The Shape of Things to Come?

Joe Barks, Editor, Club & Resort Business

One club announced that for the second straight year it would forego hiring a GM to save $200,000, and instead continue to rely on ‘a couple of members of the Board to be the figureheads.’

We’ve received a lot of “atta-boys” for the recent columns where we spoke out against the cases of General Managers being unceremoniously dismissed from their duties by club Boards or ownerships that didn’t properly recognize or appreciate their value, and felt they could find a way to have the job done much more cheaply.

Despite the praise we received for pointing out how these decisions are so misguided, I do feel compelled to report that some concerning developments have come to light that may indicate this is a trend that has real legs, despite our protests against it.

First there was a news report out of Medford, Ore., about how Rogue Valley Country Club was trying to “Stay Out of the Rough” (a headline that should be permanently retired, by the way).

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“A decade-long decline in membership and increased restaurant costs have forced [Rogue Valley] to tighten its fiscal belt, including delaying the hiring of a general manager for another year,” the report in the Mail-Tribune began.

While this may have at first sounded like a move you’d expect from a club on the decline, the report went on to state that Rogue Valley’s President said the club had annual revenues of between $5 million and $7 million with “plenty of reserves,” and that the club’s Board had approved a budget with a surplus of $30,000, after taking the cost-cutting measures that included doing without a GM.

Further, the report added, the club is going to save $200,000 by not moving to fill the GM position, which had already been vacant for a year. “We’ve relied on a couple of members of the Board to be the figureheads,” the President said.

And while the club had seen a general decline in membership over the last 10 years, the report noted, membership had increased this year, from 460 to 480.

“We have a balanced budget with a surplus going forward,” the President said. “I don’t think the members are going to be impacted negatively. We’re in better shape than most country clubs.”

I’ve come across some other examples of clubs that are also defining “better shape” as one that doesn’t need to include a GM in the traditional sense, or at least in its most experienced and talented form.

And a management company that has been gaining a bigger presence in the industry is using a rotation of interim GMs from within its network, who are assigned to step in whenever a new property is acquired. While there’s something to be said for this in terms of injecting needed expertise to help turn around clubs that were probably struggling (and which in turn led to their acquisition by the management firm), the practice still represents a net decline in active GM jobs.

It probably also didn’t help that a Florida newspaper reporter dug into public tax records earlier this year and published the salaries of several club GMs that were north of seven figures, which prompted a run of disparaging online comments (some of which seemed to be from those GMs’ members).

While those GMs are far from the norm, with duties that amount to running small cities, it was still another reminder of the misconceptions that can exist about what GMs do, and of how others think they could do without them.