Title: Strategic Management
1Strategic Management Sports Events
Organizations
Seminar
- Lionel Maltese
- Maître de Conférences Paul Cézanne University
(Aix-Marseille III) - Affiliate Professor Euromed Marseille School of
Management - Strategic Planner French Tennis Events
(Marseille, Paris, Roland Garros, Lyon, Toulouse)
2Degree Professional course
Engineer Economist Econometrics (Magistere
2001) DEA in Management Sciences Strategy IAE
Aix-en-Pce (2001)
Doctorat (PHD) in Management Sciences Strategy
(2004) IAE Aix-en-Pce Academic Thesis in sport
events context
Maître de Conférences Paul Cezanne
University Strategy IUT-IAE (2004)
Affiliate Professor Euromed Marseille Strategy Spo
rts Events Management (2006)
Professional Consulting (Strategic Planner)
Event Organization (Entertainment
management) Pampelonne Organisation (Open13, BNP
Paribas Masters, Roland Garros, ATP, FFT, FFR,
Occade Sport (GPTL-ASVEL), Team
Lagardere) (2001)
3Sports Organizations ?
Media Broadcast
Sports goods Equipments
Production
Sponsors
Institutions Federations
Events Clubs Franchises
Actors
Athletes agents
Consulting Agencies
Council
4Club (or franchise) VS sport event
Professional athletes management and control
- Clubs and Franchises
- Contracts transactions and salary
- Motivation training, selection, financial
premiums - ? Athlete asset for the managers
- Events
- Fees (ATP, PGA for instance)
- No control of sport performance by the managers
- ? Dependency of the athletes (calendar for
instance) and their professional associations
(ATP, PGA, UCI)
5Main goals for this seminar !
- Sports organizations professional Events
Clubs management stake ? - Proposition of a new Strategic Management Model
for these organizations ! - Understand manage key factors of success (or
failure) sponsoring, public relations,
reputation, physical (stadium) local factors,
managerial skills - Develop your professional skills on strategic
analysis formulate Sport Organizations Business
Plan (Development Plan) STRATEGIC PLANNER for
sport organizations
6Focus on Event Concept
- In sports context, event is everywhere
- National Championships (every week ! NBA, MLB,
NFL, NHL, LNF, Top 14, Premier League) - National and International Competitions (JO,
World Cups) - One shot events (every year) Roland Garros,
Tour de France, ATP, PGA, Superbowl, Formula 1
exhibitions -
7For consumers Entertainment Event
experiential service
- Key questions
- Strategic Marketing
- How to show the show ?
- How to sell, communicate, package this
experiential service ? - Who are our consumers B to B, B to C, C to C
working on communities (fans difficult for an
event !) - Strategy
- To perform and to develop sustainable
performances on sports measures, financial
ratios, affluence audience
8But we need definitions (Covell an al., 2007)
- Organization Any group of people working
together to achieve a common pupose or goals
thant could not be attained by individuals
working separately - Management
- The coordination of human, material,
technological, and financial resources needed for
the organization ti achieve its goals. - Responsibility for performance
9But what is performance for sports
organizations ?
- Performance indicators (Pis) give us an
evaluation process that can provide objective and
meaningful performance feedback to aid future
decision making. - The methods of evaluation are both quantitative
and qualitative but all the final results depend
upon one or more manager interpretation - The key for sport organizations your
stakeholder analysis.
10Sport organizations performance and stakeholders
- You can evaluate returns for
- Média
- Athletes
- Sponsors
- Institutions
- Spectators
- Cities
- Suppliers
- Owner
- .
- ? Various PIs for different objectives and
muliple stakeholders
11Managing an event ?
- Learning by Doing operational organization ?
Self Made Men (Jean-Marie Leblanc,
Jean-François Caujolle, Gilles Moretton) without
academic formation (tacit knowledge and not
explicit see Julien Vincent presentation) - Distinction between
- Operational activities press, ticketing, sports
aspects, technical (stage manager) direction,
volunteers or vacations management - Development (you !) experts in Marketing,
Strategy, Finances, RH THE FUTURE IN SPORTS
ORGANIZATIONS (Jean-Michel Aulas, Jean-Claude
Blanc, Patrice Clerc, Christian Prudhomme) - The twice but without sleeping
12Categorization of events
Scale of impacts (attendance, media, profile,
infrastructure, costs, benefits)
High
Low
LOCAL
MAJOR
HALLMARK
MEGA-EVENT
Category of event
13Categorization of events
- Local or community events Local consumers
(Beach events, Corrida, Snowboard Surf contest,
ATP International Series Tournaments, National
Events) - Major events Media interest (coverage
benefits) and capability of attracting
significant visitor numbers (Formula 1, Master
Series ATP, PGA)
14Categorization of events
- Hallmark events identified with the spirit or
ethos of a town, city or region (synonymous with
the name of the place) very traditional
(Wimbledon is the best example, 24H du Man, Paris
Dakar, Masters Evian) - Mega events so large that they affect whole
economics and reverberate in the global media
(Olympic Games, FIFA World Cup, IAAF World
Championships, Superbowl, March Madness, NBA,
MLB, NHL Finals)
15Stakeholders in sport organizations
Private sponsors
Public sponsors
Sport institutions
Event / Club
Organisation
Athletes
Spectators
Suppliers
Media
16 How to control external environment
(stakeholders) and how to be independent to
perform, to develop and maintain ?
So sport organizations are in the eye of
important actors stakeholders Our strategic
problematic is
- Now before studying strategic analytic tools
- What is Strategy ?
- What are the more sensemaking approaches to
analyze a sports organizations and their
stakeholders ?
17Main Strategic Approaches(Saias Métais, 2001)
POSITIONING
MOVEMENT
Resource-Based View RBV
Permanent Transformation
S.W.O.T 5 Forces
Competitive Advantage
STRATEGIC FIT
STRATEGIC INTENT
Michael Porter Co
Gary Hamel and C. K Prahalad Co
18FIT
- What business are we in ?
- S-C-P Structure Conduct Performance
- The structure of the industry will dictate the
conduct of firms and thereby their performance
(most popular SWOT or five-forces model
(Porter, 1979)). - The big illustration is the 5 Forces Model
(Porter, 1979).
19Porters Five Forces (Industry)
Barriers to Entry
Bargaining Power of Customers
Bargaining Power of Suppliers
Competitors
Substitutes
20INTENT
- What are we able to make with what we have ?
- RBV (Resource-Based-View, Wernerfelt, 1984,
Barney, 1991, Grant, 1991) certain assets
(resources and capabilities) with certain
characteristics will lead to sustainable
competitive advantage. - Strategy dictated by unique resources and
capabilities of the firm (what can the firm do
best?)
21Concepts definitions
- Resources stocks of available factors that are
owned or controlled by the firm (Amit and
Schoemaker, 1993) - Capabilities a firms capacity to deploy
resources, usually in combination, using
organizational processes, to effect a desired
end (Amit and Schoemaker, 1993) - Dynamic capabilities capacity of the
organization to renew competences to be in line
with the changing business environment (Teece and
al., 1997). - Asset resource capability
22Resource Based-View VRIO model (Barney, 1991)
Value
Rareness
Resources capacities Lead to Sustained
Competitive Advantage
Organization
Inimitability
Non-Substitutability
23VRIO Properties
Implications
Is the resource or capability Valuable Rare Diffi
cult to imitate Difficult to substitute Organiz
ational
- Neutralize threats and exploit opportunities
- Physically unique
- Path dependency
- Causal ambiguity
- Social complexity
- No equivalent strategic resources or capabilities
- Productive exploitation by the organization
24Criteria for Sustainable Competitive Advantage
and Strategic Implications
Is a resource or capability
Valuable Rare Difficult Without Implications
to Imitate Substance for Competitiveness
No No No No Competitive disadvantage
Yes No No No Competitive parity
Yes Yes No No Temporary competitive advantage
Yes Yes Yes Yes Sustainable competitive
advantage
25FIT Soccer metaphor
- The strategy (tactical) is a function of the
external environment (rival teams
opportunities - threats). - The trainer has a tactic adapted to the adversary
and the players (resources) adapt to this
positioning (diagram of play).
26Intent Soccer metaphor
The head coach "visionary" (or manager) has
resources (players) and sets up a strategy
(tactical) starting from these forces and
weaknesses (resources), in order to face to
certain opportunities or threats of the
environment (air play, speed, physical
engagement)
??????????????
27So What ?
- How can we implement that ? Its very
theoretical ! - Your and my job to be able to construct a
business plan (development) with a specific RBV
analysis (your sensemaking background), and
furthermore - Persuade and control our stakeholders
- Maintain our performance
- To be ready for new opportunities and threats
because of very instable sports environment
Managing resources capabilities core
competency of a modern CEO in sport
organizations (Jean-Claude
Blancand you !)
28Categorizing resources
- Barney (1991) 3
- Physical capital technology, plants, equipment,
geographical localization - Human capital formation, experience, networks -
relationships - Organizational capital formal structure,
control, routines, process, coordination systems
-
- Grant (1991) 6
- financial, physical, human, technological,
organizational, reputation. - Wernerfelt (1989) 3
- Fixed assets plants, equipment
- Blueprints patent, brand, reputation
- Teamwork effects routines, habits,
experience
29A RBV Approach to Strategy Analysis A
Practical Framework (Grant, 1991)
4. Select a strategy which best exploits the
firms resources and capabilities relative to
external opportunities
STRATEGY
5. Identify resources gaps which need to be
filled Invest in replenishing, augmanting and
upgrading the firms resource base
- 3. Appraise the rent-genrating potential of
resources and capabilities in terms of - Their potential for sustainable competitive
advantage, and - (b) the appropriability of their returns.
COMPETITIVE ADVANTAGE
2. Identify the firms capabilities What can
the firm do more effectively than its rivals ?
Identify the resources inputs to each capability,
and the complexity og each capability
CAPABILITIES
1. Identify and classify the firms resources.
Appraise Strenghts ans weaknesses relative to
comptetitors. Identify opportunities for better
utilization of resources.
RESOURCES
We are going to develop a more practical and
specific approach for business plan
implementation
30Sport events clubs assets identification
Assets
Players coach (clubs only) Partnership (sponsoring, partners) Reputation (event, sport, players) Relational (Social capital, relational networks, Public Relations) Physical (infrastructures, stadium, territory) Organizational Capabilities (Core competences, event driven know how, project management))
Sport Event Clubs Sport Event Clubs
Financial resources Profit centres Ticketting
Financial resources Profit centres Contracts (sponsoring, Public Relations) Players (clubs only)
Financial resources Profit centres TV rights
Financial resources Profit centres Merchandising
Financial resources Profit centres Institutions (public subsidies)
Renown History
Renown Sport performance
Renown Affluence, audience
31RBV first model for a sport organization
Concepts
Partnership Resources
Reputational Resources
Resources portfolio
PROPERTIES ?
Players Coach (club only)
Relational Resources
Physical Resources
Core Competencies, Capabilities
Organizational team, Managers
Performance, Sucess
Sport Success
Financial Sucess
Public Sucess
Long Term
32From strategy to event marketing
Strategic Intent ? Formalize ? Business Model ?
Business Plan (development) Exploration
exploitation Managing assets Resource
dependency - stakeholders ? External control of
the organization
Implementation
Services Experiential Marketing Segmentation B
to C B to C Packaging hedonic emotional
experience (services) Creation and development
of communities fostering of customer loyalty
33Success caseOpen13 1993---2008www.open13.org
- Familial professional bricolage from
Marseille - VIDEO
34Open13
Corporate Reputation
Sport Reputation
Reputational Resources
Partnership Resources
Relational Resources
Physical Resources
Relational competencies
CEO celebrity
Opportunism
Organizational capabilities
35Cascade of assets
Relational Resources Axes
Learning Organizational Capabilities
Partnership Resources
Reputational Resources
Physical resources
Stock of resources
Dynamic Capabilities Bricolage
36Partnership resources
- Sponsoring brand image, image transfer,
notoriety, visibility, target specificity, TV - Examples BNP Paribas, Louis Vuitton, Rollex,
Peugeot, Indesit, Adidas, Nike, Fedex, Coca-Cola,
Philips, Renault, Mercedes - Public Relations Business relations, Employee
relation, Government relations - Examples of RP events PGA tour, Americas Cup,
ATP tournaments (Open13, GPTL, RG)..
37Definition
- Provision of assistance either financial or in
kind to an activity by a commercial organization
for the purpose of achieving commercial objective
(Meenaghan, 1983) - Sponsorship involves two main activities
(Cornwell and Maignan, 1998) - exchange between a sponsor and a sponsoree
whereby the latter receives a remuneration (cash
or in-kind contribution) and the former obtains
the right to associate itself with the activity
sponsored - marketing of the association by the sponsor
38Sponsor support financial or not
SPONSOR Firm, non profit organization,
institution
SPONSORED Entity individual, group,
oragnization, event Area sports, arts,
environment..
Benefits for the sponsor achieve communication
objectives
Media
Sponsor target
Sponsored Target
PUBLIC
39Strategic approaches for sponsorship
- Passion approach passion of a CEO (The dancer
of the President) RLD (Adidas Om), Serge
Kampf (Cap Gemini BO) - Opportunistic approach link between a
sponsorship project and a firm CEO (Sodexho /
Cities Thomson / Canal ) - Strategic approach sponsorship integration with
the global strategic communication or marketing
strategy of a firm (banks, sport brands )
40Implementation by the event organizerTargeting
Activation Faithfulness - Innovation
- Knowledge about the sponsors activities (strategy
marketing finance human resources) - Event pool of communication and marketing tools
gt Fit with sponsors needs - Do not implement a communication tool if youre
not able to evaluate or control it Be careful to
overflowing effects !
41Implementation by the event organizerTargeting
Activation Faithfulness - Innovation
- Activation
- Participative actions for the sponsors and their
target (best example NBA All Star Game - Importance of the HOSPITALITY (B to B and B to C)
(best example PR Village) - Communicate about your sponsors loyalty
(faithful) - If you can (very rare) using your sponsorship
evaluation about efficiency in your event ! - Innovation NTIC Buzz Marketing
Technological innovation (MSL for instance HD
for TV broadcast)
42Summary being sensemaking !
- Understand the sponsor needs (your customer !)
- Targeting for your sponsor (sponsor day for
instance) - Linking your media planning with the
communication strategy of your sponsors - Selecting the media
- No concurrency between the brands
- Being aware for new activations.
- Making you sponsor dependant and not the contrary
- Using strategic FIT for your sponsor but You must
be a visionary (strategic INTENT)
43Event or Club Partneship Resources
VRIO
Linkage among resources
Sponsor Event communication (sponoring resources)
44Relational Resources
- Event Managers Social Capital (Christian Bîmes
Jean-Claude Blanc, Patrice Clerc Jean-Marie
Leblanc ) - Relational and business networks GPTL (Marie
Roussille (Occade) in Lyon), Pampelonne
(Jean-François Caujolle)
45Public Relations (PR) ?
- Public Relations is a management function which
tabulates public attitudes, defines the policies,
procedures and interest of an organization
followed by executing a program of action to earn
public understanding and acceptance. " (Edward
Bernays) - According to Michel Crozier (1957) Public
Relations is a set of processes used by managers
to gain external publics sympathy and goodwill.
46PR for events managers
- Press-relations control development
- Events creation during your event
- Political PR
- People exploitation (dedicated person in your
organization) - Construction and management of relational
networks inside and outside your event - Forging an iron cage for your event network
be carefull about the balance between
quantitative and qualitative interpersonal
relationships
47Interpersonal ties efficiency (Granovetter,
1973)
- The Strength of Weak Ties, 4 criteria
- Relation duration
- Emotional intensity
- Intimacy
- Services reciprocity between stakeholders
48Physical (territorial) Resources
- Stadium Wimbledon, Roland Garros, Madison Quare
Garden - Territory Tour de France, F1, Rally Tennis
(Monte Carlo), 24 H du Man, Stade Toulousain,
Pau-Orthez, Derby de la Meije - Infrastructures training camps and conditions
49Reputational Resources
- Event legend and history JO, Americas Cup, Le
Tour de France, Roland Garros, Wimbledon - Corporate Reputation FFT, Amaury, IMG, Octagon
- SUPERBOWL VIDEO
50Dynamic Capabilities and Organization
- Dynamic Capabilities processes to integrate,
reconfigure, gain and release resources to
match and even create market change - Examples Stade Français (Rugby) with Max
Guazzini or Roland Garros Brand and co-branding
(Adidas, Peugeot, Lancel) - Organizational capabilities Project Management
- Most organizational event Tour de France !
51Understanding the Meaning of Performance ?
Athletes Performance
Shareholders performance
Brand Exploitation ?
Event Reputation ? Performance
Event Internal Measure P.A.P.E.R Test
Sponsoring Efficiency (Partners)
PR Efficiency (Partners)
Institutional Performance
Media Performance
Stakeholders Performance
52Reputation key resource ?
Value
Rareness
REPUTATION gt Sustained Competitive Advantage
Organization
Inimitability
Non-Substitutability
53Reputation key asset but difficult to control
- Media exposition
- Being Good or Being Known (Business School cases
!) - Notoriety / Reputation
- Actors Reputation (athletes, coach, Managers)
differences between local major / hallmark
mega events
54Expressive organizations ?
Services Hospitality B to C B to B
- In the context of Entertainment and sport
organizations (clubs events) are expressive - Sports organizations compete based on their
ability to express who they are and what they
stand for. - Emotional and symbolic expressiveness is becoming
part of the experience of doing business - Expressiveness strategy must serve all
stakeholders and that means employees as well as
customers, shareholders, creditors, suppliers,
local or special communities, and the media.
Product Sport competition
Experience Entertainment Expressiveness
implementation Very difficult !
55Linking Identity, Reputation and Expressive
Organization (club or event) Brand
56Identity (Fombrun, 1996)
- Corporate identity describes the set of values
and principles employees (and players) managers
associate with a company. - Corporate identity derives from a companys
experiences since its founding, its cumulative
record of successes and failures very important
for sports organizations !
57Reputation (Fombrun, 1996)
- Reputation is the general estimation in which
one is held by the public (American Heritage
Dictionarys) - A corporate reputation represents the net
affective or emotional reaction good or bad,
weak or strong of customers, investors,
employees, and the general public to the
companys name.
58Whats in a name ?
- Sports organizations names are very strategic
- Cities
- Objects, animals, groups, symbols, features
Colts Bulls Celtics Patriots - Indians - Sponsors BNP Paribas, H Cup , Evian Masters,
Andros Trophy - Moreover in a market society like ours, its
clear that names and the reputations we
associate with them have economic value - Michael Jordan continued to bring in top
endorsement income from companies like Nike,
Hanes, General Mills and Quaker Oaks (estimated
13 million a year) - Jack Nicklaus, Arnold palmer (golf), Joe Montana,
Wayne Gretzky, Andre Agassi, Zinedine Zidane
59Reputation and media
- Difficulty to control inside de Communication Mix
(TV, Radio, Internet, Press, posting) ! - For sports organizations you can develop your
own information for the public official website
(very important !) and sometimes own press
(production) or TV
60Linking Identity Name Image Reputation
(Fombrun, 1996)
Corporate Identity
Names Self-Presentations
Customer Image
Investor Image
Employee Image
Community Image
Corporate Reputation
61Brand construction and control in a very
expressive organization
Club or Event Brand
Place, City, Country
Public, Fans, Communities
Athletes brand
Sponsors brand
62Brand construction is difficult in this
contextBut
- Reputation construction and control can
stimulate and develop your commercial brand !
63Corporate Reputations can be measured and managed
- Reputation management
- The Reputation Quotient
64Reputation management(Fombrun, 1996)
Visibility
REPUTATION
Authenticity
Transparency
Consistency
Distinctiveness
65Communicates Appropriately with Everyone Carries
out Visible Stakeholder Initiatives Participates
in Worthy Social Initiatives
Visible
Is Recognizably Different... Makes a Distinctive
Promise Stands out
Distinctive
Expressiveness Quotient
Walks the Talk Is Identifiable in its
Communications Conveys a Consistent Message
Consistent
States Its Beliefs Openly Discloses Information
in a Timely Fashion Shows Responsiveness to all
Stakeholders
Transparent
Is Credible and Sincere in Its Communications Is
Honest Is Appealing to deal with
Authentic
The expressiveness quotient (Fombrun and Van
Riel, 2004)
66Reputation management in action !
- You have to
- Create
- Protect
- Repair
- your reputation
- Indeed bad reputation can affect brand
development (OM)
67But dont forget your resources reputation !
- Sponsors Brand
- PR and CEO celebrity
- Local or cultural identity
- Hospitality (stadium)
- Your history !
Being Known gt not always Being Good (Stade
Français or NY Knicks cases)
68Reputations are magnets they help a company
attract resources (Fombrun and Van Riel, 2004)
Employees
Make jobs more attractive motivate hard work
Customers
Encourages repeat purchase builds market share
Investors
Lowers capital costs attracts next investment
REPUTATION
Media Journalists
Generates more favorable Press coverage
Financial Analysts
Affects content of coverage And recommendations
69Measure reputation Quotient (6 dimensions and
20 attributes)(Fombrun and Van Riel, 2004)
7-pt scale 7 describes very well 1oes not
describe well
Social Responsibility Supports Good
Causes Environmental Responsibility Community
Responsibility
Emotional Appeal Feel good about Admire and
Respect Trust
Products Services High Quality Innovative Value
for money Stands Behind
Vision Leadership Market Opportunities Excellen
t Leadership Clear Vision for the future
REPUTATION
Financial Performance Record of profitability Low
Risk investment Growth Prospects Outperforms
Competitors
Workplace Environment Good Place to work Good
employees Rewards Employees Fairly
70Transfer in the context of sports organizations
7-pt scale 7 describes very well 1oes not
describe well
Social Responsibility Supports Good Causes
(Ethic) Environmental Responsibility Community
Responsibility (fans)
Emotional Appeal Admire and Respect sport
athletes Passion hedonism Comsumer experience
Products Services High Quality of sport show
experience Innovative Value for money (tickets)
Hospitality
Vision Leadership Market Opportunities Excellen
t Leadership Clear Vision for the future CEO
celebrity
REPUTATION
Financial Performance Record of profitability Low
Risk investment Growth Prospects Outperforms
Competitors Media returns - affluence
Stakeholders performance
Workplace Environment Good Place to work Good
employees Volunteers management
71Mega Event
72Remarks
- Communication fit with the actuality ?
- Merchandising and memory ?
- Identity and Reputation places french
inheritance - The athlete is known because of the event
- Difficulty to target popular event
- Caravane sponsoring unicity
- Event director charisma and celebrity
Jean-Marie Leblanc ? Christian Prudhomme
73Questions ?
- How do you manage an exceptional (mega) event ?
- Development ? Innovation ?
- Answers ?
- You have to maintain your level !
- Reputation management (creation protection
(doping) repair) pivotal resource ! - If you can transform your event reputation into
a brand -
- External control (sponsors media institutions
communities)
74Reputation ? Brand
Roland Garros
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825 principles Reputation Management For Roland Garros
Be visible Media choice (F2-3) Stadium evolution
Be authentic Traditional identity History respect (museum)
Etre consistent Sport advantage Sponsors control (colors on the court)
Etre distinctive Sport exception Grand Slam Clay courts Physical impacts
Etre transparent Communication (ex players) FFT is an association (now difficulty with Christian Bîmes)
83Physical Resources
Relational Resources
Partner Resources
Reputational Resources
Corporate Reputation
Sport Reputation
Exploitation
Protection
Learning
Forecasting
Organisational Capabilities
84Cascade of assets
Reputational Resources axes
Learning Organizational Capabilities
Partnership Resources
Physical Resources
Relational Resources
Stock of resources
Dynamic Capabilities Bricolage
85Jean-Claude Blanc resources management
strategist
TV Rights 32 million
Public Relations 31 million
Sponoring 25.5 million
Ticketting 21 million
Equilibrium Resource-Based (2001-2006)
No Resources Dependency External control of
the environment rents optimization (most
important in France)