A Chairman’s Reflections
This interview with AKC Board of Director President Ronald Menaker ran more than a decade ago in the 2012 issue of Dog News’ annual D Magazine. With his recent recognition by the AKC Museum of the Dog, Dog News is pleased to make it available online.
There are people who have the ability to move their universe in a positive direction. They lead with intelligence and vision. They recognize which challenges are pressing, and they have the management skills and the creativity to find solutions.
Since its founding more than 125 years ago, the American Kennel Club has had several leaders who possessed those qualities. The present chairman, Ron Menaker, stands out within this distinguished group.
Ron Menaker has been an AKC delegate since 1988. He has represented three clubs during his tenure: the Bedlington Terrier Club of America, the Des Moines Obedience Training Club and currently the Rockford Freeport Illinois Kennel Club. He was appointed to the AKC Board in 1996 and served through 1998, returned in 2000 and was elected vice chairman in 2001 and chairman in 2002. His last full year on the board will be 2011, due to the term-limit rule passed by the Delegates.
Menaker, 65, grew up in New York City and attended Queens College. He and his wife, Kathy, have two children and four grandchildren. His professional career is centered in the financial world. In 2001 he retired from JP Morgan & Company Inc., as a managing director. He also served as president and director of JP Morgan Services. In those capacities he was responsible for 17,000 employees worldwide. Menaker currently serves on the boards of several other corporations; he was past chairman and is the current vice chairman and a director of New York Downtown Hospital. He is also a member of the Board of Overseers of the University of Pennsylvania School of Veterinary Medicine. He is a former member of the Morris Animal Foundation’s board of directors and that of a local New Jersey animal-rescue organization, St. Hubert’s Giralda.
Menaker has served in various capacities on the boards of several AKC-affiliated organizations as well. He was one of the early directors of the AKC Museum of the Dog, having been its president. He is also a member of the board of directors of AKC Companion Animal Recovery. He is currently the vice chairman and a founding member of the AKC Humane Fund.
Menaker avidly supports many AKC clubs as well. He is the former delegate to the Bedlington Terrier Club of America, which he also served as president, and is also a member of the Giant Schnauzer Club of America and the Border Terrier Club of America. In addition to being a member of these three parent clubs, he is a member of the Westminster Kennel Club, the Morris & Essex Kennel Club, the Westchester Kennel Club and the Tuxedo Park Kennel Club.
Menaker has been active with several breeds of purebred dogs over the years. Beginning with a German Shepherd Dog, he and his family have enjoyed the company of Bedlington Terriers, Giant Schnauzers, and Norfolk and Border terriers. He has finished championships on many of his dogs and only traded his armband for the judge’s badge when he took a seat at the AKC Board of Directors’ table. Menaker is forthcoming about how he came to the sport of dogs, and enjoys recalling the story of how his pleas to breeders for a dog fell on deaf ears and led him to buy his first show prospect at Gimbels department store. That puppy and Menaker embarked on a journey that resulted in a lifelong passion for the sport of purebred dogs.
Menaker with an early Bedlington Terrier.
In his 14 years in various leadership roles on the board, Menaker has been witness to a host of accomplishments and challenges, but he believes that the most significant issue facing AKC today is declining registrations. When Menaker joined the board in 1996, registration numbers had already begun to deteriorate. From a high point of 1.5 million registrations in the early 1990s, AKC registrations diminished year over year, eventually falling below 600,000 in 2010. The continual loss of registrations resulted in a very serious revenue shortfall. (Consider that in 1965, 95% of all AKC revenues came from registrations and supported all of AKC’s programs and overhead. Today, our revenues from registrations are less than 50 percent.)
Menaker explained that some of the decline could be attributed to the law of “unintended consequences,” in which policies put in place to protect the interests of purebred dogs and the fancy resulted in other side effects, to the detriment of the Sport. Specifically, he addressed AKC’s policy on DNA requirements for Frequently Used Sires as well as its approach to inspections and investigations, which, while motivated by our sense of duty to educate and rehabilitate, often came off as heavy-handed and hostile. These actions gave rise to the perception that AKC wanted to remove commercial breeders from the registry. As a result, many commercial breeders in good standing with AKC left and formed their own registries based on dogs originally acquired with AKC registrations. Today, Menaker said, there are 34 other competing registries, in the aggregate causing a tremendous loss of revenue to AKC.
Another unintended consequence could be found in our well-intentioned provision for a non-breeding limited registration. The adoption of limited registration has caused us to lose 11 percent of potential breeding stock each year from the AKC registry. Sadly, many of these limited registrations are simply converted to full registrations with our many competitors. Menaker maintains a realistic attitude about these lost registrations, noting that the significant decline in registration did not occur overnight; therefore it cannot be expected to be resolved quickly.
“There is no silver bullet,” he admonishes. “It will be a long road back.”
Menaker and his “Giants.”
The 1990s was a pivotal time for AKC. Compounding the issue of declining revenue was the mounting need to support the growth of the sport. At that time, AKC was subsidizing events at a cost of more than $10 million a year. Costs to AKC for events grew as our core revenues shrank. Up until the 1980s, dog shows, obedience trials, field trials and tracking were the only activities in which AKC was engaged. To these agility, rally, hunting tests, coonhound events, lure coursing, earthdog, herding tests and trials were added at the requests of member clubs wanting these activities. (Incidentally, the only sport that does not have to be subsidized is agility.) In 1965 the number of events offered was 6,044.
In 2009, this number had ballooned to 22,843. The technological infrastructure necessary to maintain and support these activities cannot be ignored. Also during this period the public began to shift some of its interest from purchasing AKC-registrable purebred dogs to adopting from shelters. The animal-rights movement began building an insidious campaign that has over the past several decades infiltrated even seemingly well-meaning rescue charities and veterinary schools with an anti-breeding message.
Over the course of a quarter of a century, all of these factors made it evident that a prudent increase in fees for registrations and other services was necessary, as AKC was facing a serious revenue problem. Furthermore, it became obvious that alternative sources of income had to be identified and fostered in response to the shortfall. To achieve this, AKC broadened its approach to reach beyond core sources of income and traditional activities. One of the first of the new initiatives was the AKC Canine Good Citizen program, in which mixed breed and purebred dogs were able to achieve basic training designations for good manners in the home and the community. CGC has proved invaluable as an educational and public relations activity from which later programs have extended, such as the AKC S.T.A.R. Puppy program. Canine Partners, another large-scale effort to engage a broader audience of dog owners, counted 20,000 mixed breeds listed as of year-end 2010.
From left: Al Cheauré (AKC president), Mayor Beverly O’Neill, Ronnie Irving, Chairman of the Kennel Club, UK, Menaker, and Frank Sabella (judge) awarding Best in Show at the 2003 AKC/Eukanuba National Championship to Norfolk Terrier Ch. Cracknor Cause Celebre.
Under Menaker’s tenure, staff also created several new opportunities for breeders and show giving clubs. He said the Grand Champion program is proving very successful in helping clubs bring increased participation and additional revenue from entries, to AKC’s benefit as well. The new Breeder of Merit program, still in its early stages, is quite popular with breeders who strive to be responsible custodians of their breeds.
AKC staff has worked creatively to bring in $75 million in non-core revenue over the past 10 years through major initiatives including licensing, sponsorships and affinity programs. Menaker spared no words in praising the executives and staff for their dedication, motivation and innovation in their efforts to bring alternative revenue to AKC and find solutions to declining registrations while serving the sport simultaneously. He was specific about staff’s careful attention to cost saving as well, citing that recently senior executives went beyond the call of duty in voluntarily declining any pay raises. Impressively, while reducing costs, several new functions were established. Menaker feels strongly that the fancy should feel gratified in knowing that the sport and our organization are well served by a dedicated, talented and responsible team of employees.
The Princess Royal with John Spurling, chairman of Pet Part-ners, visiting the American Kennel Club with Menaker.
Public relations have become of vital importance to AKC as our organization struggles with declining registrations, falling revenues and legislative challenges, and Menaker’s leadership has seen an enhanced Communications Department, the engaging of a public-relations firm and the addition of a Canine Legislative Department to bolster efforts already being made in Public Education. Menaker went on to enumerate other successful public outreach steps. The AKC/Eukanuba National Championship is now a prime-time television event, and is the single largest Bred-By show in the nation and the only international competition in the U.S. The air time for this show is worth several million dollars and the positive PR value to AKC is immeasurable.
The first two stand-alone “Meet the Breeds” expos in New York City were mega-hits with the public and the media, to the tune of about 40,000 people each year. The annual “Meet the Breeds” accompanying the AKC/Eukanuba National Championship draws thousands of spectators as well. The most recent one in December drew 160 parent clubs showcasing their breeds.
AKC Responsible Dog Ownership Day has become an annual event hosted by kennel clubs around the country. These successful local outreach efforts have been a cooperative effort between AKC staff and clubs.
When Menaker gave this interview to “D,” he seemed frustrated by the attitude of a number of AKC’s delegates. He cited the tendency of some to criticize and often second-guess every action the board and staff initiate. In fact, he points to the governance structure as AKC’s Achilles’ heel. He feels that the structure of AKC must be modernized to keep pace with our changing world. The AKC Board of Directors is meant to set policy, and the staff is charged with running the day-to-day business of the organization. However, he believes that with the combination of a 600-member delegate body and an archaic set of bylaws, it has become too difficult to make efficient and actionable decisions in today’s fast-paced environment.
Menaker asserts that when AKC broadcasts, by written or spoken word from delegate to constituent, the outside world is often inappropriately let in on certain matters that would normally be kept confidential. This can allow AKC to lose its competitive edge and forfeit strategic advantage. Menaker noted that the role of the delegate under both New York State law and the AKC bylaws is not to make day-to-day business decisions. He feels the board should provide expertise in areas requiring specialized knowledge, or seek outside help in doing so, and let the staff be free to make business decisions affecting the organization at a moment’s notice, as the majority of American businesses do.
Menaker referred to the “Petland” matter in which the outcry from some delegates was so public and acrimonious that a contract was rescinded. Our reputation and credibility were damaged by that public display, a matter which should have been a purely business transaction. (The essence of the agreement was to register AKC dogs at the point of sale. Menaker reminded me that puppies purchased from pet shops have been registered with AKC ever since pet shops were established after World War II, the fact of which some delegates were unaware.)
To clarify his position Menaker explained, “AKC has long and proud traditions, and it is our responsibility to both honor and maintain them. At the same time, in order to preserve the sport as we know it, and to keep the AKC financially healthy and viable as an organization, we must be willing to re-evaluate constantly how we do business in a rapidly changing environment. Often we must be able to act immediately and decisively, and in some cases confidentially, on business proposals with very brief windows of opportunity, and we need the ability to respond quickly to and counter challenges from competitors and from those who try to discredit the sport.
“While the bylaws give the board this authority, in reality AKC’s governance structure is much more cumbersome, and makes quick, decisive action and confidential negotiations next to impossible. This can place the organization at a serious disadvantage when it comes to trying to operate a successful and competitive business or react to threats to the sport.
“The fact is, we are a 21st-Century, $60 million business forced to operate by our antiquated bylaws like a 19th-Century club,” he concluded. “The board and staff are too often hindered by our archaic governance structure.”
Menaker and his Border Terriers.
Menaker is emphatic that we need to change the way we do business by revising and modernizing the bylaws. Menaker said there is a need for proven special talent and significant professional accomplishments on the board. He believes that AKC would benefit from appointing to the board, even in a non-voting capacity, one or two non-delegates, such as prominent business executives who possess unique and relevant expertise. Currently this is not permitted under the bylaws.
Another major problem facing us soon is the restructuring of our bylaws to address the growing number of eligible clubs. Currently there are more than 800 additional clubs eligible to apply for membership, which could swell the current roster to more than 1,400. Moreover, there are an additional 3,500 clubs holding AKC events that are not even eligible to apply for membership under the current bylaws.
Menaker thinks that three delegate meetings per year are sufficient to conduct business while being more cost effective. It is interesting to note that in 1965 the cost of delegate and board activities was $19,000. In 2009, that cost had risen to $833,000. Menaker sees an opportunity to reduce these expenses.
We discussed the notion of term limits, and on this subject Menaker’s attitude is pragmatic. He believes that in effect we already had term limits in place, with the delegates’ ability to vote someone out of office at their discretion. He elaborated that if the delegates feel mandatory term limits are necessary, it should include a full four-year term exclusion after two terms served. He also firmly believes that term limits should also apply to delegate committees for the same reasons and rationale applied to board members.
With an eye toward the future of the sport, Menaker affirmed that AKC must be innovative, flexible and willing to change the way we do business to remain successful. He cited Canine Partners as an example of a positive initiative that has proven beneficial in growing a coalition between pet owners of mixed breeds and purebred dogs.
Above left: Menaker, Melbourne Downing (judge) and Chet Collier presenting Best in Show trophy to Ch. Registry’s Lonesome Dove at Westminster 1992. Above right: Menaker, Edd Bivin (judge) and Chet Collier presenting Best in Show trophy to Papillon Ch. Loteki Supernatural Being at Westminster 1999.
When asked about his greatest accomplishment during his tenure on the board, Menaker pointed to the financial reserve and endowment that he and Hon. David Merriam established. (This fund now has $55 million in reserves to be used in the event of catastrophe, operations emergency or other major unforeseen expense.)
Menaker also speaks of his role in the repair of the registration meltdown in 2003 among the highlights of his leadership. “One of the most gratifying experiences I had as chairman occurred at the time when AKC faced one of the greatest challenges in its history. The complete collapse of the registration system in 2003, resulting from a failed re-engineering effort, threatened not only AKC’s main revenue stream, but the very existence of our organization.
“I had the opportunity to spend two months in AKC’s Raleigh Operations facility, working with dedicated staff members and outside consultants not only to bring the registry back, but to reintroduce a much more efficient and enhanced, reengineered system,” he recalled. “There was greatly improved productivity, and much better collaboration among departments. One of the principal enhancements to this new system was our ability to process registration applications online. It is now hard to imagine a registration system without that capability.”
Today, approximately 39 percent of dog registration applications and 74 percent of litter registration applications are processed online.
At ease in the board room.
Menaker was emphatic in his belief that the only way that AKC will be around in 100 years is to make fiscally sound decisions. He said AKC has been successful when other organizations have failed, and we have weathered poor economic conditions with good results. He is proud of the fact that AKC continues to be the only all-breed not-for-profit registry in the United States, which is still able to support a multitude of other non-profits, including the AKC Canine Health Foundation, the AKC Museum of the Dog and the AKC Humane Fund. Yet he contends that changes to the fundamental structure of our organization must be made, and we must continue to innovate in order to not only preserve and protect but also enhance AKC’s position in the world of dogs.
As for his future, Menaker enjoys judging, and he would like to return to the ring some day as an exhibitor. He also has a few other options to occupy his time. He derives great satisfaction from the work he has done at New York Downtown Hospital; he will continue this and other not-for-profit activities and is considering joining other corporate boards.
As our lengthy talk ended, Menaker took one more opportunity to commend the officers and staff for their extraordinary dedication, enthusiasm and great contributions – both personal and professional – to serve AKC, its constituents and the public. He is clearly an advocate of the proud tradition of AKC, and hopes that its future will be placed in the hands of those who are committed to that legacy in the years ahead.