Building the future on solid foundations
The CIPD has set itself ambitious targets for the future. They will be stretching, but we start from a position of strength. Our total income for the year was £35.2 million, an increase of £1 million compared to the previous year. We achieved each of our financial objectives and, at the end of June, our general fund stood at £29.3 million.
Membership has grown consistently in recent years. We've improved retention, and continue to attract new members of the profession to the CIPD. But we're far from resting on our laurels. We've set ourselves a target of reaching 150,000 members by 2010, with a substantial increase in chartered members.
Our commercial businesses also continue to contribute significant funds to support our provision of services to members, our research, and the considerable efforts we make to promote good practice in people management and development to the widest possible audience. They're also a major channel through which we deliver services to the profession and the wider managerial market.
Ensuring continued growth
These commercial activities face pressures in a crowded market and from tightening budgets amongst customer organisations. In anticipation of this, we completed a comprehensive commercial review during the latter part of the financial year. We identified changes to the way we manage some outsourced services such as our contract for the production of People Management and for our conferences and exhibitions. We have also identified opportunities to expand our training courses, grow new markets and build on the strength of the CIPD brand to raise our effectiveness, coverage and financial return.
These changes are needed, both as a shock-absorber against short-term economic vagaries and so that we can continue to grow our services to the profession. Our effectiveness in the past has allowed us to build strong reserves to protect us against short-term pressures and to enable us to invest in strategic projects to ensure we continuously add to and improve the services we offer. We assign reserves to designated funds to cover specific priorities for future investment. Over the course of the year, we spent £2.1 million from these funds, mainly on IT developments, research and strategic priorities, leaving a total balance of £4.5 million at the end of June.
Our current strategic priorities include getting closer to large employers, exploring international opportunities, managing more effectively our relationships with our approved centres and our studying members, and a number of forward-looking strategies for the development of the CIPD.
Delivering value for money
By running a well-managed, financially robust Institute, we are able to keep our membership subscription low while still making these investments in the future. It is a strategic objective of ours to deliver high value to our members for a relatively modest subscription. By investing carefully in the right projects, in our research and expertise, and in the delivery of a consistently high level of customer focus, we're able to stay ahead of the game. This is what ensures that we're able to offer much better value for money to our members than other professional bodies.
We continually seek to adapt and change to meet the needs of our current and potential members. We're working hard to review the routes to membership so that they maintain rigour and credibility while also reflecting the changing career paths and roles in the people management and development profession. We're also developing a new centre profiling project to enable us to better monitor and report on the performance of our partners who deliver CIPD qualifications, which in turn will enable prospective students to make more informed choices and help us manage risk better and report more effectively to external regulatory bodies.
We're also working to build closer relationships with the most senior members of the profession – tailoring events and networking opportunities for the leaders of the profession so that we continue to fulfil our commitment to supporting members at every stage of their career.
A strong team
We've got a strong team to meet these many challenges. Recent additions to the team include the arrival of Mike Watts from the Cabinet Office as Professional Development Director, responsible for the Professional Standards side of the Institute's work. Sue Upton was promoted to become our Communications Director. Ian Saville, our Finance Director was appointed Commercial Director in May. And Linda Holbeche joined us from the Work Foundation as Research and Policy Director as the financial year drew to a close. They all form part of the strong management team, working with the Executive Board and governance bodies of the CIPD and taking responsibility for driving forward our ambitious plans for the future.
In April, Geoff Armstrong, Director General of the CIPD since 1992, announced his intention to retire from the Institute at the end of the next financial year, in June 2008. His early announcement has allowed us plenty of time to appoint a successor. A rigorous recruitment process is underway to find the right person to lead the Institute and the profession into the future.