As the dynamic of private clubs continue to evolve, so too has the thought process on how to lead and manage them successfully. Certainly, traditional management methods have worked well in the past, as evidenced by the industry’s longevity and evolution over the last several decades. In recent years, however, the industry has recognized that the changing landscape may lend itself to a different type of management style—the General Manager and Chief Operating Officer (GM/COO) model.
So, what exactly is the GM/COO model and how is it affecting governance in private clubs across the country? For more insight, we spoke with two industry veterans—Dick Kopplin, Partner at Kopplin Kuebler & Wallace with over 45 years of experience in the club industry, and Chambers’ Executive Vice President Skip Avery, a club manager himself for over 30 years and Past President of CMAA. Here, we discuss the benefits of this management style, why clubs are embracing it, and the challenges clubs may encounter when trying to make the transition. Keep reading to learn more!
Historically, the majority of clubs in the industry were led by what is often referred to as the “three-legged stool” concept. In this traditional approach, a club’s Board hires three key individuals to manage overall club operations—a Club Manager, a Head Golf Professional, and a Golf Course Superintendent. The Club Manager reports to the House Committee chairperson and is responsible for day-to-day clubhouse operations, overseeing administration, food and beverage staff, and pool and tennis operations if applicable. Similarly, the Golf Pro reports to the Golf Committee chairperson and is responsible for all golf operations, while the Golf Course Superintendent reports to the Greens Committee chairperson and is in charge of course maintenance.
“With this model, club managers are good stewards of the facilities but act more like a clubhouse manager. Their role is limited,” says Skip Avery, “As the industry has grown through the years, managers have moved from being more of a steward/caretaker of the Club to becoming professionally educated leaders.” As part of this shift, the General Manager/Chief Operating Officer model was born. In this model, a club’s Board establishes overall policy and strategic direction, while the GM/COO is responsible for implementing those policies and managing day-to-day operations for the club in its entirety. This individual oversees all programs, services and activities, monitors financial reports, and oversees all other club logistics.
There are many benefits to implementing the GM/COO model—consistency, financial oversight, and improved talent to name a few. The traditional committee-run, three-legged stool concept “leads departments to work independently of one another, which causes a lack of consistency across all club operations,” says Dick Kopplin. This creates more opportunities for miscommunication due to the number of parties involved in the decision-making process. “Everyone needs to be moving in the same direction in a club,” Kopplin advises. “There are a lot of moving parts and someone needs to be the ‘go-to’ person to coordinate them. The GM/COO model helps clubs achieve that.”
Kopplin continues to explain that this model enables the manager to oversee the entire budget operation for the club, allowing him/her to offer the Board a great overview of where the needs are, which assets should be replaced, how facilities are operating, how the club is functioning, etc. This model also leads to a better Human Resource function with consistent policies. This way, decisions are made with a global perspective, creating an organized and enjoyable environment for staff and members alike.
Consistency is also key when considering the importance of maintaining the strategic vision of a club. “The GM/COO model allows the manager to become a strategic thought partner for the governing Board,” says Avery. “Someone who can help take day-to-day operational pressures off of the Board and allow them to instead focus on the club’s vision for the future.” As such, this management model also opens the door for greater talent. “Advances in professional education in this industry have produced very talented managers that are looking for the GM/COO role,” says Kopplin, “so clubs with this model open themselves up to a greater talent pool when searching for a new manager.”
Though the benefits are many, shifting to this style of management is not without its challenges, which are two-fold according to Kopplin. “The GM/COO model affects both staff and membership,” he explains. “Individuals like the Golf Pro and Superintendent, for example, experience a shift in their reporting function. At the same time, it affects the membership—particularly those who are serving as Committee Chairs and previously had that responsibility of overseeing.”
And while change can be difficult, it is important to approach the shift with an open mind and clear vision of how this model can benefit the overall health of the club. “The key is to educate Committee members, Chairs, and the Board of the value of this model,” says Kopplin. “Once you do that, it’s a smooth transition that can lead to great success.” In fact, Kopplin’s firm believes so strongly in this model, they will only work with clubs who are searching for a GM/COO. “About a year ago,” he explains, “we spoke with a club President who wanted to hire us to find a Club Manager. We don’t do that search anymore. We believe it sets most clubs up for failure.”
It is important, however, to make sure the club is prepared before jumping into the GM/COO model prematurely. “Sometimes we see clubs take a step backwards if they move too fast too soon,” Avery advises. “Often, it’s a result of too much turnover in management, which leads to a lack of continuity. Clubs then revert back to the three-legged stool concept because it is less costly to employ a Club Manager compared to the salary of a COO.” Avery also cautions that while this is the recommended management style for today’s private clubs, it is also important to remember that each club is different. Smaller clubs with limited offerings, for example, may not need the full COO approach, and this model could actually lead to unnecessary financial strain in some cases. All in all, each club must evaluate what is best for its individual situation.
As the GM/COO model becomes more widely adopted across the industry, more and more clubs are seeing the impact—both financially and in the member experience. “From a financial perspective,” says Kopplin, “we see better efficiencies, budgets that have been streamlined, and cost savings that clubs haven’t experienced in the past.” He explains that this often comes from the professional education GM/COO’s have with regard to things like making purchasing decisions. A Club Manager, for example, may not follow “best practices” such as going out for bid for certain purchases. A GM/COO, however, is likely to challenge the purchasing process and take a close look at how the club’s dollars are spent, providing a real financial benefit for clubs.
And of course, the most important aspect of any private club is the member experience. “When clubs make this shift, we see increased member satisfaction and increased member participation in every area of the club,” says Kopplin. This is a clear correlation demonstrating that when the governance and management model is organized and everyone is moving in the same direction, the result is a positive impact on the member experience and their overall happiness when spending time at their club.
For more information…
There are many resources for clubs with regard to implementing the GM/COO management structure. First and foremost, CMAA has several great resources available on their website, including an overview of the concept, position descriptions, performance evaluations, and more. “It’s great for clubs to belong to an association like CMAA,” says Kopplin. “As CMAA continues to provide more and more data that clubs can use as a resource, it helps Boards make practical, data-driven decisions rather than basing decisions off of emotions.” The National Club Association also provides valuable resources on the topic, as well as consulting firm’s like Kopplin’s that can help point clubs in the right direction during their manager search.
Has your club felt the benefits of making the shift to the GM/COO model? Comment below and let us know how the experience has been thus far!