Tag: insight

Research Brief: Stakeholder Expectations of Club Leaders’ Skills

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Today, finding the right club leader is less about finding someone with experience – it’s more about using data to find the right professional to match the skills needed for a club’s unique demands.

Leadership expectations of club managers only continue to grow. Leaders require the operational knowledge that corporate executives demonstrate. Members have increasingly higher expectations of the experience their club delivers. Employees have more options than ever and desire a leader who understands they are an integral part of the club.  But what precisely do members and members of management want in their next GM/COO/CEO? How do these expectations change based on what each group perceives as essential?

The club industry has done an excellent job of creating opportunities for professional development focused on creating well-prepared industry leaders.  For example, the Club Management Association of America (CMAA) has integrated 11 competency areas around conceptual, administrative, and technical skills into their Business Management Institute (BMI) curriculum.  The Club Management Association of Canada’s (CMAC) mission – to create great leaders through excellence in club management – also focuses on supporting their members by providing professional development in critical operational areas.

But when it comes to clubs finding their next great leader or a current professional looking for the next great club, identifying the specific skills and abilities needed to succeed isn’t always straightforward.  Expectations are provided and often repeated across job descriptions, focusing on:

  • Position overview and the expectations of the position;
  • Attributes, competencies, and qualification expectations; and
  • A summary of the club’s initiatives and where the club is going

However, the specificity of crucial stakeholder expectations needs to be clarified.  Often members and employees have very different needs, and these insights are critical to understanding who will be successful as a leader.

Using our research-based approach, where data about the club’s needs are front and center in the search process, deeper insights into expectations can be established.  Using a multi-step method, we emphasize understanding the similarities and differences between stakeholders and how these influence finding the right candidate. Information is collected from both groups, employees and members of the club, to identify the skills and capabilities needed from potential candidates, assess potential hires’ fit, and place a candidate with the best opportunity to succeed.  Our research has found that stakeholders’ expectations at a club are focused on four areas: technical knowledge, management skills, professional attributes, and member engagement.

While each area represents critical leadership abilities and experiences, each offers unique value.  For instance, technical knowledge and management skills have similarly elevated levels of importance.  Whereas technical knowledge is driven by knowledge of various functional business areas, management skills are driven by effective leadership and the ability to be strategic. Professional attributes illustrate that being personable and creative is important, while member engagement focuses on understanding and delivering on the needs specific to the club industry.

Stakeholder Differences

As part of our executive search process to identify each club’s unique needs, employee and member stakeholder groups are asked to prioritize the skills they see as most important.  Results indicate similarities across expectations along with significant differences between members and staff.

Members emphasize the financial and budgeting skills needed at the GM/COO level, the importance of bringing food and beverage experience to the position, and the ability to provide direction for the departments they supervise.  Food and beverage stand out as unique, given that GGA generally sees this as an area of improvement when working with club industry clients.  These results indicate that greater emphasis is being placed on a new GM/COO hire to increase member satisfaction in this critically important area as part of having broad department-level experience.

On the other hand, managers emphasized club industry experience, the ability to manage the board, being innovative in finding solutions, and governance experience.  Understanding the club industry’s uniqueness is critical for this group.  From a previous experience standpoint, managers want a leader who knows how to effectively to interact with members and manage this fundamental relationship effectively.

From Differences to Interaction

To provide greater insight into clubs’ needs, the interaction between the specific abilities and experience across technical knowledge, management skills, professional attributes, and member engagement areas demonstrates where emphasis can be placed.  Through this process, clubs and potential applicants get a genuine sense of what the right candidate looks like. As demonstrated below, it is important to understand that some areas are more important than others when looking for the appropriate skillset. The larger bubbles indicate a more important position attribute, while only those interacting skills and experiences are shown, indicating that not every skill set is interrelated. For instance, from a GM/CEO/COO perspective, the importance of demonstrating leadership experience (the largest bubble) comes down to effectively leading in areas such as listening, team orientation, and successfully handling members. Leadership can also be showcased by having business acumen and financial knowledge. While thinking strategically and being able to motivate are essential considerations, effectively communicating is considered a critically important skill compared to other abilities.

 

Key Takeaways

While various leadership skills are essential for any position, a research-based process paints a clearer picture of the right candidate skillset needed for each club.  By tailoring any search process using these insights, unique needs can be identified to find suitable candidates for clubs and the right opportunities for candidates to help everyone succeed in the long term. From our research, we have found that:

1.While similarities exist between two very influential stakeholder groups, significant differences indicate that care should be taken to ensure that the needs of both groups are considered when hiring a club leader.

2. These differences are shown in how each stakeholder group views one another. Members see supporting other managers as more important, while managers see managing the member relationship as significantly more important.

3. Club’s stakeholders’ expectations are focused on four areas, that not all areas are considered equally important, and that significant (and important) interactive relationships exist across categories.

Though potential club managers are typically evaluated on a list of abilities, leaders are judged by their success in exceeding member expectations. Technical abilities are important to deliver these exceptional experiences, but personality is also critical to a leader’s success. By using a data-driven approach, the unique needs of each club can be identified to understand and match the personality attributes and management experiences needed to lead successfully. Ultimately, there is no standard formula for finding the right leader, but by using data, a club can find future leaders with the best chance to succeed.

Interested in learning about GGA’s Executive Search services?

If you would like to learn more about how we can help your club find its next club leader, please michael.gregory@ggapartners.com

Leveraging Personality Research to Find Club Leaders

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As the club industry continues to evolve following the COVID-19 pandemic, many clubs are facing the challenge of finding the next great Chief Operating Officer/General Manager (COO/GM).  The increase in retirements, a constrained talent pipeline, and the change in expectations of work-life integration contribute to an increasingly challenging talent acquisition environment.

Many clubs will turn to search firms to help find the right leader for their club. As part of the process, most firms conduct an introductory inquiry into the functional aspects of the position by identifying the requirements and the unique knowledge, skills, and abilities the club needs. While this is an important introduction to the position’s basics, it doesn’t necessarily identify the often hidden and interrelated needs unique to the club and the membership. To successfully conduct an executive search, a deeper understanding of the position is often necessary.

Using a research-based approach creates deeper, data-informed insights to target suitable candidates and enhance the success of the search.  In developing an understanding of the position and the club itself – its traditions, culture, and future aspirations – a more targeted approach can be used to locate the right candidate. This is accomplished by engaging multiple stakeholder groups at a club to identify the right candidate pool, attracting potential hires and correctly assessing fit, and placing a candidate with the best opportunity to help move the club forward.

Unlike traditional, industry connections-first processes focused on managerial skillsets, research can further clarify the unique considerations of each club to find suitable candidates. Examining the personality required of future leaders creates a depth of insight to help build the managerial environment, meet the members’ expectations, and position the club for long-term success.

Personality tests, which have been widely used for decades, are based on the four temperaments identified by Hippocrates:

  • supportive personality traits (e.g., supportive, thoughtful, considerate).
  • inspiring personality traits (e.g., persuasive, inspiring, personable).
  • driver personality traits (e.g., results-oriented, independent, ambitious).
  • analytical personality traits (e.g., systematic, structured, logical)

Unlike personality tests applied to potential candidates, GGA emphasizes the importance of the club’s expectations and environment to identify suitable candidates. This process includes pinpointing the specific operational skills and personality traits needed to be successful in the COO/GM position.  After meeting with the governing board and search committee to understand the specifics and unique considerations of the position, a multi-step research process is undertaken. This includes engaging staff and member stakeholder groups to help identify the right criteria for the position. We continue to collaborate with the club during the extensive interview and placement process, continuing through and past the placement as part of the extensive executive search process.

Our research in COO/GM executive searches has found that the most preferred personality traits relate directly to the need for leaders to demonstrate key components of empathy. Being personable is one of the most mentioned personality traits, followed by needing a professional demeanor and showing effective leadership characteristics.  Being friendly is also important, along with the need to have a natural ability to communicate with members and employees alike. Most importantly, these attributes are distributed across all four groups of the personality traits mentioned above (supportive, inspiring, driver, and analytical), indicating the need for balanced leaders that demonstrate an effective mix of personality traits.

While more than 35 personality traits have been identified as important, there is a high degree of overlap and alignment between the staff and membership (e.g., each group sees professionalism as incredibly important). However, differences also emerge between these two groups. Being friendly was the members’ most important inspiring personality trait while compassion was most important for employees. These differences demonstrate how each group’s preferences are driven by their interaction with the COO/GM (e.g., employees want a leader to show compassion, whereas members want a friendly leader). Personality traits also differ based on the club’s current needs, culture, and other dynamics identified during the search process.

While basic research can identify the unique needs of each club and even potential differences between stakeholder groups, a more detailed process paints a much deeper picture of what is required. Take professionalism, for example.  Everyone knows professionalism when they see it, but how does professionalism relate to other personality traits? Using our advanced analysis techniques, results indicate that professionalism is not simply a construct that exists on its own. When searching for a club leader, professionalism must be demonstrated across multiple other traits, such as how candidates listen, communicate, and how they establish approachability. Crucially, the importance varies across other personality traits, indicating clubs are looking for professionalism as related to some areas more than others.

Like leadership abilities and functional skills, personality is essential for a club to find its next successful COO/GM. Understanding the importance of and interaction between supportive, inspiring, driver, and analytical personality traits is an area that clubs, search committees, and potential candidates would be wise to focus on. While detailed research can help clubs understand unique needs, clubs and candidates should consider that when working with a search firm that emphasizes personality traits as part of their process, they will both be put in a better position to succeed.

Using a research process that goes beyond leadership skills and industry knowledge needed for a position allows search firms to:

  • Truly understand the needs of a club to help identify candidates with the best opportunity for success based upon the culture, situation, and specific stakeholder needs.
  • Understand what specific personality traits are essential for each club and how these behavioral considerations differ.
  • Go beyond the closely cultivated network of contacts looking to transition to seek out passive candidates who are not looking to change but could be interested in a position that aligns with who they are.

If you would like to learn more about our Executive Search services can help your club find its next club leader, please get in touch.

Michael Gregory, Managing Director & Partner
Contact Michael

Dee Anna Clarke, Director
Contact Dee Anna

Dr. Eric Brey, Ph.D.
Contact Eric

5 Tips for “Yes” in Your Capital Call Communications

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People fear change when they don’t understand the reason for it. And when they don’t understand the reason, they resist it.

In our work related to capital investment communications, we find that the vast majority of private club members understand and accept that it is their duty to leave their club better than they found it, with the caveat that the investment they are being asked to make is reasonable and necessary.

While obtaining a positive vote for your upcoming assessment is not guaranteed, getting members to say yes to being assessed can be much more achievable by following these 5 guidelines:

1. Communicate the Need

One of the keys to achieving a positive assessment vote outcome is to clearly communicate the need for the proposed upgrades. Whether your irrigation system is past its useful life and now costs more to maintain than replace or your casual dining area cannot service the demand or still has 1980’s decor, it is important to educate members about the need for the upgrades as well as the benefits that members will receive from them.

2. Engage Members in the Process 

Gone are the days when new amenities being proposed were based on the desires of a board member or two. Today, board members and management teams have adopted a more strategic approach to determining investments needed to ensure their club’s continued success. Club leaders are apt to rely on member surveys and focus groups as the starting point to understanding the need and the desire for capital improvements. It is a good first step, but not the only one. The most effective club leaders prepare preliminary plans and drawings with the understanding that once members have a chance to review the information, there will likely be a need for changes. We encourage clubs to present the plans in multiple meetings with small groups of members. This allows the facilitator to engage each member to hear questions and comments. This method allows the facilitator to control the flow of the meeting and ensure that one or two members are not monopolizing the meeting. Once all meetings have been completed, a recap of the key takeaways should be shared with all members.

3. Don’t Rush the Process 

Typically, the reaction to the introduction of major capital improvements and the associated assessment will be quite mixed. At GGA, we typically find that 20% of members will fully embrace the upgrades and 20% will be adamantly opposed to the plan. The remaining 60% need time to process the information and become comfortable with the prospect of the changes to the club and their budgets. That’s why it is vital to allow time for members to process the information, become comfortable with the plan and consider how it will benefit them. If you rush to a vote, there is a good chance the level of support needed will not be achieved. But if you take the time to communicate how you are addressing member concerns, answer member questions, provide plan updates, then ask for support, you will have a much greater chance of getting to that “yes” vote.

4. Develop an Equitable Payment Plan

The most senior members at clubs are least receptive to paying a lump sum assessment, using the argument that they will be paying for something they will not be able to enjoy for long. To ensure the capital improvement payment plan is not the deterrent to support, many clubs have moved to a “pay as you go” program whereby a small portion of the total assessment is paid in a lump sum, but the remaining assessment amount is paid monthly or semi-annually over three to five years. Not only does this payment option make it more manageable for all members, it also shows that those who will be enjoying it for years to come will assume more of the burden of paying for the plan.  

5. Bring Members Along on the Journey

Just like you, members are overwhelmed by the sheer volume of information that bombards them every day, which means that your capital investment communications need to work harder than ever to break through the clutter. Efforts to keep members informed along the journey to improve their experience should carry a consistent theme, be repetitive and as short as possible.

A clear, consistent communications plan to educate and engage your members in the process of planning your capital improvements will ensure that fear is not the deciding factor of your club’s future.

Interested in learning about GGA’s Capital Call Communications services?

If you would like to learn more about how we can help your club execute a capital call, please contact us.

The Art of Influence – Executive Presence in the Boardroom

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What do people think when you walk into a room, open your mouth to speak, or engage with others? Are they excited for what is about to happen? How do they see you, and how do they experience you? What happens as a result of your presence?

Senior leaders are increasingly discussing Executive Presence – what it is and how to have more of it. No matter how you define it, it has much to do with how we influence others.  To be clear, Executive Prescence is not about how many followers you have on your social profiles but rather, how you connect, communicate, care, and impact others.

In his recent book, “The Gift of Influence”, Tommy Spaulding reveals how we can be more mindful and effective in wielding influence throughout a lifetime of connecting with others. He outlines research that suggests the average person will influence up to 80,000 people in their lifetime – about the size of a football stadium. He suggests that “If you commit to living a life of positive influence, you will never look at your personal and professional relationships the same way again.” “Leadership is not about influence. It is influence.”

Influence has everything to do with leading in the boardroom, the staff room, and beyond. Here are some considerations on how to elevate your presence, your influence and your life.

Trust – The Strongest Foundation

All relationships start and end with trust. Think about the best board relationship of your career or greatest team you have ever been a part of. What was the level of trust?

If you want to build trust with others, make sure you are trustworthy yourself as well as trusting of others. This doesn’t mean establishing blind trust without questioning. It means that we always have the intention of trust.

Years ago, author Stephen Covey likened trust to an emotional bank account. As with a real bank account, we want the balance to be at its highest. And so, it is true with a trust account. When the balance is high, the relationship is easy, more productive, and positive influence occurs. On the other hand, a low trust account breeds an environment of fear, a lack of engagement, negative influence and limited results.

Ensure you are making more deposits than withdrawals into your trust account with others: Be upfront. Be clear with your intentions. Do what you say you will do. Find the answers. Show you care. Acknowledge others.

Communication – A Main Ingredient

Most great influencers are extraordinary communicators. They understand that the words they say are powerful, and the way they say them is even more.  They get to the point – and they have one! Brevity and clarity are their style. They say what they mean and mean what they say. They speak with good intentions. They have the good of the other person and the organization in mind, not themselves. A great communicator uses the language of vision and possibility.

In the leadership development practice, we have a saying “Say Less. Ask More.” The best leaders exercise the skill of listening more and speaking less. They are curious. They don’t have all the answers and genuinely seek them out. They ask powerful questions that engage others, explore solutions, and bring about growth. The focus shifts to others, not themselves.

A positive influencer also knows how their body language and voice add to or detract from their impact. They are purposeful yet speak with integrity and authenticity. They read the room, they remain calm under pressure, and they connect and engage others. Their eye contact, facial expressions and gestures are appropriately warm and powerful at the same time. They influence.

Humility – If You Don’t Have It, Find It

No question, you need to be competent in your role, but do you need to be the smartest person in the room?

Positive influencers own their competence, yet never let their competence own them.

The most purposeful leaders have the gift of humility. They let the results speak. They always give credit where it is due. They show up as competent, kind, caring leaders, and they often get amazing results. Their reputation speaks for itself, without their own input. They are keenly self-aware and always learning and growing.

Are you aware of how you “land” with others? Do you speak the language of team or individual?   What message are you trying to send? Be acutely aware.

The great news about executive presence and influence is that they are learned skills. Start where you are. Dive in. Get feedback from those that you trust. Acquire some training or coaching. Change some habits and see how your positive influence soars – in the boardroom and beyond.

To have a discussion about how GGA’s Leadership Development and Coaching services can benefit your club, contact michael.gregory@ggapartners.com

Inflationary Impacts on Budgeting

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Since 2012, the Federal Reserve has targeted a 2% inflation rate for the US economy; however, recent inflation rates are currently hovering closer to 6%, after averaging 8% in 2022.

These ever-fluctuating inflationary rates are felt deeply in clubs, who are heavily impacted by increases to personnel costs as well as food and beverage and other key supply purchases.  Club leaders are expecting continued high inflationary increases to key departmental expense budgets, including expected increases of 7.3% to payroll expenses and 6.2% to non-payroll expenses.  

Unlike more traditional industries, where pricing strategies can be more nimble to reflect volatility in costs, clubs are generally bound to operate within the confines of an annual budget cycle, establishing member dues rates once a year and leaving limited flexibility to adapt or react as economic circumstances change within a given period. Clubs get one chance to get it right for the year, and live with the consequences of the assumptions and decisions made during budget-time.

Clubs can be best-prepared to addressing these inflationary challenges by being proactive with their budgeting strategy to validate the inputs, and ensuring that they have a robust communication plan in place to support the outputs.

Understanding the specific factors that will impact budgetary line items is the first step towards creating an effective budget, and the key factor that will impact your ability to clearly communicate any resulting pricing changes. Breaking down the specific inputs which have the most significant impact on overall membership dues, whether that be payroll, cost of goods, or other operating items, and getting a clear line of sight to the factors impacting their increases will allow you to budget effectively and provide an opportunity to communicate those reasons clearly, increasing the likelihood of membership acceptance of the changes. For instance, rather than applying a consistent inflationary rate across all line items, consider the specific regional and cost-specific information that will impact individual line items.

In line with the budget for the year, be sure to prepare a robust communication strategy to prepare members for the upcoming changes. Leverage external data points wherever possible to support the assumptions you are making, and ensure you highlight the wins wherever you can. As the cost of labor goes up, the relative cost of technology to replace that labor goes down. Consider opportunities to leverage technology to supplement / support (not replace) human capital and share that with your membership.

Whether investing in technology to supplement your variable workforce, altering your menu design to improve margin yields, or ensuring that your labor costs are keeping up with regional trends to secure your workforce for the longer-term, the more you can communicate with your membership, the more confidence you can have when it comes time to implement the impact of these changes via dues increases.

Rather than reducing service or programming offerings, the vast majority of clubs have responded to increasing costs by passing along these inflationary increases to their members.  While inflationary pressures are certainly widespread, and members can be expected to be generally receptive to the idea of resulting cost increases, the more diligence that can be demonstrated by management throughout the budget process, the greater the membership buy-in is expected to be, and the less the membership resistance you can expect to hear.

Inflationary impacts are certainly being felt far and wide throughout the industry, and can make club budgeting challenging. Being proactive with your budgeting strategy, knowing how to respond to inflation,  and communicating clearly and effectively with members can help to mitigate effects that result from inflation.

How GGA Partners can help your club address inflation

  • Investigate ways to improve your cash flow.
  • Explore ways to reduce your debt payments.
  • Make suggestions to make your budget more inflation-proof.

Contact us today to discuss how we can help.

Online Voting, Explained

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The Covid-19 pandemic accelerated digitization across many sectors, inspiring many to wonder: why didn’t we do things in this way before? This is indeed the case for electronic voting. Many clubs implemented electronic voting, albeit by necessity, to navigate complex challenges brought on by the pandemic. However, electronic voting is still relatively immature within the club industry. If you are curious about electronic voting, we answer five common questions that help to paint a clearer picture of electronic voting.

Why do online voting?

With the option of electronic voting, participation rates traditionally increase. Instead of needing to attend a meeting and fill out a paper ballot, members can access the ballot at home on their computer or at work on their phone. Voting can be completed in minutes and members receive a virtual confirmation assuring them that their vote was tallied. Higher voter turnout means higher levels of engagement among your members, and a simpler democratic process.

If planned properly, online voting can also be much more cost-effective. Your club can save on printing and mailing costs that would not be required through an online platform. It can also allow your club to allocate time and human resources to other areas of club operations.

By moving ballots online, elections are transitioned to a safe and secure platform, used routinely by private organizations and corporations. Online voting allows an ongoing audit trail that virtually eliminates the potential for human error which would not exist with paper ballots.

Online voting is customizable and implementing changes to your election is simple. The online voting system can be set up according to specifications provided by your club. This includes branding the voting website, ballot loading, preparation and loading the list of voters, and managing authentication of voters. When it comes time to vote, a mass email is distributed to all electors with a direct link with unique authentication credentials encrypted into it, making it easy for the member and safe for the club. Once the vote has been completed and the results are analyzed, online voting provides clubs with faster and more accurate tabulation of results, saving the club time and resources. The online platform also allows for further demographic segmentation while maintaining voter anonymity.

Do our bylaws align with online voting?

When first adopting an online vote, many clubs notice that their bylaws make it complicated to shift their voting to an electronic platform. Most clubs’ bylaws were written before the introduction of online voting, and therefore, may not adequately account for it. Just because a club’s bylaws or state statutes do not restrict a club from conducting a vote online, it does not mean their bylaws are optimal for doing online voting. Although many clubs are technically permitted to conduct online voting, their bylaws may prohibit them from doing so in an efficient and logical manner.

Typical barriers and bylaws that may interfere with a smooth online voting process may include:

  • Proxy requirements and the format of the proxies, i.e., general proxies vs. directed proxies.
  • Critical timing requirements and limitations on when proxies can be collected and when voting must occur.
  • Explicit requirements to issue paper notices, ballots, or proxies.
  • Specification of who is authorized to administer, issue, or receive proxies and ballots.

So, what is a club to do?

A change to your bylaws may be required. To successfully implement online voting, advisors can help clubs identify the required changes to their bylaws that are more compatible with online voting.

Who will be responsible for planning the vote?

Elections vendors offer support and guidance on the logistics and technical aspects of how the voting will occur. Votes require strong leaders/leadership team to plan and coordinate various aspects of the vote, such as communicating with members, producing meeting notices and information circular packages that are cohesive with the online voting process. Involving the club’s legal counsel is always advisable to ensure compliance with bylaws, state statues, and any other important requirements.

How should members be prepared for online voting?

It is recommended to initially implement online voting for a ‘low risk’ vote, such as an AGM vote where there are no polarizing motions or elections tabled. Although hybrid votes can be more complex, when they are set up appropriately, they can be a good first step for members to become familiar with the process. For example, in a simple vote with no proxies, members could be mailed a paper ballot or be given the option to vote online. The outcome of how many people elect to vote online vs. by paper can provide you with a good gauge on what your members are comfortable with. You can also observe turnout from other online engagement efforts, such as member surveys.

What vendor or service should I use for online voting?

There are many vendors, each of which excel at different aspects. Important factors to consider when selecting a vendor may include:

  • Budget
  • Structure: whether the vote will be a hybrid vote or exclusively online.
  • Vote requirements: will the voting experience need to be integrated with the technology being used to run the meeting via video?

Ready to implement electronic voting for your next vote?

To learn how our online voting program will benefit your organization, contact martin.tzankov@ggapartners.com

What Do Members Want?

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Some club leaders believe that it is a fool’s mission to try to understand what members want.

In fact, it is quite simple…you need to ask members what they want. Michael Gregory and Dr. Eric Brey at GGA Partners can tell you with certainty that developing a broad and deep understanding of members’ wants, needs, expectations, and fears is a matter of faithfully applying proven practices of attitudinal research.

Dr. Brey, a PhD-accredited professor at the University of Wisconsin – Stout, is an expert at leveraging analytics to implement dependable customer-centric strategy and hone it on what truly impacts satisfaction. And it all begins with asking members what they want. Sometimes referred to as qualitative analysis, members’ viewpoints are normally collected within small groups and sometimes validated in expanded follow-up listening sessions. In his work with GGA, Dr. Brey has implemented this science within private clubs where understanding members’ attitudes are so important.

In order to measure what matters are of greatest importance to a given club’s members, attitudinal surveys prove to be a trustworthy tool. Establishing the proportion and intensity of members’ attitudes has become even more important in a time when members want to know that their viewpoints were taken into account.

Gregory, having worked at GGA since 2007, is expert at administering private club surveys. He emphasizes that attitudinal surveys in private clubs are essential because the relationship between the club and its members is an emotional and often intense one. In recent years, club leaders have become more reliant on member surveys as the sophistication of such surveys goes deeper into members’ viewpoints. Not the stuff of satisfaction surveys, an attitudinal survey seeks to quantify and measure members concerns and expectations, willingness to fund certain capital projects, and identify the characteristics – by analyzing underlying data – to provide club leaders with clearcut insight into what members want. Five factors that are consistently revealed in member surveys include:

 

  1. When factures occur in private clubs, they are often on the lines of gender and generation.
  2. Normally, the most satisfied members are the newest and the least satisfied members are the most tenured in the club.
  3. Older (in age) members are least supportive of capital projects and debt.
  4. Younger members are eager to see regular capital improvements.
  5. Women tend to be most alert to the club’s value system…”are we what we claim to be?”

Insights vary from club to club and require careful and objective analysis of underlying demographic data to enable the board to understand how members align and differ on certain topics. Dr. Brey advises careful analytical discipline and measurement. “There is no substitute for patient and transparent data analysis,” he says.

At the end of the day, Brey and Gregory confirm that it is possible to know what members want. One simply needs to ask the right questions in the right way.

This piece was authored by Henry DeLozier, Partner, for the National Club Association‘s Winter 2023 Issue of Club Director Magazine. 

Connect with Henry – henry.delozier@ggapartners.com

An Anatomy of Two Committees

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Of all the club committees, none is more important that the nominating committee and none is less important than the executive committee. You may think it a radical thought, but before you dismiss it, consider the following rationale. One of the five principles of good governance is electing board members on their merits and not on their popularity, personal agendas, seniority or some other basis. Honoring that principle is best achieved via an uncontested election, where the number of candidates equals the board slots to be filled. An uncontested election requires two essential ingredients:

*An independent, objective nominating committee.

*A board-established profile that lists the requirements and desired characteristics of board members.”

Member trust in the uncontested election process is directly linked to their perception of the nominating committee’s integrity. To ensure that trust is nurtured, establish your nominating committee using the following guidelines:

Smaller is Better

The size of most club nominating committees is between five and seven members. Because of the high premium placed on the confidential proceedings of the committee, we prefer the smaller size.

Selecting the Chair

The key decision in forming the committee is the selection of its chair. Club bylaws often specify that the chair is selected by the president. Others may identify the immediate past president as the chair. Of the two approaches, we favor having the president select the chair, primarily to avoid the appearance of a self-perpetuating board. However, the importance of this decision calls for a board-approved set of criteria for the chair. For example, the board may require the president to select a chair based upon their reputation of integrity, independence and objectivity; their understanding of club governance; and their ability to lead a highly confidential vetting process.

Allow the Chair to Select Committee Members

Once the chair is designated, there is the selection of committee members. Some bylaws have the president selecting the committee members. For those clubs whose bylaws are not specific as to how committee members are chosen, we recommend leaving that decision to the newly appointed committee chair. If they have been selected using criteria like those listed above, they will recruit like-minded members to carry out this important role.

Define the Ideal Candidates

As important as selecting the right chair and committee members is the process used by the committee to prepare a slate of candidates. The board should approve a profile that includes both required and desired characteristics of board members. Further, we recommend the committee be held accountable to use the board profile to vet potential candidates. A properly formed nominating committee using a board approved process and referencing a board profile is best equipped to select a slate of highly qualified candidates for the board.

The Executive Committee

While the nominating committee has the most important role among club committees, we believe the executive committee has the least. Our concern with a board’s executive committee is that it can become a mini-board, i.e., it can make decisions that are best left to the entire board. One of the principles of good club governance is the board speaking with one voice. Having the executive committee stand in for the full board dilutes this principle and can result in board members not on the executive committee feeling like second class citizens.

Despite the threats to the one-voice principle, executive committees have a long history in clubs primarily for two reasons:

  • There are board decisions that must be made between board meetings.
  • There are matters calling for a group smaller than the board to handle.

Regarding the need for decisions between board meetings, the last two years have demonstrated how easy it is to call an online meeting of the board. If an issue requires a decision by the board, the president can email an invitation to board members and assemble an online meeting within days. Some bylaws require a notice period of a week or two before a special meeting of the board but many clubs have amended their bylaws to allow only a few days’ notice, given the ease with which board members can be contacted and made available for the meeting.

The second rationale for having an executive committee is the occasional need for a small group to handle a particularly sensitive issue or provide the general manager with counsel on a policy or a decision. While a smaller group is more efficient and may be more secure with sensitive information, we do not see an executive committee as the one-size-fits-all group. For example, if the behavior of a staff member may result in adverse publicity for the club, it may be best to assemble a group of board or club members based on their expertise and not their office. Similarly, if the general manager needs counsel on handling an issue or transaction, they can call on board members or club members best suited to offer the advice.

A final point: Although the common board size is nine members, many clubs have 12 or more members. These larger boards are more likely to lean on an executive committee for efficient decision making. However, the more these larger boards rely on their executive committees, the more likely the non-committee members will feel left out. If a board is unwieldy, reduce its size rather than creating a two-tiered board by depending on an executive committee to make intermediate decisions.

This piece was authored for the National Club Association‘s Summer 2022 Issue of Club Governance. 

Corporate Policies and Best Practices for Proper Club Committee Alignment

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More and more, private clubs are looking to corporations for policies and best practices in governance. For example, private clubs have realized the benefits of modeling the relationship between their boards of directors and general managers after the relationship between corporate boards and their CEOs. Although there are other lessons from the private sector clubs are learning, there is one area clubs seem slow to embrace: the appropriate alignment of committees.

Corporate boards maintain committees such as strategic planning, finance, audit and nomination committees to support governance functions. But they leave the formation of advisory committees on matters such as accounting, customer relations, sales, marketing, communications and the like to the CEO. In contrast, most private clubs have all their committees reporting to their boards. We believe there is a more effective approach to aligning club committees with the functions they support.

Assume you are just starting a private club and you have been assigned to develop a governance model. You decide on the size of the board, the terms of office, the election process and other features of the model. Next comes the task of identifying club committees, including their purpose, configuration and leadership. What’s the first step in this task?

The Purpose

Begin with the primary purpose of a committee, which is to serve as an advisor on policies relating to the issues subsumed by its scope of services—for example, finance, membership, golf, house, strategic planning, etc.

The next question is to whom does the committee report? The answer lies in the functions being supported by the committee. The board is a governing body with a strategic perspective. It needs committees to support strategic functions like finance, strategic planning, membership and governance/legal. In a good governance model, the board delegates the authority and the responsibility to the general manager to manage club operations, which includes delivering the services and activities efficiently and effectively. The committees supporting these functions, therefore, are best positioned reporting to the general manager.

We recommend two types of committees for a private club:

  • Board committees that support board functions and report to the board.
  • Operations committees that support operational functions and report to the general manager.

Unfortunately, the inertia militating against this alignment is rooted in history, where virtually all committees have reported to the board. Most club bylaws state specifically or clearly imply that all club committees report to the board, meaning that even boards that seek to realign their committees must first go through the process of amending the bylaws. Even if their bylaws allow for a restructuring, many boards are reluctant to effect the change.

Their rationale tends toward one of the following:

  • Having operational committees report to the general manager would diminish their role and prestige in the club, making it harder to recruit members to serve on these committees.
  • Moving operational committees away from the board reduces the board’s ability to stay informed on operations.

Value and Attraction

It is difficult to refute outright that service on operations committees will be less valued and therefore add to the difficulty in attracting quality members. Yet our experience suggests that club members are more persuaded by the influence of a committee and the quality of its management than by the person or persons to which it reports. In that vein, the closer the committee is to the decision-maker, the greater its influence and sense of value. Accordingly, we believe that whatever loss of status presumed by having operations committees report to the general manager is more than offset by the linkage the committee enjoys with the person who is responsible for making the decisions it recommends.

Likewise, we can understand the perception that not having operations committees report to the board will cause board members to lose touch with these important functions. However, there is no reason the board cannot require reports from the general manager that contain metrics the board believes are necessary for it to monitor performance.

Additionally, having operations committees report to it may encourage the board to meddle rather than monitor. Too often, board meetings are burdened by committee reports that address matters that belong to the general manager—not the board. If the general manager’s handling of an operational area is in question, the board can always ask for input from the committee. But to bake committee reports into the board agenda not only consumes meeting time, it also invites the board to be inappropriately involved with operational matters. Moreover, it blurs the clarity of responsibility for operational performance. If boards are holding general managers responsible for operational performance, the general managers must be given the authority to carry out the duties and the authority to form committees that support the functions related to operations.

Clearing Hurdles

As mentioned, many clubs refer to governance models of successful businesses, such as adopting the COO model, which clearly separates the governance function of the board from the operational leadership of the general manager/COO. But too many of these clubs are unwilling to realign their committees to more accurately reflect the corporate model and more effectively connect their committees to the appropriate level. We don’t discount the years of tradition that resist such a change, but we recommend that clubs clear the hurdle of the status quo and place their committees where they will most efficiently serve.

This piece was authored for the National Club Association‘s Summer 2022 Issue of Club Governance. 

Key Metrics for Effective Management of Gen Z

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Generation Z (Gen Z), representing those born between 1996 and 2010, is quickly graduating from “children of members” to Junior and Young Executive membership categories in many clubs. Aged 10-25, this next generation follows millennials into private club membership and is set to become an important part of a club’s generational mix. Many of today’s key performance indicators (KPIs) focus on a broader vision that reflects a club’s priorities, values and purpose. Clubs who are proactive in addressing the needs and wants of this next generation will be poised to benefit from protection against rising attrition from a more vulnerable generational mix.  But how, exactly, should clubs cater to the priorities of Gen Z members and what information will help them to do so?

Clubs who seek to attract and retain Gen Z members will need to both understand the specific needs of this generation and know what data to track to determine whether those needs are being met. Learning about Gen Z, and what differentiates from past generations, will help identify successful strategies to engage a group who is soon set to reach full purchasing power.

The following metrics will assist Boards in making better business decisions related to Generation Z:

Generational Mix

The club’s Generational Mix outlines the percentage of members belonging to each of the generational groups. Traditionally, these generational groups include the Silent Generation (1928 – 1945), Baby Boomers (1946 – 1964), Generation X (1965 – 1980), Millennials (1981 – 1995), and now, Generation Z (1996 – 2010).

A club’s Generational Mix can say a lot about its culture and how it evolves over time. The mix can also reveal age clustering whereby there is insufficient distribution among the generations, making the club more vulnerable to large waves of attrition. Tracking the mix over time can identify historical trends and provide the opportunity to predict the future mix, allowing for the appropriate infrastructure to be implemented to meet the needs of future members.

Boards should regularly monitor and evaluate their club’s generational mix. For example, the MetricsFirst Lifecycle Dashboard identifies generational trends of various segments within club membership.

Diversity Profile

Gen Z are a diverse generation to the extent that they tend to take diversity for granted and have been taught by their Gen-X parents to disdain outright exclusivity. Tracking diversity markers, whether by race, gender, age, marital status, or otherwise, is helpful to understand the profile of your membership and how it is changing over time.

Clubs need to understand who Gen Z’ers are and where their priorities lie. The new generation expects organizations to take a stance on societal issues and are keen observers of how they are behaving in and out of the boardroom. Gen Z will expect governance from a Board that is as diverse as its membership – understanding how diversity, equity and inclusion is not just supported, but encouraged and represented throughout the Club, will be of value to this next generation.

Careful attention should be paid to how this data is collected, tracked, and utilized by clubs and boards. It is vital that appropriate, inclusive language is considered when requesting this information from members and emphasis placed on using the data to create an inclusive environment. External expertise may well be required to determine how best to obtain and safeguard this sensitive data.

Digital Engagement

Born into a world of technology, Gen Z is the first truly digital generation. This cohort expects private clubs to embrace technology as a complement to their overall customer service experience rather than a replacement for it. Clubs must focus on creating experiences for Gen Z’ers who understand and communicate using technologies like social media. This group’s natural use of technology will influence how clubs not only operate but engage. In addition to employing technology within the club environment for efficient ordering, registration, voting, etc., clubs should consider how technology, particularly social media, can be leveraged to drive engagement with existing members and to recruit prospective members.

The Net Promotor Score (NPS) is a valuable metric to track engagement and should be a standard metric employed to measure loyalty, which is important to younger generations. Social media metrics, such as likes, shares, and follows, are also helpful to track, and can be analyzed to determine content the membership finds most engaging. Remember to move beyond simply counting engagement – it is just as important to understand which social platforms members engage with to tailor content to those specific platforms. TikTok content creation is much different than content developed for LinkedIn. Tracking engagement to understand where to focus resources across social platforms contributes to effective management.

Amenity Utilization & Compaction

Gen Z’ers expect flexibility in their work and personal lives, with the ability to work in hybrid-type jobs and environments. Successful clubs will ensure that amenities are available on-demand to meet these needs. Boards should pay careful attention to the long-term planning for capital expenditures and human resources to make sure that the right mix of amenities is available to encourage long-term engagement between Gen Z members and their clubs. Opportunities may arise for utilization of club services and facilities in traditional off-peak windows, providing further incentive for clubs to encourage this next generation to engage with club membership earlier than previous generations have traditionally done so.

Metrics that identify compaction periods, and conversely, periods with excess capacity, will help clubs to take advantage of the flexibility Gen Z’ers bring.

Tracking club activity using member card swipes, digital card scans on mobile apps, or even facial recognition technology can help clubs better understand overall utilization. Combined with program participation (personal training lessons, class bookings, event registrations, etc.) and a valuable picture comes into focus of overall utilization, which can easily be broken down by demographic.

Gen-Z is defined by its prioritization of diversity, equity and inclusion, comfort with (and reliance on) technology, and expectation for on-demand services to meet flexible schedules.

As this rising generation begins to come of age in parallel with the “new-normal” of life post-COVID-19, clubs are faced with the opportunity to evolve to meet the needs of Gen Z. Leveraging data effectively will assist to understand what actions to take to do this. Private clubs contain a wealth of important data, with access to demographic, utilization and engagement metrics that can be very challenging to obtain in a more traditional business environment. The strategies that clubs can implement by analyzing this data more effectively have tremendous potential. Clubs that take advantage of the changing landscape of a post-COVID world to meet the needs of Gen Z are poised to benefit from the diversity this generation brings.

This piece was authored by GGA Director, Liz McDowell CPA, CA, CCM, and Trevor Coughlan, Vice President of Marketing at Jonas Club Software for Boardroom Magazine. 

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