database, engage chapter leaders for feedback on what they want and need, and learn to implement better technology! There’s an entire Agile Project Management approach that’s been developed in recent years specifically to solve technology problems just like this.
Similarly, there’s no need for a OneFPA Network to improve chapter accounting with a standardized chart of accounts, rolled up into chapter benchmarking for best practices. Just create the standardized chart of accounts, roll it out, teach chapters how to implement it, and then have them submit their data every year as a part of the annual chapter recognition program!
And there’s no need for a OneFPA Network to help members understand all the opportunities to engage with National and its chapters across the organization and across the country. Create a centralized calendar on a website, send out requests to the 86 chapters leaders that National is already in contact with, get the dates for their events, and publish them as a central resource!
Furthermore, if the FPA really wants to transform itself into an entity that better supports its chapters, try tackling the really hard questions. Like why National says it’s primarily focused on supporting its chapters, but nearly 75% of a member’s dues go to National and not the chapters – which has so squeezed the chapters over the past decade that Chapters have raised their own dues assessment to generate nearly double the revenue they did 10 years ago (from $1.245M of cumulative chapter dues in 2007, to $2.112M in 2017) to make up for what they’re not receiving from National.
Because the reality is that in the end, FPA doesn’t actually have an “integration” and “alignment” problem. It has an execution problem, where the strategies and tactics that the FPA does implement doesn’t go well – from the current membership database, to its woes in developing a national speaker’s list, the declines in everything from the revenue of the Journal of Financial Planning to the membership attendance and sponsorship dollars of conferences over the past 10 years – yet even when the execution yields poor results, nothing changes and no one is held accountable. Instead, the FPA’s struggles are always everyone else’s fault. Or it’s the fault of a “challenging and difficult landscape” for associations. Never mind that every other association serving financial planners has grown by more than 40% in the past decade, while the FPA is down nearly 20% and revenue is down even more.
To the extent that FPA is going to insist on moving forward with the OneFPA Network, then create a real vision of where we’re going. Not just a statement that we can’t stand still. Paint the picture of what success would look like. Not with consultant-speak. With real words. Which means at a minimum, the National leadership needs to:
- Stop calling it “participatory governance” when it is not, or truly create a real governance structure if the goal really is participatory governance. Which means actually empowering the OneFPA Advisory Council with substantive oversight, substantive power to hold leadership accountable… and enshrine the OneFPA Council in the organization’s bylaws in a manner that cannot simply be ended at the will of the Board. Otherwise, the OneFPA Council exists solely at the will and mercy of the Board itself, which creates no accountability, and unequivocally is not actually governance.
- Stop saying the OneFPA Network is necessary for alignment, because all it really amounts to saying is “the reason FPA isn’t growing is that it’s the chapters’ fault for not being better aligned to what we’re trying to do at National.” Which, again, just further perpetuates the Us vs Them problem in the first place. And if the chapters aren’t aligned after 20 years, recognize that maybe it’s a leadership problem at National, not the chapters’ fault for failing to fall in line with leadership that’s failed to ever get their buy-in along the way!?
- Take some responsibility for the prior OneFPA Network rollout failure. The rollout announcement of the OneFPA Network never mentioned it was a “draft” plan. It never even mentioned the Listening Tour. It certainly didn’t have a Public Comment period. It simply told us this was the future, and that we could go to the OneFPA Network website to learn more about it. So rather than engaging in revisionist history and pretending it was a “draft” all along when it wasn’t, own the mistake that was made. It’s OK to say “We rolled it out as a done deal, and recognize now that we pushed it too hard. We were wrong. We’re going to do better.” Not “Here’s the latest ‘second iteration' of the draft plan” as though the first was ever intended to be a draft. If you can’t own your mistakes when they happen, we can’t trust you to do the right thing the next time.
- Be more transparent with the process, which means at a minimum that public comments should be public. Post all the public comments submitted, good and bad, in a public location where all stakeholders can see them. Compartmentalizing feedback across multiple forums, and asking for public comments to be submitted to a private email address, undermines stakeholder trust.
- Give us the opportunity to meaningfully talk about the structure of a new Master Services Agreement, not just before it is beta-tested, but before we have to agree to the OneFPA Network in the first place. It’s impossible to give substantive feedback on whether the OneFPA Network is the right path forward when we literally have no idea how it will work and what chapters will be required to sign until after the fact.
- Show us the goals for the beta test, with real KPIs to determine success, that we have a meaningful opportunity to comment on and be a part of beforehand, and show how the leadership will back away from the OneFPA Network if those goals aren’t met.
- Most importantly, show us the goals for the OneFPA Network overall, how the FPA will earn back the $1M of hard dollar costs and the countless hours of volunteer resources that are being spent, and show how the leadership will be held accountable if those goals aren’t met.
Or better yet, just stop trying to fit the FPA’s current problems to National's unilateral OneFPA Network solution – which, frankly, isn’t even a “OneFPA Network” one chapter consolidation is off the table… unless it’s not? – and instead, sit down and listen to what members, chapter leaders, and other stakeholders really want, and do that instead. Stop having the conversation about how to implement the OneFPA Network, and start having the conversation about if it’s what we should be implementing in the first place. Share with us what National's real goals are, and let’s, for the first time, have a real conversation about all the different ways those goals might be achieved. Rather than just assuming that National's OneFPA Network must be the only possible solution, when it's not.
Or stated more simply… if the FPA really wants to figure out how to start growing again, try actually asking the members, and be willing to listen to the answers. And then be willing to make staff and resource changes necessary to actually execute what the members want. Because that will ultimately create more growth, alignment, relevance, and impact for the organization than any forced consolidation of chapter resources ever could. (And if we happen to decide years from now to consolidate anyway, so much the better.)
For any other FPA members and stakeholders who want to share their own feedback on the OneFPA Network, you can submit comments to FPA directly by May 30th via [email protected].
Kaleb Paddock, CFP® says
In looking at the graphic showing declining membership, I’d say FPA is suffering from not having a NICHE. Anybody with a pulse can join FPA in any financial-related industry. Look at NAPFA, XYPN, etc. and you see growth because it’s a defined and well carved out niche.
And contrary to industry insiders, being fee-only and offering hard dollar pricing is a brand new concept and totally niche to 90%+ of average consumers looking for financial advice. Maybe in 10-15 years it will be mainstream but we are still a LONG way off from the person on the street realizing financial planning is available without millions of dollars to invest or being sold financial products.
Michael Kitces says
The irony is that FPA does have a niche – CFP certificants, which are still ‘only’ about 25% – 30% of all financial advisors.
But the FPA has struggled to embrace that niche, out of fear of alienating non-CFPs (who aren’t in their niche anyway).
The end result is that FPA is still CFP-centric enough to alienate non-CFPs (of which there are almost none in the membership), but not pro-CFP enough to actually attract CFP professionals. So they’ve ended out in the middle, not growing with either. :/
Evelyn Zohlen says
Thank you for taking the time to review the Second Iteration of the OneFPA Network Draft Plan and providing input that will be used by the OneFPA Transition Task Force as they work to finalize the plan this summer.
When the original OneFPA Network draft plan was introduced at the FPA Chapter Leaders Conference in November 2018, we shared the challenges that FPA―like many other broad-based voluntary professional associations―is facing and offered the OneFPA Network vision as a way to meet those challenges. The Second Iteration of the OneFPA Network Draft Plan was developed through a collaborative process between our volunteer task force (OneFPA Transition Task Force) and chapter leaders after careful review of all feedback collected during the four-month Listening Tour. The Second Iteration also outlined the intention to share the Master Services Agreement and Key Performance Indicators (KPIs) in early June to collect feedback from as many of our stakeholders as possible prior to releasing the final plan on July 11. By sharing these in advance, we hope to ensure those critical documents will result in a meaningful beta-test that will inform whether or not the testing is successful, what may need to be adjusted as we go through the beta-testing process, and the veracity of the OneFPA Network vision.
Our FPA leaders, from the beginning of this journey, have expressed a strong desire to ‘get this right’ or not do it at all. The Listening Tour, which began the day we announced the original draft plan last November, was an opportunity to hear from stakeholders directly about their views, concerns and questions so we could ensure we were on the right path with our thinking. As you saw in the Second Iteration of the OneFPA Network Draft Plan, significant changes were made as a result of that feedback, but the feedback also let us know that the vision of a more integrated and aligned organization is important for our future. And while we expressed our desire to have all stakeholders participate in this process, the vast majority of the feedback received was from chapter leaders and to a much lesser degree our members. Despite that, we will continue to encourage all stakeholders to let us know their views so the final plan, Master Services Agreement and KPIs can be developed the right way.
Thanks again, Michael, for the review and input. We will be sure the OneFPA Transition Task Force takes it into account as they continue their important work.
Evelyn M. Zohlen, CFP®
2019 FPA President
1) Despite publicly claiming an end to Borg OneFPA assimilation, leadership also admits they are proceeding forward (notably Investment News & FPA Smartbrief) with takeover, just slowly. 2) I disagree the Chapter method is obsolete. The state associations of accounting, medical and legal professions do it successfully. However, our national leadership hasn’t looked outside for other options. 3) The Second Iteration is same as the first, just re-written so people will stop talking about it. 4) The only way for National to recoup its Borg Assimilation investment is to take the remaining 25% in dues from the chapters, after they have all been assimilated next year when Lauren claims it to be successful. 5) The $1 M would be better spent building chapters. — this will not end well, and will end with FPA’s demise.
J.R. Robinson says
I do not disagree with the enumeration of the FPA’s failings highlighted in this piece, and I agree that these failings can be broadly attributed to buying into consultant speak and to leadership’s overestimation of its importance and value to its membership base. At the same time, I tend to believe the FPA’s subsequent mea culpa. Rather than respond with arrogance and duplicity (as the CFP Board would have done) the FPA accepted responsibility for and walked back from its poor decision to dissolve the individual chapters.
It is also my understanding that a major source of the row between the FPA Board and its chapters is that the popularity of certain annual chapter conferences has been harming attendance at the national conference. I believe you have referenced statistics on this in previous Nerd’s Eye View posts. I am not privy to the issues at hand, but I tend to agree with the importance and value of a national annual conference, and can’t help but wonder if there may be a compromise solution that would please both the regional chapters and the national FPA.
In terms of the larger picture, it is no secret that the FPA has long been a lapdog/puppet for the CFP Board. It has long treated non-CFP members as second-class citizens and has been an unabashed member of the so-called “Financial Planning Coalition,” political action committee, which is lead by the CFP Board and also includes NAPFA. The FPC exists to lobby state and federal legislators to grant the CFP Board monopolistic control of the financial planning profession.
In the wake of its failed attempt to borrow a page from the CFP Board and apply bullying tactics to its membership, I believe the FPA is taking a hard look in the mirror and is finding that it does not much care for its own reflection. At the same time, the FPA is taking fire from and being bullied by the CFP Board, and is perhaps waking up to the fact that CFP Board is a self-serving and abusive dictator rather than the benevolent advocate for the consumer it pretends to be in its multi-million dollar PR campaigns. In my view, it would be a great step forward if the FPA began to proactively and publicly distance itself from the CFP Board and, instead, began to focus on advancing the financial planning profession for the benefit of both its members and consumers.
IMOP the FPA is logically positioned to provide a forum for financial planner discourse and to provide valuable group benefits to its membership base. If the FPA could unify its members around a platform of embracing a true fiduciary standard (as opposed to the self-defined, utterly fictitious standard being promoted by the CFP Board) it could become the most important voice for the planning profession. It would also do itself a huge favor – and garner the support of a large group of neglected financial planners – by ending its alienation of thousands of non-CFP financial planners who are actually held to the SEC’s REAL fiduciary standard.
Just my usual blasphemous two cents. 🙂
Daniel Berg says
From the FPA website:
“THE BENEFITS OF FPA
FPA Membership Options
We offer membership options for all those who support the financial planning practice and profession.”
First line of Why join FPA tab:
“We all seek to belong to something, and community is the container in which our sense of belonging can be fulfilled.”
Membership options are not a benefit of the FPA and the first line of why join a professional organization should not be to fulfill my need for belonging.
David Mendels says
Thank you for, once again, setting forth a thoughtful analysis of the threat to the profession posed by this somewhat less threatening but still half baked proposal. True, OneFPA 2.0 is an improvement over the original in that they have, at least for now, put down the gun they were pointing at the local chapters, but they have not put it away.
The problem remains that they still seemed determined to transform the FPA from a grass roots organization served (rather poorly) by national to a top-down organization directed by national. The very image they use showing a rigid and lock-step “alignment” of the local chapters speaks volumes. What speaks perhaps even louder, though, is the arrogance with which “OneFPA 2.0″ was released. As with the original, it seems that no one at national thought the membership worth even so much as a brief email to let us know, leaving it up to the trade press to fill us in — and then they wonder why we don’t trust in their platitudes about ” better serving the membership”.
David Strege says
Everything I’ve read does not improve Governance by the Board for implementation by Staff to the benefit of the members, our industry and overall the public. The hired governance consultants either didn’t provide any substantive help or their ideas weren’t heard and properly implemented.
When issues of organizational value arise the question can be asked, “What empty hole or vacuum would occur if FPA didn’t exist?” Better professional education can be attained from other places by a variety of methods. Financial planning professionals can get together at local or regional meetings for networking and comradery. National and State initiatives to bring about a recognized profession of financial planning does not appear to be coming from FPA with any success. Where it doesn’t appear the world would miss the Financial Planning Association then it must be asked “why does the FPA exist?” If that cannot be answered and implemented in a compelling way then the answer may be self-evident. From my one perspective I’ve been receiving less and less value from FPA. I can always vote with my feet, my membership dues and attendance at conferences. The financial planning industry is seeking organizational leadership to grow our profession. It will move on to somewhere else if that servant leadership isn’t provided by FPA.
David Strege, CFP®, CFA, CKA®