Sunday, August 21, 2005

Bad business, bad football......

Al Groh is 30-21 in 4 years as coach of UVa, though only 1-8 against our top conference peers (VT, FSU and Miami), yet just snagged a contract on par with the elite college coaches (i.e. those who go to BCS bowls), and a $1M raise. Groh's teams have finished his four seasons ranked in the ESPN Coaches' Poll as follows:

2001: unranked, with no votes for the team in any of the final polls
2002: 25th
2003: unranked, with only 3 votes
2004: 23rd.

I wonder what Groh would have gotten if he had ever had a final top 20 ranking, won the games that matter, and had UVa competitive nationally.

I can't fault Groh for asking to renegotiate his contract, and I'm sure there will be a ripple effect of coaches more successful than Groh asking to renegotiate (such as VT's Beamer, making "only" $1.3M), but this was an absolutely stupid decision by the athletic department.

For starters, I can't see how Groh's boss (es) perceive him as a top tier performer. Groh has pretty well-bamboozled the UVa establishment with his NFL credentials and style, but does it work at the end of the day? (I'm holding back here, as I'm convinced that Groh's "NFL-Style" is close to charlatanism.)

Second, whatever happened to rewarding performance instead of paying for promise?

Thirdly, how can UVa's athletic department support an additional $1M in salary expense? Groh's extra $1M equates to about 50,000 extra tickets sold every year, or almost one whole home game. (I'm assuming $20 profit per ticket.) This suggests that the 12th game on the schedule - to be added next year - will basically be to pay for the coaching staff.

Finally, I'm troubled by the notion that even if the athletic department has an extra $1M lying around, that investing in ongoing athletic department expense is the best thing for the university. I need to do more research, but I believe that the UVa athletic department is pretty much breakeven (even before the massive current expansion in expenses related to the basketball program.)

My impression is that problem is a serious lack of business savvy and discipline among University presidents. Their permissiveness has created a monster in the athletic dept. (AD), which the presidents view only slightly more favorably as a fundraising loss leader, as AD's have burgeoning revenues, but little total contribution to university support. Of course, the University contributes little more than it's name and some admission slots, and gets 5 or 6 fun weekends when little college towns become big league - if only for 6 hours - so who would want to kill the golden goose?

I think UVa (and other prominent universities) should instead demand a permanent return on AD revenues. I'd do this in the form of a 50% royalty to the University on all athletic department revenues. This concept is not unlike the royalties that colleges claim on logowear.

I have a vague recollectiuon that UVa athletic revenues total something like $20M, meaning the university would add $10M in annual support. Besides the support, this idea would not only introduce some fiscal sanity, but also reset on-campus priorities. Sure, UVa in particular would fall out of national athletic prominence, but really, with most universities familiar with prostituting themselves for smaller amounts, what wouldn't the university do for an extra $10M per year?

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With my new friends on the Great Wall of China

With my new friends on the Great Wall of China
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"I do not choose to be a common man. It is my right to be uncommon -- if I can. I seek opportunity -- not security. I do not wish to be a kept citizen, humbled and dulled by having the state look after me. I wish to take the calculated risk; to dream and to build, to fail and to succeed. I refuse to barter incentive for a dole, I prefer the challenges of life to the guaranteed existence; the thrill of fulfillment to the stale calm of utopia. I will not trade freedom for beneficence, nor my dignity for a handout. I will never cower before any master, nor bend to any threat. It is my heritage to stand erect, proud, and unafraid, to think and act for myself, to enjoy the benefit of my creations, and to face the world boldly and say, "this I have done." All this is what it means to be an American." -- Anonymous