Clubs around the country are developing new amenities to meet the needs and expectations of the next generation of members.
An astute and forward-thinking move. But can they afford it?
GGA Partner and Head of Transaction Advisory, Craig Johnston, spells out the importance of capital planning and the need to assess what your current assets cost to maintain (and will cost) before planning to invest in new ones.
As environmental consciousness continues to rise across the world, GGA Partner and Chairman of the Board of Directors for Audubon International, Henry DeLozier, identifies the three starting points for clubs looking to make the shift towards a greener future.
Americans are more concerned about climate change than ever before. According to a recent Pew Research Center Survey, “About two-thirds of U.S. adults (67%) say the federal government is doing too little to reduce the effects of climate change, and similar shares say the same about government efforts to protect air (67%) and water quality (68%)…”
The study also found that concern over the state of the environment is more than a national interest or partisan issue, with the majority indicating that climate change is affecting their daily lives, “Most Americans today (62%) say that climate change is affecting their local community either a great deal or some.”
Does the same sentiment exist in golf? Since 2017, managers have reported to GGA that their clubs are under the microscope in some areas, receiving provocation from local municipalities and increased pressure to comply with local rules and environmental regulations. These pressures have led to the need for clubs to increase their ‘green’ efforts in education, labor and training inputs, as well as governmental reporting.
Whether it’s a case of compliance or the desire to develop a greater sense of environmental stewardship and eco-friendly operations, it can often be difficult to know how and where to start. To ease this process, here are three starting points for clubs looking to make the shift towards a greener future.
1. Assess current levels of resource utilization
Understanding how much your club is using, in what areas, from which sources, and at what price is an essential first step.
This will allow you to develop a baseline for evaluation, and measure these against performance goals.
In need of a helping hand to get started? A number of associations and organizations have developed intuitive and informed tools to enable clubs to conduct these evaluations in-house.
2. Develop an environmental policy.
“Putting your golf course, community or resort on the path to sustainability may seem overwhelming, but it doesn’t have to be,” Audubon International CEO Christine Kane says. “We suggest starting by establishing an environmental policy that will guide your operations. This will bring your employees and members onboard and pave the way for incorporating topics such as water conservation, IPM or wildlife management into your budget, marketing and maintenance processes.”
3. Seek a certification program and pursue recognition.
Establishing a reputation for environmental stewardship in the public eye – that is, from the viewpoint of your current and potential future members – is a valuable business marketing tool for clubs to wield. Pursuing formal recognition and certification for the club’s commitment to “green” operating practices can grow its market share and build loyalty among the power-spending generations of the future.
If your club is looking to bolster its environmental credentials, here are some awards and programs to consider:
Golf facilities and clubs also benefit from sustainability’s halo effect. Many members today expect greater levels of environmental stewardship from businesses and other organizations with which they are associated. In addition to its environmental impacts, sound resource management and recognition through certification has taken on a good-for-business shine as well.
Research points out that sound environmental stewardship matters to women and millennials especially. While sentiments diverge along lines of on geographic location and political affiliation, it is apparent in the Pew Research study that women and young adults (e.g. Millennials and Generation Z) exhibit a higher propensity to regard climate change as a serious issue which affects them personally.
The bottom line is that that these groups represent the next generation of members and they are both concerned about sound environmental practices and are receptive to learning how club managers are caring for Mother Earth. Clubs and courses seeking to attract younger members would do well to take a responsible approach to environmentalism.
While directors carry ultimate responsibility for the financial resources of a club, it’s the relationship between the board of directors and club manager that can often determine just how well managed the finances actually are.
Bobby Crifasi, General Manager of New Orleans Country Club, reveals the formula which keeps his club on a sound, sustainable financial footing.
A mismanaged and uninformed approach to financial management can seriously damage a club’s ability to make sound business decisions.
And as the buck stops with the board of directors, it is they who must carefully measure the future financial needs of their club, plan for the sources and uses of funds, and ensure the economic sustainability of the club. Doing so is no small challenge and requires:
As one of several duties, that can be a lot to ask of volunteer board members. This is where top-performing club managers step in. The more they can equip their board of directors with the information they need to fulfill their duties, the greater the guarantee of them making the soundest possible business decisions.
Bobby Crifasi manages New Orleans Country Club (NOCC) with style and grace that belies a savvy financial manager. First educated and trained as a certified public accountant, during his time Bobby has seen the Club through a natural disaster in Hurricane Katrina which led to $5 million in unplanned renovations. On a day-to-day basis, Bobby ensures that the Club remains on solid financial ground by keeping his board fully informed on the Club’s financial facts.
“All of our financial information is sent to the board in advance of the board meeting,” explains Crifasi. “I receive our financial reports by the 10th of each month and that allows a week or so to investigate any variances before the financial information is sent with the board package. If there was anything of significance that I thought the board should know sooner rather than later, I would report on it at the House Committee meeting or email the board directly.”
Keeping the board informed of financial performance metrics is a key for Crifasi and his team, “What we do is provide a lot of financial data comparing this-month to this-month-last-year and year-to-date-this-year to year-to-date-last-year comparatives on a monthly basis. We do good, old-fashioned spreadsheets with all this information monthly.”
Among the keys that are faithfully tracked at NOCC, Crifasi emphasizes the mission-critical factors in the balance sheet and income statements, “On a monthly basis we focus on key balance sheet items like cash, notes payable, and any other balance sheet items that may have changed significantly during the month. In addition, we look at our Statement of Income and Expenses and talk about any variances during the month and the factors that may have caused that. We track initiation fees and dues to ensure we are on budget with those as they represent such a large part of the financial picture.”
On a practical level, NOCC uses a rolling budget process to enable adjustments as conditions require, “We have a rolling budget for the food and beverage operation which is adjusted each month to reflect additions or deletions to the banquet business as well as current forecasts for our restaurant business.”
Given the significant impact of rising labor costs in private clubs, Crifasi adds, “We also look at labor in each department to ensure it is tracking as projected.” GGA observes that labor expenses are typically the largest category of expenses for facility operators, with benchmarks generally ranging from 52-58% of total expenses for public, semi-private, and resort facilities and slightly higher at 55-62% for private member clubs.
Astute financial management starts with the key information boards require to make sound decisions. Crifasi’s meticulous approach and proactive relationship with his board has helped to simplify an area that other managers can often find complex, providing a financial foundation for the long-term success and stability of NOCC.
If you want to follow in the footsteps of this top-performing manager, four-point approach to financial interaction with board members will provide an invaluable process to work from:
There’s an old saying about plans – more specifically about the lack of a plan: “Without a plan, any path will get you there.” We wholeheartedly agree with that adage, but acknowledge a flip side that raises a question that many diligent planners confront: How to effectively integrate multiple plans into one comprehensive and cohesive plan that guides your overall operation?
The analogy that comes to mind is the challenge facing airlines with thousands of passengers on any given day, each trying to get to his or her destination. The airline has flight plans for hundreds of aircraft and tries to mesh all of those planes and flights into a fairly seamless plan to get you where you want to go. Most days it works, but not without a lot of coordination.
There are three stumbling blocks that derail effective planning efforts: 1) lack of coordination among stakeholders and contributors, 2) poor scheduling and time management for due diligence and preparing materials, and 3) confused or confusing desired results. These three project killers diminish the quality of the overall plan and undermine the credibility of the planning team.
For golf course and facility leaders, the challenge is considering the information gathered through market analysis, financial evaluation and board input alongside the plans of superintendents and those managing food and beverage, membership and financial operations. And then bringing all the information, insights, recommendations and plans together to support the club’s or facility’s objectives. For managers of each of these functions, the same challenges exist, if only on a smaller scale.
If you’re currently in your planning cycle, and charged with pulling discrete plans and input together so the end product doesn’t feel disjointed, consider these five steps:
1. Sync every plan to the vision.
No matter which area of the club or facility the plan is focused on, it should clearly map to the overall vision – the club or facility’s long-term, forward-looking aspiration, what we like to think of as an organization’s North Star. You should be able to see this in the plan’s objectives and priorities. With multiple workflows, the project leader must maintain an overall understanding of the project and ensure all plans are headed for the same airport, even if they’re taking different runways.
2. Outline specific steps along the way.
Define project milestones, the steps that will help you get there at a predetermined time and those responsible. Schedule regular check-in meetings to make sure all pilots have their planes headed in the same direction. It’s much easier to make mid-course corrections than to wait until all planes have landed and plans submitted.
3. Designate one holding place for project inputs and research.
See that all team members participating in the project planning process have transparent access to information and a full understanding of progress. Lacking a central repository of project information, important pieces of information can be misplaced, overlooked or lost. This also helps projects from getting siloed and managers feeling isolated.
4. Prioritize workflow.
On expansive projects or ones that involve multiple contributors, establish which components are most critical to the overall project plan. This step enables effective planners to allocate time, financial and human resources. Sequential planning guides the team in accomplishing mission-critical tasks and components.
5. Maximize productivity through careful scheduling.
If a golf course superintendent is preparing an agronomic plan, for example, it is important to make sure each assistant and technical expert is scheduled to deliver information in a timely manner. Stagger the timelines, monitor the cross-disciplinary dependencies, and eliminate duplications and redundant production.
Most managers have broad responsibilities and must combine resources to produce comprehensive and workable plans. Developing a disciplined process for research, input and development is the key to successfully landing all of your plans and making sure they support the same vision and goals.
This article was authored by GGA Partner Henry DeLozier for Golf Course Industry Magazine.
