How to survive the storm: Strong, patient leadership needed to weather these difficult times

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Golf and hospitality industry expert Jim Riscigno offers his views on what operators can do to help them get through the current economic recession. Riscigno, a former Club Corp executive and currently president of ASE Consulting, will be a speaker at the March 30-April Golf Inc. Conference at the World Golf Village.
We are all painfully aware of what has been creating those restless nights and difficult board and staff meetings over the past couple of years.
Our sector of the hospitality industry is in a recession, especially if you are involved with a residential country club that is still developing its membership. Membership enrollments have dramatically declined and the ability to collect high initiation fees and deposits is a thing of the past.  Many clubs are scrambling to adjust and offer special membership programs, discounts, financing programs and more.
So what should we expect to see over the next two years?
The current situation will continue (at best) for the next two years.  There are no short-term solutions to most of the issues that are causing pain for management and club members. The residential real estate markets may start to slow the decline in sales and prices, but no one is predicting turnaround in this sector over the next 18-24 months.  The next area to see softening will be the commercial real estate markets and this will not be good news. 
Employment trends are not encouraging and retailers are struggling. It may get worse before it gets better, but it will change. Nothing stays the same and if you can step back and take a deep breath and not panic you can actually benefit from any of these cycles or at least survive.
The first advice is to stay informed of what is happening in the local, regional, national and international markets. Study the past down cycles; if you are not a student of history you are doomed to repeat it.  
Don’t panic. You are not alone and there are strategies you and your team can use that will help to position your club for the eventual turnaround.
Make certain you are not cutting muscle as you look to cut the fat from your operations. Let’s define muscle as your most talented staff, the standards that your members expect, the member activities that are traditions, member and staff communications and keeping the integrity of your membership offering positioned to benefit not just the club, but existing members.
The mistakes I see all too often are short-sighted business decisions by managers, owners, and/or boards with no view of the consequences these decisions may have in the long term. Once you cross certain lines you will put yourself and the club in a downward spiral (possibly a death spiral). It will be very difficult to recover from bad short-term decisions when times are better.  You must bite the bullet and keep talent, standards, traditions and communications at the appropriate level.  
How do you accomplish this? By adopting strategies such as member focus groups, member surveys, strategic plans, staying current with the industry and continuing education meetings, benchmarking successful clubs and other hospitality-related operations, staying current by reading industry publications as well as other appropriate publications and seeking outside help from industry associations, industry experts, consultants and management companies.
You have many options available to you, but the one option you can’t afford is doing nothing and hoping this will all go away.  Leadership strengths or weaknesses show clearly during difficult times.



Interesting article, the trying times might act as a catalyst for leaders to take new steps to increase engagement levels with employees. Subtle and not so subtle ways to improve can benefit facilities while increasing employee engagement and increasing productivity... Does leadership need to evolve? Can internal resources help to gain more share and better service?

I agree, the most important thing to consider is the health and viablity of your buiness during and indeed after this recession. Planning for difficult times and in times of recovery are paramont. Across the board budget cuts should be avoided and a careful eye should be used when trimming costs.

Great insight. Although I am not in management at our club, the decisions made to trim fat has slashed morale...and the service we used to give our valued customers has suffered greatly. Golf has survived many downturns. The PGM programs need to begin teaching winning strategies. GM's and Head Golf Proffesionals must stick their heads out from behind the desk. Our customers don't even know who they are...and we are a Signature Course.

I remember being lectured about recession golf during the late 1980’s by my grandfather. He made it a point to impress upon me the importance not to “cheapen” the product. Conditioning and service is what brings the golfers through the doors, that's what he used to say. Today let’s provide the services people want, efficient check-in, knowledgeable golf staff, friendly F&B personal, and timely golf rounds. Trim the valet bag drops, post round club cleaning and free bag tags. Superintendents and greens committees need to focus on the basics and leave the third cut, hand mowing the approaches, and courtesy paths to Augusta.

Unfortunately at many corporate owned clubs there is not always clarity about the fat and the day to day muscle that drives member satisfaction and tradition. Assuming the remaining staff are empowered to lead, this situation can also be looked at as a glass half full. The number of existing members looking to engage (re-engage) with the club will be at an all time high. Seize that opportunity. Second, the opportunity/appetite to introduce new (cost effetive) ideas/traditions to improve the club will also be encouraged. So use those restless night to focus on re-shaping the club.

It was clear in reading this article that the perspective shared was predominately focused on the private club segment. 72% of courses in the United States are open to the public and suffering in ways far different from the private club industry. Over-development fueled largely by the real estate industry has caused inexperienced operators to drop price to fill under-utilized tee sheets. The resulting downward spiral of average rate with little if anything to show in terms of increased rounds or customer franchise is slowly killing public golf courses around the country. Operators must stop using price as a blunt instrument to influence customers and focus on increasing loyalty and truly improving over-all customer satisfaction. We must all find the emotional fortitude to look a customer in the eye and with conviction stand by our rate structure rather than playing let’s make a deal because we fear we will lose them to the guy down the street whose charging $5 less for an inferior experience. In addition, we as an industry have to transition our pricing philosophies away from being a disposable commodity and to the more pragmatic approach of rates based on profit margin in relation to each of our relative expense loads. Finally, we have to do a far better job in educating customers about what it takes to produce a quality golf course product and as such what we must charge in order to meet their champagne tastes on our beer budgets.

The current economy is a cop-out for the ignorance of most member owned golf and country clubs in the management and operation of their respective clubs. Approximately 70% of all revenue generated by golf & country clubs comes from dues and yet most Boards & General Managers don't realize they are in the dues business! The number one priority should always be maintaining their membership level. If you lose a member, take the steps necessary to replace the member with a new one. It's called marketing which most Boards & GM's don't understand. Typical scenario is raise dues, assess existing members, cut services (and quality of same)and slowly destroy the club. I truly believe most Board members are sincere and want to help their clubs but lack experience in managing a golf club. The personal agendas, egos, friendships are counter productive and lack continuity as each new group takes over. Understanding the value of a member is another area sorrowly missed. If dues are $7,000 per year and the average life of a member is 14 years, my math tells me that member is worth $98,000 minimum. How much would you invest to buy $98,000 in value? I could fill your next two issues with personal experiences of the mentality of Board of Directors, General Managers, etc. when it comes to membership recruiment. Now many clubs are running scared and don't know what to do. Good marketing knows how to create a need and who to reach. I have read the posted materials. Each has merit but very little application if a club is losing members and doesn't have a program designed to replace them.

Wow, this topic is generating lots of heated responses! It's should a very interesting conference at Golf Inc.

Leaders take responsibility to LEAD... NOT PUSH! Team work implies people who CARE about each other and about the goals of the group. The most successful leaders establish and sustain emotional attachment with their TEAM and in the process build trust in their authority to make critical decisions.

As golf professionals we need to start thinking of our tee times more as perishable commodities, like airlines think of seats, once the plane leaves with an empty seat that potential income is gone. It takes creatively approaching pricing and services but it can be done, and in these times, must be done, in order to maximize income, and insure survival.

Great comments which attests to the quality of the story and its impact. Someday-someone will design and produce a business plan or guideline for future Boards & General Managers on the do's and don'ts of golf and country club management and hopefully dues will be the Number One priority. If a "true survey' was ever taken regarding the most important things in a country club members life, I would bet it would be family, health, friends and GOLF! Protect friends & golf with making members & member dues the most important requirement. Until that day comes, more and more clubs will disappear, shattering many dreams. This comment was written like most ads for golf memberships. Lot's of words but no true reason or urgency! Forgive my ignorance of which I have accused others of being.

In my almost 30 years in the golf and country club business, I have seen many poorly managed and maintained clubs. Management frequently overlooks inefficiencies that if corrected could help the bottom line and instead tries to cut critical services and reduce quality. Get back to the basics and look for the opportunities to save in ways that do not impact your overall customer and member satisfaction. If you don't know where to start, call me.

Many good comments here. In nearly 15 years in the club industry, one thing I’ve observed that continues to haunt the less-than-successful clubs is the failure to recognize that member loyalty and customer satisfaction are operations and service issues, NOT marketing issues. If the club industry is a hospitality business, as I agree it is, much can be learned from the success and customer retention earned by the top hotel chains. These aren’t necessarily the most expensive hotels, though they are generally at the mid to upper range of the industry. What these businesses know however, as a core part of their operation and service philosophy, is that every customer interaction is an opportunity to confirm back to the customer, the “correctness” of their choice to spend money and time in their establishment. And that attitude has to run through the entire organization, top to bottom, and bottom to top. Failing to do so makes every piece of marketing a hollow reminder of what should be. And, regardless of what any industry marketing “experts” tell you, spending limited budgets on a message that is not backed up by operational excellence is simply throwing your money away. To become the club that everyone wants to join or will drive the extra 10-15 miles to utilize, means club management and directors will need to start looking, honestly and in detail, at their facilities as hospitality businesses competing for the limited time, and now much more limited dollar, of their potential member or customer.

Golf can prosper in both boom and bust. See my detailed comments in recent article "AN ECONOMIC SURVIVAL GUIDE -- How Golf Can Prosper Both in Boom and Bust Times" See my article archived here:

It is difficult to explain what to do, but it´s easier to what not to do. In my golf club this crisis is being "solved" by cutting staff and they are obviuosly cutting muscle (as said in main article). We now enter in a circle. Less customers - less money - cut staff - poor service - less repeated business - less customers - less money.

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