Executive Director's Report

Policy Council Meeting

4 February 1998

Massachusetts Institute of Technology

by

Roberta L. Spencer

Status of the Home Office

Operations are intact and continuous, especially the sales and services to members. All financial information is current using the new accounting program "QuickBooks." The local Albany bookkeeping and the Society bookkeeping Jack maintained have been merged thanks to Jack's expert guidance. Financial information in this report reflects the Society as a whole.

I see the position of Executive Director as having two distinct parts: the first part is maintaining current and routine operations, and the second part is development and new initiatives. Items listed below have been completed, are in the works or are planned for the future. With the guidance of the Administrative Committee I am forging ahead. I look forward to advice from the Policy Council on any item.

Routine Operations (Attachment I)

Membership services and recruitment. Continuous phone, E-mail and mail coverage are being provided. The replies have been fast, focused and very responsive as shown by the positive feedback we have received. A sales and contact database has been growing since January 1, 1997. Currently we have over 400 records of members and non-members who have contacted this office for products or information. This database does not include all the contacts by E-mail.

In 1997, 37 new members have joined the Society as a result of their contact with this office in order to purchase a Beer Game or publication. This illustrates that sales lead to membership. Other new members have contacted Wiley directly.

A local Society office website is being maintained. It contains brochure information, including how to order past publications and how to become a member. The website will also contain conference information and perhaps the conference papers. The site address is http://www.albany.edu/cpr/sds/.

Beer Distribution Game, Proceedings, Journal , and Bibliography Sales.

There is great interest in the Beer Distribution Game, and less demand for the Proceedings and back issues of the System Dynamics Review. Orders filled (including bibliographies) as of December 31, 1997 totaled 271, and were shipped to over 35 countries.

Regarding the Beer Game: Sale of the Beer Game continues to be strong. In June 1997 a session of the Beer Game facilitated by John Sterman was videotaped. This raw material is in need of editing in order to produce an instruction video to "train the trainer." According to input from a range of clients from large corporations to small consulting firms, there seems to be a strong need for this new product. Working with the manufacturer for both the vinyl boards and the videos, we have acquired cost reductions for these products. Postage is paid by the consumer on all Beer Game sales, increasing Society profits. I remain very enthusiastic about the continued interest and sales of the Beer Game.

Regarding back issues of the System Dynamics Review: A new product has been added to the publications order form. A set of 21 back issues (Volume 1 - Volume 10) will be offered for sale for $500.00, a savings of $190.00 over the individual purchase price. A suggestion has been made for a gradual reduction in price on old issues. If this decision is made, clearance will be sought from the Administrative Committee.

Other. Bibliography disks continue to be available, although the bibliography needs to be updated. The current version is dated 1995.

Membership

John Wiley & Sons continues to be very helpful and responsive. The membership directory dated September 1, 1997 lists 680 members. Please see Attachment II for more detailed membership information. A membership directory was produced at John Wiley & Sons. It was distributed in September.

We are currently working on setting up a system to send welcome letters to new members of the Society. John Wiley & Sons will send information on new members to me and the Society office will mail out the letters.

Sponsorship

In an effort to increase membership, the arrangement for sponsorship has been slightly changed. In lieu of receiving a free subscription with a sponsorship, the corporate sponsors now will receive up to three free annual memberships. We have had two successes with this new arrangement to date, with two brand new sponsors.

A procedure for managing sponsors needs to be developed and put into action. There are eleven sponsors listed in the System Dynamics Review during 1997. We received dues from only four sponsors. I need to expend personal attention to this situation.

Society Finances

The finances have been transferred in whole to the Albany office and are currently being managed by David Andersen, V.P. Finance. As of December 31, 1997 income (cash basis) shown on RlocalS books total $68,411. Other income includes profit from the 1996 conference that was posted in January 1997 of $35,883; dividend and interest income of $10, 304; and Gordon Brown investment income of $17,528 totaling $132,127. Large expenses include replenishing the supply of vinyl boards and videos, including videotaping a Beer Game session to produce a training video, $16,877; purchase of a new computer, $2411; membership directory, $5071; and other expenses as listed on the profit and loss statement $18,785. Total expenses (cash basis) are $43,144 as of December 31, 1997. Please refer to the full statement shown in David Andersen's VP Finance Report.

Due to customer demand and conference involvement by the Society office, the Society has begun to accept credit card payments. This eliminates significant purchase barriers, especially for international customers. The processing charge would be 2.93% on all credit card sales with a minimum monthly processing charge of $35.00 Our break even point is approximately $1200 per month. In addition, there is a $15 per month statement fee, a one time charge of $150 for training/acquisition and a cost of $350 for software. Credit card sales for the past three months have been:

November 1997: $2817
December 1997: $3559
January 1998: $4904

Please see Attachment V for sales activity by month during 1997.

Administrative Calendar

A Presidential Initiative in 1997 was to create the Administrative Calendar. The rationale for this tool is for continuity of organizational memory. The Calendar will help the administration of the Society to be continuous, but also responsive to change. Please see the attached draft of the Administrative Calendar (Attachment III). Key people will need to comment on the Administrative Calendar and related processes to make it complete. The role of the Executive Director would be to help keep all the Society processes timely. Unfortunately there has been little progress on the Administrative Calender to date.

Please note: the next Policy Council Meeting is scheduled at the Quebec Conference. The dates and times that are currently set aside are:

Monday, July 20 - 5:00 pm to 6:00 pm
Tuesday, July 21 - 11:30 am to 1:30 pm
Wednesday, July 22 - 5:00 pm to 7:00 pm (if needed)

Planned Initiatives

Currently we are aiding a very enthusiastic new member of the Society in establishing a Central/South American Chapter of the System Dynamics Society. Based in Argentina, Mr. Valiente is contacting members and we are contacting non-members from our sales and contact database. The non-members are being asked to contact Mr. Valiente if they are interested in the idea of being part of the new chapter. He is hoping to give a report at the Quebec Conference if there has been sufficient progress.

Current Allocation of Effort for Executive Director

Daily time sheets are recorded as my time is separated into three cost centers at the University at Albany, the main one being the System Dynamics Society. Most of my time on Society work continues to be spent on current operations. Much time is being spent on system building. I continue to have difficulty trying to find enough time for the new initiatives listed above. As of December 31, 1997 I have worked a total of 286 hours over half-time. We also had a graduate assistant work to assist in setting up the office. For the months of April through December the hours add up to 280.5 (conference = 80 hours, Society = 200.5). In addition, a conference support person started in November and has worked a total of 56 hours as of December 31, 1997. Without this added assistance, organization of the office and conference would suffer. It would benefit the Society to be able to continue with this assistance.

Attachment I

Routine Operations - Other Processes (not tied to Administrative Calendar or Research Conference)