10 Lessons that Clubs can Learn from Business
In the many strategic planning sessions we facilitate, there is a growing theme of clubs wanting to become more “professional.” Often, we hear from participants there is a desire for their clubs to become more businesslike or act more like a business. While I agree that there are a lot of “professional practices” clubs can – and should – adopt from business, clubs are not businesses. Of course, clubs can learn lessons from business. But, the leaders of sport must never fall into the trap of thinking they are.
There are two fundamental differences between clubs and businesses.
First and foremost, when someone establishes a business it is usually for the pursuit of financial gain or profit. This is through the provision of a given product or service. Rarely will a business continue beyond the short-term to provide a product or service if it isn’t generating a suitable “return on investment”. The purpose of a club, on the other hand, is generally to provide sport, recreation and social opportunities for their surrounding community.
Of course, clubs have to generate enough funds to pay their bills but the law prohibits dividends and financial benefits being distributed to members (except in exceptionally rare circumstances).
The second significant difference is that businesses are run almost entirely by employees. People who are paid to provide their time, expertise and knowledge. Volunteers drive community clubs. They freely and passionately contribute their time, knowledge and often large amounts of money.
A great way to illustrate the true difference between clubs and businesses is two potentially similar situations. In 2000, over 80,000 passionate Rabbitoh supporters marched between South Sydney and the Sydney Town Hall. They were protesting the announcement in 1999 that the South Sydney Rabbitoh’s were not going to be included in the new NRL competition. The Full Bench of the Federal Court overturned this decision in July 2001. Yes, supporters were passionate enough to fight for their club all the way to the Federal Court.
Compare and contrast this situation, to the closure of 363 Dick Smith stores across Australia and New Zealand. The closure put 3,000 people out of work in 2016. There were no supporters marching, no volunteer rallies and no court cases to try and keep an iconic Australian company. There was only predators picking over the corporate carcass.
Club’s should never let the pursuit of “professionalism” come at the cost of passion and volunteerism. Although, that doesn’t mean there aren’t lessons or practices that clubs can learn from Business that will help make it easier for clubs to be successful.
So what is there that clubs can learn from business?
Here are 10 business practices clubs should adopt:
Induction training for new volunteers
Rarely do businesses, no matter how small recruit people and then simply ask them to do the job. The opposite is so often true in clubs. Roles and whole committees will change at an AGM with little or no hand over to the incoming volunteers.
Documented club structures
Very few clubs have a written down club structure, that is a diagram that illustrates the roles within the clubs. This is vital for committees, especially new committees. It shows exactly the number of volunteers that the club needs to recruit and the functions within the clubs.
Documented position descriptions
Every role within the club ideally would have a position description that documents and defines the tasks making up the role, who the role reports to, the level of training and support the role requires and the time the roles is expected to take. Again, this is crucial information which is often lost from year to year because it isn’t written down. It is also so much easier to recruit volunteers when they can see exactly what the role entails.
Ongoing training and support (succession planning)
Successful businesses focus on developing their staff and generally promote from within. Likewise, clubs should develop training and support programs that allow volunteers to develop confidently from entry-level tasks to complex roles such as President, Secretary, Treasurer, Coach etc. These don’t need to be formal programs but a recognition that succession planning is not recruiting the next President, Secretary, Treasurer or Coach – it is developing them.
Clearly defined goals and objectives
Unlike businesses, very few clubs have clearly defined, documented, goals and objectives. This means that often volunteers will work towards what they think is in the best interests of the club. When we start working with committees for the first time we ask them a very simple question. If your club could achieve just one thing for the year what would it be? Generally, even in the most united committees, there will be at least six different answers.
The greatest asset of most businesses is their intellectual property or knowledge of how to “do” things. In clubs, we rarely hand over knowledge well from one committee to the next, one volunteer to the next. So much knowledge, experience, and learning are lost from the club each year. Clubs can usually safely assume that if something isn’t written down it will be lost. That is why the most successful clubs generally have extensive policies and procedures documented and updated. Most people think policies and procedures exist from a compliance perspective. Of course, there is a compliance element. But the reality is policies and procedures are what collects club information. They also are what hands over acquired club knowledge and learning from one year to the next.
Strong financial accounting and reporting
Generally, most businesses know their exact financial position down to the cent. Clubs, unless they are using an online accounting system, rarely know their financial position. Sometimes, they don’t even know if they have enough cash to get through the whole season.
Use of technology: an online, cloud-based accounting system
Many clubs have been slow to embrace online accounting, preferring to continue to financially manage their club using the traditional spreadsheets, bank statements and cash books. While online accounting systems have a small ongoing license fee they make the treasurers job so much easier. It allows them to provide the committee with far better information to financially run the club.
Use of technology: communication
Successful businesses have sophisticated communication strategies that use technology to store information about their clients and customers and then use digital communication to remain connected. Conversely, very few clubs keep a database of people connected with the club other than the current players or members. They rarely communicate outwards to their broader audience, unless they want something from them. Having an up-to-date website, active social media, and regular email newsletter allows clubs to engage and grow their supporter base.
Use of technology: online purchases
Clubs can collect every revenue online. You can use your membership platform or an App such as Team app to generate and pay for memberships. Apparel and merchandise can be sold to members using an online shop, and event registrations can be sold using a ticketing website, like Trybooking. Using online technology makes it easier for the volunteers to manage their tasks, but your club supporters actually prefer to pay online.
Clubs are about people, passion, relationships, and tribalism. There is so much opportunity for what clubs can learn. They can be continually innovating and evolving to create great experiences for their loyal community of supporters.