By Kurt Kuebler , CCM*
I Just Cut Off My Right Arm...Call the Bean Counter to Stop the Bleeding!
Clearly, the bleeding of many private clubs is the talk of the industry today, as well as the talk around most boardrooms. “Have you heard that the club across town is hemorrhaging members?”, “Have you heard about the 90 year old club up in Michigan just filed for Chapter 11?”, and “Have you heard that they had to lay off 1/3 rd of staff at ‘so and so’ club, and the remaining staff took a major pay cut?”
We’ve heard it all in our travels, and have seen some of the carnage first hand. * Unfortunately, much of it has been self-inflicted AND continues to be!* It’s almost as though the pain of ‘losing the first arm’ wasn’t enough and some clubs are looking to see if losing the other arm might stop the pain…and, if that doesn’t work, they’ll try each leg!
Where does that thinking come from? Why is it so endemic in the club industry? And, whoever thought that the answer that many clubs come up with is the equivalent of, “Let’s call our bean counter to stop the bleeding!”
Only looking at the expense line and cutting back on staff, service, operating hours, benefits, etc, just isn’t the optimal answer in most instances. Having the Board, Committees and Members take on operating functions and responsibilities isn’t likely going to produce anything but chaos, lack of accountability, more challenges and, in the long run, more expense if not complete failure.
It doesn’t matter how traditional or how unique a club is, it’s still a business!
And, it needs to be run like a business, albeit a high performing, member-centric, ‘Raving Fans’
generating one! As we and other industry professionals have preached for years, a club must have a plan,
work it and be flexible to react to changes in the environment. And, most importantly, the responsibilities for who is to execute the plan have to be clearly spelled out, consistently communicated. The General Manager/Chief Operating Officer of the club needs to be supported and held accountable to make it happen. If he/she cannot, the answer isn’t to reinvent the system; it’s to reinvent the leadership! And that could mean the GM/COO, the Board or both! Harsh, but true.
Let’s face it; the easy answer in difficult financial times is often to ‘cut’
. Certainly, many cuts can be easily initiated and are appropriate when improving efficiency. Often it means finally addressing long-standing issues that have likely been identified in the past, but something has caused reluctance to address them.
The question, however, that not enough clubs (Boards and Managers) have asked is, “What should we be doing to make sure that we’re the last thing our members cut from their discretionary spending?”
, or, “How can we make our club the first choice when our members are deciding where to spend their time and money?”
Essentially, clubs should be asking themselves if they are providing value to their members. Do they offer their members that “safe harbor” that should be the first recreational choice for every family member?
We’ve seen a number of clubs around the country have the BEST
year in their history over the past twelve months! What is the common theme to almost all of them? They had a plan and that plan didn’t call for a knee-jerk reaction of ‘cutting off one of their arms’ and hope things will get better!
It didn’t call for the bean counters to make decisions by simply looking at the numbers on the lower half of the P & L!
In nearly every instance, these clubs actually provided MORE
services to their members (sometimes spending MORE money than originally budgeted), and finally addressed long standing policies that needed to be changed but hadn’t due to some longstanding, but no longer relevant ‘tradition’
(Read: denim policies, cell phone policies, poorly attended traditional events, and even updating antiquated bylaws in order to give the Board/Manager greater ability to operate effectively).
More importantly, these clubs had the confidence in their Professionals (Management Team), primarily due to their prior development of Trust and Accountability and Expectations, and supported this group and their recommendations. In effect, they DID NOT
simply call an accountant to stop the bleeding!
What solutions have we seen when the bean counters have been called in to solve some of these stressful issues in clubs? They are typically saying something like this…..“Our members will likely be happy that we cut staff pay, benefits and eliminated positions as the staff will probably be so happy that we did so, service levels will improve!”
Or, those clubs are the ones who said, “Our members will be thrilled that we’re only open now for dinner a couple of nights a week and we’re going to close the course an extra day to save labor expense.” Or, something like, “They’ll be okay with the building being just a little dirtier than normal as we reduce housekeeping, and they won’t mind getting ALL
of their club communications now via email while the club phone is answered every time by an auto attendant!”
Is this REALLY
what you would like your club to become?
When did the ‘bean counter’ mindset resolve effectively such important, stressful economic issues in the private club industry? We’re not demeaning accountants, we’re simply pointing out the mentality of ONLY
looking at the numbers, not the underlying opportunities!
So, what to do?
As a club, let’s figure out what we want to be.
Let’s put a plan
in place to get there. Let’s measure our progress and results, fine tuning as we go along. Let’s remember that if our club is having trouble attracting and retaining members now, it’s probably not going to get better if we cut back or simply don’t address areas of improvement---facilities, staff, service, etc. Let’s remember that everyone---Board, Committees, Members, Management and Staff---all have to be accountable to the plan
in some fashion, and by doing so in a positive, supportive and value-oriented way will likely pay dividends.
Finally, if we’re going to stop the bleeding, we probably can’t cut off any more limbs. And our advice to do so from the bean counters, just like the advice we get from that big round table in the Men’s Grill that nobody likes to walk by, most likely isn’t the solution the vast majority of the members are hoping for!
Kurt D. Kuebler, CCM and Richard M. Kopplin are Partners with Kopplin & Kuebler, specializing in the placement of General Managers/Chief Operating Officers, Directors of Golf and Golf Course Superintendents. They may be reached at 407-864-6798 or through the website at www.kopplinandkuebler.com.
Originally posted by KurtKuebler
on 08 Nov 2010.
All contributors: KurtKuebler
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