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General Managers:
They're Staying Longer, Here's Why

General Managers...they're the most important person in the daily life of thousands of private clubs across the country. They make the club hum, they keep members happy, they balance budgets, communicate and delegate with department heads, raise money, oversee construction or renovations, and hopefully still find time for family life. And as history shows, they, more often than not and for a variety of reasons, have moved from one club to another with seeming regularity.

Today, times are changing! General managers are staying longer at private clubs. Ten years ago, the average term for a general manager at a single club was just under three years. That number has increased to four years, nine months. In fact, some areas of the East Coast indicate even longer terms, while some parts of the south suggest shorter than average tenures.

The conclusions are based on a research survey in which private equity, private non-equity and clubs operated by management firms were contacted. The conclusions included:

General managers at clubs operated by management firms had the shortest terms.
GM's at equity and non-equity clubs had the next longest terms.
General managers from equity clubs, but who are also members of the CMAA had the longest terms.

Why is it happening? Why has a GM's tenure at one club increased to almost five years?

People who know the private club industry well suggest there are a number of reasons...all good. Two major factors explain the phenomenon, according to James B. Singerling, CCM, CEC, chief executive officer of the Club Managers' Association of American (CMAA).

"First, club boards have finally begun to realize that their clubs are a BUSINESS," he says. "Secondly, the average age of the managers of today's clubs (CMAA members) has gone from 57 years to 44 years of age over the past 15 years.

"Businesses do not ask their chief operating officer to live at the work place. As CMAA members have become better business operators, their ability to delegate authority to fellow management staff also allows the COO to have a family life."

So there are two definitive statements...boards are finally realizing their clubs are businesses, and their staff also needs to have a life outside the club. For many these 'paradigms' represent a breakthrough in how clubs operate and undoubtedly contribute to the extended tenure of a general manager.

Another key factor deals with how boards relate to their general managers right from the get-go...from the time a head hunter firm is hired to find the right candidate through the checking of references, annual performance evaluations, and "blue skying" about the club's potential.

Another contributing factor is the clubs realize just how much it costs to replace a senior manager.

"It is much smarter to work with the club's management team through performance evaluations to enhance their performance, rather than terminating staff," says Singerling. "The numbers regarding average tenure that have been promoted by some industry vendors had little basis in fact. Industry studies that showed reduced years on the job in the last decade reflected the entire CMAA membership, including assistant managers, clubhouse managers, general managers and chief operating officers.

"In theory, most assistant managers are encouraged to move through multiple positions during the early years of their careers to gain experience. This overall movement of this segment of the CMAA membership skews the "average time on the job" reporting. The true general managers/COOs have always retained their positions for many years longer...it has to do with smarter boards of directors seeing the value of a talented professional and making sure that their COO cannot afford to leave. The salary paid to senior management comes back to the club many-fold through an efficient operation and a higher quality staff. It is just good business sense to compensate good staff and retain them." And therein lies much of the story.

Gregg Patterson has been general manager of The Beach Club of Santa Monica for 21 years. He suggests the Rule of Five is a reason that keeps a GM on the job.

"The Rule of Five has always been applicable - it takes five years for a new manager to truly know their club, the politics, the people, the facility, the employee team, the norms and the possibilities," he says. "To have a lasting impact, the manager needs to know the membership and their wants, needs and expectation and to figure out how best to deliver the most product to the greatest number of people with the least possible expense to the club. To do that they (the GM) need a relationship, and substantive relationships take years to establish. The more years a strong manager is in place, the more satisfying it is for them and the more successful is the relationship for the members." A point well made by Patterson's lengthy tenure at The Beach Club.

So what's the impetus for this increased longevity? Jay DiPietro, CCM, president/COO and general manager of Boca West Country Club credits "better training and education by the CMAA....Today's manager have a better understanding of their members' needs."

Dick Kopplin, president of Kopplin Search, Inc., an executive search company based in Scottsdale, Az., agrees with this assessment and adds "I may sound partisan but I truly believe one of the primary reasons that tenure continues to improve in the private club world is because both club search committees and headhunters are doing a better job of matching the candidates to the clubs. Too often, in the past, a manager would accept a job at a new club without really evaluating the opportunity in a thorough fashion. Correspondingly, the search committee would not recognize the importance of the "right fit" as they reviewed candidates. Thankfully, that is changing."

John Sibbald, president of John Sibbald Associates, an executive search firm from St. Louis, MO, is in agreement.

"Clubs are relying more on professional search firms in identifying and recruiting managers who have "both the technical skills to do the job, but even more importantly, the cultural compatibility with clubs membership and staff," he says. "A search firm takes the time and possesses the expertise to seek out the right individual to make a match that works for both parties."

Sibbald says longevity is good news for clubs since there is stable, familiar leadership for both members and staff. Other benefits range from having a continuing management philosophy allowing greater continuity of programs and projects to developing staff loyalty and reducing turnover.

Kopplin suggests there are two positive results. "First, it allows for continuity in management philosophy. That in turn will provide for better staff retention and increased member recognition all the way through the club. And second, the general manager has the opportunity to properly "condition" the leaders of the club i.e. board members. I mean "conditioning" in a positive way. The more time the general manager can work with the leadership of the club and the probable future president, the better the dynamic will be with the manager and the president as they work through a variety of governance issues."

It's Sibbald's opinion and others in the industry that a change in club leadership is always an uncertain time for any club. But stable leadership at the top means there is vastly better continuity of programs and leadership. Even though he agrees longevity is a good thing, change for many reasons, may be inevitable...and maybe for the best of the club, its members and the manager.

"In our experience, a club manager, until he or she is in their mid-50's or so in age, should not stay more than 10 years at any club," Sibbald opined. "The reason for this is that clubs Ð like the extended families that they are - go through major social and cultural changes. The manager who was perfect for a club a decade ago may not be the right manager for that same club today. Also, managers themselves often benefit from a fresh new work environment. Then too, clubs, unlike most private sector enterprises, can't grow markedly in revenues and memberships. An ambitious manager on his or her way up in their career is going to expect average or above-average competitive salary and benefits. Oftentimes, the only way these needs can be met is by a move to a larger, better paying club. Consequently, job movement for this reason is both good for the club and its manager."

The Beach Club's Patterson believes the reasons for longevity are many.

Better placement as a result of more informed boards and more informed managers.
The use of "head hunting" firms who specialize in finding the right club culture for the right person.
A more sophisticated manager community that is better able to deal with a sophisticated membership and the complexities of the operation.
An acceptance by managers that "jumping around" is disruptive to quality of life and that quality of life is worth a lot more than a few extra dollars.
And two career households which make the casual "exit" from a job by one of the spouses more complicated, since the second needs to uproot their career as well.

In the minds of both managers and industry experts, education, professional development programs and exposure to professionals from many industries has contributed more and better qualified people and thus longer tenures at clubs. Much of the credit goes to the CMAA.

"Education and exposure makes managers more sophisticated in both the hard and soft (people issues) sciences, thereby increasing the possibility that they'll be a success at any given club," suggests Patterson. "Industry experience, reflective opportunities, structured education, developed curiosities - all have contributed to the growing success and increased longevity of contemporary club managers."

Sibbald adds that "there is no professional society or association in any line of work that has done as fine a job in the professional development of its members than CMAA. And they (the CMAA) just keep getting better and more resourceful about it. The end result of such development is a better-trained manager: Multi-functional in skills, and technologically up-to-date. Such individuals are far less likely to fail on the job."

So if there are benefits to members, clubs and staff, do clubs really become more efficient the longer a managers stays in one place?

"Clubs often become more efficient the longer a manager stays because they come to know the club's systems and the talent needed to make those systems work at their highest efficiency," says Patterson. "This is true up to a point, that is, up to a number of years when managers feel comfortable with their operation, feel less challenged by the membership or committees or board and tend to grow less driven to improve."

Kopplin says his experience working with private clubs "tells me the big three will always be the dominant factors in creating greater longevity for a general manager.

1) Financial ability. One of the best ways a manager can develop trust with a private club board of directors is to demonstrate financial knowledge and business acumen.

2)Professional visibility. An outstanding general manager will always have a sense of where they need to be. Good visibility does not always mean being in the dining room. In fact, it may be knowing when to spend the day in the office or being on the golf course or being seen in the pro shop or even at the delivery dock.

3) Communication. The best surprise is no surprise. Most tenured general managers will admit to "over-communicating" with a new club president until they find a level of understanding, which is comfortable for both.

Publisher's final thoughts

Longevity is happening, all of which is good for the private club industry. The fact many boards of directors are treating their clubs as a business, is a step in the right direction. It's also a positive in that clubs are tapping talent, often through executive search firms, best for their club. Boards and search committees are meeting and asking the right questions of the right candidate. The "right" fit in the first instance, combined with continuing professional development, positive performance appraisals and firm leadership undoubtedly are contributing factors for longer, productive terms for general managers.

If clubs wants a general manager with current thinking and an understanding of the industry today, and the general manger wants longevity, it's my belief education is the Number One priority. It's important that boards budget for continuing education and encourage their general manager to seek appropriate educational opportunities.

Clubs benefits from longevity because the relationships between manager and members are stronger; members and staff understand the club's vision; the club community grows and prospers and replacing the general manager is a thing of the past.

At least, that's the way I see it!

John Fornaro
Publisher