Tag: henry delozier

Financial Indicators to Monitor

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What are the financial indicators that the club leadership should monitor to stay strong?

Canaries in a coal mine were the early-warning system that saved miners’ lives before technologies for detecting noxious gases came along.  Just as careful miners took caged canaries underground with them, club directors are wise to protect the club by implementing early warning tools—or Key Performance Indicators (KPIs).

Stephen Johnston, the founder of Global Golf Advisors and a former KPMG senior auditor for major accounts, explains, “The number one duty of every club director is to protect the assets of the club.”  To Johnston, the canary to be watched is full member equivalents (FME) of a club.  FME represents the total annual dues amount divided by the amount of a full-member’s annual dues.  Johnston warns directors that when FME metrics begin to slip, directors should beware.

Future attrition rates and the successful conversion rate from potential new members follow the FME metric.  Attrition signals retention success or concern while conversion rates presage new member recruitment.  Keep these KPIs singing a happy song.

Successful membership recruitment follows a 10 percent conversion rate—from bona fide member lead to accepted new member.  Therefore, this ratio instructs the board and management that the roster of prospective members must be ten times the number of membership openings.  Says Johnston, “If you want to add 30 new members, you will do well to develop at least 300 trustworthy leads.”

In addition to FME metrics, Johnston emphasizes the power of the cash flow statement.  For a club to be truly economically sustainable it must generate revenues adequate to pay the club’s bills and fund its future capital needs.  Johnston advises club directors that the annual “spend” on capital assets should be 7 to 9 percent of annual gross revenue.

The impact of the recessionary cycle caused most clubs to fall behind on capital replacement and maintenance so the cash available to catch up on deferred capital maintenance is a critical early indicator of future financial stress or security.

For the miners, early-warning was the difference between life and death.  For private clubs, monitoring early-warning KPIs is similarly crucial.

GGA’s Henry DeLozier penned this article for the National Club Association’s Club Director Magazine.

Agronomic Planning – Avoid Canine Brunch

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Those who know our firm are aware of the value we place on plans that focus resources and actions against strategic goals and objectives. But too often our plans turn into something resembling a dog’s breakfast: a mess of opportunity, necessity and happenstance. To avoid agronomic plans that are similarly inconsistent and random, here are three steps that will give an agronomic plan order and purpose while showcasing the author’s professionalism.

1. Educate

Golf course superintendents are agronomic experts with scientific training and specialized knowledge. Club and course managers are similarly well-educated professionals. They are keenly interested in the results supers produce, but not so sure how they pull it off. Therefore, superintendents’ plans must educate, providing the knowledge and understanding that help course owners, club directors and fellow management professionals see the inherent logic and forethought.

An informative agronomic plan:

States standards of excellence. Mowing and trimming frequency, height of cut and fertility programs need to be explained beyond frequency or fertilizer blends so club and course managers understand how the superintendent’s tactics connect with the facility’s overall goals and objectives. Once they do, they can become supporters of the plan.

Environmental objectives should be considered in this same context. Elements of the conservation plan should be described to help club managers understand the use of pesticides and standard practices for water taking. Information about beekeeping, bird and bat houses, and milkweed cultivation for butterflies, for example, also reinforces the facility’s overall sustainability efforts that can be passed along to members and customers.

Explains importance of standards. Many become confused when asked, “Why is that practice so important?” The superintendent who uses the agronomic plan to educate helps golfers be even more supportive and understanding.

Quantify needs. Measure everything and see that every line item in the budget is backed up with specific data points for acres or square feet being mowed, irrigated, fertilized and kept. Every number in the budget should have support tied to key data points. For example, labor – including wages and benefits – is increasing significantly in most markets across North America. Fuel prices are likely to remain volatile with the risk of sudden increases driven by geopolitical events.

Express aspiration. Describe your vision for the golf course. Be brave in setting higher standards for your facility. Describe improvements that can enhance the reputation and earning power of your course.

2. Organize

While there is the need to educate, club managers can become weary reading about unfamiliar agronomic standards and practices. Help hold their interest by organizing your plan. Starting from mission critical, first cover the most important topics – care and upkeep standards, expense and budget management, and expected outcomes. Then describe routine matters and needs that preserve working conditions and standards of excellence. Last, address matters such as storage needs and practices, staff training and break-room amenities.

3. Paint a Picture

Photography, video and other graphics can be highly valuable support tools for your audience. People who are not scientific experts need the additional understanding that imagery provides.

  • Show intended results. Teach readers of the plan and what they should expect in terms of denser turf, deeper color in maintained turf, reduced pesticide use and reduced water consumption.
  • Provide graphics for such details as mowing patterns and explain why your crew mows greens from different alignments.
  • Show how carefully your usage of manpower is planned. Help others understand that you command your category of expertise with knowledge and experience.
  • Support budget projections and expense trends with graphs and third-party data sources. Show the actual expense history of your course and how your own trend tracks local, regional and national patterns.

GGA’s Henry DeLozier penned this article for Golf Course Industry Magazine.

Finding New Members

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The need to grow membership keeps me up at night. Where should clubs focus their attention to find new members?

A bleary-eyed Keith Richards awoke with music in his head. He switched on the recorder and laid down the riff that everyone now knows to be the lead-in for “(Ain’t Got No) Satisfaction.” And, then, promptly fell back asleep. “When I woke up in the morning, the tape had run out,” Richards recalled. “I put it back on, and there’s this, maybe, 30 seconds of ‘Satisfaction’ . . . and then suddenly the guitar goes ‘CLANG,’ and then there’s like 45 minutes of snoring”.

It’s the need for better and more actionable market knowledge costing many club managers sleep. In fact, recent research from Global Golf Advisors (GGA) finds that [only] 6.5 percent of 4,400 private clubs in North America are full with a waiting list of members hoping to join. Or, nine-in-ten clubs are searching for members. But, where? And how?

Michael Gregory at GGA offers important points of focus:

  1. Win the Kids – Understand where the best school districts are if you want members for a family-oriented club. Clubs are especially important to families during their child-rearing years.
  2. Win the Moms – Offering a wide assortment of programs and activities engages women who cast the veto-vote in most to-buy-or-not-to-buy membership decisions. Moms search for clubs that meet most of the family’s needs.
  3. Do Your Homework – Market information concerning housing, demographic and psychographic trends is readily available in most markets, so do the research to understand the push and pull factors that matter most locally

The market factors that are key to generating more members are surging consumer confidence, favourable employment statistics, increasing household income and advanced educational attainment. Private club members tend to be found on the positive side of these indicators.

Sometimes inspiration appears in the middle of the night. For most club managers the results that keep your club at the top of the charts requires consistent pursuit of market knowledge and future member insights.

GGA’s Henry DeLozier penned this article for Club Director Magazine, Published by the National Club Association.

The Equalizer

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At one point in Neil Simon’s Tony Award-winning Biloxi Blues, Sgt. Merwin Toomey tells his young recruit, Eugene Morris Jerome, “If there were no such thing as problems, we could all go home at lunch.”

As managers, regardless of title or type of facility, we’re all problem solvers – or we better be. Not only do most of us face enough problems to keep us from going home at lunch, but solving them is also what is expected of us by our boards, general managers, owners and employees.

The best problem solvers share a number of characteristics:

  • They plan for problems. Many managers develop sound and well-conceived plans. Then something unexpected happens. Effective planners develop back-up plans to deal with unforeseen or unintended outcomes.
  • They use rigorous logic and progressive-step methods of analysis. They organize their work into constructive increments.
  • They tap into substantial reserves of research and data to make fact-base decisions. But they’re also capable of learning on the fly. They can harness emerging information, and search for patterns from previous study and experience to extract the underlying essence of how things work.
  • They are comfortable being uncomfortable. They often enjoy the challenge of unfamiliar problems.
  • They continually expand their network of resources. They use professional and peer networks to learn how others have dealt with similar challenges.
  • They research other business segments and disciplines for solutions to similar problems. They leave no stones unturned. If more research is needed, they dig back in to explore creative ideas, continually testing new theories and hunches.
  • They are positive, determined and patient. They roll up their sleeves and get to work, knowing that problems seldom solve themselves and that a solution exists for every problem.
  • And when the solution is found, they share so their fellow professionals can learn from the problem and the solution-finding process. Writing white papers for magazines or presenting your experience in peer-study programs expands everyone’s knowledge and proves you to be a tireless learner and a genuine professional.

In contrast, unskilled problem solvers struggle to find new solutions in time-worn practices. They often miss the complexity of an issue and try to force-fit simplistic solutions.

Effective leaders and managers develop their problem-solving skills through a variety of means: formal continuing education, trial-and-error and with the help of mentors. While there is no substitute for the experience of having faced a major problem and figured out a solution, you also can learn to be a more effective problem solver. Here are three strategies:

Get help

The golf business offers terrific resources, including associations, consultants and peers who have a shared interest in helping to find the best solution. Some people are too proud to ask for assistance, but their stubborn and prideful isolation not only compounds the original problem but deprives them of relationships with the many generous and knowledgeable people in our business.

Work the problem

One need not solve all problems or even every aspect of one. It’s like the answer to the question, “How do you eat an elephant?” One bite at a time. The key is to break the problem into manageable chunks, solve that part of the problem and move on to the next step. If you have a strategic plan, prioritizing problems becomes easier because your plan tells you which problems are standing in the way of meeting your objectives.

Reverse engineer

Stephen Covey advised “begin with the end in mind,” which is the approach of diligent problem solvers. What will success look like? What will it take – whether it’s capital, labor or persuasion – to get there? Reverse engineering brings focus to the intended outcome. Use it as your magnetic north.

Our jobs surround us with problems, making problem solving the unwritten part of every job description. The better problem solver you become, the more valuable you will be in any position your career takes you.

GGA’s Henry DeLozier penned this article for Golf Course Industry.

Focus on Planning, Not Plans

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Gen. Dwight D. Eisenhower, who served as Supreme Commander of the Allied Forces in Europe and planned the successful invasions of North Africa, France and Germany during World War II, didn’t put much stock in plans.

“Plans are nothing,” Ike once said. Planning, however, was an entirely different matter for the man who would become our nation’s 34th president. He believed “planning is everything.” In other words, the value really derives from the disciplined process that produces the plan. Furthermore, a plan that has not been preceded by sufficient planning may not get you where you want to go.

Are you planning for the future of your facility or club in ways that produce the right plans to guide your actions? Before you try to jump to the final product (the plan), consider a few basic but critical planning steps.

Agronomic Planning. Many states in the U.S. and most Canadian provinces have begun the progressive reduction of pesticides on golf courses and sports fields. Is your course anticipating the almost certain changes that are coming? Your planning process also should address water and water-taking, fertility, pesticides and chemical use and storage, tree replacement and removal, mechanical care and upkeep of maintenance equipment, and employee training and development.

Capital Improvement and Investment Planning. Golf courses and private clubs have insatiable appetites for capital. As a result, clubs must maintain a robust and thorough roster of capital assets, ranging from community infrastructure and buildings to rolling stock and maintenance equipment to furniture, fixtures and equipment.

Typically, capital and investment plans are the work of the controller and the finance committee. But expansive-thinking clubs also include in the process management, staff and the people who actually use and operate the capital assets. The more inputs provided to the capital asset roster, the better the eventual capital plan. The controller should issue clear and unequivocal guidance concerning the active definition of capital assets to ensure board-based understanding and compliance.

When planning for future capital needs, take into account: capital items owned by the club; standard useful life estimates (available through the American Institute of Certified Public Accountants); life-cycle projections for golf course assets, including greens, tees, sand bunkers, irrigation systems and drainage (available through the American Society of Certified Golf Architects); and actual standard unit counts of assets to ensure alignment with utilization needs and patterns.

Crisis Planning. What happens in the event of a disastrous or tragic event at your club? What specific actions should employees take, and in which priority order? Which staff members are authorized to contact and deal with police, emergency responders and fire departments? Who contacts the insurer? Who drafts responses to media questions and acts as a spokesperson for the club? Who manages the subsequent media cycles? All of these questions should be anticipated and answered during a detailed planning process and obviously before any crisis.

Resources in answering these questions include your insurance carrier and agent, local public services of fire, health and public safety, and experts available through major professional associations such as CMAA, GCSAA and PGA.

Marketing Planning. One of the regrettable truths revealed by the Great Recession is that most golf courses and private clubs do not understand their markets well enough to inform their most critical decision making. Few conduct a business-like market analysis of existing customers and prospective market segments outside of the front gate.

Lacking a thorough and current understanding of their markets, most clubs execute misdirected, ineffective and potentially costly marketing efforts. Top-performing clubs have studied and measured their market areas. Among other benefits, this research helps them understand feeder markets (which may be out of state and beyond) that can sustain growth and reliable financial performance.

Armed with the information uncovered during the planning process, you now have the ingredients of a comprehensive business plan which supports your overall strategic plan. While he may not salute your plan, Ike would surely be impressed with the hard work and critical thinking that produced it.

This article was authored by GGA Partner Henry DeLozier for Golf Course Industry.

Will Women Save Golf?

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Golf has a tendency to exist in a vacuum, one where blinders we sometimes wear with pride make us inattentive to happenings outside the confines of our green fairways. But looking away from one of the most important issues of the day could have calamitous consequences.

2018 may well go down in modern history as the year of the woman and the fight courageous women waged for respect and opportunity. What started as a backlash against a Hollywood movie mogul by women trapped by his influence has spread to other parts of society and is now part of the daily dialogue. It should also be part of the conversations we’re having in golf.

Leading up to the World Economic Forum in Davos earlier this year, Erna Solberg, the prime minister of Norway, and Christine Lagarde, the managing director of the International Monetary Fund, wrote that “time is up for discrimination and abuse against women. The time has come for women to thrive.”

They went on to say that “giving women and girls the opportunity to succeed is not only the right thing to do, but can also transform societies and economies.” If that opportunity has transformative global potential, just think what it could do for golf.

More women in leadership roles – on boards, as general managers, as department heads, as executive directors of allied associations – would do wonders for golf. I continue to be dismayed when I see panels composed of middle-aged white men at industry events. What perspectives are we missing that could inform better decision-making? What experiences are we not aware of that could help us fix problems on and off the course? What nuances are we tone deaf to that would make the game, our courses and our facilities more engaging?

We’ll never know until women have the opportunity to demonstrate their leadership abilities. And we won’t know the consequences of those omissions until participation and diversity have dwindled even further. Dare we risk that? Golf’s good-old-boys club took us so far. It’s also one of the reasons momentum has stalled.

There is urgency because, as we have seen dramatic evidence of already this year, women are not content to wait for change to come to them. But are the mostly male leaders of golf and its mostly private clubs prepared to examine their own practices and begin to open the right doors?

Introspection starts close to home. Boards can mandate women fill a minimum number of seats around the table. They can also require that job searches include women (and minorities). General managers can make educational and career-experience opportunities available to women so when management positions become available women and men are competing on a level playing field. Clubs can take the necessary steps to help women stay active in the workplace while raising a family. And without question, clubs can compensate women and men on an equal basis for jobs with similar requirements and responsibility.

Enlightened perspectives should also be customer facing for obvious reasons:

  • Women are driving the global economy – the women’s market is growing at a faster growth rate than men.
  • Women are responsible for $20 trillion U.S. dollars in annual consumer spending.
  • Women have a high level of commitment and loyalty.
  • Women share positive experiences.

But (news flash!) there are considerable barriers that women must overcome to gain the respect and opportunity most men are granted with few questions. Almost 90 percent of countries have one or more gender-based legal restrictions holding back women. Fortunately, those legal restrictions do not exist in the United States. But we all know that there are other barriers that can be onerous and restrictive, and we don’t have to look outside our own organizations to see them. Clubs ignore those hurdles and discriminatory practices at their own peril.

We must realize that recognizing and rewarding women’s potential is critical to the future of golf and golf clubs. We may be swimming against the tide of tradition in some cases, but the best practice seems simply to make the most of everybody’s talents.

The tide has shifted, the momentum has changed. Today’s conversation focuses on broad social change led by women and – yes – men who are speaking out against outdated views that hold all of us back. Helping women make the most of their potential is a job for all of us, and it’s time to get started.

GGA’s Henry DeLozier penned this article for Golf Course Industry.

GGA Education Events Isolate Themes & Challenges Facing Club Leaders

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Golf club executives have come together on both sides of the Atlantic as GGA continues its program of insight-led educational Symposiums, that deliver insights, research and current trends influencing golf club business success.

Against the backdrop of Loch Lomond Golf Club in Scotland and Scarboro Golf & Country Club in Canada, senior figures in the club industry discussed the challenges, issues and successes of the past year and forecasted opportunities and possible difficulties for the next 12 months.

Managing Partner of GGA’s EMEA Practice, Rob Hill, who directed the European Symposium in Scotland, said: “Our Symposiums foster a culture of knowledge sharing and collaboration among club leaders, many of whom are tackling the same challenges and are eager to learn from each other’s successes. This, backed by GGA’s key findings and research, provides a foundation of confidence and focus for the year ahead.”

The Scotland and Canada Symposiums touched on a vast array of topics ranging from far-reaching global trends to granular, market-specific issues managers are typically experiencing, including strategic thinking, business intelligence, member satisfaction, capital expenditures, membership growth, governance and manager-led panel discussion.

Key Takeaways:

The Symposiums isolated a number of key themes and challenges club managers are set to face in the year ahead:

  • Strategic thinking is a challenge everywhere, particularly among club Boards. Challenges in defining strategy, remaining strategic at the Board level, and qualifying the elements of a strategic plan are widespread.
  • Business intelligence resources are in high demand. Many clubs indicated that they do not have all the data they need to make strategic assessments and key business decisions, particularly as they relate to local-market understanding, member satisfaction, club utilization habits, and evaluating club finances.
  • Member Satisfaction is paramount. Club managers believe that understanding members’ satisfaction, current habits, and future preferences is essential to a happy club environment. Empirically and anecdotally, there was strong correlation between overall member satisfaction and evaluations of a club’s social atmosphere, food and beverage operation, and clubhouse quality/condition.
  • Millennials and Generation X are top of mind. While tactics for recruitment and sentiments for the viability of these audiences varied significantly among regions and participating managers, it is evident that understanding the future generation of club members is a hot topic for club managers and a concern for some.
  • Governance is both a source of strength and adversity. Clubs are constantly facing challenges to govern effectively and implement governing infrastructure which supports the organization’s strategic vision. At clubs where governance is characterized by strategic thinking, written policy, and efficient, purposeful deliberation, success often follows.
  • Clubs are considering the following key initiatives for 2018:
    • Strategic Plan implementation: implementing/executing golf course masterplans, facilities masterplans, determining club brands, or evaluating club relevance to current/future members.
    • Governance reviews: reviewing governance practices, ensuring governance models are more ‘business’ appropriate, implementing Board Policy Manuals, and operating with greater transparency and more communication.
    • Membership changes: evaluating membership categories, measuring member utilization, focusing on maintaining existing members, and assessing approaches to attract Millennials/Generation X.
    • Financial monitoring: increasing the measurement of goals and financial performance through business intelligence/satisfaction surveys/employee surveys, assessing costs and benefits of process improvements through technology/robotics, and monitoring labor costs.
    • Environmental assessments: gauging the cost and potential impacts of processes focused on sustainability, ecology, and environmental stewardship.
    • Capital replenishment: conducting capital reserve studies, building capital reserves, exploring new methods of capital funding, gaining member support for CapEx through digital communications (i.e. video information rather than Town Hall meetings; estimating vote projections through online surveys; electronic voting for easier capture and analysis), and improving the monitoring capital maintenance requirements.

Rob added: “While these learnings represent only macro-level, shared sentiments among participating European and North American club managers, they point toward an auspicious outlook for the 2018 golf season, one defined by a focus on data-driven decision-making and informed strategy.”

Symposiums provide an opportunity to connect with club managers and to share the latest and fullest extent of GGA’s wealth of industry knowledge observed through client assignments and extensive market analysis. Partner Henry DeLozier, said: “At GGA we believe that one must share knowledge so that all may benefit. None of us owns knowledge.”

How to Be a Great Board Member

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“The most effective private club board members park their personal agendas at the door and work collectively for the betterment of all members.”

GGA Partner Henry DeLozier discusses “Servant Leadership” at the Board level in an article written by Mike Stetz for Golf Inc. Magazine’s March/April 2018 Issue.

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Creating Strong Club Culture

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“CULTURE EATS STRATEGY for breakfast,” said management guru Peter Drucker. For clubs, culture is governance, and private club strategy—no matter how good and well-conceived—will be a victim to poor governance.

According to Fred Laughlin, nonprofit governance expert and a Director at Global Golf Advisors (GGA), “the board speaks with one voice—in writing,” in clubs that are well governed. When you omit either one of two key concepts in the phrase, you invite dysfunctions.

Take out “one voice” and you have a board of factions. While diversity of thought around the board table is healthy, speaking with multiple voices outside the boardroom confuses the members, frustrates the general manager and discourages the board members whose voice is not heard.

Take out “in writing” means the board must choose another way to communicate policies, which usually comes from the person with the most power or influence, the largest faction of followers or the loudest voice. Such verbal policies are ephemeral, lasting only if the person or group stays in power.

Following is a useful three-question test concerning the governance at your club:

1. Are we who we claim to be? The brand promise in most private clubs is that the club will provide an enjoyable lifestyle for its members. Lifestyle varies from club to club; the promise does not vary where the culture of the club is genuine.

2. Are we doing what is right for the members? Often boards deliberate what is allowed under the bylaws. Sometimes the proceedings ask: What options will the members tolerate? Great boards concern themselves with the moral compass that points to doing what is right. Truthfulness, dependability and openness are terms most often cited in private club member surveys concerning expectations of the board.

3. Are we truly servant leaders? Servant leadership places the point of focus on those served ahead of focusing on those serving. Great and successful clubs share the characteristic of strong servant leadership.

Strategy flourishes in clubs with cultures that foster great governance. Great strategy is simple in its description and thorough in its formulation. Effective strategy depends upon a culture borne of trustworthy governance.

An indicator of a club with weak governance is timid and has ambiguous goals that hold no one accountable for their achievement.

How Does a Club Implement Strategic Thinking?

“Putting strategy to work is the key,” according to Derek Johnston, a partner at Global Golf Advisors. GGA recommends a shortlist of primary actions to ensure strategy is alive and functioning at the highest level.

  • Strategy must be an agenda item at every board meeting. Strategic plan review enables the board to adhere to strategy. Progress toward goals should be reported into every board meeting by either the long-range planning chair or the club manager.
  • Keep score on strategy. The strategic scorecard is a valuable tool that enables the board to focus on the key strategic goals and objectives. As simple as a financial performance dashboard, the strategic scorecard shows each goal or objective across the horizontal axis with the monthly or quarterly (depending upon the frequency of your board meetings) forming the vertical axes. Progress updates should be summarized at every board meeting.
  • Socialize strategy. See that the management staff is fully informed of the key strategic goals. More importantly, see that everyone on staff understands and is committed to the strategy that the board has set.
  • Publish the club’s strategic plan. Members want to know that their club operates in a responsible manner. Make the club’s strategy available to all members in ways that ensure that the strategic plan is not passed throughout the local community and into the hands of competitor clubs. It is important for club members to know what is and is not included within the clubs’ strategy.

Discipline and attention is necessary for private club boards responsible for preserving and enhancing the best attributes of the club.

Written by GGA Partner Henry DeLozier, this article was originally written for and published by Club Director Magazine in January 2018.

The Keys to Successful Strategic Planning

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Research by Global Golf Advisors indicates more than 80% of top performing clubs believe they are working to a strategic plan. But are they?

“It is absolutely true 80% of clubs wish to have a strategic plan and truly intend to have a strategic plan, but if the road to hell is paved with good intentions, not all of them do,” says GGA Partner Henry DeLozier.

“The reality is that many managers are not clear what a bona fide strategic plan is. They believe that if they have a capital asset roster or have developed a master facilities plan they are well on their way to developing a full strategic plan, which is not accurate.”

So what is a strategic plan and what happens when clubs successfully implement strategy?

In this video, Henry DeLozier explains Global Golf Advisors’ five key elements of an effective strategic plan and why a focus on implementation and performance monitoring frequently leads to success and an increase in club membership.

https://youtu.be/vQSzlpXGcm4

For more insights on successful strategic planning, download the GGA whitepaper ‘Strategic Planning: A Road Map to Club Survival and Success.’

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