An introduction to The Business of Golf

When we look at the business of golf on a global scale, it quickly becomes evident that many of the strategic and management challenges are common to all golf facilities and businesses, no matter how different their geographic location might be.

Outside of the local rules, which govern on a regional and individual facility level, most clubs face similar challenges. These range from the spectre of continued falls in memberships levels, difficulties with membership retention and subscriptions’ revenues, through to the difficulty with bringing in new ‘blood’ to the game, the more effective use of bricks and mortar facilities and then on to too few revenue streams outside of the staple returns on greenfees and membership subs.

Although there are many types of businesses and activities within the business of golf, all with different constitutions and goals, when it comes to a question of ‘good governance’ and effective management, the key elements are almost always consistent and the primary layers of these will be the need for:

 

 

1. consistent management
2. a stable, happy and incentivised team of staff
3. cohesive policies
4. guidance and proper oversight
5. clear processes and decision-rights/responsibilities for given areas within the operational process
6. accountability

If we look at these in the context of a golf club, the first can offer a challenge at many golf clubs as whether the club has a board or committee, (we shall use board as a reference for both throughout this piece) the regular change of individuals composing the board can threaten the very foundations of consistency.

The second area can also be problematic as each board can be tempted to impose its ‘vision’ for the club without careful attention having been paid to the status of existing initiatives and previous policies.

Successful boards do not, as a club manager once described to me, ‘rush around like a pack of hounds trying to leave their own personal scent on everything’. In contrast, they will evaluate the success and progress of previous policies objectively and in consultation with the management team, before proposing and/or embarking on any changes, or the start-up of any new initiatives.
An effective board will also see these first two areas as iterative tasks that will require both theirs and the management team’s attention every working day.

Additional safety measures, to curb possible excesses by ‘over-enthusiastic’ individuals, can include the adherence to strict protocols to ensure the continuation of previously adopted policies, or a rigorous and open policy in order to propose and then effect any changes. One estate in South Africa, in response to its logo style and colour having been changed ‘too often’, has set up a legacy committee to ensure continuity in terms of the style and key features of the development that can fall prey to what one manager I know refers to as ‘the potential for undue interference’.

Guidance and oversight will require that the board’s members understand theirs and management’s roles clearly. In the simplest terms a board should, in conjunction with its professional management staff, evaluate the club’s needs, the desired goals and then decide on the best strategies and appropriate supporting budgets to achieve these goals over a given period. The board will then step back and allow management to implement, deliver and manage the intended plans. In this process, the board’s role will then be to monitor the activities and offer guidance and inputs reactively in terms of management’s updates and progress reports. There will also be the need, on occasion, for it to act proactively (avoiding the well-established dangers and temptations of micro managing) as and when such interventions are called for.

In recent years, the lack of accountability in many international corporates and government’s bodies has eroded the confidence that everything would be done ‘by the numbers’, with all the requisite checks and balance in place and a clear window onto those who would be accountable both in terms of any failures and successes. At a management or supervisory level, the burden of accountability must be balanced by the requisite authority, or the personnel with this responsibility will be set up to fail from the outset.

In broader terms there has been some sign of growth in terms of player numbers, although perhaps not as much as was hoped from the projections during the boom period of the 80s and 90s.
This explains the number of stalled new course projects and courses being forced to close. In its development heyday, courses were being opened at the rate of one a day in the USA, now they are reported to be closing at the rate of one a week.

Certainly, some of this can be put down to the market being overtraded, but is this actually true or are we now also reaping the harvest of outdated thinking and outmoded management processes?

In Southern Africa, travel and tourism offer a huge potential windfall for golf facilities that position themselves effectively for this increase, as the region’s traditional industries, such as mining, continue to decline.

I was one asked why I loved golf and was prompted to reply – ‘because of my undying affection for team sports!’ The jest underlines that, in the main, ours is a lonely pursuit and team spirit is just not part of the game’s DNA. That said, clubs working in tandem and not competing with each other might just be a lifeline for many an embattled golf course.

Do we tell our good news stories effectively? I really think not, given that the tree huggers and environmentalists still talk about our industry using the best land to build courses on and using potable water to irrigate the playing areas!

The health of the game is a key concern for all golfers, so it is just these types of areas and challenges that this column will cover and explore over the coming months.

In the process we shall be offering insights into successful initiatives, sharing thoughts and comments from a range of respected and professional industry insiders who work daily in the business of golf.

We want this to be an open debate, so if any golfer or anyone working inside the golf industry has any area that they feel needs to be covered they are invited to contact the column’s host – John Cockayne.

John Cockayne has been a Professional Golfer since 1977 and is a fully qualified founder member and Life Member of the PGA of South Africa. He is a former Head Professional at Royal Oak, State Mines and Benoni Country Clubs and Director of Golf at Southbroom, during which period he was involved in the organisation of golf tours, numerous professional and amateur tournaments and as a consultant on the Sunshine Circuit.

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