Are clubs run by boards becoming a thing of the past?

[Mike_Young]

Mike,

I think financial pressures are making "consolidation" more of a reality.

I see this trend toward management companies as a trend appealing to clubs in financial trouble.

The boards remain operational, but, they cede the day to day operations to professional firms.

Pat,
That's what I'm talking about...no where have they seen me say management companies were the answer. 

[Tim Martin]

I disagree that management companies are the answer.  Tiger is right: the benevolent (and somewhat cheap) dictator is the best answer. The second best answer is a board of recently-retired, reasonably well to do former executives (who, with a little bit of self-education and inquiry, will be at least as competent  as the management company types),  and still want to be somewhat active and with a mindset toward both thinking like a business and also like the club they've always known. Personally, I think the Board-run club is way the heck better than turning over the keys to a stranger looking for a profit.

Dave-Agreed. Talk to the guys at Wampanoag who sold their souls to the devil back in the nineties   thinking it was a magic bullet and then couldn`t wait to get out from under their thumb.

[David_Tepper]

A quote I just saw on Geoff Shackelford's website:

"It is no coincidence that most of these great courses have been guided in their changes by one sensitive, farseeing man. Such a man may have taken advice from many architects, golfers and superintendents, but he has retained an iron control, ranging from benevolent to egocentric dictatorship. Hardly any golf courses have achieved greatness by committee."
DESMOND MUIRHEAD

[Dan Herrmann]

I'm sold.

[Steve_ Shaffer]

Muirhead's quote does NOT deal with club management, only changes to a golf course. In that context, I agree;however,with respect to management, there are numerous instances of club boards renovating,redecorating or expanding club houses, swimming pools, tennis courts,etc,that have lead to disaster, bankruptcy or worse.

[David_Tepper]

Steve Shaffer -

You are correct. I probably should not have posted Muirhead's comments in the context of this thread.

DT

[John Gosselin]

 Steve,

Are there any success stories in the Philadelphia area where a management company is running a member owned club? Besides Commonwealth are there many successful clubs run by management companies at all in Philly?

Hartefeld? Inniscrone? Philly Public? Concord? Broadrun? now LuLu?

[Brent Hutto]

Can a club just snap its fingers, so to speak, and bring into existence a visionary benevolent dictator who is capable of managing it into greatness?

I would think one might be careful of assuming that since several great clubs are the product of such a single vision then all clubs should be run by a single person with near absolute authority. What if no such man exists, should the club just choose the best of a lesser lot and hope that the job will make the man?

[Steve_ Shaffer]

John,

Hartefeld is still private but owned by the management company.
Inniscrone is public and owned by the Township. There's a new management company there.
I'm not familiar with Concord.
BroadRun is a public course.
LuLu is still member owned for now. Their new management company is now a possible buyer of the club.
Commonwealth, Trump National Philadelphia, Ace Club, Blue Bell,Talamore and Applecross,all private, are not member owned.
I believe Yardley is still member owned and hired LuLu's management company last year.

I can't think of any  other member owned clubs besides LuLu & Yardley in the area that have hired a management company.

[Anthony Butler]

For a member-owned club, you need a General Manager to manage all the course and house staff. He/she reports to an elected board of members. That's how just about every private club in Australia and most GB clubs operate... and why all the incessant talk about clubs going out of business on GCA.com is mostly confined to the US.

If you don't have enough people invested in the well-being of your club to make that model work, it's probably best to close it down or sell to Donald Trump for 15 cents on the dollar.

[Ed Brzezowski]

I belong to Concord and while the Management company spun a great tale to get in, they were terrible once in place. Constantly asking who the important members were, really screwing up the F and B side of the club. We had an event with 90 guys signed up, the event included lunch. Well lunch rolls around and  they put out 24 burgers, total for 90 guys. Their " model " showed not eveyone stayed for lunch so they lowballed the number. We ended up not charging for lunch and microwaving hotdogs for our closing event of the season.

The "model" did not include paying local school taxes, cleaning out beer taps and a host of other screwups. Plus we were overcharged by their corporate office for evey phone call and letter. I am an insurance broker and they really put the screws to us there. Seriously overcharged on the Work Comp policy.

For those that see them as a silver bullet be careful what you wish for, yes a board is not always the best solution, but a board is more likley to watch the dollars and cents carefully.

ed

[Carl Johnson]

For a member-owned club, you need a General Manager to manage all the course and house staff. He/she reports to an elected board of members. That's how jsut about every private club in Australia and most GB clubs operate... and why all the incessant talk about clubs going out of business on GCA.com is mostly confined to the US. . . .

That's exactly how my home club in North Carolina, USA, operates.  The model has been working excellently, in my opinion.  Here's an excerpt from a recent letter to the membership:

" [W]e [recently] . . . took a board retreat, highlighted by [a] strategic planning session facilitated by [Mr. X] . . . one of the most highly regarded private club consultants in the world.  He praised the board for the success of [the club] over the past decade . . . .  He noted that [the club] is among the top 2% to 5% of private clubs in operating at an effectively full membership, and with an average age of 47, is one of the youngest and most vibrant clubs he has seen anywhere. . . . He was also impressed with how the board refers to a well-crafted Strategic Plan in allocating resources and our commitment to the General Manager form of governance."  [Emphasis added.]

Note: the club is a narrowly focused golf club -- not a typical American country club.

[Anthony Butler]

I belong to Concord and while the Management company spun a great tale to get in, they were terrible once in place. Constantly asking who the important members were, really screwing up the F and B side of the club. We had an event with 90 guys signed up, the event included lunch. Well lunch rolls around and  they put out 24 burgers, total for 90 guys. Their " model " showed not eveyone stayed for lunch so they lowballed the number. We ended up not charging for lunch and microwaving hotdogs for our closing event of the season.

The "model" did not include paying local school taxes, cleaning out beer taps and a host of other screwups. Plus we were overcharged by their corporate office for evey phone call and letter. I am an insurance broker and they really put the screws to us there. Seriously overcharged on the Work Comp policy.

For those that see them as a silver bullet be careful what you wish for, yes a board is not always the best solution, but a board is more likley to watch the dollars and cents carefully.

ed

Is that Concord, CA... Concord, MA Concord, NH or Concord in Sydney...

[Ed Brzezowski]

Concord pa, in a lowly pedestrian suburb of philly.

[Mike_Trenham]

Last I knew HVCC in Philadelphia had a management company or active consultant relationship.

[Rob_Waldron]

     

[Steve_ Shaffer]

Rob,

There must be examples of well run, member owned, private clubs in the US. Other than high end, well established clubs like Merion,etc, can you provide some names?

[Ken Fry]

That's exactly how my home club in North Carolina, USA, operates.  The model has been working excellently, in my opinion.  Here's an excerpt from a recent letter to the membership:

" [W]e [recently] . . . took a board retreat, highlighted by [a] strategic planning session facilitated by [Mr. X] . . . one of the most highly regarded private club consultants in the world.  He praised the board for the success of [the club] over the past decade . . . .  He noted that [the club] is among the top 2% to 5% of private clubs in operating at an effectively full membership, and with an average age of 47, is one of the youngest and most vibrant clubs he has seen anywhere. . . . He was also impressed with how the board refers to a well-crafted Strategic Plan in allocating resources and our commitment to the General Manager form of governance."  [Emphasis added.]

Note: the club is a narrowly focused golf club -- not a typical American country club.

So the club paid a consultant a large fee to faciliate an offsite retreat probably paid for by the club to hear how well the Board is doing?  While I applaud the Board for asking for expert help, does anyone else have a problem with this??

Ken

[John Gosselin]

Mike

We (Billy Casper Golf) receive calls on a daily basis from private clubs seeking assistance or managment alternatives. I have long said that in general, member owned country clubs operate with extremely week business models. Most Boards turn over members so fast that they never have time to understand the business. Private clubs typically operate extremely heavy with labor due to long term employees being compensated in the upper tier of the payscales for their positions. Maintenance budgets are fat due to a Superintendent pulling the wool over the eyes of an inexperierienced Green Chairman. I cannot not tell you how many times I have heard Supers threaten their Boards with loss of turf or greens if they were not given an additional $100K on top of their exorbitant $1.0 million budget. AT BCG we challenge our Supers to get more out of their existing budgets. Since the Board of Directors are usually not experts in the fields of Agronomy, Golf Operations, F&B, Membership Marketing, FInancial Reporting, and IT they rely on the staff to run the club. In many cases this is like the inmates running the asylum.

Professional golf management companies bring a level of expertise not usually found at private country clubs. By hiring a management company you hire a team of trained experts in all the necessary disciplines of golf course operations. When you hire a GM/CEO to run the club you get the expertise of a single individual. You rarely find an individual who understands golf ops, agronomy and F&B.

I always explain to prospective clients (Owners) that at the end of the day they are in complete control of the operation. The management company  merely executes the business plan. (Which reminds me, when was the last time a GM at a private club actually presented his Board with a business plan let alone an agronomic plan or marketing plan?) A management company can provide insight to the Board of Directors so they can make the decisions. For instance, many private clubs up north keep large full time year round staffs of maintenance employees despite the fact that the course is dormant for 3-4 months. Is it really necessary to pay wages and benefits during the off season? Well many Supers prefer this to laying staff off and hiring part time or seasonal staff which takes more of their time. The question is who should be making the decision, the Super or the Board? There are many cases when private clubs tend to make decisions based on emotion as opposed to economics. A good management company will provide the Owner/Board  with the options along with the costs. This way the Owner can apply their preferred level of emotion to make the decisions. Of course the managment company can provide counseling and advice to the Board giving them the proper tools to make the correct decisions.

At the very least I would recommend that private clubs turn to management companies for their expertise in identifying opprtunities to streamline their operations and reduce costs. Based on our experience many Boards would be in for quite a surprise!

Rob, I have been on this site since 2000 and that was the most insulting piece of promotional bullshit I have read to date. I am still waiting to hear from one superintendent that works for a management company to tell me anything good about thier employer or model they work under. That is your company includeed. Now I can see why after reading your post and seeing what you think of Supers, GMs, and would assume Goldf Pros.

Is your model to fire long term employees and replace with less experieneced cheaper ones? What great thing for golf.
 

[JMEvensky]

So the club paid a consultant a large fee to faciliate an offsite retreat probably paid for by the club to hear how well the Board is doing?  While I applaud the Board for asking for expert help, does anyone else have a problem with this??

Ken

I would if I were a dues paying member.

Where does one find an expert in member-owned club management?

[Mike_Young]

So the club paid a consultant a large fee to faciliate an offsite retreat probably paid for by the club to hear how well the Board is doing?  While I applaud the Board for asking for expert help, does anyone else have a problem with this??

Ken

I would if I were a dues paying member.

Where does one find an expert in member-owned club management?

If my guess were to be correct , this consultant does this at many clubs and even prints a magazine for clubs....they can smoke a club board in a second...

[Ken Fry]

If my guess were to be correct , this consultant does this at many clubs and even prints a magazine for clubs....they can smoke a club board in a second...

That's what I was thinking Mike.  "Thanks for paying my fee, here's the part where I make you feel good to forget about how much money you just paid me."

No offense to Rob, but this is the hook so many management companies have used over the years.  I've never been involved in a Billy Casper managed facility but I've seen the "bait and switch" from many of the others, those still in existence and those long gone.

Ken

[Randy St John]

Rob, Thanks for the infomercial.  If it was easy, everyone could do it...or work for a management company made of of non-golf industry specialists who are actually real estate speculators.  The list of "failed and changed hands" private clubs that have gone down the "management company" road is too long to detail and we all know it.  Marginal clubs are just that.  When BCG, AGC, CC or all the smaller guys actually manage truly private, fine CLUBS, then let's talk.  I am all in favor of companies that help clubs who cannot afford top end management.  Don't be so quick to criticize PRIVATE clubs that can.

Mike , as to CMAA stepping on the PGA's wiener, that is a two way street and off hand comments like that and the famous Peter Jacobsen "salad bar comment" do no one any good.  Divisive, fiefdom holding, staking out territory relationships among supers, GMs and pros only exist in the vacuum of leadership...either paid or unpaid by Boards.

[Mike_Young]

Rob, Thanks for the infomercial.  If it was easy, everyone could do it...or work for a management company made of of non-golf industry specialists who are actually real estate speculators.  The list of "failed and changed hands" private clubs that have gone down the "management company" road is too long to detail and we all know it.  Marginal clubs are just that.  When BCG, AGC, CC or all the smaller guys actually manage truly private, fine CLUBS, then let's talk.  I am all in favor of companies that help clubs who cannot afford top end management.  Don't be so quick to criticize PRIVATE clubs that can.

Mike , as to CMAA stepping on the PGA's wiener, that is a two way street and off hand comments like that and the famous Peter Jacobsen "salad bar comment" do no one any good.  Divisive, fiefdom holding, staking out territory relationships among supers, GMs and pros only exist in the vacuum of leadership...either paid or unpaid by Boards.

Randy,
Hope you are doing well.
you like my "weiner" comment huh?     I didn't say it was bad for CMAA to step on the PGA weiner...I just said the PGA let it happen. ( and many PGAmembers agree) The PGA dropped the ball and never really promoted it's members as managers.  But meanwhile..tell bout the "salad bar" comment.  I don't think I've heard it.
Now back to  this thread....
1.  No where have I said that Management companies were the answer to "boards becoming a thing of the past".
2.  As of today I have never seen an association, whether it be the CMAA, the PGA or the GCSAA run a club.  People run clubs and as you state there are many fine clubs that do it right.  BUT, in this environment there are many smaller town clubs and and golf courses that can't be run by a board anymore.  It seems that this site always gravitates toward the cream of the crop clubs and uses them for comparisons and that is probably to be expected.  But there are a lot of places out there that are in big trouble because of heir boards.  The banks are beginning to realize it also.  They can't afford a management company and various ways are being devised.  Honestly, I think there will be a dya when someone such as yourself would be operating a facility similar to where you are but the input would be almost minimal if at all from members.  And one reason is going to be the way the younger genration does business as compared to the older.  JMO....don't step on any wieners at the salad bar today

[Ken Fry]

2.  As of today I have never seen an association, whether it be the CMAA, the PGA or the GCSAA run a club. 

Just for reference, the PGA does own and operate the PGA Golf Club in Port St. Lucie, Florida and Valhalla Golf Club in Louisville.