Strategy is a process.
Establishing sound strategy is one of the foremost duties of a club director. In most clubs, directors think of strategy as a careful capital investment plan, which is partially accurate. A proper strategic plan includes careful capital planning and so much more. Here is an eight-part director’s checklist of strategic planning components:
- Club Culture – Establish the vision, mission and core values of the club. The club’s culture must flow through its strategic components. Take the time to describe the club accurately and don’t allow the planners to bog it down with wordsmithing.
- Goals and Objectives – This section is key because it identifies priorities to be accomplished. Careful thought and concise description are needed. Normally this section includes four or five primary goals.
Great goals should be big and expansive. Most clubs under-shoot their capabilities because directors are unwilling to be seen to have fallen short.
- Market – The people who are or will become members of the club will define its future. Study the external market of people who could join and the internal market of those who are currently members to understand the demand factors for club memberships. Most club directors think they know the market only to discover that their blind spots are difference-makers. Don’t assume.
Careful external market analysis includes population-growth trends and data references to favorable school districts (for family-focused clubs), property values, household income growth, and educational attainment. Accurate internal market analysis is achieved through independent attitudinal surveys which blend qualitative and quantitative analysis.
- Operations – Is the club currently operating efficiently? Substantial trustworthy third-party data exists that can identify and measure the efficiency of spending on wages, operating expenses and general overhead. Operational choices for standards of excellence and members’ expectations must be considered within spending assumptions.
- Finance – Club directors too often back into calculations that establish dues by asking themselves “How much will members resist a dues increase?” In fact, the price of dues is a function of matching the established standards of excellence—the brand promise or value proposition—with the costs imbedded in delivering the services and standards promised. This calculation estimates necessary dues levels.
The financial goal of every club director should be to make their club economically sustainable, which means the club is able to pay its expenses and fund future capital needs.
- Capital Planning – The costs to repair and replace capital assets are straight-forward. Most clubs are still recovering from deferred capital spending that arose during the Great Recession. Club directors should budget 7% to 9% of gross club revenue for annual capital reserves. In clubs where this range was not sustained since 2007, reserves should range from 10% to 11% annually.
- Governance – Most clubs are governed like no one’s business because they are no one’s business. Regular reviews of best practice standards for club governance are needed. Changes in members’ expectations of transparency, communications, confidentiality and conflict of interest policies are examples of recent changes.
- Action Plan – Who is responsible for what? And when? This section of the plan is where the directors put the plan to work. Be specific. Set realistic timetables for accomplishing goals and establish clear-cut lines of authority and accountability.
It was then-General Dwight Eisenhower who stated, “Plans are useless, and planning is indispensable.” Ike knew that the planning process clarifies and simplifies and makes the plan all the more reliable.
The National Club Association (nationalclub.org) provides members excellent information, guidelines, and a strategic planning resource on which club directors should rely. In addition, a sample strategic plan is available to directors at Global Golf Advisors (globalgolfadvisors.com). Collect the resources that are needed to put reliable strategy in place at your club.
Henry DeLozier is a principal at Global Golf Advisors, an international club management consulting firm that provides specialized services to more than 3,000 clients from offices in Toronto, Phoenix and Dublin (IR). He can be reached at [email protected] or visit globalgolfadvisors.com.