Thirty Minutes of Their Time
A half-hour into some staff meetings, a lot of bosses are still droning on through spreadsheet reports, or finally beginning to wrap up a recap of last night’s company softball game. But precisely thirty minutes after John Wright convened with his Norwood Hills department heads on the Wednesday morning before the 4th of July weekend, everyone around the table had been heard from, the meeting was adjourned, and these were just some of the issues that had been covered:
It’s a brutally hot day, even by summer-in-St. Louis standards. Inside the clubhouse of Norwood Hills Country Club, the air conditioning is working fine, thankfully, but there’s still plenty of noise, dust and heated activity, as the final push of a major renovation is in high gear.
From room to room and hallway to hallway, members and staff have to conduct their business around a mix of the just-completed and the still-to-do. In the redone grill room, for example, everything looks great except for the chairs—the gleaming new wood tables are all surrounded by standard, black-fabric banquet-style stackables that have been called into temporary duty until new custom-ordered furniture, caught in a manufacturing delay related to the Southeast Asia tsunami, can arrive.
And oh, did we mention that one of the most active weekends for any club, the 4th of July, is just two days away?
Put it all together—the heat, the constant construction-related commotion, the approach of one of the busiest times of the season—and you could certainly understand if people at Norwood Hills showed they were a little stressed.
But outside, despite the heat, nothing but idyllic scenes can be found on the club grounds, as members and guests happily use the golf courses, driving range, tennis courts and pool.
Inside the clubhouse, the grill and other areas are humming with steady activity, and no one really seems to mind that they have to sit on temporary chairs, or eat and socialize amid a lot of whirring and banging.
And in the middle of it all, Norwood Hills GM/COO John Wright is pulling his staff together for meetings that are remarkable both for their efficiency and good nature, with a full agenda of upcoming events and related details discussed with all the concern of who’s bringing what to the family picnic.
Amazing, isn’t it, what adding 200-plus new members in 14 months and seeing immediate returns from a $7.5 million renovation can do to keep everyone calm, collected and in the best of spirits, even when the heat is really on?
Nothing They Can’t Handle
Actually, considering what Norwood Hills has been through in its 80-plus-year history, it’s easy to understand why things like a couple of weeks’ delay in chair deliveries, or a lot of impending activity over the 4th of July weekend, wouldn’t really phase anyone who’s been associated with the club for any length of time.
“Over the years, we’ve had bankruptcies, restructurings, major fires [which gutted the current clubhouse in 1985], damage from tornadoes, bad management, bad Board decisions, resistance over becoming gender-neutral, battles over smoking policies, you name it,” says current President Gary Uthoff, a 26-year member of the club.
“And for this latest renovation, which we started to plan six years ago,” Uthoff adds, “by the time we got it approved by our shareholders, 9/11 had hit and the recession had set in. Suddenly steel, wood, dry wall and concrete prices were all up 50% from when we’d started. We were looking at being one and a half times over budget before we’d even started to take a hammer to anything.”
But reflecting the let’s-just-find-a-way approach that has marked every step of Norwood Hills’ path to upgrading its facilities and expanding its membership base, Wright and the club’s directors sat down with their architect and general contractor, and literally went back to the drawing board.
“We took a hard look at every aspect of the design and structural plan, and in three months we had found ways to get back within our original budget, even with the higher materials costs,” Uthoff says. “We kept our kitchen configured north-south, instead of redoing it to be east-west, and that saved several hundred thousand in concrete costs alone. We also found new ways to use existing space under the building, instead of digging out new space, which led to huge savings as well.
“And the funny thing about all of this,” says Uthoff, “is that because we were forced to take another hard look at everything, we actually ended up with a better and more functional plan.”
Another huge boost to the renovation project came after a Norwood Hills member who is a real estate developer suggested that the club, which hosted the 1948 PGA and has a long and rich connection with St. Louis-area social history, look into the possibility of applying for placement on the National Registry of Historic Places. Successfully securing that status, the developer member advised, would then qualify Norwood Hills, which operates as a for-profit corporation, for renovation tax credits.
“[The member] felt we could qualify not so much because of the club’s history or architecture, but because of the distinction of our members in the St. Louis community through the years,” Wright says.
The two-and-a-half-year process of applying (to both state and federal agencies) was arduous and intensely bureaucratic, Wright adds. But in February of this year, Norwood Hills was finally notified that it did indeed qualify to be included on the registry. And with the honor came a huge financial benefit: specifically, the ability to earn tax credits for 45 cents of every dollar spent on the renovation project.
“Looking back, we couldn’t have done the scope of this
project without [earning the benefits of the historic status],” Wright says. “I don’t want to say it was a gamble, but once we looked into it and saw the possibilities, we were sort of counting on it, even though we were never sure we would [qualify].”
The initial euphoria over attaining the status and its attendant benefits was dampened somewhat, Wright notes, when a St. Louis newspaper, after the announcement was made, published an editorial to the effect that “rich country clubs shouldn’t get tax credits.” But in a valuable public relations lesson that all clubs would be wise to heed, after Norwood Hills management pondered how to respond. “We did the smart thing,” Wright reports. “We did nothing.” The noise died out quietly, and Norwood Hills is now enjoying its new-found place in history and the benefits that come with it.
No Detail Too Small
The non-response to the editorial, however, probably qualifies as the only time that the Norwood Hills management team, under Wright’s leadership, has ever decided to “do nothing.” Hired seven years ago after serving as GM of two other St. Louis-area clubs, Wright made it clear up front that he would only come to Norwood Hills if “I would report to the Board, do all the hiring and firing, and have everyone report to me, not to committees.” That was just fine with the Norwood Hills Board, which only has one-year terms for its Presidents (“Anyone who would want to [be a club President] for more than a year would either have to be semi-retired, or nuts,” current President Uthoff laughs.)
Once in place as the new GM/COO, Wright pretty much hasn’t stopped reporting to the Board about the activities and accomplishments of his management team. Here’s a briefing on some of the more notable recent achievements, and what lies ahead, for each department:
• Membership—Katie Mirth, promoted from an administrative position two years ago to the newly created position of Membership Director, closed the deals last month to fill out the club’s 750 available golf memberships (and actually start a small waiting list as well). Memberships in all classifications now total 940 at Norwood Hills, representing a net gain of 216 from April 2004.
Like clubs in many other “near suburbs” (Norwood Hills has a St. Louis address but is actually just over the city line, in northern St. Louis County), sprawl was a major reason for the club’s declining membership, as people began to live and work farther and farther from cities (in St. Louis’ case, there is now pretty much continuous development to Columbia, in the middle of the state).
But the Norwood Hills Board saw—as is happening in other urban areas around the country—that a rebound effect from sprawl was beginning to occur, especially among younger families, as commutes to and from the outlying areas became hellish, and schools in the exurbs didn’t match up to those in the established suburbs. So at the same time that it put its renovation plans into motion, the Board decided to try to catch those younger families on the rebound by offering a no-initiation fee “Construction Special.”
Unlike club programs that waive fees entirely and permanently, however, the Norwood Hills plan does secure a commitment to be a dues-paying member for a minimum of three years (at monthly rates that are subject to increase), through the signing of a promissary note. Regular members are also required to purchase one share of equity by the end of the three-year period.
Resignations prior to meeting the three-year commitment incur a $5,000 penalty fee or buyout. But once the three-year commitment is met, members who joined during the promotion will earn a dues reduction.
Existing Norwood Hills members were assessed an additional $45/month to help fund the renovation, but Mirth reports that “maybe only half a dozen had issues” about waiving the initiation fee for new members. In fact, she says, existing members were willing and extremely able parts of her “sales force” as she fielded an onslaught of serious inquiries from prospective new members.
“Letting [prospects] look at the membership directory was one of my best sales tools, because they almost always realized that one of their friends or neighbors was already a member here,” Mirth says. “[Existing members] were great about coming over and introducing themselves if they saw me having dinner with someone new; when I went through the men’s grill on tours, there were some who were notorious for yelling, ‘This is a great club!’ ”
The promotion led to the acceptance of 146 new Golfing members in Norwood Hills’ last fiscal year (which ended this past March), and the first month of the new FY kicked off with an additional 31 members joining in April 2005.
• Food and Beverage—Clubhouse Manager Chris Selby, Chef Bernard Pilon and Executive Sous Chef Darrell Hatchett have wasted no time setting out to maximize the new capabilities of Norwood Hills’ renovated and expanded kitchen and clubhouse facilities (nearly $2.5 million of the $7.5 million renovation cost was F&B-related, according to Wright, as the kitchen was doubled in size, to 3,000 sq. ft.). With the extra room came extra toys: The chefs now have things like a built-in wok station, a sauté area, a wood-burning oven, a meat smoker and a temperature-controlled meatcutting room at their disposal.
“We’re doing much more in-house production,” says Pilon. “We’re smoking our own salmon, making our own sausage and bacon, we have our own pizza menu, and we’re bringing in specialty items like venison from Colorado, rabbit from California, foie gras and fresh fish from Boston. [The new facilities and equipment] are allowing us to continually broaden what we can offer to the members, as well as greatly improve efficiencies.”
At the same time, adds Hatchett, the Norwood Hills F&B staff has become more excited about being able to work in the expanded and upgraded facilities, “and that’s a selling point, too.”
The payoffs have already been “wildly successful,” Wright reports. “We budgeted a 30% increase (in F&B revenues because of the renovation) this year, and we’ve been running at a 45% pace. We’ve been averaging 100 a la carte servings a night and weekends have been in the 1,200-1,300 range.”
• Golf Course and Operations—Perhaps the most vivid illustration of the get-it-done spirit that permeates the Norwood Hills operation is that tee times are not required to play on either of the club’s 18-hole courses. “We’ve never had them and I’m sure we never will, because it’s a tradition here and we’ve all just accepted the fact that we can’t have them,” says Mike Mueller, the club’s Head Golf Professional.
“It’s something that attracts people to our course,” Mueller adds. “It’s a comfort to members to know they can make a last-second decision to play, or fly in a customer and not get squeezed out. You would think it’s chaotic, but it’s just something that we’ve always made work—you just kind of learn to know who’s
going to be coming at what times without a tee sheet, and everyone learns to co-exist.”
At the same time, Norwood Hills is extremely organized—and aggressive—in pursuing outings, with a member of its golf operations staff, Shawn Barnes, holding down the dedicated role of Tournament Director. Working with the club’s F&B staff, Mueller and Barnes have compiled an e-mailable Tournament Information Book—a Microsoft Word document that covers booking procedures, fees, guarantees, formats, policies, dress code, and food and bevcrage information, including lunch and dinner menus.
“[The book] is a never-ending work in progress, just another part of how we keep trying to get better and better and do whatever it takes to make sure every person who comes here has a great experience,” says Mueller. “Norwood Hills has become known for its outings, dating back to the ‘70s and ‘80s, to the point where about 80% of our events are now reoccurring each year. We really don’t have to do a lot of marketing, so that allows us to focus on the details of coordinating and producing the event. And Chef [Pilon] does a great job of working with Shawn to provide just about anything [the event clients] want.
“Our members are what we’re here for,” Mueller adds. “But outings are the golden nugget, they’re what allow us to remain a great value and keep dues and amenities affordable. And the outings also provide great exposure for our course to potential new members, in addition to a direct new source of revenues.”
With the influx of new members combining with the steady interest in outings, Mueller says Norwood Hills has budgeted for a 12% increase in rounds played this year. And “if the first two months of the season are any indication,” he adds, “we’re going to do better than that; May was phenomenal.” Not surprisingly, pro shop sales are also “humming” in step with the increased activity on the courses, Mueller adds.
While Mueller and his staff keep working to draw players to the two Norwood Hills courses, the club’s grounds department, headed by Mike Noll, will try to keep up with the added activity while still maintaining an average annual cost per hole ($7,000) that’s less than half the industry average, according to Wright.
And Wright thinks Norwood Hills is also going to defy common practice when it comes to finishing the clubhouse renovation, despite all the commotion that was still evident in early July. “We started in August ‘04 and the schedule called for completion in December ‘05, but I think we can be done by September or October at the latest,” he says. “And that’s something to shoot for, because every month we finish ahead, we save $25,000.”
Make that a cool $25,000.