Latest News, Strategic Planning, Strategy, Success, SI Insights, Henry DeLozier
Private clubs have made a comeback since 2008, what are the important ‘to do’ items for a club’s success today? There are at least five characteristics that separate top-performing clubs from those that are not:
Excellence in Governance – Top clubs do not have disciplinary problems. Moreover, top clubs govern with an openness and resolution on which members may rely. Matters that come before the board are addressed timely, thoroughly and within the context of a well-known and widely understood Board Policy Manual (“BPM”). These clubs’ boards deliberate as many and govern as one. Differences of opinion and priorities are kept in the board room.
Trusted Leadership – Top clubs enjoy great leaders. Servant leaders who put the needs and priorities of others – their fellow members – ahead of their own. Sometimes the great club leaders are titans of industry and sometimes small business owners; they are always servant leaders. They are trusted because they are reasonable, respectful, patient and visionary. They can see beyond the horizon.
Visionary Strategy - Boards at top clubs understand that they are responsible for three critically important matters: strategy, finance and culture. These boards rise above the day-to-day issues of the club and keep focused on the future of the club... what its values will be...how it will fund its unending capital needs...and, what steps will ensure long-term economic sustainability for the club. Clubs of this type have strategy that is big, bold and evolutionary.
Market Differentiation – Most clubs are situated in over- supplied and highly competitive markets adrift in a sea of “sameness” where one club offers much the same value proposition as the next. Top clubs are easy to spot because they are different...and everyone knows it. What distinguishes your club from its competitors? The objective of market differentiation is to make your club more attractive, appealing and successful than others within its competitive set. Typically this begins with focused brand planning and execution. Top clubs have “it” and everyone can point to what “it” is!
Revenue-Focused (versus expense-focused) – Top clubs understand the metrics of their business...fees and dues. Top clubs recognize several sources of fees: (1) joining fees are typically used to fund capital reserves and long-range capital needs; (2) fees for non-member services such as weddings, outings and special events; and (3) usage fees for such needs as club storage, lockers and access privileges of one type or another. It is often said that “clubs are in the dues business”. In fact, fees and dues represent the most high-yield / high-margin sources of funds for private clubs. Leaders in top clubs understand that their club must consistently increase revenues from the various high-yield sources to achieve economic sustainability, which is paying all of the club’s costs and funding its future capital needs.