Should Non-Elite Sport be Run as a Business?

Today Sport is a business, but how is the business of sport holding up?

The answer is it depends who you talk to. If you look at the elite level around the world it would appear that top flight sport has never been in a better position. Television companies are shelling out billions of dollars for the honour of hosting the top competitions. Players are being paid salaries that few of us can comprehend, salaries where some athletes earn in a week what it takes those who watch them a year to earn.

The profile of top level sport has never been better and players who may not have been superstars twenty years ago with the right management, and good public relations can become a major player in terms of profile and salary. It is now about marketing as much as ability.

Peel back the veneer that is elite sport and many will tell you, and obesity figures may confirm, that sport at its most basic level is in a far from healthy place. The world over, sporting fields are being lost to developers as populations expand, so in many cases exercise time for children is being restricted.

Life puts so many demands on individuals today that there are not the volunteers that there used to be. Time is of a premium to many. Sponsorship at the lower levels is increasingly hard to come by, and most sponsors are simply donors as they see little or no return on their investment. One of the reasons being that away from top flight sport it is nigh on impossible to obtain coverage in newspapers or on radio and television, where their company can gain exposure.

To make matters worse some sports such as football have a governing body that has restrictions on whom clubs may have as sponsors, with no ethnic companies allowed. Yet most A-League sides would welcome investment from an overseas company.

It is a tough time in sport if your are not part of the elite program globally. In Australia where distances are vast and each state is almost like another country the task of running sport is becoming even harder.

The word is that a number of sports in Australia are currently doing evaluations as to whether they need to have a an office in every state. With computer programs and the like could they save money by shutting down the various offices and centralising operations? In place of the full time office staff, they would still have representative staff who coach and promote the game, but they will be controlled by a manager in head office.

There is in truth some merit in such a move.

A fortnight ago on the ABC in its “conversations” segment the CEO of the Edmund Rice Foundation, Anthony Ryan said he had changed the way this charity operated and had steered the Foundation away from being a Not-For-Profit organisation. He made a very salient point when he said “the default of most not for profits is they turn into a fundraising body to try and resource what they are trying to do.”

In truth that just about sums up any sporting body. The funding they receive from various Government bodies which is supposed to be to used to ensure that the sport is accessible and promoted to all as a healthy way of life, is in fact spent on paying the salaries of those then trying to achieve the same goals, but with no budget. Something has gone horribly wrong.

When sporting bodies claim they have no budget for promotion there is a problem, as at state level that is one of their key roles, to promote sport as a healthy option and increase participation.

So is centralisation the answer? Have one CEO rather than seven or eight in each state and territory around the country? To cull seven such positions would in fact leave close to $1million to be spent in other areas based on an average annual salary of $150k per annum. If similar positions were centralised even more money would become available. The key is to make sure that the centralised CEO does not then try and claim the lion’s share of the saving made for his or her salary.

Several sporting codes have been criticised that all of the money is spent at the elite level, by centralising administration they could free up money which could be directed to the right areas and Government funding may also then reach those that it is intended for. Of course they would have to be more detailed in their reporting as state governments would want to see proof that monies provided were spent in their state.

One other suggestion tabled has been that the Government bodies match the funds raised by the sporting bodies. In other words rather than having the various bodies rely on that Government funding to stay solvent, make sure that they go out and generate sponsorship, before being given funding. The levels of reciprocity to then be negotiated, be it doubled or trebled by Government.

No doubt some will say that the same applies to clubs in the A-League and Super Rugby. They should not receive funding assistance unless they generate funding of their own. Most do generate funding, but funds filtering down should be on a needs basis. One year one club may be in dire need of assistance due to circumstances beyond their control. So they can be helped in that year and another club the following year.

Certainly there is a lot to say that all sports should work more collectively in order to achieve their aims below the elite level. Currently every club striving to survive and looking over their shoulder enviously at their rivals is not a healthy environment for the long term good of sport.

Coming back to Anthony Ryan’s point, why shouldn’t our sporting bodies be run as viable businesses? Should the Not-For-Profit tag be taken away from sporting bodies and left purely to true charitable organisations?

These are all points for debate, but one feels that the current administrative landscape has to change, if so many sports are to survive. Whichever sport takes a strong lead may in fact reap the long term rewards. Some may be quick to follow, while you can rest assured some will not want to change. The truth is things have to change as times have changed drastically since many of these structures were created.

Should Non-Elite Sport be Run as a Business?
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