Leadership with a capital "L": ClubCorp's new CEO preserves traditions, empowers employees.

CMAA's new paradigm for general managers is "Management to Leadership." John Beckert has embraced that model in spades. The CMAA model states that aside from "general management," the club manager should guard the club's traditions, provide stewardship for its assets, and create a clear vision for the club's future.

Beckert was named CEO of ClubCorp Inc. in August. Prior to that he was president and chief operating officer. He leads a company that owns and manages almost 200 clubs and resorts of all kinds, with assets in excess of $1.5 billion and 18,000 employees.

He came to a ClubCorp that was like the old golf trophy tucked in a corner of the case--a somewhat tarnished remnant of a golden past. Some of the vision that the company's founder, Robert Dedman, Sr., had set in the '50s had been eroded by an out-of-focus corporate culture--and an ill-timed leveraged foray into fee golf just when the recession and the slide in the golf market had battered the company financially.

When he joined the beleaguered company, Beckert was a newcomer to the club industry. Prior to joining ClubCorp in August 2002, he was a partner at Seneca Advisors, L.L.P., a Dallas-based consulting and private investment firm. He once served as president and COO of Bristol Hotels & Resorts, the largest independent hotel operating company in North America. A Cornell hotel grad, Beckert joined Bristol in 1981 and was with the company until its sale to Bass PLC in 2000.

Change in Direction

In 1957, ClubCorp founder Robert L. Dedman bought 400 acres in Dallas and developed Brookhaven Country Club. With the conviction that most clubs were built and managed like they were "nobody's business," Dedman set out to build a private club company that would be somebody's business.

"I think it's what we've been doing for 45 years. We clearly view running clubs as a business," Beckert said. "One of the most difficult things we can do is compete against someone who is not running it as a business."

ClubCorp established an early reputation by providing consulting services to owners and developers of country clubs. As corporate America boomed in the '60s and '70s, ClubCorp added business clubs that offered fine dining experiences and corporate meeting facilities in a private club setting. In the late '70s, the company raised its profile by demonstrating proven "turn-around" expertise in acquiring and developing country clubs.

As members' concerns turned toward healthier lifestyles in the '80s, ClubCorp responded by creating city/athletic clubs (now called business clubs and sports clubs). The '80s also meant expansion into complementary lines of business--including destination golf resorts and semiprivate and daily fee golf courses--as well as international growth. During this time, the company also added high-profile properties to its portfolio, including Mission Hills Country Club and Indian Wells Country Club in California, and The Homestead in Virginia. In the '90s the company expanded into the fee golf field.

Human Assets

As an outsider, Beckert recognized the richness of the company's heritage. He also focused on what he considered to be the company's greatest assets: its employees and club members. Considering that ClubCorp had drawn fire from independent private club managers and other industry observers in the '80s and '90s for a perceived focus on profits at the expense of level of service and sensitivity to employee contributions, this was a major change in direction.

"Eighty-five percent of our culture was what allowed our corporation to be successful," Beckert stated. "I wanted to build on what was successful." Today, ClubCorp's mission is "Building Relationships and Enriching Lives."

The focus on maximizing the value of ClubCorp managers and employees began at the top. Corporate staff was reduced by 20 percent, eliminating levels of bureaucracy that had increased work at the club level while adding little value to members. Beckert's goal was to make the corporate office approachable and an asset to those working at the club level.

"We're making sure that corporate office is working with the clubs," Beckert said. That change in approach has even evoked a change in nomenclature. "We now call it 'The Home Office' instead of the 'Corporate Office,'" Beckert said. Once each quarter, all clubs are surveyed regarding any services that they have received from the parent company.

"In the past we focused on some of the wrong things," Beckert stated. "I've traveled to over 130 of the clubs. I sit down with manager and department heads. I spend 15 or 20 minutes of time telling them what's going on with the company and then I sit there with pen and pad. Every good manager has said 'We need more time to do what we do. We need fewer initiatives from the home office. We need fewer distractions from the home office.'

"A GM in Dallas told me, 'If you want to me respond to e-mails quickly, I can do it. If you want me to meet with members, I can do it. I can't do both.' There are some things that managers must do: Get the cash in the bank every night, do the accounting sales tax, etc. But if you put really good managers in clubs and give them time, they're going to improve the clubs."

Beckert said that ClubCorp is also looking for partnerships--such as the highly successful Avendra purchasing venture in which ClubCorp was a founding partner with Fairmont Hotels and Resorts, Hyatt Hotels Corporation, Intercontinental Hotels Group, and Marriott International, Inc. "It's allowed us to lower product cost. Managers spend less time looking at products and just order," Beckert said.

In making sure that the company's mission is communicated to every employee, ClubCorp simplified the message into three bullet points:

* Warm welcomes.

* Magic moments.

* Fond farewells.

Beckert then charged his managers with recognizing employees who created "Magic Moments" for members and guests. Managers nominated 150 employees whose actions epitomized the three points of service and built relationships and enriched lives for members. Sixteen employees won the "Three Steps of Service" contest. Winners were flown to Dallas and given VIP treatment at the ClubCorp home office, including dinner with Chairman Robert Dedman Jr.; were presented with awards; posed for photos recreating their winning stories; and were filmed during interviews about their experiences working at their clubs or resorts.

Examples of winning stories included an employee who befriended and visited an elderly member at home; a golf professional who held an impromptu cookout on the golf course; and a membership director who created a memorable setting for a mother-and-daughter reunion.

Beckert said employee reaction has been very positive. "We've heard exciting comments that touched everyone. One employee who was recognized said he now knows what it's like to be a member after 15 years with the club."

No Starbucks Clubs

In addition to preserving company culture, Beckert is intent on recognizing and capitalizing on the cultures of each ClubCorp club. That's particularly challenging as some of the individual clubs get bigger, he said. "When I've seen one of our clubs, I've seen one of our clubs. A member wants to be a member of their club--they don't want to be a member of the local Starbucks."

One area in which ClubCorp will not face as big a challenge as some other clubs is in the area of diversity. Founder Robert L. Dedman insisted that women, children, and people of all races and religions be welcomed into the company's clubs from the very beginning. "We're very proud of never having discriminated in any of our clubs. Many could say that today. Very few could have said that 45 years ago. When you look at who can afford a club today, population is growing more diverse. I'm very proud that when you look at the photos of boards of governors on the walls of our clubs, they represent diversity within their communities."

At the core of building relationships with members, Beckert said, is recognizing that club members expect excellent golf and dining experiences. At a time when fee courses and clubs around the country are shaving nickels and dimes from operations wherever they can, ClubCorp corporate management insisted that their clubs increase golf course maintenance budgets across the board. And it didn't stop there: Corporate managers check to make sure that the money is indeed being spent and not allocated to other line items or moved to the bottom line. "We want to make sure that people are spending the money. Golf course conditioning--things like pre-emergent treatments--pay off six months down the line."

In the dining room, ClubCorp wants to deliver a food and service package that matches members' expectations as well. "We're not dictating the menu. The F&B experience needs to be better than they can find elsewhere," Beckert said.

To make sure that members are getting what they're looking for at their club, ClubCorp sends an Internet-based poll to every member throughout the year. By using the Internet and conducting the polling system-wide, ClubCorp holds the cost to $1,000 a year per club, assures the consistency and quality of the questions and methodology--and their managers get verbatim member comments. "We have a 25-percent response rate," Beckert said. "The responses are screened by a human being and significant negative comments go back to the manager within three days."

Investment in Technology

ClubCorp is putting "significant amounts of energy into research and development" on ways to use technology to provide better service and expand revenue in its club properties, Beckert said. The company's involvement in the resort and daily fee golf business has been a big help in developing systems, according to Beckert. "There really isn't a vendor that provides a turnkey solution to the club industry. The hotel industry is really behind.

"What we've developed is much more sophisticated. The program targets member preferences gathered from point-of-sale systems, reservations made, etc., and builds a profile that can be shared among club departments and ClubCorp properties."

Improving the Golf Score

Beckert said that ClubCorp has addressed the slide in the golf market on several fronts--the most obvious being the company's move to shed its public fee courses. Another was the aforementioned focus on course quality. A third piece is promoting non-golf-related relationships among members; familiarizing them with who other members are; and creating activities like wine and book clubs that will promote loyalties to the club that go beyond a great round of golf.

ClubCorp is also encouraging its clubs to promote activities and events on the course. "In the short term, we can't address the number of courses being built," he said. "But we can increase our market share. We're holding seminars in communities on how to host a golf outing to fund raise. We're offering training tools and compensation programs for our golf professionals, teaching them to spend more time with people and how to get more of the available share of private outings.

"How many outings can we get when our course is closed? One of the things we've done with golf professionals is that they meet with the manager to discuss revenues. We've begun to challenge them on how we drive revenues if we can have more guests play on Tuesday afternoon. There's not a conflict between what's good for ClubCorp and what's good for their members. We're not going to do anything to disrupt a Saturday morning for their members."

The Bottom Line

While it's not all about the ROI at the reborn ClubCorp, it doesn't hurt that the company's numbers are showing a positive turn. "In the second quarter of last year we refinanced all of our debt. It was exactly the right time to do it in terms of the money markets. And our new financial partners--Pacific Life, GMAC, and Textron--want to be leaders to the golf industry.

"We're showing 15 percent bottom-line growth in results. When you're making progress and it's the progress you want to make, everybody's happy."