ATC Business Case for Collaboration and/or Consolidation: Phase I Results - 1/15/08 (Final)

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ATC Business Case forCollaboration and/or
ConsolidationPhase I Results - 1/15/08 (Final)
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Business Case for Collaboration and/or
Consolidation

• Phase I Results
• Arizona Technology Council Collaboration and/or
• Consolidation Case Studies and Best Practices
• Date January 15, 2008 (Final)
• Place Phoenix, Arizona
• Presented By
• Steven G. Zylstra, Formerly Technomic Growth
  Strategies
• President and CEO, Arizona Technology Council
• (T) 602.343.8324 ext. 101, (M) 412.735.9537
• (E) szylstra_at_aztechcouncil.org
• URL http//www.axtechcouncil.org/
• Mark Goldstein, President, International
  Research Center
• (T) 602.470.0389, (M) 602.670.6407

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Business Case for Collaboration and/or
Consolidation Project Overview

• The Arizona Technology Council has undertaken a
  review of considerations for strategic
  alignments, collaboration, and possible
  mergers/consolidation with other Arizona
  technologyfocused organizations
• Study authors Steven G. Zylstra, formerly
  Technomic Growth Strategies and Pittsburgh
  Technology Council, current President and CEO,
  Arizona Technology Council, and Mark Goldstein,
  International Research Center are familiar with
  both the Arizona technology landscape and the
  nationwide consolidation/collaboration activities
  among past and present technology organizations

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Business Case for Consolidation and Collaboration
Phase I Project Detail

• Identify Business Models - Identify known
  business models similar to those in the Arizona
  technology sector to determine the feasibility of
  a merger or a substantive strategic partnership.
  The Arizona organizations to be explored include
  Arizona Technology Council (ATC), Arizona
  BioIndustry Association (ABA) and Southern
  Arizona Technology Council (UTC)
• Conduct Research - Conduct primary and secondary
  research to document business models that would
  facilitate consolidation, cooperation, and
  collaboration between the ATC, ABA and SATC,
  including the entire spectrum of interaction from
  simple mutual support on issues to complete
  merger.
• Document Results - Prepare PowerPoint for
  presentation to the ATC Sustainability Committee
  documenting results of business model study
  including preliminary recommendations. Define
  the strengths and weakness of each approach,
  especially its impact on the ATC and its members.
• Present Conclusions - Deliver a PowerPoint
  presentation to ATC Sustainability Committee with
  results of Phase I study.

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Business Case for Consolidation and Collaboration
Pending Phase II Project Detail

• Engage Partner Leadership - Using direction from
  the ATC Sustainability Committee and guidance
  provided by the Phase I study, engage volunteer
  leadership of ABA and SATC to discuss how to
  better leverage the Arizona technology-based
  industry strengths for the good of industry and
  the state.
• Conduct Survey - Assuming interest by ABA and
  SATC, conduct a detailed survey of the products,
  services and benefits that each of the three
  organizations provide, looking for redundancy or
  duplication. Document at some level of detail,
  the infrastructure and assets that each
  organization brings to the table.
• Propose Structure - Given the overlay of products
  and services from the above evaluation and
  business model analysis of Phase I, propose
  varying organizational structures that would best
  leverage the strengths and assets of the three
  organizations that delivers results and member
  satisfaction.
• Prepare and Deliver Presentation - Present Phase
  II results to ATC Sustainability Committee.

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Business Case for Consolidation and Collaboration
Phase I Results

• The consultants identified and profiled
  nationwide examples of previous
  collaborations/consolidations/mergers involving
  regional technology-focused not-for-profit
  organizations resulting in a series of brief case
  studies, including lessons learned and best
  practices focusing on
• Who lead effort and what process were utilized?
• Impetus for collaboration/consolidation/merger?
• What benefits gained?
• What structure did the governance or business
  model use in these combined enterprises?
• What critical issues arose and how were they
  handled?
• What was the ultimate outcome and lessons
  learned?

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Regional Technology Association Case Studies

• Arizona Technology Council (ATC)
• Pittsburgh Technology Council (PTC)
• Northeast Ohio Software Association (NEOSA)
• Utah Technology Council (UTC)
• Mass Technology Leadership Council (MassTLC)
• Technology Council of Maryland (TCM)
• TechColumbus (TC)
• Minnesota High Tech Association (MHTA)
• Technology Council of Northwest PA (TCNWPA)

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Arizona Technology Council (ATC) Case Study
AIN ? HTIC

• Background
• The Arizona Innovation Network (AIN) merged with
  the Arizona High Tech Industry Cluster (HTIC) in
  late 90s with effort lead by Steven G. Zylstra,
  HTIC Chairman and Simula executive
• Rational/Benefits
• AIN, started in 1984, had out lived its
  usefulness by mid-90s, supplanted by ASPED/GSPED
  technologybased clusters, including software,
  high tech, optics, bioindustry, advanced
  materials, environmental, etc.
• Process/Issues
• Both AIN and HTIC Boards agreed the time had come
  and accomplished with no significant issues, but
  process took almost 24 months
• Outcome/Lessons Learned
• Consolidation quelled noise in the marketplace
• New core HTIC membership adds
• Increased attendance and involvement at HTIC
  meetings
• Key AIN sponsors could focus resources
• Actual event of merger was anticlimactic

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Arizona Technology Council (ATC) Case Study
HTIC ? AzSoft.net ? ATC

• Background
• The Arizona High Tech Industry Cluster (HTIC)
  merged with Arizona Software Internet
  Association (AzSoft.net) around 2002, which later
  became known as the Arizona Technology Council
  (ATC) with efforts lead by Ed Denison, President
  and CEO of AzSoft.net
• Rationale/Benefits
• Follow trend of national peers, AzSoft.net was
  CRITA members at this time
• IT Industry facing major losses with Dot.com
  bust
• Create critical mass in order to influence
  stakeholders
• Sponsors were reluctant to support multiple
  entitles in weak economy
• Combine supporters and members for more
  influence/results/value
• Process/Issues
• AzSoft.net drove process as part of overview
  consolidation vision
• Staff/Governance
• HTIC Executive Assistant outsourced services
  absorbed into AzSoft.net operations and budget

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Arizona Technology Council (ATC) Case Study
HTIC ? AzSoft.net ? ATC (Contd.)

• Critical Success Factors
• Significant concerns of several HTIC Board
  members managed and satisfied through
  accommodation and engagement process
• AzSoft.net/ATC was seen as a regional comer
  and the place to be
• Outcome/Lessons Learned
• Use champions and influencers to lead the
  organizations to come together and court
  considerately, openly and flexibly
• Too much of a heavy hand further pushing the
  consolidation may have put off some additional
  merger prospects at the time
• Website http//www.aztechcouncil.org/
• Contact Steve Zylstra, ATC President and CEO
• (T) 602.343.8324 ext. 101, (M) 412.735.9537
• (E) szylstra_at_aztechcouncil.org
• Ron Schott, ATC President and CEO Emeritus
• (T) 602.343.8324 ext. 109, (M) 602.320.9342
• (E) rschott_at_aztechcouncil.org

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Pittsburgh Technology Council Case Study
Megastructure

• Background
• Co-located and co-managed with Catalyst
  Connection, the Doyle Center for Manufacturing
  Technology, and the Pennsylvania NanoMaterials
  Commercialization Center
• Rationale/Benefits
• Shared Infrastructure including Finance,
  Accounting, Marketing, IT, HR and Administration
• Synergistic missions
• Shared space
• Shared management
• Process/Issues
• Council started in 1983, Catalyst added in
  1988, Doyle Center in 2003, Nano Center in 2005
• Council 501(c)6 trade association, others
  501(c)3 economic development entities
• Catalyst started as an educational foundation
  of Council
• Some PTC members felt Catalyst competed with
  them

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Pittsburgh Technology Council Case Study
Megastructure (Contd.)

• Staff and Governance
• Separate boards, with almost no overlap
• Separate legal entities
• 4 x 4 (16) board meetings and exec. committee
  meetings per year
• Council 32 FTEs, 5M, Catalyst 34 FTEs, 6.8M,
  Doyle 6 FTEs, 3.5M, Nano, 2 FTEs, 2.3M,
  included in the FTEs are the one-third of shared
  staff
• Critical Success Factors
• Management assured that there was complete
  synergy and no redundancy between the various
  enterprises
• Communication between Board leadership
• Service agreements that clearly spell out
  shared services and whos paying for what

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Pittsburgh Technology Council Case Study
Megastructure (Contd.)

• Outcome/Lessons Learned
• Significant savings in infrastructure costs due
  to shared services
• Able to hire much more competent/seasoned staff
  in infrastructure positions
• Viewed positively by technology/manufacturing
  community for savings
• Hard to hold together without strong leader
• Boards start worrying about focus of management
  as number of entities goes up
• More influence and effectiveness from sheer
  girth
• Websites http//www.pghtech.org/
• http//www.catalystconnection.org/
• http//www.doylecenter.org/
• http//www.pananocenter.org/
• Contact Steven G. Zylstra, Former President and
  CEO
• (T) 412.735.9537
• (E) sgzylstra_at_zoominternet.net

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Pittsburgh Technology Council Case Study
Macrostructure

• Background
• The keystone of the success of Pittsburgh
  Technology Council is its fundamental business
  model which is based on its network structure.
  They
• Provide forums for education and peer-to-peer
  interaction
• Train and educate members
• Increase awareness of best practices
• Provide valuable networking opportunities for
  members
• Develop cost- and time-savings services
• Maintain quality programming applicable to the
  membership
• The preponderance of product and service
  offerings emanate from and support the networks
• The PTC IT Network is larger than virtually all
  the state or regional IT associations in the U.S.
  and Canada

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Pittsburgh Technology Council Case Study
Macrostructure (Contd.)

• Networks
• Driven by direct input and feedback from our
  members
• Advisory Committees
• Four (4) Industry Network Advisory Committees
• Six (6) Peer Network Advisory Committees
• Meet quarterly at the Council Offices
• Annual Listening Survey
• Electronic survey conducted each Spring
• Outreach Process
• In-person, on-site staff visits with our
  members
• Goal Minimum of 400 technology members in
  2006-07

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Pittsburgh Technology Council Case Study
Macrostructure (Contd.)

• PTC Network Structure

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Pittsburgh Technology Council Case Study
Macrostructure (Contd.)
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Northeast Ohio Software Association (NEOSA) Case
Study

• Background
• NEOSA merged with Council of Small Enterprises
  (COSE), the pre-eminent small business membership
  organization in northeast Ohio in 2004. The
  Greater Cleveland Partnership (http//www.gcpartne
  rship.com) was created in March 2004 by the
  consolidation of Cleveland Tomorrow, the Greater
  Cleveland Growth Association, the Greater
  Cleveland Roundtable and their primary affiliates
  COSE, the Northeast Ohio Technology Coalition
  (NorTech), and the Commission on Economic
  Inclusion. Interview with Jim Cookinham, founder
  and former head of NEOSA, now with COSE.
• Rationale/Benefits
• Impetus for merger for NEOSA came from 400K in
  state funding pulled, struggling with membership
  (500 members, 1M budget, 5 FTEs)
• Catalyst for COSE was worried about lagging
  membership, due to the organization's principal
  value is in providing low cost insurance (17,000
  members, 60 FTEs)
• Not a merger of equals, but NEOSA had loyal
  members who attended events and are committed to
  their cause and added energy to COSE. COSE had
  services NEOSA didn't offer.

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Northeast Ohio Software Association (NEOSA) Case
Study (Contd.)

• Process/Issues
• Process started as a discussion about a possible
  partnership
• Staff/Governance
• In order to create enhanced value for its
  members and to enhance member retention, COSE has
  adopted a network strategy similar to the
  Pittsburgh Technology Council (macrostructure)
• NEOSA is now a network leader within COSE. I has
  grown membership to 700.
• Ex-Chairman of NEOSA now chairs COSE for next two
  years, NEOSA has 3 dedicated staff, has a Board
  of Advisors with no fiduciary responsibility,
  high visibility for new CEO
• Critical Success Factor
• Both parties have been faithful to the
  concept/vision and lived up to expectations

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Northeast Ohio Software Association (NEOSA) Case
Study (Contd.)

• Outcome and Lessons Learned
• After merger, COSE adopted network structure.
  Besides NEOSA, COSE has added an Arts Network and
  a Home-based Business Network
• No loss of NEOSA members
• NEOSA now get less media attention
• Not as much fun for former NEOSA head
• No public whining or adverse media attention
• Key take away, you must decide whether you are
  focused on your membership or on economic
  development. They drive very different
  strategies.
• Websites http//www.neosa.org/
• http//www.cose.org/
• Contact Jim Cookinham, VP Member Networks and
  Programs,
• (T) 216.592.2295
• (E) JCookinham_at_COSE.org

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Utah Technology Council (UTC) Case Study

• Background
• UTC was formed in April 2006 by the merger of the
  Utah Information Technology Association (UITA)
  established 1991 and the Utah Life Science
  Association (ULSA) established 1994, after
  working together closely for over a decade.
  Interview with Richard Nelsen, former CEO of
  UITA, CEO of UTC.
• Rationale/Benefits
• Following lead of peer organizations around the
  nation
• Encouragement from UITA board members and other
  civic leaders
• Retirement of ULSA Executive created
  vacuum/opportunity
• Several key disgruntled Board members at ULSA
• Process Issues
• UITA did focus groups with members in 2002 and
  a bio-study in 2005
• ULSA did focus groups in 2005
• UITA believes life science represents the
  future and will exhibit strong growth
• Sought advice of CEOs at Pittsburgh Technology
  Council and New Jersey Technology Council who
  interacted with a UITA/ULSA task force

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Utah Technology Council (UTC) Case Study (Contd.)

• Staff and Governance
• Large merged Board (55)
• Kept UITA executive to run merged UTC
• Hired a Life Science Director from San Diego to
  head-up bio efforts
• Formed a Life Science Advisory Council to assure
  appropriate representation and focus
• Critical Success Factors
• Principally, the timely departure of ULSA
  executive predicated
• Key ULSA Board members unsatisfied with status
  quo and drove merger

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Utah Technology Council (UTC) Case Study (Contd.)

• Outcome and Lessons Learned
• Executive must have thick skin, before and
  after merger
• The destination was worth the journey and speed
  bumps manageable
• Life sciences companies more needy, different
  culture/perspective
• Seek outside advice and counsel to objectify
  and broaden considerations
• Buy in important from both boards
• Website http//www.utahtechcouncil.org/
• Contact Richard Nelson, President and CEO
• (T) 801.568.3500 ext. 100
• (E) rnelson_at_utahtech.org

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Mass Technology Leadership Council (MassTLC)
Case Study

• Background
• Formed by the combination of Massachusetts
  Software Council (MSC) and New England Business
  and Technology Association, Inc. (NEBATA) in
  September 2005. Interview with Tom Hopcroft,
  former President of NEBATA and now VP at MassTLC
  and Joyce Plotkin, Former President of MSC and
  now President of MassTLC.
• Rationale/Benefits
• Too many tech associations in Boston (8 for
  IT), reduce competition
• Combining sponsorship requests
• Elevate combined groups to a higher level (in
  eyes of tech community)
• Improve governance
• MSC board wanted growth, decided merger was
  good strategy
• NEBATA board saw MSC as strategic vehicle for
  IT buyer-seller dialogue

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Mass Technology Leadership Council (MassTLC)
Case Study (Contd.)

• Process/Issues
• Initiated by two of the executives, one from
  each organization
• Good synergy, little overlap between the
  organizations products/programs
• MSC had sellers perspective (vendors), NEBATA
  had buyers perspective (enterprise)
• Both executives view was to do what was best
  for their organization. Shared a common vision
• Used a lawyer as a counselor
• MSC acquired NEBATAs assets and then they
  renamed organization
• The two boards made the strategic decision to
  merge organizations. Massachusetts non-profit
  law required that one organization be dissolved
  and assets transferred in order to effectuate
  this business result
• Staff/Governance
• Eliminated inactive Board members from both
  Boards
• Both executives retained a position in new
  organization
• Critical Success Factors
• Shared vision create companies and jobs
• Both organizations were fiscally healthy

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Mass Technology Leadership Council (MassTLC)
Case Study (Contd.)

• Outcome/Lessons Learned
• Merger process was a success because the key
  executives were on the same page
• Boston Globe tech writer gave merger good
  treatment in media
• Successful integration
• Boards were highly supportive
• Notes Both MSC and NEBATA attempted to merge
  with Massachusetts Innovation and Technology
  Exchange (MITX) and were unsuccessful. Initiated
  by chair of MITX. MSC was three time to the
  altar and then MITX would throw them curve.
• Website http//www.masstlc.org/
• Contact Joyce Plotkin, President
• (T) 617.437.0600 ext. 11
• (E) joyce_at_masstlc.org

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Technology Council of Maryland (TCM) Case Study

• Background
• TCM has separate Tech Alliance and MdBio
  Divisions as a result of merger with MdBio
  Foundation.
• Rationale/Benefits
• MdBio first attempted to create its own
  membership component, but was unsuccessful.
  Amounted to hostile takeover of bio members.
  Finally came to table
• MdBio was well funded, but would eventfully run
  out of funding
• Primary motivation was confusion in the
  community as to who spoke for life science
  wanted single voice

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Technology Council of Maryland (TCM) Case Study
(Contd.)

• Process and Issues
• The merger was Board (Chairman) driven, both
  legacy CEOs fought it
• Chairs of organizations had different vision of
  outcome, not on same page
• New bylaws created that end up having far too
  much specificity. Done to appease Directors who
  were afraid of loosing identity
• Went to the alter three times before succeeding
  in merger
• Staff and Governance
• New governance structure is extremely cumbersome
  and overly taxing on resources. Now three 501(c)
  3 boards and four governing bodies in the one
  501(c) 6 board with multiple divisions. At least
  30 board meetings per year.
• Staff was unintentionally set up by board to
  fail. All MdBio staff ultimately left
• Success Factors
• Do better planning

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Technology Council of Maryland (TCM) Case Study
(Contd.)

• Outcome/Lessons Learned
• Hire outside consultants during the
  negotiations process, not just after, to serve as
  objective experts and advisors
• Do lots of advanced planning around
  organization structure, governance and budget
  before attempting integration
• One year later, things are starting to settle
  down/work
• Took personal toll on new executive hired to
  run overall enterprise
• Website http//www.techcouncilmd.com/
• Contact Julie Coons, CEO
• (T) 240.453.6213
• (E) jcoons_at_techcouncilmd.com

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TechColumbus (TC) Case Study

• Background
• The Columbus Technology Council was created in
  late 2002 through a merger of the Columbus
  Industry and Technology Council (ITC) and
  Columbus Technology Leadership Council (CTLC).
  Then TechColumbus (TC) was formed through the
  merger of the Columbus Technology Council and the
  Business Technology Center (an incubator) with a
  close linkage to Ohio State Universitys Science
  and Technology Corporation (Scitech). Interview
  with Tim Haynes, VP Member Services and Marketing
  
• Rationale/Benefits
• Realized that all organizations shared
  essentially the same end
• Desired a common advocacy platform
• All looking for funding from the same sources

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TechColumbus (TC) Case Study (Contd.)

• Process and Issues
• Process lead by the three Chairs of the Boards
  of the organizations
• Took too long to integrate
• Some board members from the past organizations
  thought they were in the dark
• Staff and Governance
• Brought in new executive to run TC
• BTC executive retired
• Critical Success Factors
• Leadership - Chairs of the Boards of the three
  organizations committed to merger
• All three entities fiscally sound at time of
  merger

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TechColumbus (TC) Case Study (Contd.)

• Outcome and Lessons Learned
• Maintained both a 501(c) 3 (state-supported)
  and a 501(c) 6 (member-supported)
• Though continuing to do events and new business
  formation services, business approach and model
  underwent major change in the impact TC has and
  the momentum its able to generate, as well as
  ability to push more strategic regional
  initiatives
• New entity now can do more breadth of tech
  and entrepreneurial to mature companies
• Diverse Board Large and small companies,
  academic, state, legal, accounting, etc.
• New bylaws
• Staff of 12, 3M budget
• Recently got 15M from state for
  entrepreneurial program plus local match funding
• New executive brought in
• Small Board 13 now, 9 at merger
• Merged organization now co-located
• Website http//www.techcolumbus.org/
• Contact Ted Ford, President and CEO
• (T) 614.487.3700

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Minnesota High Tech Association (MHTA) Case Study

• Background
• MHTA adopted its current name in 1998 with the
  merger of the Minnesota High Technology Council
  (MHTC) and the Minnesota Software Association
  (MSA). No interview, just an email exchange with
  Kate Rubin, President (see below)
• I was not here when MHTC and MSA joined forces.
  A good idea, but little attention paid to the
  integration. Many say it was MHTC taking over,
  dropping MSA programs. On the other hand, many
  MSA members were sole proprietors who did not pay
  dues, so tell me how that is a real membership
  organization? In fact there were tens if not a
  couple hundred companies in this category. So
  any talk of how the merged organization lost so
  many members is also probably bogus. We have
  since brought back a few MSA programs, let others
  go completely from both MHTC and MSA,
  re-integrated some real company members, and
  clarified the value proposition as it were for
  the new MHTA. Working pretty well right now and
  growing stronger by the day

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Minnesota High Tech Association (MHTA) Case
Study(Contd.)

• References
• Rick Krueger, former MHTC/MHTA President could
  provide more details, as he was President at the
  time of the merger. Also, perhaps Dee Thibodeau,
  who is a former MHTA board chair, was part of
  MSA, and continues on MHTA board. She is at
  dee.thibodeau_at_chartersolutions.com.
• Website http//www.mhta.org/
• Contact Kate Rubin, President
• (T) 952.230.4562
• (E) krubin_at_mhta.org

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Technology Council of Northwest PA (TCNWPA)Case
Study

• Background
• Successfully merged the Erie Technology
  Management Association (ETMA) into the Tech
  Councils IT Network. Unsuccessful merger with
  the Erie Network Users Group (ENUG) as too techie
  focused and unwilling to pay dues.
• Rationale/Benefits
• Eliminate competition
• Enhance participation
• Drive membership
• Process and Issues
• New Bylaws
• Staff and Governance
• Able to add one additional staff member IT
  Network Director
• Created new IT Steering Committee

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Technology Council of Northwest PA (TCNWPA)Case
Study (Contd.)

• Success Factors
• Top down merger
• Utilized a few community leaders that people
  listen to
• Outcome/Lessons Learned
• Went from 60 to 85 members
• Association of Information Technology
  Professionals (AITP) chapters in Northwest PA
  failed because the volunteer driven model
  couldnt sustain them
• A former AITP group in McKean County has
  approached the Tech Council to have an IT Network
  Chapter in that county
• Website http//www.technwpa.org/
• Contact Perry Wood, Chief Executive Officer
• (T) 814.451.1173
• (E) perry.wood_at_technwpa.org

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Technology Association of Georgia (TAG) Case
Study

• Background
• TAG started through a merger of three SIGs Women
  in Technology (WIT), Southeastern Software
  Association (SSA) and Business Technology
  Alliance (BTA) in 1997-98 and now has 20
  Societies and 6 Affiliates. Interview was with
  Tino Mantella, President.
• Rationale/Benefits
• Share infrastructure
• Process and Issues
• Merger driven by Chairs of three organizations
• Staff and Governance
• Large Board, 55 members
• Each Society has an Advisory Board
• Budget 1.3M with a staff of six, contract out
  accounting

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Technology Association of Georgia (TAG) Case
Study (Contd.)

• Success Factors
• A TAG staff member attends every Society meeting.
  Staff responsible for between 2 and 8 Societies
  each
• TAG has reached a critical mass
• Outcome and Lessons Learned
• TAG has 3300 members today, more than doubled in
  less than two years, of which approximately 2000
  are company members and the remainder individual
  members
• Dues range from 900 to 10,500, depending on
  size of company
• Affiliates trade their member rate for their
  programs to TAG members in order to have TAG
  promote their programs
• Conduct over 100 meetings a year with an average
  of 55 attendees. Each Society meets on average
  monthly.
• All but three Societies are pulling their weight
• All Societies come together quarterly as part of
  the Leadership Council, consisting of the Chair
  of each Society and five members at large
  appointed by the President
• Website http//www.tagonline.org
• Contact Tino Mantella, President
• (T) 404.817.3333, ext. 7, (E)
  tmantella_at_tagonline.org

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Technology Association of Georgia (TAG) Timeline
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Virginia Technology Alliance (VTA) Case Study

• Background
• Eight regional technology councils formed the
  Virginia Technology Alliance (VTA) in 1998
  including the Northern Virginia Technology
  Council (NVTC). Two other councils were created
  after that and then inducted into the VTA.
  Interview with Josh Levi, Vice President for
  Policy, NVTC and VTA Board Member.
• Rationale/Benefits
• Shared interests technology, Virginia's best
  interest
• United support on policy issues
• Process and Issues
• Developed bylaws
• Difficult to define common interests, small
  entities more interested in programs/events and
  larger more in policy/staff/organizational
  development
• While the mentorship aspect of VTA tends to
  benefit the smaller councils exclusively (one-way
  street), benefits from VTA membership flows to
  all councils and even the larger councils gain
  and benefit from the networking and policy
  advocacy aspects
• Councils have different expectations of VTA
• Staff and Governance
• No staff

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Virginia Technology Alliance (VTA) Case Study
(Contd.)

• Success Factors
• None identified
• Financial contribution to VTA went from per
  member assessment to organizational tiered
  structure
• Outcome Lessons Learned
• Annual strategic planning retreat discussion
  goes back and forth whether VTA should be a loose
  alliance or have a strong central governance
  structure
• VTA conducts an annual legislative reception in
  Richmond as their only event
• Collaborative CFO event in partnership between
  Virginia, Maryland, and DC Tech Councils
• Produced statewide magazine, failed after two
  issues, some councils publish their own
• While NVTC is in Virginia, they are also part
  of the Greater Washington region. The Maryland
  and DC Tech Councils are physically located
  closer than many of Virginias Tech Councils
  making it easier for them to collaborate and
  partner with DC Area Tech Councils.
• Website http//www.thevta.org/
  http//www.nvtc.org/
• Contact Josh Levi, Director of Policy, NVTC
• (T) 703.904.7878
• (E) jlevi_at_nvtc.org

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Regional and National Supplementary Examples

• Arizona Chamber of Commerce
• BC Technology Industry Association (BCTIA)
• Advance Colorado Center (ACC)
• Communitech (Waterloo, ON, Canada)
• Ottawa Centre for Research and Innovation
  (OCRI)
• Baton Rouge Technology Council (BTRC)
• OCTANe Orange County
• American Society of Association Executives
  (ASAE)
• Internet Security Alliance (ISAlliance)

43
Regional and National Supplementary Examples

• The Arizona Chamber of Commerce and the Arizona
  Association of Industries (AAI) merged in late
  2007 forming the Arizona Chamber of Commerce and
  Industry and are developing the Arizona
  Manufacturing Council to continue serving as the
  focused voice for Arizonas manufacturers and
  supporting industries (http//www.azchamber.com/)
• The British Columbia Technology Industry
  Association (BCTIA) was incorporated in 1993,
  joining the Electronic Manufacturers' Association
  of British Columbia (EMABC) and the Information
  Technology Association of Canada, BC Chapter
  (ITAC-BC) (http//www.bctia.org/)

44
Regional National Supplementary Examples
(Contd.)

• The Advance Colorado Center (ACC) provides common
  headquarters and logistical support for
  non-profit associations and organizations that,
  in turn, provide a variety of services and
  programs to companies, entrepreneurs, and
  individuals in order to stimulate job growth and
  promote a sustainable corporate environment in
  Colorado (http//www.advancecoloradocenter.com/)
• Colorado Software Internet Association (CSIA)
• Colorado BioScience Association (CBA)
• Colorado Association for Manufacturing and
  Technology (CAMT)
• Colorado Nanotechnology Alliance (CNA)
• Colorado Photonics Industry Association (CPIA)
• Connected Organizations for a Responsible
  Economy (CORE)
• CTEK Venture Centers
• Colorado Film Commission

45
Regional National Supplementary Examples
(Contd.)

• Communitech started up in 1997 to support the
  Ontario regions early tech cluster, Key partners
  include the Industrial Research Assistance
  Program (IRAP) program of the National Research
  Council (of Canada), Has a pending London, ON
  area organizational merger (http//www.communitech
  .ca/)
• The Ottawa Centre for Research and Innovation
  (OCRI) brought together 6 non-profit tech orgs to
  create an organization of over 100 staff and 12M
  budget that has now achieved the capability,
  critical mass, and resources to achieve
  significant results (http//www.ocri.ca/)
• The Baton Rouge Technology Council (BRTC) merged
  about two years with the Chamber of Greater Baton
  Rouge, driving economic development in the Baton
  Rouge metropolitan area and serving as the voice
  of the business community (http//www.brtc.org/)

46
Regional National Supplementary Examples
(Contd.)

• OCTANe Orange County was formed in September 2002
  and has become a fast growing IT and biomedical
  organization serving the Orange County,
  California region (http//www.octaneoc.org/)
• The American Society of Association Executives
  (ASAE) merged with the Greater Washington Society
  of Association Executives (GWSAE), the ASAE
  Foundation, and The Center for Association
  Leadership in July 2004 (http//www.asaecenter.org
  /)
• Internet Security Alliance (ISAlliance) agreed to
  provide financial services to the Electronic
  Components, Assemblies Materials Association
  (ECA), Government Electronics Information
  Technology Association (GEIA), JEDEC Solid State
  Technology Association (JEDEC), and
  Telecommunications Industry Association (TIA)
  July 2007 (http//www.isalliance.org/)

47
Council of Regional Information Technology
Associations (CRITA) Recent Member Survey (N25)
Majority of Regional Association Members are Tech
Firms
48
Council of Regional Information Technology
Associations (CRITA) Recent Member Survey (N25)
Major Force in Community Today and in Five Years
Ongoing Need for Regional Tech Associations
49
ATC Business Case for Collaboration and/or
Consolidation Business Models Summary

• Loose Alliance VTA, ACC
• Network Structure (Macrostructure) PTC, COSE,
  UTC, NWPATC
• Umbrella Organization (Megastructure) PTC et
  al, TCM
• Society Model TAG, IEEE
• Complete Assimilation AIN/HTIC, MassTLC, BCTIA,
  BRTC

50
ATC Business Case for Collaboration and/or
Consolidation Phase I Conclusions

• Structure A Network Structure is successful
  nationally and likely most appropriate for a
  ATC/ABA consolidation
• Geographical Challenges Addressing a large
  geographic area is a challenge everywhere,
  especially in states with multiple major metro
  centers. Phoenix and Tucson have exhibited
  regional cluster growth that would appear
  similarly challenging
• Merger Recommendations Based on this research
  and the experience of the consultants, a merger
  with SATC or an emerging GTTA would be extremely
  difficult. Certainly ATC should strive to build
  stronger linkages, however loose affiliations
  without mutual expectations and concrete
  deliverables by the parties involved and codified
  through a formal agreement, would most likely
  create more frustration
• Define Clear Charter Clarifying whether an
  organization is a economic development entity or
  a member-based trade association should guide
  organizational design and is a critical success
  factor
• Plan for Success Careful preplanning of the
  combined governance structure, organizational
  staffing and a pro forma budget is a key to
  assure smooth integration
• Variables Change of leadership is a common
  variable leading to many mergers
• KPIs Few organizations had concise or well
  understood metrics about the before and after
  conditions

51
ATC Business Case for Collaboration and/or
Consolidation Phase I Conclusions (Contd.)

• Support Entrepreneurship ATC should become a
  more visible contributor to the entrepreneurial
  scene by considering doing the following
  Initiate a business plan competition (many to
  emulate), create an entrepreneurs network,
  collaborate with Ernst Young to showcase the
  Entrepreneur of the Year winners in TechConnect
  magazine (hand out at event), support local angel
  network(s), consider conducting an angel capital
  fair, partner with TiE-AZ on events and outreach,
  create a partnership with Stealthmode
  Partiers/FastTrac to bring entrepreneurial
  programming to ATC members, and consider creating
  a biannual entrepreneurial boot camp.
• Bio Integration Biotechnology related
  organizations have successfully merged with
  technology associations in spite of being
  initially skeptical
• Positive Results Although many mergers were
  more difficult, more complex and took longer that
  expected, few regretted it, and stronger, more
  vital organizations generally resulted
• Politics with a small p Personalities and
  protection of turf often played a critical role
  in the success of a smooth merger
• Seek Third Party Advice Hiring consultants or
  seeking experts to help provide objective advice
  before and during the process, was a strong
  recommendation by several councils
• Rejoin CRITA The Arizona Technology Council
  should again be a participating member of CRITA
  as it represents IT and technology trade
  organizations in an effort to facilitate
  information, visibility, networking and services
  for IT-focused, not-for-profit business
  organizations in the United States and Canada

52
ATC Business Case for Collaboration and/or
Consolidation Pending Phase II Activity Overview

• Engage Leadership Engage volunteer and staff
  leadership of ABA and SATC/GTTA in discussions on
  how to better leverage the Arizona
  technology-based industry strengths for the good
  of industry and the state.
• Conduct Survey Assuming interest by ABA and
  SATC/GTTA, conduct a detailed survey of the
  products, services and benefits that each of the
  three organizations provide, looking for overlap
  or duplication.
• Inventory Assets Document at some level of
  detail, the infrastructure and assets that each
  organization brings to the table. Given the
  overlay of products and services from the above
  evaluation and business model analysis of Phase
  I, propose an organizational structure (loose to
  formal) that would best leverage the strengths
  and assets of the three organizations to deliver
  results and member satisfaction.

53
Arizona Organizational Landscape - Background

• The Arizona Strategic Partnership for Economic
  Development (ASPED) of the late 80s and early
  90s with SRI involvement evolved into the
  Governor's Strategic Partnership for Economic
  Development (GSPED) of industry clusters and
  infrastructure foundations flourishing throughout
  the 90s
• Several clusters and infrastructure foundations
  operated statewide, though a number of clusters
  had separate Phoenix and Tucson based
  organizations, and several others were only
  active in one metro area or the other
• The Arizona Partnership for the New Economy
  (APNE) public/private partnership undertook a
  yearlong effort (2000-2001) to assess Arizonas
  current readiness and establish benchmarks for
  measuring progress, as well as to develop
  strategies for correcting any perceived
  deficiencies
• GSPED faded during the APNE timeframe, several
  infrastructure foundations expired, and clusters
  continued to emerge and evolve in partnership
  with regional and statewide economic development
  and government groups

54
Arizona Organizational Landscape - Today

• The Arizona Technology Council (ATC -
  http//www.aztechcouncil.org/) continues to build
  membership, keep strong events focus, has become
  major public policy player, and publishes the
  statewide technology magazine TechConnect, Steve
  Zylstra was recently recruited from the
  Pittsburgh Technology Council to return to the
  Valley and assume leadership, Various
  collaboration /or consolidation opportunities
  under consideration.
• Arizona Department of Commerce
  (http//www.azcommerce.com/) supports various
  groups and initiatives including the Governors
  Council on Innovation Technology (GCIT -
  http//www.gcit.az.gov/), Unified economic
  development model with recently announced Arizona
  Economic Resource Organization (AERO) going
  forward
• Strong Tri-University system (ASU, U of A, NAU)
  with good legislative investment in
  infrastructure, growing technology licensing and
  spin offs, and developing entrepreneurial
  programs
• TGen, IGC, ASU Biodesign Institute, and U of
  As BIO5 and Phoenix Medical Campus are driving
  Phoenix biotech cluster along with Tucson BIO-SA
  and Flagstaff bio component growth
• Science Foundation Arizona (SFAz -
  http//www.sfaz.org/) launched in 2006, now with
  135M of state funding to be augmented by
  matching funds and made available for grants to
  deepen scientific, engineering and medical
  infrastructure
• Arizona Telecom Information Council (ATIC
  http//www.aztele.com/atic/) continues guiding
  telecom policy development driving broadband
  deployment, convening regional stakeholders,
  facilitating public-private partnerships, and
  providing public news, outreach, and education
• Greater Arizona eLearning Association (GAZeL -
  http//www.gazel.us/) serves as an alliance
  between eLearning educators, practitioners and
  related businesses to provide vision, share
  research, support learning initiatives, and
  gather resources for the utilization,
  implementation and expansion of eLearning in
  business, government, and education
• Venture Capital (VC) remains problematic in
  Arizona, especially for early stage companies

55
Arizona Organizational Landscape - Arizona
BioIndustry Association (ABA)

• The Arizona BioIndustry Association (ABA -
  http//www.azbioindustry.org/) is a
  not-for-profit, 501(c)6 trade association that
  was reorganized in 2003 to promote the growth of
  the bioscience industries in Arizona through
  member services, educational programs, business
  networking, public policy, and entrepreneurial
  endeavors
• ABA is also the state affiliate of the
  Washington D.C.-based national Biotechnology
  Industry Organization (BIO - http//www.bio.org/)
  and focuses on both biotechnology and medical
  devices
• ABA has approximately 200 members and 21 Board
  members, Recent bylaws revision
• ABA leadership and staffing were in transition
  in mid-2007, Robert (Bob) Eaton, who led MdBio, a
  bioscience industry support organization in
  Maryland for 10 years, has relocated to Phoenix
  and began his new position as President and CEO
  on 10/1/07. Natascha Hebell Fernando, formerly of
  the Arizona Department of Commerce has recently
  become COO. ATC previously initiated active
  discussions on CC which should be reinvigorated
  under new leadership.
• ABA is complemented by the closely affiliated
  Bioindustry Association of Southern Arizona
• (BIO-SA - http//www.bio-sa.org/) and a growing
  Arizona Nanotechnology Cluster (http//www.aznano.
  org/) collaboration
• ThirdBiotech (http//www.thirdbiotech.com/)
  group recently launched in the Valley to foster
  networking and business deals within the life
  sciences community

56
Arizona Organizational Landscape - Tucson
Technology Organizations

• Aerospace, Manufacturing and Information
  Technology (AMIT - http//www.amit-az.org) was
  formed in 2005 through a merger of the Southern
  Arizona Industry and Aerospace Alliance (SAIAA)
  and the Information Technology Association of
  Southern Arizona (ITASA)
• Southern Arizona Tech Council (SATC -
  http//www.satc-az.com/) formed in August 2000 to
  promote and implement high-tech industry economic
  development and competitiveness in Tucson
  Southern Arizona
• Arizona Optics Industry Association (AOIA -
  http//www.aoia.org/), Environmental Technology
  Industry Association (ETIC - http//www.az-etic.co
  m/), and Bioindustry Association of Southern
  Arizona (BIO-SA - http//www.bio-sa.org/) strong
  here
• Tucson Regional Economic Opportunities, Inc.
  (TREO - http//www.treoaz.org/) is the lead
  economic development agency for the greater
  Tucson area
• Cluster representatives from Tucson and Arizona
  Clusters have been meeting to discuss business
  development needs and strategies for Southern
  Arizona and plan to rename and repurpose SATC as
  the Greater Tucson Technology Alliance (GTTA) to
  facilitate collaboration of technology industry
  clusters and other business development,
  government and education organizations

57
Arizona Organizational Landscape - Entrepreneurial

• The Arizona Internet Professional Association
  (AZIPA http//www.azipa.org/) arose in the late
  90s with Phoenix area meetings and an active
  e-mail discussion list that remains in place
  today. It was complemented by Tech Oasis
  (http//www.techoasis.org/) meetings in the
  Phoenix area and Tucson which for a time had
  significant attendance and continue in Tempe
  monthly, but at a lower attendance level. Both
  attract a more technically oriented /or
  entrepreneurial audience.
• The Indus Entrepreneurs (TiE) have a strong
  regional chapter (http//az.tie.org/) based in
  Phoenix to inspire, foster and support
  entrepreneurship in Arizona. They hold monthly
  dinner meetings and a popular Annual Venture
  Capital Conference/Panel.
• The Invest Southwest (http//www.investsouthwest
  .org/) in partnership with is ASU Technopolis
  (http//www.asutechnopolis.org/) produces the
  premier capital conference in Arizona annually
  featuring over a dozen Arizona startups and
  attracting several hundred investor attendees.
  The Arizona Technology Council is visible as an
  exhibitor and publicity partner.
• The Arizona Entrepreneurship Conference
  (http//www.azentrepreneurship.com/), now in its
  second year is a day-long series of panels,
  workshops, speakers and networking opportunities
  and has proved popular. The Arizona Technology
  Council is visible as an exhibitor and publicity
  partner.
• The Phoenix-area FastTrac Entrepreneurial
  Programs (http//www.fasttrac.org/) of the
  Kaufman Foundation is produced by Stealthmode
  Partners with a recurring 12 weeks of classes
  with several different focuses and often
  subsidized rates with over 200 graduates to date.
  Stealthmode Partners also hosts monthly
  Entrepreneur Roundtables over dinner and has a
  large rotating base of attendees.

58
ATC Business Case for Collaboration and/or
Consolidation Potential Next Steps

• PHASE II
• Utilize Feedback Get direction from
  Sustainability Committee on appropriate direction
  for next steps based on Phase I results
• Conduct Phase II Execute Phase II statement of
  work as modified by above
• PHASE III/IV
• At the discretion of the Sustainability
  Committee, the consultants will execute Phase III
  for preparation of a detailed strategic and
  operational plan for specific targeted
  collaborations and/or consolidations, and if
  necessary, execute Phase IV to repeat the
  assessment and planning process with other
  targeted organizations

59
ATC Business Case for Collaboration and/or
Consolidation Questions and Answers

• Thank you for the opportunity to conduct this
  project.
• Presented By
• Steven G. Zylstra, Arizona Technology Council
• (T) 602.343.8324 ext. 101, (M) 412.735.9537
• (E) szylstra_at_aztechcouncil.org
• URL http//www.aztechcouncil.org/
• Mark Goldstein, International Research Center
• (T) 602.470.0389, (M) 602.670.6407
• (E) markg_at_researchedge.com
• URL http//www.researchedge.com/