When University Sport Means Business
5 questions to consider when evaluating the efficacy of your varsity sport model.
In the words of the former NCAA and NBA champion basketball player Michael Jordan, “Just play. Have fun. Enjoy the game”. Those are the words of one of the most successful athletes of his generation. But, for those working in athletics departments for post-secondary institutions, building and operating a high-performing, financially sustainable department to develop such athletes is not as simple as that. As two formerAcademic All-Canadian varsity athletes turned consultants with experience in the business of sport, we strongly agree that focusing on simply playing and enjoying the sport is part of being successful. However, there is a whole lot more that goes into running a thriving athletic department or sport program.
So, what is our point here? What are two former university athletes trying to share?
To draw on our own experiences, Sidekick recently had the opportunity to partner with two Canadian universities on sport model efficacy projects. One has a longstanding varsity program and was interested in improving its performance track record while becoming more financially sustainable. The other an institution that recently became a university and was looking to assess the feasibility of introducing a varsity sport program (or not). Although each university sought to approach sport model efficacy from a different perspective, both had a similar question – how do you develop a thriving, high-performing, and inclusive athletic department that is financially sustainable?
It’s a big and complex question. Often, we get asked, if you’re not a Power Five school (which is one of 65 schools that make up the five largest and richest conferences in college athletics in the US) is it even possible? For us, answering that question starts with the right sport model. This is where we draw upon the sport and corporate world's best models and operational designs to help.
Specific to these two projects, we applied our proprietary Entrepreneurial DesignTM Framework, to help organizations evaluate which business model, or in this case, which sport model, will best allow them to achieve their desired results and pursue their mission. The framework is built on the belief that to make an impact and achieve desired results, the 4Ps (Purpose, Passion, Profit and People) must be aligned and balanced.
If you face a similar challenge or don’t know where to start when evaluating a suitable sport model, here are five foundational questions to consider.
1. What are you trying to achieve?
The first and most critical step in evaluating the appropriate sport model to achieve your intended results is being clear about the intended results. Start with the end in mind. Varsity sport programs can add incredible value to a post-secondary institution, to student experiences, and for local community members. There is much written on this topic, including research on academic successes, the ability of collegiate sport to increase enrollment, and the impact of athletics on the campus experience. Check out this University Affairs article and International Journal of Education Research Open piece to learn more. As you write out the goals for your athletic program, it's essential to align with all decision-makers and key stakeholders on your purpose. Be sure to outline how it supports the university's strategic vision. What is your department's reason for being? Is it to become a top 5 school in all market-driven sports in the next ten years? Is it about maximizing student engagement and enrollment at the school? We call this your purpose. Without this, you cannot pass go. This is where we start any work, and we only move further once we have complete and unanimous alignment.
2. What are your financial performance expectations?
Now comes the fun part (insert sarcasm here) - how much money is required not only to build, but to maintain this sport model? What’s the most viable and sustainable financial model needed to operate it? It is a delicate balance of the budget and resources required, while knowing your financial performance exactions. A review of collegiate programs in North America found that very few programs have revenues that exceed expenses. Of the 1,200 North American universities offering collegiate sport programs across the NCAA and USPORT, it is estimated that less than 2% break even or generate a profit (Foster, George, et al. Sports Business Management Decision Making around the Globe. Routledge, 2021.) Institutions need to consider in almost every case that the university or college needs to invest to some extent in the program.
This is where we advise clients to understand their financial performance expectations and funding realities before finalizing any sport model. Are you expected to generate a profit? Is a deficit considered an investment in student experience? Are you expected to self-fund your entire budget or a portion of it? What percentage of your budget will be funded, if any, by the university, government or other funding sources? Once this is understood, a re-validation of the first set of questions is required to ensure your purpose and passions are not a pipe dream but a reality.
3. What is the one thing you do better than anyone else?
We have seen most sport programs struggle, and in particular collegiate sport programs, when trying to achieve too much at once in too short of a time. Said differently – trying to doit all is a recipe for disaster. There are dozens of published case studies which find that focusing on one unique capability, product, or sport can achieve the best results. Focus on the one thing you can do better than anyone else. Albeit risky, nerve-wracking, and unfavourable to some, it works. Two classic Canadian examples come to mind: Laval football and Carleton basketball. In both cases, the Rouge et Or and the Ravens made the decisionto focus their efforts and meagre resources on a very small number of activities. Dynasty level success followed for football (Laval) and basketball (Carleton), with championships, ticket sales, media, sponsorship, merchandise, and reputations as the best in the country resulting from this approach.
4. Which sports will allow you to realize your purpose and passions?
Once you’ve aligned on your purpose and passion, it’s important to consider which sports will best set you up to achieve this successfully. This can be the unfavourable part, especially since not all sports can be included. Consider the fact that even the most financially successful schools only have limited offerings, such as the University of Texas which fields 8 men’s and 10 women's teams. Apply a supply and demand perspective, considering both the supply factors (e.g., cost of infrastructure, sports science requirements, the viability of competition) and the demand factors (e.g., interest from students, coaches, and spectators) for each sport. What often results is a tiered category sport model, with the first category being the most critical sports to achieve your desired results, both on and off the field.
5. How will you maximize your resources?
Finally, who are the people, and what resources are required to bring this sport model to life? What team, sport science and department roles are required? What is the organizational structure? What facilities and equipment are necessary? How can you be innovative and collaborative to maximize the contributions of these resources? What are the unique strengths, passions and capabilities of your people, program and university that can support this?
For example, can facilities be shared or rented out to local sports teams? Do all teams require the same amount or type of sport science (e.g., physiotherapy, nutrition, strength training)? Ask any coach and athlete for their list of resources, and we can bet you it will be quite the wish list. The critical consideration is what resource inputs are required to consistently maximize output, achieve your intended results and support the university’s vision and strategic plan.
Teamwork Makes the Dream Work
We recognize these are five big questions to answer, which can leave many Chief Athletic Officers, AthleticDirectors, or Administrators feeling like they have the weight of the world on their shoulders.Our advice?The best sport models are designed and evaluated taking an intersectional and cross-functional approach that involves decision-makers and key stakeholders from the sport community, university, and larger community. In our experience, this has fostered the most valuable, critical, tough, yet fruitful conversations that ensure the long-term support and success of any sport model.
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(Photo 1 Description: Man Wearing White Sweater and Black Shorts About to Run0
(Photo 2 Description: Image of basket ball with copy: Just Play. Have Fun. Enjoy the Game. Michael Jordan)