$100/$10 Plan Details

The $100/$10 Dues will significantly increase IEEE membership 

Since early 2020 IEEE volunteer leadership (IEEE Boards) and senior IEEE staff have been aware of this website’s recommendations to reduce member/student annual dues. In Nov. 2020 the IEEE Board of Directors approved a 50% discount of all IEEE STUDENT dues around the world to be implemented Jan. 2021.

Can IEEE Afford to Reset Member Dues to $100?

You will see the answer is YES.

IEEE 2019 Revenue Sources

  1. IEEE Business revenue – 503.3 million 90.3%
  2. IEEE Member revenue – 54.3 million 9.7%
    • Full dues 37.7 million
    • Less than full dues 4.9 million
    • Student dues 3.3 million
    • Society dues 8.4 million
  3. Total IEEE revenue – 557.6 million 100.0%

Based on the above 2019 revenue data, IEEE is a highly successful world standards, conference and publication corporation. Member revenue represents only 9.7% of IEEE’s 2019 total revenue. While the contribution of member revenue is not significant, it is IEEE’s volunteer members and not IEEE staff (1,200) that are responsible for generating the 90.3% portion of IEEE’s business revenue. IEEE’s 990 2019 tax filing states IEEE has 100,000 volunteers. John Vig, 2009 IEEE President, believes the number is conservatively 200,000 volunteers. If the average member volunteers 10 hours/yr, IEEE receives 1 million hours of free labor each year. The average IEEE staff member earns $53/hr. Replacing volunteer hours with paid staff hours would increase IEEE’s expenses by $53 million/yr. This cost would result in IEEE having significant net revenue losses for 12 of the past 15 years. IEEE’s net assets would be much smaller than they are today. That is a major financial impact! Therefore, any effort to increase IEEE membership WILL have a significant positive financial impact on IEEE’s business revenue.

$100/$10 Plan Impacts

  1. Retention (renewal) rates will improve.
  2. Recruitment rates will improve.
  3. Increase of retention and recruitment rates will vary from Region to Region because the member dues discount will vary Region to Region. Today regional growth is positive or negative based on different dues levels.
  4. The number of members who pay full dues in every Region will grow at different rates.
  5. New Society membership/revenue growth will be immediate!
  6. $100 dues will encourage some members to use the money saved to join a Society.
  7. Member revenue will drop in the first 2 to 4 years compared to current dues levels.
  8. Member revenue can exceed current revenue starting in years 3 to 5.
  9. In future years the initial member revenue loss will be paid back.
  10. Short term member revenue lose can be covered by:
    • a small yearly IEEE expense cost reduction, or
    • a small reduction in IEEE’s net assets, which exceed over $550 million.

$100 Dues Financial Impact On Your Section

Each year IEEE gives our Section money based on the # of members in the Section. With more members renewing & more new members joining that financial support will increase. This means our Section will have more resources to invest in local community activities, such as STEM projects for grades 1-12, undergrad projects, community awards, Section member awards. Etc.

As a non profit corporation, this is one of the major goals of IEEE.

The $100/$10 Plan directly impacts members who pay full dues. Therefore, the simulation models will show the future membership/revenue impact on members who pay full dues. The model only uses 2 variables to forecast growth levels, which are recruitment rates and retention rates. It is these variables that have driven IEEE’s past and present membership and member revenue.

Each Region will be modeled with different recruitment/retention rates, since each Region currently has it own unique growth and revenue pattern. The sum total of all 10 Regions will be compared against IEEE’s projected membership and revenue assuming current membership dues policy.

The projected impact of Society net membership/revenue growth will also be shown as a result of the $100 Plan implementation.

Assumptions Used For $100 Plan Simulations

  1. Only full dues paying member’s growth is simulated.
  2. Projected membership growth of full dues paying members at today’s dues levels is -2.6% going forward. Current dues will be constant in future years.
  3. Member/revenue growth at current dues level will be compared to $100 dues.
  4. A member retention rate of .88 is chosen for $100 dues members in future years. Other rates can also be used.
  5. The current ratio of Society members/total members is .79. For every new member it is assumed there will be a new .79 Society member.
  6. The average Society dues of $29.40 remains constant starting in 2020.
  7. Projected member growth starts in 2020.
  8. For each simulation a different member growth rate can be selected for each Region.

Historic IEEE Retention & Member Growth Rates

In 1998 when IEEE dues were approx. $100 the overall retention rate was .862, which meant that member retention was much higher. Also over a 5 year period around 1998 IEEE’s growth rate was 12%. In the 1980s to 1990s IEEE growth rates ranged from 19% to 30%. Based on past IEEE membership growth it is reasonable to assume reseting member dues to $100 will encourage growth of 25%. 

Simulation Example

$100 plan with 25% avg new member growth & .88 member retention rate

This $100 Plan example assumes a constant retention rate of .88 for members in the simulation. In other simulations it can be made to vary Region by Region or over time to study the impact. An average 25% new member growth is assumed. To reach this average some Regions will have a higher growth rate while others will have a lower rate. For this example it is assumed that Regions with a higher discount rate from the current dues level will have higher new growth rates than Regions with a smaller discount. In all cases it assumed all Regions will see higher new growth rates. The simulation starts at the beginning of 2020 and stops at the end of 2025.

The overall results of the 25% avg new member growth and member retention of .88 are shown in the spread sheet below along with assumptions.

As expected, upon implementation of the $100 Plan with 25% avg. growth there is an initial drop in member revenue compared to keeping member dues at current levels. The contribution of net new Society members and revenue helps to minimize this revenue drop. This loss becomes smaller as more new members and net new Society membership start to grow. You can see over time membership/revenue and Society membership/revenue growth begins to accelerate compared to the current dues policy. By 2023 the Plan becomes self supporting and starts to create higher member revenue. The total losses that occurred from 2020 to 2022 are completely paid back by the first quarter of 2025.

The lost revenue in the years from 2020 to 2022 can easily be covered by either a small IEEE expense cost reduction or using a small portion of the IEEE unallocated net assets ($532 million). With 2.7%, 1.7% and 0.5% expense cost reductions the negative impact to IEEE’s net revenue in the years 2020 to 2022 can be avoided. Most for profit corporations routinely plan yearly expense cost reductions of 5% yearly.

At the end of 2025 IEEE can expect to have a full dues paid membership of 525,163 compared to 170,627 members for pay much higher dues. $100 Plan member revenue in 2025 would be $60 million compared to only $32 million for the same time period.

In addition the net increase of full paid members would add a net increase of 257K to the existing number of Society members. There would also be a corresponding net increase of $7.56 million to Societies.

As discussed earlier under the $100 Plan with a 25% avg growth, all members who now pay only $100 in dues would have a yearly savings of $58 to $108 starting in 2020. It is not unusual to expect some members would use a portion of this money to join one or more Societies. With out the dues reset to $100 members might have thought joining just one more Society was an expense that would be unaffordable. What would be the impact on Society revenue if 1 out of 4 members who pay full dues actually joined a new Society?

The spread sheet below calculates this impact from 2020 to 2025.

As can be seen, there would be a very large member/revenue bonus for all Societies. This bonus would help to significantly reduce the initial member revenue loss by $5.8 million in 2020 and $6.6 million in 2021. It would help the $100 Plan become self supporting one year earlier. By the first quarter of 2023 the combined $10 million member revenue loss would be repaid. The expense cost reductions in 2020 and 2021 would only have to be 1.6% and 0.4% respectively.

The details of the simulation model and how the new member growth and retention variables are applied to the model has not been discussed here. The model allows the user how to customize the performance of each of the 10 Regions; and, then produces an average model, which you have seen in the above tables. If you would like to know more about the simulation model or wish to use it yourself to test how customizing both new member growth rates and retention rates impacts growth of fully paid IEEE members on a world scale, please use the Contact page to make the request.

If you agree that the above example has shown the potential of having a major positive impact on both IEEE member/revenue and IEEE Society member/revenue growth, please electronically sign the constitution petition and the candidate petition. 

Please note:

  • Only members and grad students of Sections in Region 2 may sign the candidate petition.
  • All Members and grad students from any Region may sign the constitution petition.

Link to electronically sign 100 plan constitution petition & candidate petition:

http://www.ieee.org/petition

The express opinions on this website are not necessarily the opinions of IEEE.