EPISODE 104

Tucker So. The first question that I’d love your opinion on is when boards ask members to vote on major strategic decisions, are they just being democratic, or are they avoiding their responsibility to lead and the role of the board in general?

Derek I think it depends on what specific thing you’re asking members to vote on. The industry calls this brand governance. And this isn’t new to the industry. It’s relatively new to us since in the five years that we’ve been working on this, understanding and experiencing how boards work differently from club to club to club, and how we see which clubs are the most successful based on that relationship. We’ve worked with clubs where the board of directors has hired the general manager to do what the board tells that person to do. And we’ve worked with clubs that have a general manager that I think of as more of a CEO, where all the board is there to do is to make sure that that person has the resources and the guidance that they need when they need it. So a board is literally elected to represent the membership. Now, how the board members get elected within each specific club, we can kick that to another conversation because I think a lot of clubs have the opportunity to vastly improve that process so that the members who are voting for their fellow members to make decisions for them are doing so on a more informed basis. But as a whole, I, as a member, have elected a board to make the hard decisions. When there’s a 50-50 kind of sentiment in the club, it’s up to that board to be the tiebreaker. So I think in a roundabout way, what I’m getting back to is when the membership is asked to vote, that’s a board that doesn’t have the backbone to do what they’ve been elected to do.

Tucker I think if you take out all of the depends type conversations, meaning it’s in our bylaws, if we’re going to do an assessment, we have to ask people to vote. There are some things where you absolutely have to do, by requirement of the club and the bylaws, and how you go about certain things. And I get that. But, in short, what I would argue is that requiring member approval for strategic decisions, to me, is leadership weakness. And it’s disguised as a democratic principle, meaning, we feel like this should be a democratic decision of everybody and everything. And your argument, which I agree with, is but that is why people vote. The democratic nature of this is that people vote on the board. That’s who makes the decisions, rather than pushing every decision that the board should be making out to the membership. And the reason why I think this happens is actually because people confuse listening and leading, and the role that listening has in the strategic nature of what boards do. Because there are a lot of people who say you need to ask your members, you need to ask your members. And while I agree with that sentiment, you don’t need to ask your members how to make a decision. You need to ask them the fundamental questions that lead you to making a decision. And that’s what really drives success, in my opinion, is that the members experience a club from their own individual perspective. They know what they personally enjoy, they know what frustrates them, and they know they would like to change personally about the club. That’s valuable, that’s super valuable. The board is supposed to be there to zoom out and not just see the individual, and to see the entire club, and to see the landscape that the club lives in, and to see all of the different trends across the club world and to really look at this from a long term aspect, whereas members look at it as what do I want next season? The board should really look at it as what do we need to be in the next five to ten years, and how do we make that happen? And so that, to me, happens when they have clarity of knowing what’s right for the club. They’re asking questions that aren’t answers. They’re not looking for answers from the membership, but looking for general opinions and help to try to guide them across a whole slew of different conversations. And that’s when it happens, where we see boards that get really stuck in personal preference, or they get stuck in when a membership says that they don’t want something to happen because it’s short-term challenges, as in we see, oh, we’re afraid of member backlash, so we’re not going to invest in this other thing. But everything around the club changes, and now the club is eroding. And that’s when you see that – it’s because they’re deferring their decisions to the membership.

Derek Well, I think if it’s going to happen in a perfect world, there’s a handful of assumptions that we have to make. We have to make the assumption that the person who joined the board joined the board because they believe in the greater good of the club that they belong to, and leading that club through some good times and especially the challenging times to make sure that they are working towards that future, the goals that they’ve all been very clear on. You’re making an assumption that it’s not a popularity contest. That I’m on the board because somebody asked me to be, not because I want to be. But it sounds great. I get my picture on the wall inside the club. I get to sit in these meetings. I get to be involved in what’s going on. But I don’t want to make any decisions that are going to upset my friends because I have to play golf with them every Thursday afternoon. So then the other nature, and maybe we’ll get into this even more, is the short lifespan of a board member. In one club that we work with, the term of the president is one year. So by the time the president gets onboarded, they might have enough time to take on one issue over the course of their presidency, by the time they then transition to onboarding the next president. So in that one year, does that president of the board have the time, the energy, the focus to make those challenging decisions, to break those 50-50 votes, and to be willing to upset a certain portion of the members knowing that in the long term the choice that they’re making is for the best and the members that are upset today are probably going to come around in time.

Tucker The irony of all of this is that members actually want confident leadership more than they want to be consulted. That’s the funny part about asking members their opinion. Most members are going to say, I thought we had a board so that I wouldn’t have to make these decisions. I don’t know what to do. And that’s part of how you become a strong leader by asking people who don’t have the energy, they don’t have the time, they have no desire to make these decisions, so they’re just going to make the easy decision. And what you want to do is make the difficult decision of pushing the club forward in the right way. And that’s not always going to be what the membership wants. We’ve watched leadership teams survey their membership on questions that members aren’t equipped to answer. And then they act very surprised when there’s a vocal minority that tries to derail the evolution and get upset about this whole thing. You’re asking someone who shouldn’t be involved in the conversation to be involved in the conversation.

Derek In a perfect world, the board members of a club wouldn’t be members of the club. I know people who live inside an HOA. The members of the board of the HOA are residents, and some of these residents live in different parts of the community that have different rules and regulations. But in our corporate client past, the corporations that we’ve worked with, their board of directors are often made up of people who do not work at that company. They’re advisors that bring in fresh perspective, that bring in other experiences, and have the ability to make those hard decisions without upsetting their friends or their neighbors, for that example. I know we can’t change the way the industry is made today, but these are all factors that I think we have to take into consideration.

Tucker How do boards build clarity and confidence to make the decisions for the future of the club, even when those decisions make members uncomfortable? How do they do that?

Derek Boards will have the confidence to make decisions if they have some objective guidelines that they’re following, so that when a board is sitting there and they say we’ve talked about this issue ad nauseam, now what are we going to do? Let’s decide. And when somebody says well how are we going to decide, I have a contingent of members who want x, and they want y, and our survey has this sort of data that we can clearly go back and say, well, the mission statement of our club says that we are here to do these three things. And the issue that we’re talking about to address that correctly, if we’re going to be true to the mission, is to do it this way, this way, and this way. And it’s to have that guidebook in place, that foundation.

Tucker That echoes what I’m thinking. When you define who you are, what you stand for, and where you’re going as a club, and the board shares that sentiment, and it’s yes, these are three things, and these are unique to our club that the club down the street can’t say about what is going on with them, if you have those three things, everything ladders up to it. That creates ultimate confidence and clarity around, well, these are the two options on the table, which one allows us to reflect who we are, what we stand for, and where we’re going as a club. And most clubs skip that work. It’s easy not do that work because it is hard for a lot of people to define, and it requires you thinking past the current board, and it requires you thinking past the current general manager and thinking more at a 30,000 foot view, which is really difficult for people, especially in the world where you’re saying that they cycle in and out all the time.

Derek There’s a subset to those questions that I think is also critical, and that’s, who are we for? When we decide who we are, where we’re going, what we’re all about, then we get real crystal clarity on who our target audience is, who our membership is, and who we want more of. It’s surprising to me how many clubs either take this for granted or think that they know it, but never do the hard work of establishing it. In the business world, we would call this working on the business. The day-to-day is running the business, working in the business, making sure things are working smoothly, addressing, reacting. But to be proactive, yeah, it’s hard work. It’s incredibly hard work to be clear and succinct to set these guidelines. But when you go through the fire of doing that hard work, man, it makes so many of these issues simpler. Not that people are still not going to be upset in some certain subset, but you as a board, as a leader, as a president, or somebody who’s leading your club can have all the confidence in the world to say, you know what, I don’t even like that decision either personally, because as a member, I’m never going to use that specific facility because I don’t do that activity. But I believe that to be true to the mission, that is exactly what we need to be doing here. And my job as the board is to uphold our mission statement.

Tucker And that’s the next kind of conversation I’d have, which is define the role of your board explicitly, to look at, are we representatives or are we stewards? And that is a big difference that I don’t think a lot of people say. When you go through working with consultants for clubs, a lot of them say, we want stewards of our clubs. And I think that that becomes this buzzword, almost to have people say, a steward of a club is someone who’s passionate about the club. That is not how I see a steward of a club. The difference between a representative and a steward of a club is that a representative serves the current preferences. They are just member representatives. To your point about the POA example, they represent the different types of members that we have and the different preferences that we have across the club, and they’re just the voice of that. That’s if you’re just a representative. A steward is someone who protects long-term health even if it requires short-term unpopularity. These are people who are ready to make hard decisions, even if they go to the next social event and people look at them with a disgusted face because there needs to be a certain assessment. These are people who believe in the future of the club and believe what the club needs to be, rather than people who are just really, really excited to be a part of the club. And I think that people get elected onto boards because they’re passionate, rather than people who believe in the future. And that can be a huge defining factor around what type of board we have, and what their role is, and making it clear when we onboard board members to the board. That becomes a part of their onboarding. Here’s what your job is. Your job is not to just be the voice of your friends. Your job is to move the club forward in a way that other people won’t because they don’t have the energy or the time to do it.

Derek And before that onboarding even happens, when the executive committee or the nominating committee at a club is throwing some names in the hat to be considered for these three upcoming opening spots, they should be the type of leaders that are looking at those people when that name comes up and say, that person’s nominated themselves. Is that person in the list of considerations because they represent the golf contingent, or the racket contingent, or the women’s contingent, or the family with small kids contingent? And/or is that person appropriate because we believe they have the vision and the long-term interest of the overall health of our club, even if, as a hardcore golfer, for example, we know that that might mean that they’re going to make decisions that might not make their golf contingent happy, but it’s going to benefit the health of the club, at least for the next three years. That’s tough.

Tucker And you get into the world of when you were talking about how people get elected. And what do they say? We’ve seen so many where it says, okay, here’s your opportunity. Here are the people who are running for a board seat. And what they talk about is who their family is and what they’re passionate about at the club. They never say, here’s how I believe the club should be moving forward. Here’s the role I believe that we need to have in our members’ lives. They never talk about the things that actually should be elected. And I think that just comes into this big challenge around just telling people who you are. Is it the same as telling people what you think the club should be? And that’s a whole other conversation, but it’s a very interesting one.

Derek Not only what the club should be, but what they understand the club is and is trying to do, and who the club is for, because they, as a potential board member, already have the answers to who we are, who we are for, where we are going, and what we want to do. I had the opportunity to look at the candidates for a club’s upcoming board election. There were five candidates, and I read all five of the pieces that each of these candidates put together, that was shared with the membership, to help them vote. And one of the five candidates within their write-up had three bullet points on what their goals would be if they were to get elected. The other four were exactly what you described.

Tucker You know you should vote me in because I like tennis.

Derek Exactly.

Tucker I think that it becomes a really easy argument because we’ve always done it that way. That is the killer, that is the Achilles heel of the club world. But that’s the way we’ve always voted members of the board on, it’s just who they were, what they used to do for work, and maybe what they believe is the best meal on our restaurant menu. But the thing that I think is the most important, whether you got elected onto the board for this reason or that reason, it doesn’t really matter, is that board members need to communicate with confidence around what they’ve decided. So a lot of this comes up front. How you make really confident decisions is by making the hard decision and thinking about the future of the club. Another way to do it is to create confidence in the membership by the way you communicate that. When you go to a social event, and you guys have made a decision, and someone goes, well, why did you do that? And you go, well, Steve really wanted to get it done. That’s not helping the process of getting it done, whereas if you were to say, here’s what we decided as a group, here’s why we believe it matters for the future of who we’re going to be, and here’s how it aligns with who we think we are today. And if a board member jumps off the ship and says, no, we did that because this person wanted to get that done, now you’re just throwing that all under the bus, and you’re not looking like a strategic group. You’re looking like a group with a bunch of individual preferences.

Derek Clubs take for granted that they are communicating enough and have enough transparency. Now, I’m not saying that every member needs to know how the watch works. That’s operational stuff that’s under the purview of the operations team. But every single club that we’ve worked with, when we talk to their membership, that membership has a strong desire for more understanding of what’s going on and why we’re doing it. And clubs that sit in those board meetings and the general manager that’s in all of these meetings and committee meetings and executive reviews and board retreats, they are so up to speed on it that I think they take for granted that everybody is just as up to speed as they are, and they just literally forget to take the time to share the appropriate amount of information to keep the membership knowledgeable about what they need to be knowledgeable about and being proactive because when they forget and you blink your eye and an entire season goes by and you realize that the nine things that the board’s been grinding over for the last year, none of those have been shared with the membership at large. Now you have an issue that you have to take care of and deal with.

Tucker It’s such a weird analogy, and I’m very early on my tenure as a parent, but it is interesting when you put the perspective of the board is making decisions that the members are not going to like, and it’s not because it’s not good for the members. It’s just because that’s the way it has to be to create a flourishing environment in the future. And I would love your perspective on what the relationship is between a board’s willingness to lead without all of the members agreeing, without full membership consensus. And if we don’t get full membership consensus, what does that mean for our long-term strength? Is there a correlation between not always bending to the people today to be able to create a brighter future for tomorrow?

Derek People today just don’t have the quantity of information that the board has. The boards reviewed the survey, they’ve talked to people, and they have been the pulse of everybody. The membership at large is coming to the club, and they’re enjoying the club. They’re coming for lunch, and they are going back home. The board is staying and grinding, and they are diving into it, and they’re reviewing. They have so much more information that they have all of the knowledge and the tools that they need to lead without full member consensus. I can’t imagine that a club who makes every decision based on trying to get some sort of consensus of the full membership will exist in the near future. I think that correlation is failure. By the way, the general manager can leave. They can go get a new job. And so, as a people who you’ve dedicated your energy, your finances, your emotions to belonging at this place, if you’re going to water down the decisions that far, it’s going to be 50-50 or 30-30-30 every time, and nothing’s going to get done, and you’re going to be behind the proverbial eight ball. I think it’s a death knell.

Tucker I think it’s interesting to look at how members don’t have nearly the amount of information that the board does, nor should they. And that’s the other part that’s really important because there are a lot of boards who say we need to give our membership all the information they could possibly take. And I believe that the board’s angle is to take all of that information and distill it into direction, and then you can put reasoning behind it. And there are a few things that we really put as the top of our list, information-wise, that guide this decision, and here’s the information just for you. That’s absolutely something that you should look into as a board. But I don’t think it’s viable to say, and we need everyone to see everything all the time, because that’s when you get into, I joined a club to really, really get a lot of great golf in. I didn’t join a club to make these decisions. And that’s the difference between a board member or not. There are people who want to be a part of that decision-making process. And there are some people like you, Derek, who just want to enjoy the club, and that’s okay. And I think that that’s this balance of trying to expect too much out of your members to make a decision that they should never even be asked to make in the first place.

Derek It’s interesting. You make a perfect point. I’m happy to advise people at my club. I’m happy to tell you what I think. I’m happy to give you my perspective. But frankly, I’m not ready to be on the board. If you’re a member and you agree to be on the board or you want to be on the board, I think you have to go into that with eyes wide open and all the energy and a full understanding of what your job is. And then it’s not any sort of accolades or a popularity contest or a pat on the back, but you’re going there to work. You’re going to work because you love it, because you’re passionate, because you feel like you have something to offer, but that’s not for everybody.

Tucker One big thing that I took away as we wrap up from this is that there are great clubs that see their board as this kind of brain trust of decision-makers and how we do things and what is best for the club moving forward, even though that won’t be popular with everybody. And then there’s this whole other side of that, where there are clubs that have boards where they act more like a student council for a high school, where it’s like, oh, we got voted on because people like us. And I didn’t really want to make any decisions in the first place. I just thought it would be a good kind of social connection point. That’s not what boards should really be. And so that kind of balance determines the strength of a board and also the ease of getting things done that I just think goes a lot unnoticed and people look at the GM a lot to say it’s your job to get things done around here and I would say the GM can only get as much done as the board will let him get done or her get done and that to me is a huge takeaway.

Derek I think my takeaway is that boards that default to asking members to vote on issues that they should be deciding on, either that club hasn’t defined its objectives and has not received clarity on who we are, what we’re doing, and where we’re going, or that board member isn’t bought into that vision. And that’s something that needs to either be built or clarified or righted based on the people that you bring on your board in the first place.

Tucker That’s what should be done at board workshops. When people do board workshops, I don’t understand why you don’t talk about the future of the club. It just doesn’t make sense to me. Don’t talk about the tactical thing you want to get done this season. Talk about where the club is going when you’re not a board member. That is the reason you guys sit and do board retreats and workshops and all of that. It blows my mind. I just don’t understand how it happened.

Derek Tactics are what the subcommittees are for. Tactics and operations are what the general manager and their team are about doing. The board should be about setting, resetting, and protecting the vision and the long-term aspirations of the organization.

Tucker Awesome.

Derek But don’t ask me to be on your board.

Tucker Oh, I don’t want to be that person. All right. Thanks for the conversation. Super insightful.

Derek This was fun. Thanks for listening to Clubs Made Meaningful. At Sussner, we help private clubs build brands that create belonging. If this episode resonated with you, please share it with someone in your club world. And until next time, let’s create something worth celebrating.