By John G. Fornaro
Private clubs have been through much in the past several years, but many private club general managers have been high-level achievers in leading their clubs.
They have focused on getting their finances in order amid changing cultures, and ardently seeking out new members all while improving the member experience.
As well, times are a-changing. As clubs rebound, there’s another important factor impacting the private club world. Many of the Baby Boomer generation general managers who have spent the past 25-40 years in the industry are taking their leave. They’re moving on …to retirement…to other activities.
Today, clubs must think outside the box to become more of a ‘one-stop shop.’ As we all know golf itself is not increasing in popularity because of money and time issues. You have to provide facilities and programs for the spouses, children, and allow members to look and feel as they would at home.
Daniel Somogyi, general manager/COO, Montclair Golf Club
That means a new generation of leaders is moving into the private club industry, and the issues they face are quite different from those who have gone before. Yes, the private club world is evolving…and with it so are its general managers, the leaders of tomorrow’s industry.
Smart thinking general managers know they must adjust to today’s private club world…to meet the new needs of younger members and do what it takes to attract the next generation of members.
How is all of this taking shape in 2015?
“The club industry is still very much alive,” exclaimed David Sizelove, general manager and chief operating officer, The Club at Carlton Woods, Woodlands, TX, a BoardRoom Distinguished Emerald Club of the World.
“However, we as managers must realize the business model has changed. For most clubs the times of just offering a generic experience, although it might be a high-end experience, is over. The challenge now is how we can stand up against the great restaurants and public/semi private golf courses surrounding our clubs.
“In other words we have more and more competition out there that are competing for our members’ discretionary dollar. But the more important and probably more pressing question is how we as managers are going to keep a member engaged once they do join.
“I find that we are now charged with creating more personalized experiences within the club and there are more demands on making sure this experience is extraordinary.”
Daniel Somogyi, general manager/COO, Montclair Golf Club in West Orange, NJ, a BoardRoom Distinguished Emerald Club, feels that while “the private club industry has experienced a comeback, it will not be the same as it was 20-30 years ago.
“Today, clubs must think outside the box to become more of a ‘one-stop shop.’ As we all know golf itself is not increasing in popularity because of money and time issues. You have to provide facilities and programs for the spouses, children, and allow members to look and feel as they would at home.”
There are, he says, several other major issues impacting clubs.
“Technology is a major part of this change. Our club also faces the question of cell phone and iPad policies, creating areas for kids to feel at home, and providing more things for the teenagers. Today, women make many of the decisions about where to spend the money, and if they don’t feel comfortable at the club they will not join, or they will quit.
“Our club allows denim on certain nights and casual dining for families. We also keep certain rooms traditional for members who want to come to the club in jackets and ties. We look beyond golf and try to create an experience for the members and their guests,” Somogyi added.
“My view is that the clubs that continue to focus on only offering the best will always be in high demand,” injected Michael McCarthy, CEO and general manager of Addison Reserve Country Club, Delray FL, another BoardRoom Distinguished Emerald Club of the World.
“Clubs that have scaled back and have let their assets deteriorate will be the clubs that are always chasing the market for members.
“We’re thriving today because our board has never lost focus of our mission – ‘Excellence is our Standard’ – even through the recession. When clubs hunkered down, and in some cases, went into hibernation, we were one of the few that saw an opportunity to reinvest in our facilities because the construction market was extremely cheap.
“In 2013 we finished with above average home and membership sales, and last year (2014) we were off to a record start.” Addison Reserve’s biggest challenge today, McCarthy suggests, is the fact that “we have the lowest number of inventory (homes) for sale in the club’s history.”
And the major issues today, in McCarthy’s opinion are: The aging club population; lack of interest in golf from younger members, and the generational battle between providing services and amenities for the younger families while also taking care of your older members who continue to support the club.
“The solution? Diversity in all your planning…making sure that there is something for everybody. This is not an easy task and also is quite expensive,” McCarthy intoned.
General manager Christian Thon represents an ‘old school…old values’ club, Menlo Circus Club, a BoardRoom Distinguished Emerald Club of the World, in Atherton, CA. A family club started in 1920, Menlo Circus Club has a fascinating history, and is steeped in charity works, polo and family events.
“We see the emphasis on safety and quality of life…of time together and ‘old school values’ that the clubs bring. All the ‘right things related to growing up (honesty, ethics, following rules, being nice to others, etc.) are all reflected in a private club and its DNA,” GM Thon related.
“Clearly the economy is a determining factor in when people join clubs. My own club is in a very affluent area (most expensive zip in the U.S.) so we are in a bit of a bubble so to speak.
But we are very much ‘old school and old values.’ The process to get in is very strict (eight letter writers as a minimum before being considered) but I still see the new members wanting more and not being as vested as the older ones.
“They love their club and are very loyal to their club – just not as much as the previous generation. I get more questions like: “Why don’t we….”. “The other club I am a member of does…..” “Just raise the dues a bit more so we can get more services….” That’s a different tone than the generations before them,” he suggested.
As for major issues, Thon says, “Stay fresh. Stay current. We constantly change and evaluate how we do things while still keeping the traditions that are appropriate. Come up with new things. New ideas of how to use the club’s facilities. And make sure you communicate with the members so you understand what they want.
“It’s ironic that communication is at an all time high – in how to communicate- but actual valuable communication is probably at its lowest. Communication has become superficial and not deep and meaningful,” Thon added.
Incorporating electronics will be a major hurdle and GM Thon wonders why clubs are fighting the idea.
“People want to stay connected at all times. Why are clubs fighting that? I’d bet that in 10 years, most clubs no longer have a ‘no cell phone’ policy. It will become a thing of the past.
“Members will say, “Keep me connected. Keep me happy. Make it fun and entertaining and make my life easy and oh, let me go home early with my family.” That’s the trend and will probably stay that way for some time. Keeping the membership engaged will be a challenge compared to earlier years. I don’t know if it’s a major issue or simply something we need to work on.”
The fact the new generation of club members will shop around to try and get the best deal is another issue says Somogyi.
“If you are one of the traditional and well known clubs in the area you will have a hard time attracting new and young members if you don’t follow the competition. This industry became as competitive as the hotel and restaurant industry. Newer members don’t always care about how green the grass is…they care about other facilities for their families, and the best deal,” he offered.
Another major issue for many clubs is the increasing club dues. “Unfortunately, food, liquor, and insurance costs all go up but members want the club dues to stay the same without any increases…and the pool of people we can all draw from is shrinking.”
Sizelove suggests another major challenge “is the fact that a lot of ‘clubs’ are not willing to really listen to their membership. They are not willing to make the investment in the membership. We all know the saying ‘keeping up with the Joneses’, and I believe that could not be more true than in today’s club environment.
“Most members and/or prospective members now spend the time shopping around at different clubs to find the right fit for the family. So there is an extreme amount of pressure these days to make sure the facilities/amenities don’t fall short, “ Sizelove explained. “If a club falls behind then, in my opinion, it will take a lot longer to regain the strength it once enjoyed. If you do not find a way to offer what your members are looking for, then they will spend their time and money elsewhere.”
And having great amenities is not the only answer, Sizelove offered. “These amenities must be approachable by the entire family. Ten years ago most clubs were either golf centric or social clubs. Nowadays, most successful clubs have to be more than that. Don’t get me wrong, there are handfuls of clubs that only do golf and do it very well, but to be truly successful, in my opinion, clubs need to realize that they must cater to the family…more specifically to the children and lady of the household.”
“Clubs have adapted some,” Sizelove added, “but I still believe we have a long way to go, because the ideal country club will be one that the family will enjoy together.
“As we all know time is also an issue and clubs must be conscious of members’ valuable time and with this in mind, create activities for all ages.
“One challenge we are having at Carlton Woods is that there are members that are looking for activities that the entire family can participate in but there is also a group of members looking for activities that their kids can enjoy while the parents enjoy other aspects of the club. Having a good blend of these activities is key for us,” Sizelove explained.
“Plain and simple, the member experience has become more personalized. No longer can we, as managers believe that ‘one size fits all.’ We must be willing and ready to create personalized experiences day in and day out.”
In an effort to attract new members managers need to stay on top of the industry trends, work with the board and the members to stand out from the competition, Somogyi suggests.
“We need to offer value for the money. At Montclair we have transformed our food and beverage services to be like a restaurant. With the competition in New York, we are often now told that we are better than most restaurants in the city. Services in all aspects of the club have become more like a Ritz Carlton and when members see that they don’t mind to pay the big bucks.
“We also have hired a youth program director and our kids events are sold out each and every time. We have baby-sitting services, arts and crafts. These items are popular in certain clubs but as a former traditional golf club it is a big change.”
GM Thon thinks “more emphasis is being put on the financials of the club’s operations than ever before. The old – ‘just do it ‘cause the President’s wife wants it’, has become less and less, and basic business practices have become more and more important and prevalent to today’s clubs.”
“How do you improve the member experience?” Thon queried and in answering his own question, said,” I see the hiring of more and more professional people (managers) as being the main reason for an improved member experience.
“If you hire great people, you’ll usually get great results with the events. Being more creative with what you have is also a key to member satisfaction. When you consider a club’s facilities, (150 acres of land, multiple buildings and landscaping with loads of ‘stuff’ to use like trees, pools, grassy areas, parking lots, roofs, etc.) you have endless options to put on creative events.
The members usually will love seeing something new, different and fun. It shows that the GM cares about their club and the membership,” Thon opined.
So as younger general managers, do they feel boards of directors are amenable to a younger generation of general managers-chief operating officers?
“Of course, I am biased to this question,” says Michael McCarthy of Addison Reserve, “I had my first general manager role at age 27 and truly believe that boards are seeing a more educated, professional and experienced manager today,” he added.
“Yes,” Somogyi stated emphatically. “You always have to prove yourself and maybe getting the job is harder as people look at us younger interviewees and have question marks in their mind.
“However, you have to be confident in your ability. After all most of these members have become wealthy business people (sometimes even in their 20s and 30s). But once you have the job you’re only good as your last meal as they say, no matter what your age. You have to stay engaged and well read. Our job as young managers is to know our stuff, inform the members and the board and continue our education,” Somogyi added.
“Bottom line, the board of directors want to find the right person for the job,” explained Sizelove. “So I believe as long as the younger manager positions themself correctly, boards are more than willing to look at and embrace a younger GM. I still believe it is very important for the younger manager to plan their career.
“Working at diverse facilities help to better prepared you for that GM job. Younger managers quite often change jobs because they want a better title or more money. I believe if you change jobs for greater experience and responsibility then you will be noticed more than if you just chase the title.
“The title and money will come once you have proven you have the experience and pose to be that young GM. Keep in mind a board is looking for someone who has made a difference at a club…not someone who has jumped around from place to place thinking the grass is greener. If you put in the hard work and stay connected that GM job will come for the younger professional,” he related.
“I think they (board of directors) are amenable to younger GMs,” explained Christian Thon. I think it’s important that the new and young GM observes, slow down, watch and learn before they make changes.
“A younger person often tends to do things fast without thinking it through but I think a young manager with a degree in hospitality is more attractive as a GM to boards than an older GM who’s been around the block and set in their ways – at least for most clubs. There are always exceptions but they are further and further apart.”
Publisher’s final thoughts
I’ve been fortunate over the last 20 years to meet many of the more than 6,000 general managers that work hard at private clubs across North America. The ages vary from those in their 20s to some in their late 70s. All in all I don’t think age matters in this industry.
Having said that, I do believe many of the younger general managers are making a difference, especially on the technology side and many of the tangible aspects of running a club.
Many younger general managers are more educated and thus have a stronger educational background. But on the other hand, many of the older GMs possess a stronger bent for the intangible side of club operations…the member experience. These general managers have the benefit of wisdom from their long time experience in the private club industry – not just knowledge.
So at the end of the day, the scenario plays out with clubs deriving equal benefits from both younger and older general managers.
In fact, a younger assistant general manager working with an older, enterprising general manager viewed as the younger person’s mentor is often a plus for a club.
Hiring an effective leader who demonstrates a consistent commitment to achieving goals, who remains aligned with achieving their club’s purpose and principals, and who focuses on the consequences of their decisions and actions for all of the club’s members will have a significant impact both during and after their time as GM.
As a former owner of a private club myself, I’ve seen the different benefits offered by both younger and older managers. Like I said, age doesn’t always matter in this industry.
At least that’s the way I see it!
John G. Fornaro, publisher
If you have comments on this article or suggestions for other topics, please contact John Fornaro at (949) 376-8889 or via email: email@example.com