Lessons from Alice in Wonderland

Illustration from Alice in Wonderland with the text: “’Would you tell me, please, which way I ought to go from here?’ said Alice. ‘That depends a good deal on where you want to get to,’ said the Cat. ‘I don’t much care where – ‘ said Alice. ‘Then it doesn’t matter which way you go,’ said the Cat.”
“’Would you tell me, please, which way I ought to go from here?’ said Alice. ‘That depends a good deal on where you want to get to,’ said the Cat. ‘I don’t much care where – ‘ said Alice. ‘Then it doesn’t matter which way you go,’ said the Cat.”

This refrain from Alice’s Adventures in Wonderland could not be more relevant to clubs today who neither have a published, “board-approved” Mission Statement nor constructed an annual budget that is focused on a financial outcome, rather than member-experience outcome.

Clubs who have reached out to McMahon Group for assistance in improving their operational outcomes to both enhance member satisfaction and drive new member recruitment all have a common theme: their annual budgets are not aligned with their Mission.

All clubs have a Mission, regardless of whether or not it is articulated and published.

The most successful clubs have published their Mission Statement and weaved it into every aspect of their planning and day-to-day operations. These clubs have gone through a strategic process that is led by the general manager and board. This process first involves obtaining member input to identify and understand the club’s core values. Those principles guide the club’s internal conduct and are at the foundation of its existence. These core values are then inserted into the club’s Mission Statement. The Mission Statement defines the club’s purpose, what it provides, to whom and at what quality level.

The published Mission Statement, however, is only the first step.

The second step is translating that Mission Statement into a financial plan (annual budget) that provides the financial resources to actually achieve the club’s Mission. This step is essential and critical as it fully empowers management to implement and achieve the Mission. The club’s general manager is responsible to lead this process. He/She must work closely with the club’s controller/CFO to put a process together that involves all club department heads and member committees for input. This input must envision each amenity area’s member experience in financial terms to be included in the budget. This budget is reviewed and approved by the club’s finance committee, who then recommends it for approval by the board. The annual budget should define:

  • What member user fees pay for
  • What member dues pay for
  • Member operational expenses not included in user fees
  • Principal and interest payments of any club indebtedness
  • Annual capital expenditure/replacement costs
  • What capital income should be reserved

Constructing the budget should be a bottom-up process that will tell the club what dues should/need to be to successfully implement and achieve the club’s Mission. So, do not be like Alice. First determine where you are going, then create a plan on how to get there.

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About Bill McMahon, Sr. AIA, OAA

Chairman

Bill is a strategic, financial and architectural planning consultant to clubs throughout North America. He established McMahon Group in 1983 as an affiliate of the family architectural firm his grandfather founded in 1906. Over the ensuing years, the firm has expanded its club consulting services beyond clubhouse improvement planning to a full range of services for all aspects of private club challenges. To date, the firm has assisted more than 2,000 private clubs across the United States, Canada, Asia, Europe and the Caribbean. McMahon Group provides a unique approach to developing club facility projects first establishing design and financial feasibility so membership approval is achieved. Thereafter final design and construction firms are selected to build the member approved project.

Mr. McMahon is unique among club consultants in providing an integrated strategic, financial and architectural approach to solving club problems. His personal involvement with his own clubs in St. Louis (serving in the roles of president, board member and committee member) has allowed him to bring unparalleled experience to each client. Mr. McMahon’s club memberships have included Bellerive Country Club (St. Louis), Racquet Club Ladue (St. Louis), University Club of St. Louis, Spring Lake Yacht Club (Michigan) and the Royal Yacht Club of Tasmania.

Mr. McMahon is a graduate of Washington University School of Architecture in St. Louis and holds architecture licenses in 44 U.S. states and in Ontario, Canada. He is a featured author in industry publications and a featured speaker at the annual conferences of the Club Managers Association of America, the Canadian Society of Club Managers, the National Club Association and the Hospitality, Financial and Technology Professionals. He serves as a visiting lecturer at continuing education sessions offered by regional CMAA chapters and at Michigan State University. Bill is a co-author of McMahon Club Trends®, the comprehensive research reports on strategic issues facing private clubs published with the National Club Association. He is also founder of the Excellence in Club Management Award.

Mr. McMahon is a member of the American Institute of Architects, and the National Club Association. He is a former president of the Missouri Council of Architects, AIA and has served on various charitable boards in the St. Louis area.

More articles by Bill McMahon, Sr. AIA, OAA