Library Profit = Community Relevance

I have long advocated that 21st Century libraries need to operate more business-like, and that 21st Century librarians need to develop business acumen. While this is essential to 21st Century library operations and survival, it may need more justification to be suitable to some as a 21st Century librarianship principle.

The major distinction between the library organization and a business is the “bottom line.” Businesses are in business for profit. Since a service business is most closely analogous to a library, a service business either delivers better service than their competition, or they earn no profit. Without profit they won’t stay in business. Libraries also provide a service and should be able to measure the “profit” of their service. The problem is that libraries as a governmental agency operate like all government agencies – as a cost center – where the bottom line profitability is virtually never measured.

Considering that not all businesses are highly profitable, there is a continuum of profitability. If your business is highly profitable then you are thriving. If your business is unprofitable, you are dying. That’s an undeniable business principle – if you’re not thriving, you’re dying. To keep from dying a business must thrive.

Just as not all businesses are highly profitable, so too not all libraries are highly “profitable” in the sense that the funds being spent to keep the library in business are not being spent most effectively to cause it to thrive. How relevant or irrelevant a library is to the community it serves is the measure of its profitability. The library’s “profit” is measured in terms of “community relevance.” In business, if you’re not profitable you die. For libraries, if you’re not relevant you die.

Library Profit = Community Relevance

There is a scale of profitability and relevance, it moves in the direction of profit or loss, and relevance or irrelevance. The center state between profit and loss is “break even” – neither profit nor loss. Unfortunately, there is no “break even” state for a library – unless one wants to consider where libraries have always traditionally been – dependent on the good will of tax payers and governance – as break even.

While libraries have historically operated with heavy reliance on other factors such as positive community history, citizens’ good will, a presumed inherent value to the community, and some basic community services that no other agency provides (i.e. summer reading, and ……….…), those traditional support factors are disappearing like so many things in our society are changing. A library can be marginally relevant, but that is closer to dying than it is to thriving. A library that is marginally relevant is not likely to be good enough to survive. Under any circumstances, marginally relevant is a tenuous place to exist in the 21st Century.

It should also be an undeniable 21st Century library principle – if you’re not thriving, you’re dying. To keep from dying a library must thrive.

Library Profit = Community Relevance


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4 responses to “Library Profit = Community Relevance

  1. Linda Senkus

    As a former corporate librarian who entered the public library arena when my company merged with another, I wholeheartedly agree with your comments. To make this viewpoint useful, we need our heads wrapped around how to measure profitability, and then get that out to the general public and the government officials.

    The web sites that measure what it would cost individuals to obtain library services annually without the benefit of their library are a start. But in my experience, few people actually go to these sites.

    The library community needs to figure out what the effective profitibility measures are, use them, and get the results out to the communities that we serve.

    • Thank you for that perspective. You seem to be implying that there are other measures of profitability, and I’m certain that’s true. I’d appreciate you sharing what those might be.

      • Linda Senkus

        In a corporate library, measures of the library value = profitability. These include reducing time to market by taking advantage of previous research, determining whether or not there is a market for a product idea (often begun with literature searches), and patentability of an idea. While I am not aware of any corporate library that has put a dollar value on these functions, this could be done, and this would help measure the profitability of a coroprate library.

        In a public library, we should be looking at things like literacy, young adult programs, general education brought by the library programming we provide, and similar measures. A literate population is most apt to be employed, and have fewer problems with the law. Young adults kept reading and off the street get into trouble less, and into productive activities more. General education and family programs enhance the community. I have heard one person say that she looked for real estate based on the strength of the library. This tells me that an active public library enhances the local real estate market, which increases taxes. These are not measures that we usually think of. We need to start the discussion of what these measures might be. I think we will suprise ourselves and the public.

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