Boardroom_Basics_Beyond

A perspicacious general manager/club executive will ensure that each new board and committee member receives a thorough orientation that will include meeting every department manager and touring their respective departments to understand how they function and operate. Not only will the new board and committee members review all of the physical assets of the club, but they will also gain a very good perspective on how each department manager leads their employee teams.

For many years the KK&W team has been fortunate to discuss with private club board members around the county the importance of what we have termed “best practices for private clubs.”

Now more than ever, as we emerge from a devastating pandemic, those practices will ensure the success and, in some cases, the survival of private clubs.
Perhaps the most important best practice that we see clubs engage is the focus on “data-driven” decision making. Thankfully, the days of the board making decisions based on anecdotal evidence or reacting to the last comment they heard from a member before entering the boardroom are coming to a close.

Many club general managers have turned to different groups and organizations to provide data-driven information on a variety of topics. Taking the emotional and agenda-driven decision-making out of the boardroom is critical while moving to the future and our next ‘new normal.’

Another best practice continuing to emerge is the educational partnership of the general manager/chief executive with the board of directors.

This kind of collaborative education will continue to provide private clubs with the strategic thinking necessary to meet current and future member needs. The key recognition that volunteer leaders MUST be aligned with paid leaders is critical. It has allowed high performing clubs to escape from the ‘each year a new agenda’ mindset that has prevailed in dysfunctional clubs.

One of the most common best practices in successful private clubs is the focus on strategic thinking and planning. A typical strategic planning session can include an initial all-day meeting, preferably at a location other than the club, where a facilitator can focus the board and key senior managers on the key issues that need prioritization.

The objective of this meeting is to develop an action plan with specific tactics and timelines along with the assignment of who is responsible for completion. An integral part of this action plan is a capital reserve study, which helps in developing capital planning. Further, this and other sessions must focus on the balance sheet more than a typical P & L discussion that dominates most dysfunctional boardrooms. Few clubs have been able to perpetuate themselves or drive reinvestment capital on the results of operations, but that is where most of the discussion centers itself.

Educating boards, committees and senior staff on the importance of a capital plan and members’ equity enhancement is critical for the sustained future success of clubs.

In the end, a successful plan has to include making the membership and senior team aware of its priorities, goals and accountabilities. Educating and communicating to those groups is critical; it cannot be viewed as “the president’s agenda” or “the GM’s plan” or such. Members have to see it as “our plan” and therefore need to understand how it was crafted, why it was crafted and what it is expected to result in achieving.

Most successful clubs and those excelling in the future will be ones who have placed great emphasis on “educating” every possible constituency, as often as reasonable, on the why of what is being done, as much as the ‘what.’ Too often that extra step of education is missed and a big opportunity to gain support and buy-in is also missed.

A general manager/chief executive typically leads successful clubs, with the corresponding authority that goes with the title, and boards have realized the benefits of this best practice. As more clubs recognize the importance of executive leadership continuity, it has become more evident to board members, many of whom use this business model that is common in their own companies.

Volunteers are harder to find. Members need to prioritize their own work and families first. Well-intended, but non-club industry educated volunteer operational direction rarely works over a sustained time period. We’re all busier now than we’ve ever been. To expect a volunteer to do ‘heavy lifting’ to ‘run’ a committee or a department just isn’t practical or advisable.

Hiring professionals, giving them clear direction and support, and getting out of their way (but still evaluating performance metrics) is going to separate the successful from the dysfunctional in the future.

Supporting this effort is an emerging best practice in private clubs whereby the department managers chair club committees with an assigned board member acting in an advisory role. While a board member will serve on the committee, the responsibility of preparing the agenda, conducting the meeting and writing the minutes are all done by the department manager. Since each department manager is closest to the issues in their respective departments, it is logical for them to present the issues to the liaison board member for inclusion on the agenda.

Why would anyone think that a volunteer board member would have the expertise about food and beverage, golf course agronomy, golf event programming, racket sports, or fitness and swimming pool issues? These are areas that the respective department managers engage with every day. It’s the focus of their expertise.

A best practice that continues to gain advocates in private clubs is the nomination of the same number of candidates for the same number of open board seats. The days of the “popularity contests” are rapidly coming to a close as more and more clubs understand the importance of “recruiting” the talent they need to provide counsel and advice to the general manager/CE. The evolution of this practice is now the norm rather than the exception and allows for a private club to ensure consistency and stability in its club governance.

Another and possibly the most important best practice is addressing the human capital side of the business. Talent recruitment, retention and development is an issue nearly every club is attempting to address in the industry. Some have figured it out, usually starting with ensuring that there is a sincere and palpable “culture” of engagement, support and caring for the team, developing their skills and ensuring that they have the tools and training to do the work expected.

The club industry, during the coronavirus crisis, has an opportunity to set itself apart of the rest of the hospitality world…typically, clubs offer more stability, benefits, work/life balance opportunities, etc., than do most restaurants, resorts and hotels. But, those unfamiliar with the club world often look at it with misconceptions, not understanding the strong relationships and satisfaction that working in this industry can bring.

The best practice of considering human capital and making sure there is a plan that is fully executed to truly be an “employer of choice” within your community will be critical!

A very thorough new board and committee member orientation process is a final best practice common in successful private clubs. Most clubs typically experience the rotation of about a third of the board each year and often about the same percentage of committee members.

A perspicacious general manager/CE will ensure that each new board and committee member receives a thorough orientation that will include meeting every department manager and touring their respective departments to understand how they function and operate. Not only will the new board and committee members review all of the physical assets of the club, but they will also gain a very good perspective on how each department manager leads their employee teams.

As the private club world emerges from a very challenging few months, these best practices will continue to be the hallmark of successful clubs. Many of these have stood the test of time and all of them provide excellent guidance for the relevant and sustainable private clubs, now and in the future.

Contributed by Richard Kopplin, Kurt D. Kuebler, CCM & Thomas B. Wallace Ill, CCM, CCE, ECM
Partners at KOPPLIN KUEBLER & WALLACE

THE BOARDROOM MAGAZINE September/October 2020