Successful businesses sharpen their value proposition by defining their ideal customers or clients. It’s a powerful technique to focus, differentiate, and match demand. However, for peak bodies representing whole industries, is there really an ‘ideal’ member?
It’s common to see industry groups lean towards representing either small business or big business. Traditional farmer organisations will concentrate on connecting with small family farms, but want corporate business to join because of their commercial influence.
The reverse is true for industry groups with a dominance of big businesses in membership, but want more small and medium enterprises to join because of the added political influence.
A current example is with one of the world’s largest business associations, the US Chamber of Commerce. It is powerful, reportedly investing US$1.6 billion on lobbying efforts in Washington between 1998 and 2020. It has also been campaigning hard since 2017 to recruit more small and midsize firms and to bring in more high-tech companies.
Their pursuit of a broader membership base is about re-positioning to be more influential in a changed political context.
Major political parties are more questioning of big business today, fuelled by negative media reports like the destruction of Juukan George in the Western Pilbara, and the findings of high-profile government inquiries into misconduct (e.g., banking) and the anti-competitive business practices of a few.
Similarly, the influence of small business groups has declined with increasing consolidation of businesses across value chains and industries. Even if most small businesses are in membership or supportive, a group might only represent 20 per cent of industry value.
A high-performance industry association needs a membership that represents the whole industry.
The challenge is to elevate the important industry contribution in the national economy. It means advocating the shared priorities of all types of business.
Industry representation with real influence and impact is ideal when connected with businesses of all size.