Managing Sport Organizations Research Paper

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Managing sport organizations at the start of the 21st century involves the application of management theories, principles, and strategies that are no different to managing organizations in the corporate, government, or nonprofit sectors. The sport industry, however, does have several unique attributes that influence how these theories, principles, and strategies are applied by sport managers. Sport has become a significant industry that employs large numbers of people in a variety of roles, is used as a vehicle for economic development in tourism and major events by governments, and is a major part of modern culture as evidenced by the amount of media coverage attributed to professional sport and by the numbers of people engaged around the world in playing and watching sport. Managing sport in the 21st century requires talented managers who are cognizant of how to apply management principles in the unique operating environment of the sport industry. This research-paper highlights nine attributes of sport that can be considered unique or different to managing in other organizational and environmental contexts, namely, consumer behavior, the relationship between sport and government, regulatory regimes, strategy, organizational structure, human resource management, organizational culture, governance, and performance management. Each of these unique attributes is briefly explained together with a focus on their implications for managing sport.

The management of sport organizations has undergone a relatively rapid period of professionalization over the last 30 years and sport has become a significant industry in its own right. The general expansion of the global sports industry and commercialization of sport events and competitions such as the Olympic Games, combined with the introduction of paid staff into what were previously voluntary organizations and with the growing number of people who now earn a living managing sport organizations or playing sport, has forced sport organizations and their managers to become more professional. This is reflected in the increased number of university sport management courses, the requirement to have business skills as well as industry specific knowledge or experience to be successful in sport management, the growth of professional and academic associations devoted to sport management, and the variety of professionals and specialists that sport managers must deal with in the course of their careers. Sport managers work alongside accountants, lawyers, taxation specialists, government policy advisors, project management personnel, architects, market researchers, and media specialists, not to mention sports agents, sports scientists, event managers, coaches, officials, and volunteers.

Sport employs many millions of people around the globe, is played or watched by the majority of the world’s population and, at the elite level, has moved from being an amateur pastime to a significant industry. The growth and professionalization of sport, particularly in the last 30 years, has lead to changes in the way sport is consumed, produced, and managed within sport organizations at all levels of sport. The enhanced integration of the world’s economies has enabled communication to occur between producers and consumers at greater speed and variety, and sport has been one sector to reap the benefits. Consumers of elite sport events and competitions such as the Olympic Games; World Cups for rugby, cricket, and football; English Premier League Football; the National Football League (NFL); National Basketball Association (NBA); and Grand Slam tournaments for tennis and golf enjoy unprecedented media coverage. Sport consumers can attend sport events live in stadiums and arenas. They can view these events through free to air and pay or cable television; can listen to events on the radio and the Internet; can read about game analyses and their favorite athletes, players, and teams through newspapers and magazines; can receive progress scores, com-mentary, or vision on their cell phones; and can sign up for special deals and information through online subscriptions using their e-mail addresses. The global sport marketplace has become very crowded, and sport managers seeking to carve out a niche for their event, league, or product need to understand the global sport environment.

Sport managers operating within community level sport organizations such as local clubs and associations must be able to provide safe and enjoyable sport participation opportunities. To do this, they manage risks for participants; they design, build, and manage sport facilities; they provide hospitality and support services for players, spectators, volunteers, and officials; they plan, implement, and manage events and competitions; they manage human resources that include volunteers and paid staff; they negotiate with commercial sponsors and government funding agencies for financial support for their organizations; and they identify, train, and educate athletes, coaches, and officials to sustain sporting activities. They also apply management principles in developing and sustaining positive organizational cultures within sport organizations, in regulating the actions of members and organizations involved in sporting endeavors, and in governing their organizations, which have no owners as is the case in the corporate sector. Managing sport at the community or professional levels therefore requires an understanding of several unique attributes of the sport management environment. The following sections of this research-paper review nine such attributes. While these should be considered the most significant attributes, they are by no means the only unique attributes of managing sport organizations in the 21st century.

Sport Consumer Behavior

Sport can stimulate an emotional intensity in its consumers that commercial products are rarely able to stimulate. Sport fans can develop powerful emotional attachments to players, teams, and the sport itself. We know that some followers are so passionate that their interests border on obsession. This addiction provides the emotional glue that binds fans to teams, and maintains loyalty even in the face of on-field failure. We also know, however, that other supporters have a more casual relationship with sport leagues and teams and that their attendance at games can change in response to the likelihood of a close contest, previous wins and losses, the state of the venue, and even the weather.

Fans can be incredibly loyal, but they can also be fickle and critical. Some might use athletes and teams to build their self-esteem, but others may use them simply to fill their spare time. For those fans that build a sense of self through the sport, team, and/or fan groupings, the intense psychological attachment that they develop is called identification. This is because they identify themselves with that sport or group. Fans that associate their identities with a successful player or team may even vicariously share the warm afterglow of success. They experience feelings of collective identity and seasonal ritual by watching, reading, and talking about sport. In fact, contemporary sport has even been described as the modern alternative to tribal hunting practices because of customs such as match rituals, traditional ceremonies, on-field heroics, intertribe rivalries, primitive social practices, and tribal singing. Being a sports fan, in other words, can create the experience of belonging to a tribe.

The feeling of belonging and the benefits of identifying with a sport team are only two reasons why a sport fan may attend games or buy sport-related products and services. There are a series of complex and interwoven motivations that drive sport fans to spend money on a variety of different sport experiences such as attending live games, watching television broadcasts, listening to radio commentary, reading the sports pages of the daily newspapers, logging into a sport Web site or discussion forum, or buying sport-branded merchandise. These motivations include stress release, escapism, entertainment, enjoying the aesthetic beauty of sport performances, spending time with family and friends, feeling a sense vicarious achievement, potential economic gain (gambling), and building self-esteem. These motivations help to explain why people become engaged with sport, but they do not determine how strongly a person will become involved with a sport product. In other words, they do not differentiate between the fans that identify their sense of self with a team and the fans that just want to enjoy some leisure time at a good game.

Three important factors explain how people develop a strong emotional attachment to sport: attraction, self-expression, and lifestyle. First, an individual may become attracted to a sport product, and experience high levels of enjoyment from its consumption. Second, the sport may be particularly meaningful to an individual and their sense of identity, and as a result, bolster their perception of themselves and their place in the world. The more a person feels that a sport brand confers upon them a sense of who they are, the more loyal and committed they will be to it. This can subsequently lead to a sense of camaraderie with others who also show strong team affiliation. Finally, the sport activity may be a central aspect of a consumer’s life and daily routine such as their social life or exercise regime. Thus, for the consumer who has a strong emotional attachment to sport, sport offers a habitual, goal-directed, and pleasurable activity that provides of sense of belonging to a tribe representing something bigger and more important than the individual.

Despite the motivations people may have for being involved in sport, and notwithstanding how strong their attachment to it is, the week-to-week behavior of fans may still change. The decisions that fans make—such as whether to attend a game or buy some merchandise—will also be influenced by external factors. For example, fans are more likely to attend a game if they expect a close match with an uncertain outcome, although they will also be motivated if they expect that their team will win against a good opposition. The quality of the opposing team may also influence their decision, with fans more likely to attend if they expect high-quality play. A sports venue will attract more fans if it provides attractive and comfortable facilities, good views of play, easy accessibility, and a large scoreboard. Other external factors that may influence fans’ decisions include the weather, which affects the quality of play and spectator comfort; the price; the appearance of “celebrity” players; the potential for a record-breaking performance; special promotions; and even what other leisure alternatives are offered.

In economic terms, sporting products tend to enjoy a low cross elasticity of demand, where it is not easy for competing sports leagues and competitions to be substituted for one another. Even where fans are unhappy about the result of a particular game or adjudication, it is unlikely that they would change their sporting preferences. In contrast, consumers of household products or health services would be expected to switch brands readily if they were dissatisfied with quality or price. Although this may seem exclusively advantageous to sports organizations, it means that it can be difficult to achieve market penetration or to encourage consumers to switch to their product through discounts or other incentives. As a result, sport managers and marketers find it more productive to encourage existing sport consumers to escalate their activity rather than work toward converting competitor’s fans. However, there is always the hope for a good season where sport followers with limited interest tend to jump on the bandwagon.

Government Relations

Governments have long considered sport a vehicle for nationalism, for the delivery of health benefits, and for social and economic development. As such, governments have adopted increasingly interventionist approaches through enacting policies and legislation to support, control, or regulate the activities of sport organizations, particularly in countries with community club-based sport systems such as Australia, Canada, New Zealand, and the United Kingdom. Most governments support elite training institutes to assist in developing athletes for national and international competition, provide funding to national sporting organizations (NSOs), support sport organizations to bid for major events, and facilitate the building of major stadiums. In return for this support, governments attempt to influence sport organizations to recruit more participants at the community level, provide services to diverse and disadvantaged sectors of the community, or have sports enact policies on appropriate alcohol and drug use, gambling, and general health promotion messages. Governments also regulate the activities of sport organizations through legislation or licensing in areas such as industrial relations and employment law, antidiscrimination, taxation, and corporate governance.

The influence of government policy on sport organizations is largely within the nonprofit sector of sport, which is generally termed community sport. NSOs are becoming increasingly dependent on federal government funding, particularly for Olympic sports, as governments seek to improve the performance of national Olympic teams and athletes in other elite sport competitions. This increased funding has led to most NSOs employing specialist staff to manage high-performance programs, specialist coaches, and other specialists in sports nutrition, biomechanics, exercise physiology, sports psychology, and skills training. This increased emphasis on elite sport is often justified because the elite element of each sport will provide role models and market exposure to the public and, thus, drive the level of mass participation up in sport. Sport organizations, therefore, have sought to increase the number and variety of sporting competitions and formats for elite competition and created a very crowded elite sport marketplace for sponsors and consumers. Some critics claim that the increased expenditure on elite sport has been to the detriment of the community levels of sport. Evidence suggests that the community sport system in many countries is under pressure due to underinvestment in building and maintaining community sport facilities, a diminishing pool of committed volunteers to manage the delivery of sport, and a reluctance by individuals to undertake roles such as officiating and administering voluntary sport organizations due to poor participant and spectator behavior and the threat of litigation from participants.

Sport organizations are also subject to institutional pressures to govern and manage themselves according to guidelines developed by government agencies such as the Australian Sports Commission (ASC), Sport and Recreation New Zealand (SPARC), and Sport England. These guidelines and specific funding rules impose certain operating constraints on sport organizations with the result that the development of strategy and operational plans by sport managers must be made in the context of current and likely future government policy for sport. It is somewhat ironic that sport has been subject to increasingly interventionist approaches by governments while other sectors of the economy have been deregulated. This highlights the unique position of sport in its relationship with government in that it delivers many social benefits such as improved health of participants, national pride, and social cohesion that without government intervention may not eventuate. Managing sport organizations, particularly at the community level, will continue to require sport managers to understand the rationale and mechanisms that underpin government policies that affect sport.

Sport Regulation

In most industries, it is common for organizations to aspire to put their competitors out of business. This is not always the case in sport. In fact, sport organizations competing in leagues rely on the health of their competitors for their own success. Sport is one of the few products or services that benefit from a balance between competitors. In fact, sport leagues profit more at those times when it is difficult to predict who will win a match. Furthermore, when the outcome of a match is considered unpredictable, attendance numbers at the event are invariably higher. In other words, to remain successful sport organizations need their opposition to be successful as well. Indeed, in many cases, sport organizations are forced by their league to cooperate by sharing revenues and players in order to maintain competitive balance.

The idea of regulating sporting leagues in order to keep a fair and balanced competition is common in sporting competitions. Sport regulators typically believe that a balanced competition will produce exciting and close results, which will increase the level of public interest in the sport and generate larger attendances and broadcast rights fees. To achieve this, sport league regulators will often adopt structures and policies that have three key characteristics. First, they employ a centralized and independent decision-making body that regulates the member teams and clubs including administrators, players, and coaches. These rules may include how players are recruited and allocated, the number of teams allowed in the competition, where the teams are located, the length of the playing season, the design of the fixtures, and admission charges. For example, drafting rules and zoning schemes may determine that “recruits” must be allocated on the basis of team “need” or the players’ places of residence, rather than according to personal choice or the best offer. This helps to ensure that no one team monopolizes the best players, and that each team has a reasonable chance of defeating an opposing team. Other rules established by a central body may even involve changing the rules of the game itself to make the sport more attractive to new markets or forms of distribution such as pay-per-view television. The regulating body is usually able to enforce disciplinary action upon those who breach the regulations.

Second, sport governing bodies will aim to expand revenue by imposing regulations that minimize costs and maximize financial viability. For example, rules may be imposed that restrict competitive bidding for players, total team expenditure on players’ salaries may be set, and revenues may be redistributed so that every club has a minimum guaranteed income base. This helps to ensure that every team cannot only acquire their fair share of quality staff, coaches, and players but can also retain them by providing competitive remuneration.

Third, sport governing bodies will aim to increase revenue by extending the market for their sporting product, improving its overall attractiveness, and generally improving the status of the league in the community. The market, for example, can be expanded by admitting new teams to the league, extending the playing season, or playing games at different times of the week. The league’s community standing may be heightened by a centralized promotion campaign that aims to improve the integrity, public image, and overall reputation of the sport. Regulators may also direct revenue to improve the quality of the game through programs to develop player skills, upgrade venues to make them more fan friendly, or provide maintenance to make playing surfaces safer. Governing sport bodies also tend to use their market power to maximize broadcast rights fees by negotiating as a single entity rather than through individual teams.

The agreements and arrangements made within professional sporting leagues to maintain competition and maximize revenue would be considered cartel behavior in other industries. A cartel is a group of firms who agree to act together as a single supplier to a market. Cartels are able to minimize competition, control the supply and cost of their products, coordinate advertising and promotion, set prices, protect the interests of members, and generally inflate revenue and profits. In most countries, cartels are illegal, since they act against the public interest by reducing competition. However, unlike more traditional industries, the sport industry is often allowed by government to pursue anticompetitive practices including extreme restrictions on the rights of players. This occurs because many governments accept that sport leagues perform poorly under free market conditions. A few dominant clubs, for example, could use their superior fan and revenue bases to capture the best players, dominate the competition, and reduce the uncertainty of which club will win a match or a season. This, of course, leads to reduced attendance at matches and, as a result, reduced interest from sponsors and the media. Therefore, while league regulation may be anticompetitive (or a restraint of trade), it is not generally considered unreasonable or against the public interest. While member teams are highly competitive and concerned with on-field dominance, they also understand that their long-term viability depends on a high-quality and well-balanced competition where teams are of comparable strength and ability.

Strategy In Sport

Strategic management involves analyzing an organization’s position in the marketplace, determining its direction and goals, selecting an appropriate strategy, and then leveraging its distinctive assets to achieve its goals. Like any organization, the success of a sport organization may largely depend on the quality of its strategic decisions. It could be argued that nonprofit sport organizations have been slow to embrace the concepts associated with strategic management relative to professional sport organizations and, indeed, other types of organizations. This is arguably because nonprofit sport organizations have largely been controlled by volunteers who may be unfamiliar with or unwilling to adopt more formalized ways of managing their activities. In a competitive market, sport managers must drive their own futures by undertaking detailed market analyses, establishing a clear direction, and crafting strategy that matches opportunities. An understanding of strategic management principles and of how these can be applied in the specific industry context of sport is essential for future sport managers.

One of the biggest issues in sport strategy is finding the balance between two or more divergent obligations. For example, it is common for sport organizations to seek both elite success as well as improved participation levels. Balancing the allocation of resources between these is inherently difficult due to the high cost of competing in elite competition and the intensive work required to increase participation levels in sport where the competition for individuals’ leisure time and discretionary income is fierce. As discussed earlier, it is commonly assumed that international success for a particular sport serves as a motivator for people to increase their participation. The success of high profile athletes might be the trigger for people to become involved in a particular sport. Similarly, interest in tennis among the public in Australia increases for a short period after the Australian Open but does not lead to longer term increases in participant numbers. One of the largest challenges for sport managers is to develop coherent realistic strategies, often with limited resources, to expand the market share enjoyed by their sport organization.

Organizational Structure

An organization’s structure is important because it defines where staff and volunteers “fit in” with each other in terms of work tasks, decision-making procedures, the need for collaboration, levels of responsibility and reporting mechanisms. Finding the right structure for a sport organization involves balancing the need to formalize procedures while fostering innovation and creativity, and ensuring adequate control of staff and volunteer activities without unduly affecting people’s motivation and attitudes to work. In the complex world of sport, clarifying reporting and communication lines between multiple groups of internal and external stakeholders while trying to reduce unnecessary and costly layers of management is also an important aspect of managing an organization’s structure. The relatively unique mix of paid staff and volunteers in the sport industry adds a layer of complexity to managing the structure of many sport organizations.

The distinction needs to be made here between organizational structures of elite sport organizations such as professional sport teams (i.e., Chicago Bulls, Manchester United Football Club, or the New York Jets) and the structures used by nonprofit sport organizations such as International Sport Federations (ISFs), NSOs and community sport organizations. To a large extent, the organizational structure of professional sport teams follow the usual principles of using functional criteria to create departments or divisions such as player management, marketing, ticketing, venue management, finance, or human resource management. In this sense, the organizational structures of these types of sport organizations are no different to other organizations. The structure of nonprofit sport organizations, however, is very different.

The structure of nonprofit sport organizations can be conceptualized as comprising five elements: members, volunteers, salaried staff, a council, and a board or management committee. The members of the organization may include individual players, athletes, participants, coaches, officials, administrators, and other individuals or, in some cases, organizations. Affiliated organizations that are classified as members can include clubs that compete in a league provided by a regional sports association or state/provincial organizations aligned with an NSO. The members (or their representatives) normally meet as a group once per year at an annual general meeting in a forum most commonly known as a council. The council comprises those people or organizations that are registered members and have been afforded voting rights on the basis of their membership status. One of the main tasks of the council is to elect, appoint, or invite individuals to a board charged with responsibility for making decisions throughout the year on behalf of the membership. The boards of nonprofit sport organizations normally comprise individuals who represent the interests of various membership categories, geographic regions, or sporting disciplines in decision making. If the organization is large enough, the board may employ an executive and other paid staff to manage the day-to-day affairs of the organization. The executive is employed by and reports directly to the board with other paid staff reporting to the executive. This structure means that sport managers work closely with a variety of volunteers to deliver programs and services in areas such as coaching, player and official development, marketing, sport development, and event delivery. This structure has been criticized for being unwieldy, cumbersome, slow to react to changes in market conditions, subject to potentially damaging politics or power plays between delegates, and imposing significant constraints on organizations wishing to change. However, most nonprofit sport organizations are structured this way as it enables members to be directly involved in decision making and ensures a certain degree of transparency in decision making.

Attempts to categorize sport organizations through the development of structural taxonomies have illustrated the varied nature of sport organizations at all levels of the sports system, as there are differences in the degree of formality, specialization, and centralization that exist within the structures of sport organizations. Sport managers and the volunteers who work within sport organizations also face structural issues such as a heightened potential for conflict due to the presence of staff and volunteers, the need to manage changes in formalization and centralization, the impacts of government policy in shaping organizational structures as discussed earlier, and industrywide changes as the sport industry has become more commercialized. In order to manage the impacts of these issues sport organizations need to adopt more formalized structures and management practices.

Human Resource Management

Human resource management (HRM) essentially involves developing and maintaining an effective and satisfied workforce. However, the sheer size of some sport organizations such as organizing committees for Olympic Games, which may involve more than 50,000 volunteers and staff, as well as the difficulties in managing the mix of volunteers and paid staff in the sport industry, make human resource management a complex issue for sport managers. Traditionally, HRM practices involve planning, recruitment, selection, screening, orientation, training, development, and performance management of human resources. If human resources also include volunteers, two additional functions of recognizing and rewarding volunteers should be performed by sport organizations. The application of HRM within sport organizations does not fundamentally differ from other organizational settings in terms of the relationship between the organization and paid staff, with three caveats. The first is that sport organizations such as professional sport teams may employ professional athletes or players who are paid many more times than the CEO, a situation that does not occur in other industry sectors. The second is that the market for recruiting professional athletes is highly regulated by leagues through mechanisms such collective bargaining agreements, standard playing contracts, and salary caps. The third caveat is the use of player or sports agents to represent the interests of individual employees (i.e., players or athletes), and the highly unionized employee market that exists in some leagues through players forming player associations or unions to represent their collective interests to league and team management.

The application of traditional HRM practices to managing volunteers, however, does have several significant limitations as outlined by Cuskelly, Hoye, and Auld (2006), which include the underlying assumptions of HRM, the lack of volunteer coordinators within nonprofit sport organizations, and the complexity of volunteer roles and perceptions of their experiences in nonprofit sport organizations. In community sport settings, sport volunteers can be considered simultaneously the owners of nonprofit sport organizations (as club or association members), unpaid workers expected to follow directives from other volunteers, and clients who are service recipients of the nonprofit sport organizations of which they are members. Each of these discrete formal organizational roles creates a set of expectations for individuals that sport organizations may not be able to meet. Cuskelly et al. argued that even the appointment of a volunteer coordinator, the equivalent to a human resource manager in other contexts, is unlikely to disentangle the complexity of volunteers’ roles in sport organizations or lead to significant improvement in volunteer management practices in the short term.

The structure of sporting competitions and events also represents a significant point of difference for the application of HRM within sport organizations relative to other types of organizations. A significant proportion of sport is played on a weekly or seasonal basis within leagues and associations across the world. The regularity of the season and the competition, whether at the elite or community level, means that the staffing requirements of sport organizations are predictable and relatively stable. There are, however, a range of sporting events and championships for which human resource planning is difficult as staffing and volunteer levels fluctuate greatly. The human resource requirements for major sport events can be referred to as “heavily skewed” or “strongly peaked.” In essence, major sport events need a large workforce, often composed primarily of volunteers or casual workers, for a short period prior to the event, during and directly following the event. The rapid increase and decline in staffing within a short period is a complex and significant human resource management problem. It requires systematic recruitment, selection and orientation programs in order to attract the staff, and simple yet effective evaluation and reward schemes in order to retain them.

Sport Culture

There is no consensus about what the term culture means. In everyday language, it is often used to describe differences between groups of people based on their ethnic background or country of residence. However, the word culture has also been used increasingly over the past 50 years to describe the behaviors and values of groups of people who constitute a submembership within a larger cultural group; for example, people may discuss the culture of university students, the culture of an organization, or the culture of European football fans. In this context, sport culture can be defined as a set of core values, beliefs, and attitudes that are common to sport, which set the standards for acceptable behaviors within the sport industry. In other words, people involved in sport (e.g., fans, athletes, clubs, and leagues) have unique ways of approaching and thinking about things. While these unique features may vary from sport to sport, or from context to context, they impact the way in which sport is managed from a business perspective.

What then are the unique features of sporting cultures? Broadly speaking, sport culture covers a wide range of dimensions such as attitudes, values, history, traditions, rituals (e.g., how success is celebrated and defeat dealt with), symbols (e.g., memorabilia and dress codes), and heroes. It can also be seen in the way people communicate (e.g., common phrases and body language), the clothes people wear, and the stories and legends they repeat.

One fundamental value evident in most sporting cultures is the sovereignty of success and victory. In fact, clubs may value on-field triumph at the expense of sound business practice; it is not uncommon, for example, for European football clubs to pay star players salaries that exceed the total annual revenue of the club—not sound business practice perhaps, but consistent with the cultural imperative of winning at all costs. The significance of winning is also reflected in the heroes of sport, who are commonly those athletes who can boast an outstanding record of on-field success. Despite the tenacity and accomplishment of an elite athlete, few people remember who came second, let alone last.

A strong competitive ethic is clearly the most prevalent system of performance evaluation in sport. This predominant value is often supported by a rigid disciplinary system, which reflects the idea that the club or sport is more important than the individual is. Thus, sport teams and clubs often revolve around powerful collectivism. Most sport teams demand loyalty, and the surrendering of the self to the greater good, but in return, they provide support and belonging. This extends beyond the playing field to the way in which sporting clubs, leagues, and businesses are operated. Sport organizations may expect employees to work unpaid overtime during evening training sessions and weekend games for the greater good.

Another common value seen in sporting cultures is the importance placed on traditional “masculine” traits such as toughness, aggression, the absence of fear, and the endurance of physical pain. Allied to this may be attitudes relating to the importance of women’s versus men’s sport, which is highlighted by the paucity of television coverage devoted to women’s events. Networks and spectators may claim that men’s sport offers superior physical performances in terms of strength or better drama through violent clashes; what this reveals is that strength and violence are considered by many people to be pivotal features (cultural values) of attractive sport.

In addition to on field gender bias, many traditional male-dominated sports possess a gender role system with strong, stereotyped attitudes about the importance of officials and employees. This tends to result in a maledominated culture, in which masculinity is rewarded. The roles of women in these sports may be limited to those of cheerleader or bikini-clad sign holder. Many sports also display a low level of tolerance for the unfamiliar. This has been shown through numerous sporting controversies involving the “outing” of homosexual athletes. From a business perspective, the homogenous and masculine culture of many sports presents a problem for future commercial development. For example, sport leagues and event organizers may have difficulty in expanding their market to attract more female fans.

The rituals and traditional ways of doing things in sport can also reveal the underlying culture of sporting clubs and codes. This may include traditional training methods that may emphasize discipline (e.g., repetitive drills) and aggression (e.g., verbal outbursts from the coach). There are also numerous social rituals associated with sport. The familiar motto “work hard, play hard” also highlights the importance of drinking alcohol in sporting cultures. Many sports are also tied closely with a history of gaming.

The history of a club or sport, in fact, may play a powerful role in determining many cultural attitudes and values in sport. Club colors and the location of a home ground are two common elements of sporting club history that prove difficult to change. Fans, athletes, and clubs may also resist changes to the rules of sport such as changes to the duration of a game to make a sport more media friendly. Many traditional sport organizations may value history, tradition, and the familiar and, as a result, may put little emphasis on long-term planning to cope with the rapidly changing sporting environment. From this point of view, many sport organizations face significant challenges in the contemporary sport environment where they are confronted with increasing pressure to adapt tradition to cater for commercial opportunity.

Like all living cultures, sport is incessantly changing, dynamic in nature and subject to constant reinterpretation by its participants. Contemporary sport is faced with many challenges in order to maximize media exposure, expand into new markets, and maintain profitability. The traditional values and attitudes of sport may elicit strong attachments from some fans, but they also limit the flexibility of sport organizations to respond to changing market demands and increasing competition from other entertainment alternatives. As a result, many sports are attempting to align their cultures with business practices, through efforts such as controlling alcohol intake and crowd aggression at games to make them more “family friendly.” While traditional gender biases and many aspects of history and ritual may be challenged as sport becomes more of a business, some things seem sure to remain: the pursuit of competition, the love of winning, and the ability to summon strong emotional responses in both victory and defeat.

Sport Governance

Organizational governance involves the exercise of decision-making power within organizations and provides the system by which the elements of organizations are controlled and directed. Governance is a particularly important element of managing sport organizations, many of which are controlled by elected groups of volunteers as discussed in the earlier section on organizational structure. Appropriate governance systems help ensure that elected decision makers and paid staff seek to deliver outcomes for the benefit of the organization and its members and that the means used to attain these outcomes are effectively monitored. As many sport managers work in an environment where they must report to a governing board, it is important that they understand the principles of good governance and of how these are applied in sport organizations. The boards of nonprofit sport organizations are vital for the continued effective delivery of sport opportunities to members, participants, spectators, and the wider community because they are the core decision-making authority with responsibility for organizational strategies and the management of risk. Sport organization boards are central to the development of organizational culture, leadership, and ultimately organizational performance. Sport managers in most sport organizations will work for a volunteer board, unlike their corporate counterparts who work for individual owners or paid directors.

There are several unique aspects of sport governance as outlined by Hoye and Cuskelly (2007). First, the threat of litigation against sport organizations, their members, and board members has forced sport organizations to address issues such as risk management, fiduciary compliance, incorporation, directors’ liability insurance, and board member training and evaluation. Second, the heightened awareness of the implications of governance failure due to several much publicized corporate cases of impropriety worldwide has forced sport organizations to improve their governance systems. Third, legislative changes to address issues of equity and diversity are additional pressures sports organizations must face and their governance systems, particularly membership criteria, voting rights, and provision of information must change accordingly. Finally, the threat of competition in the marketplace has also forced sports organizations to become more commercial and business focused, primarily through employing paid staff.

Performance Management

Sport organizations over the last 30 years have undergone an evolution to become more professionally structured and managed and have applied generic management principles to marketing their products, planning their operations, and managing their human resources and other aspects of organizational activity. The unique nature of sport organizations, however, and the variation in missions and purposes has lead to the development of a variety of criteria with which to assess the performance of sport organizations. Sport management students need to understand the ways in which organizational performance can be conceptualized, analyzed, and reported and how these principles can be applied in the sport industry.

Hoye, Smith, Westerbeek, Stewart, and Nicholson (2006) argued that sport is different from business which has significant implications for the way in which performance is measured and managed. First, it has a symbolic significance and emotional intensity that is rarely found in an insurance company, bank, or even a betting shop. While businesses seek employee compliance and attachment, their primary concern is efficiency, productivity, and responding to changing market conditions. Sport, on the other hand, is consumed by strong emotional attachments that are linked to the past through nostalgia and tradition. Romantic visions, emotion, and passion can override commercial logic and economic rationality. Second, predictability and certainty, which are goals to be aimed for in the commercial world, particularly with respect to product quality, are not always valued in the sporting world. Sport fans are attracted to games where the outcome is uncertain and chaos is just around the corner. Third, sport is not driven by the need to optimize profit in the ways that large commercial businesses are. In practice, sport organizations face two conflicting models of organizational behavior when deciding upon their underlying mission and goals: the profit maximization model, which assumes that a club is simply a firm in a perfectly competitive product market and that profit is the single driving motivational force; and the utility maximization model, which emphasizes the rivalry between clubs and their desire to win as many matches as possible. The utility view assumes that sporting organizations are by nature highly competitive and that the single most important performance yardstick is competitive success.

A systematic approach to performance management enables a sport organization to identify strengths and weaknesses, and identify the ways in which overall organizational performance can be improved. Performance management also assists in deciding where scarce resources should be allocated and benchmarking organizational performance with competitors. A performance management system should be linked to an organization’s goals and objectives, which in the case of sport organizations, may be quite different from those of business organizations. While commercial entities generally focus on maximizing profits, sport organizations are more likely to be concerned with priorities like winning more games than their rivals, and servicing the needs of members. This multiplicity of goals for sport organizations makes it difficult to determine an overall measure of organizational performance.

Summary

This research-paper has highlighted the fact that managing sport organizations requires the application of management theories, principles, and strategies that are no different to managing organizations in the corporate, government, or nonprofit sectors. The unique attributes of sport organizations, however, influence how these theories, principles, and strategies are applied by sport managers. Students seeking to explore these unique attributes, namely, consumer behavior, the relationship between sport and government, regulatory regimes, strategy, organizational structure, human resource management, organizational culture, governance, and performance management will find them to be interesting research topics. The following references are excellent starting points for further investigating the unique area of sport management.

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