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Programme design for sports federations: it’s a balancing act

To realise strategic goals in a world of declining participation, tightening budgets and increasing competition, sports federations need to balance their programme portfolio decisions with fact – not rely on intuition, speculation or political agendas.

 

Defining a new balance

A National Sports Federation’s primary customers are often its participants. They choose what they consume from the range of sports activity programmes on offer, and if they don’t like it, they will take their valuable leisure time and money elsewhere.

Recently,  sports federations have faced a three-fold challenge – declining participation, tightening budgets, and increasing competition for leisure time. Under these circumstances, choosing which programmes to offer (and at what price) can make the difference between a thriving, well-funded sport, and a ‘dead’ one.

Learning from sectors outside of sport, one key success strategy is having a ‘balanced portfolio’ of programmes on offer. While this is a term more closely associated with the asset management sector, where it is about balancing risk, here we apply the concept to sports federations. In this case, the ‘balance’ is between economic value and strategic coverage. Put simply, a balanced portfolio of programmes will serve all the strategic priorities of the sports federation (e.g. elite, mass participation, disability, gender, geography etc.) while ensuring the economic value of the portfolio is net positive.

 

Why is it so hard?

Very few  sports federations (and indeed commercial organisations outside of sport) [1] manage their portfolios effectively. For example, c. 70% of organisations have too many programmes for their available resources [2], while only 21% of portfolios have programmes that are of ‘high value’ to the organisation1. While such inefficiencies can be tolerated in times of plenty, it can be fatal when the going gets tough.

There are several key reasons why organisations find the balancing act so hard. Firstly, the absence of clearly defined strategic priorities makes it a non-starter. No portfolio will be able to provide coverage for all strategic interests and, without clear priorities, organisations will not be able to make the trade-offs necessary for success. Secondly, many  sports federations are plagued by the absence of data. Without data and evidence, decision making will inevitably become an exercise in intuition, speculation and politics. Finally, even with data, the appropriate models and analysis are needed to turn information into insight, and insight into informed decisions.

The prize is clear. If sports federations can systematically balance and optimise their portfolios, there are bountiful opportunities which could be realised – we could grow rugby league to new audiences, halt the continued decline in cricket participation, or repurpose empty golf courses to meet the demand for shorter rounds. The possibilities are endless.

 

Returns both ways

Building on our work over the past decade with well over 20 UK-based sports federations, we have developed a bespoke approach to systematically assess programme portfolios and help sports federations make any required strategic changes. The approach is built on assessing two distinct dimensions – strategic value and economic value.

To take the example of one of the UK’s largest participation sports, our strategic assessment quickly highlighted that their budget was spread across a very wide portfolio, with no clear indication of priority areas for investment. Working together with the leadership of the sports federation, we identified female participation and youth sport as key strategic priorities. Reassessing the portfolio against these strategic priorities, we were quickly able to identify which programmes were having an impact and which weren’t.

By overlaying the more traditional, second lens of economic return, we were able to plot the entire portfolio against strategic value (‘Return on Objectives’ – ROO) and economic value (‘Return on Investment’ – ROI). The implications were clear – keep going with the high ROO-high ROI programmes, get rid of the low-low combinations, and with the others either look to optimise the design or repurpose the budget to maximise total returns across the entire portfolio.

In the real world, it meant that two existing female participation programmes were found to be effective but expensive, with a high cost per participant compared to other programmes. By deprioritising several other initiatives, which were of less strategic value, the sports federation was able to release funding for investment in the female programmes. Coupled with operational improvements to increase their ROI, the two programmes were expanded to drive greater female participation at a lower cost, thus enabling the sports federation to meet its targets. A strategic gap in the portfolio was also identified and we therefore recommended the design of a new programme focused on girls, to be launched in a selection of schools which we knew, as an existing delivery channel, would contribute to a high ROI (and which was later confirmed by our model). Managing such complex portfolios in this way is therefore simple, effective and clearly of great benefit to sports federations and the people they serve.

 

It’s all a balancing act

The approach outlined above is hardly revolutionary. However, its application in this context is new and we are far from seeing its systematic application across the sports industry. We are in the fortunate position of being able to learn from the techniques, approaches and knowledge developed over decades in other sectors, and there is no reason to re-invent the wheel. By using data and modelling to provide a sound fact base, leaders within sport can focus their creative energy on coming up with innovative new ideas, designing new programmes and ultimately making sure more of our leisure time is spent consuming our favourite sports. This will also require intuition, speculation and perhaps even a little politics. Indeed, it’s all a balancing act.

 

Sources

  1. Just 21% of organisations have effective portfolio management systems in place – Robert Cooper and Scott Edgett: ‘Ten Ways to Make Better Portfolio and Project Selection Decisions’, PDMA’s Visions magazine (2006)
  2. Panview: 3rd Product Portfolio Management Benchmark Survey (2012)
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