Sport Management

Ing. Jana Nová, Ph.D., MBA

 Department: Department of Social Sciences and Sport Management

 Module: Management and Economics
 Degree: Bachelor’s

This book offers English translation of an interactive electronic course Management

ve sportu, which is available online at
http://www.fsps.muni.cz/impact/management-ve-sportu/. Online version of the
material is enriched with extra interactive elements or multimedia content, such as
text questions or movies, which are omitted in this printed version. In this material
you can also find some content which is not translated, i.e. Czech version of
accompanying images (diagrams). Therefore, you must follow English translation
which is available below such images (diagrams).

© 2012–2014 Faculty of Sports Studies at Masaryk University Brno within the Innovation and modernization
of the study programmes at FSpS Project (IMPACT), code CZ.1.07/2.2.00/28.0221. More information about
the Project: www.fsps.muni.cz/impact .
Table of contents
Introduction ..................................................................................................................... 4
Introductory word of the author ......................................................................................................... 5

Introduction to Strategic Sport Management .................................................................... 8

Definition of sport and sport management ........................................................................................ 8
Specific characteristics of sport ......................................................................................................... 10
Model of three sectors in sport ......................................................................................................... 10
Application of managerial functions in sport .................................................................................... 12

Role of State in Sport Development ................................................................................ 15

Reasons for state interventions into sport ........................................................................................ 15
Regulations, control and the extent of state intervention in sport .................................................. 17

Non-Profit Sector and Sport ............................................................................................ 22

Definition of non-profit organizations in sport and their role .......................................................... 22
Types of non-profit organizations in sport ........................................................................................ 24
Volunteering in sport in the Czech Republic ..................................................................................... 28

Professional Sport........................................................................................................... 30
Structure of professional sport ......................................................................................................... 30
Relationship between professional and amateur sport .................................................................... 32
Management of Athletes .................................................................................................................. 33
Strategies of results evaluation in professional sports ..................................................................... 34

Principles of Strategic Management and Strategic Choice in Sport ................................... 36

Characteristics of strategic decision-making in sport ....................................................................... 36
Strategic sport management and strategic management process ................................................... 38

Organization and Organizational Structure in Sport ......................................................... 42

Conditions of internal organization in sport ..................................................................................... 42
Specifics of the performance of the organization function in sports organizations ......................... 44
Challenges for sports managers in sports organizing........................................................................ 47

Human Resources Management in Sport ......................................................................... 49

Contents of human resources management in sport and its specifics ............................................. 49
Modifications of remuneration of human resources in sports environment ................................... 55

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 Volunteers management ................................................................................................................... 56

Leadership ...................................................................................................................... 57
Definition of leadership ..................................................................................................................... 57
Theory of leadership ......................................................................................................................... 58
Leadership in sport organizations ..................................................................................................... 60
Multidimensional model of leadership in sport ................................................................................ 62
Behavioural dimension of a leader in sports ..................................................................................... 62

Organizational Culture in Sport ....................................................................................... 64

Basic elements of organizational culture and its definition .............................................................. 64
Definition of culture in a sports organization and organizational identity ....................................... 65
Specifics and the importance of organizational culture for sports organizations ............................ 66
Subcultures in sport........................................................................................................................... 67
Diagnostics and management of changes in organizational culture of sports organizations ........... 68

Performance Assessment in Sport ................................................................................... 70

Specifics of performance assessment in sport and sports organization ........................................... 70
Theory of performance assessment in sport .................................................................................... 71
Multidimensional approach to performance assessment and its criteria ........................................ 74

Sport Governance ........................................................................................................... 77

Basic strategic concepts of management and models in global sports industry .............................. 77
Theory of governance in sports ......................................................................................................... 78
Principles of good governance in sport ............................................................................................. 80

References ...................................................................................................................... 83
Discussion forum ............................................................................................................ 87
Test your knowledge....................................................................................................... 88
Authors .......................................................................................................................... 89

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Introduction
Dear students,

this e-learning teaching material has been created within the framework of the whole course
innovation. The innovation also consisted in purchase of modern aids, equipment, scholarly
literature available in the university library and in syllabus innovation.

The project Innovation and modernization of study programmes at the Faculty of Sports
Studies (IMPACT – FSPS, registration number CZ.1.07/2.2.00/28.0221) realized from January
2012 till December 2014 was financed within the Education for Competitiveness Operational
Programme.

At impact@fsps.muni.cz we will be pleased to answer any of your questions even after the
project is finished.

The project team of IMPACT

Fig. 1 Sports at the Faculty of Sports Studies of the Masaryk University

Source: Archive of the FSpS MU, Brno

4
Introductory word of the author
Dear students,

this e-learning material, which you will have the opportunity to study in the framework of
the course Sport Management, corresponds in its contents to the latest trends and
knowledge in the teaching of this subject in the world. When compiling it, we took
advantage of domestic and foreign resources. The innovation of the subject lies in its
content rearrangement and extension by new topics.

Aim of the course:

This course is one of the key courses within the study field of Sport Management. You will
learn about the features in the application of management theory in the sports
environment. Content-wise, course talks about the issues of strategic planning and
management (business perspective, analysis of the environment of sports organizations,
analysis of their resources) and the basic aspects of strategic decision making, leadership and
human resources management, with emphasis on their applicability in the environment of
sports organizations. Within these general objectives, the content of the course is oriented
so that you will be able to evaluate key aspects of the changing environment that affect
sports organizations.

After the successful passing of the course, you will be able to:

1. understand various models of processes of strategic management of a sports

organization and discuss the importance of these models while taking into account
the specifics of the sport environment;
2. critically analyse the key features of current strategic management in the sports
environment;
3. identify key strategic decisions faced by managers in sports organizations;
4. critically evaluate strategic options of sports organizations, including their feasibility
and sustainability;
5. identify problems and opportunities which sports organizations face while
implementing their chosen strategies.

Content:

1. Introduction to strategic sport management – definition of sport and sport

management, specific characteristics of sport, model of three sectors in sport,
application of managerial functions in sport.
2. Role of the state in the development of sport – reasons for state intervention,
regulations, control and extent of state intervention.
3. Non-profit sector and sport – definition and role of non-profit organizations in sports,
types of non-profit organizations, volunteering.

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 4. Professional sport — structure of professional sport, relationship of professional and
amateur sport, sportsmen management, strategy of result evaluation.
5. Principles of strategic management and strategic choices in sport – characteristics of
strategic decision making, strategic sport management and strategic managerial
process.
6. Organizations and organizational structure in sport – conditions of internal
management, specifics of performance of the managerial function, management in
sports organizations, challenges for sports managers in managing sport.
7. Human resources management in sport – content of management of human
resources in sports organizations and its specifics, modification of remuneration of
human resources, management of volunteers.
8. Leadership — definition of leadership, leadership theory, leadership in sports
organizations.
9. Organizational culture in sports – essential elements of organizational culture,
definition of culture in sports organization and organization identity, specifics and
significance of organizational culture for sports organizations, subcultures in sport,
diagnostics and managing changes in organizational culture of sports organizations.
10. Performance assessment in sport – specifics of performance assessment in sport and
in sports organization, assessment theory, multidimensional approach and its criteria
in assessing performance.
11. Sports management (governance) – basic strategic concepts of management and
models in global sports industry, theory of administration.

Annotation of the innovated course

This teaching text for the Sport Management course reflects the latest findings in the field
based on domestic and international sources. It provides students with up-to-date
information about the specifics in the application of management theory in the sports
environment. The content is devoted to questions of structure and management of sports
organizations in the public sector, non-profit sector and professional sport from the
perspective of the application of the basic managerial functions. The student thus has the
opportunity to become familiar with the application of the principles of strategic planning,
leadership and management of human resources and control, as well as with the issue of
measuring performance of sports organizations – with emphasis on the principles of good
administration. Through tasks intended for self-study, the student can further enrich his
knowledge in relation to the application of managerial functions in the environment of
sports organizations.

Annotation of the innovated course

Aim of the course:

The aim is to make students familiar with the features of the sport environment, the
activities of a sports manager and the economics of non-profit organizations in physical
training and sports.

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After the successful completion of the course, the student will be able to:

 characterize the functions, roles and activities of sports manager,

 analyse external and internal environment of a sports organization and formulate
strategies on the basis of analysis,
 discuss the industry of physical training and sports and their specifics,
 understand the financing of physical training in the Czech Republic,
 propose financing of non-profit sport organizations.

Innovation:

Innovation of the course lies in the extending teaching by further topics and narrowing the
teaching contents of management in the field of sporting events.

7
Introduction to Strategic Sport Management
This chapter contains the following topics:

 Definition of sport and sport management

 Specific characteristics of sport
 Model of three sectors in sport
 Application of managerial functions in sport

Definition of sport and sport management

It is necessary to understand sport management in three dimensions. Those are:

1. Profession
2. Field of study
3. Scientific discipline

“Sport is part of every man and woman’s heritage and its absence can never be compensated
for.”
(Pierre de Coubertin: White Paper on Sport, 2007)

For the purposes of studying sport management, we will focus on understanding the concept
of sport management as a profession. In this case, however, it is necessary to define the
concepts of sport and sport management.

The definition of “sport”, as it was introduced by the Council of Europe:

“All forms of physical activity, which through casual or organized participation, aim at
expressing or improving physical fitness and mental well-being, forming social relationships
or obtaining results in competition at all levels.”

Definition of sport and sport management on the academic grounds:

The concepts of sport and sport management are defined by various authors differently,
depending on the approach of the author and their understanding of the importance of
various aspects of sport and managerial profession. Therefore, we have selected only some
of these definitions for the purposes of this learning material.

8
Fig. 2 Steps of Success
Source: Image courtesy of digitalart
FreeDigitalPhotos.net

SPORT:

Abroad

Sport is any activity, experience, or business venture with its focus on fitness, recreation,
sport or leisure activities. Sport needs not be competitive, nor does require specialized
equipment or rules. In fact, sport includes activities, such as training, running, or dancing
(Pedersen, Parks, Quarterman, & Thibault, 2011).

In the Czech Republic

Sport is usually understood as a physical activity that is characterized by efforts to achieve

the best performance of the body or achievement of victory over the opponent. Sport is a
typical manifestation of the performance-driven modern society. Its part is sports training
(Charvát, 2002).

SPORT MANAGEMENT:

Abroad

Sport management is “any combination of skills related to planning, organizing, directing,

controlling, budgeting and evaluating within the context of an organization or department
whose primary product or service is related to sport and/or physical activity (Pedersen et al.,
2011).

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In the Czech Republic

The concept of sport management can be understood as a way of comprehensive

management of physical training and sports unions, associations, clubs and cooperatives,
which at least in part accentuate the business-oriented behaviour. Furthermore, it is
unreservedly a way of management in the business sector of the production of sporting
goods or operating paid sporting services (e.g., fitness and other), (Čáslavová, 2000).

Our definition of sport management states that it is the application of managerial

principles, methods, techniques and procedures in the sports environment. By this, we
emphasize that sport managers need not only managerial skills but also experience and
understanding of the sport and its specifics. When talking about the sport environment, we
mean the different types of organizations and sporting activities, which need to be managed,
because there is a need to coordinate activities of other people who would not have by far
reached such results, had they worked separately.

Specific characteristics of sport

Smith and Stewart (2010) compiled a list of 10 specific characteristics of sport, which
determine the use of the specific managerial techniques in the sport management:

1. irrational passion for sports teams and athletes and its use,
2. differences in the assessment and evaluation of performance vs. hierarchy and
results,
3. interdependence between sport organizations,
4. competitive equilibrium (competition vs. cooperation) – anti-competitive behaviour,
5. diversity in quality of sport product/game, competition (guaranteed result vs. price),
6. high level of loyalty to the product and the brand,
7. sport-produced unique fan behaviour with substitute identification,
8. high level of optimism and expectations of sports fans vs. defeat,
9. relative unwillingness to the use of technology,
10. limited supply and seasonality vs. meeting the demand.

Model of three sectors in sport

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Fig. 3 Model of Three Sectors in Sport
Source: Translated by the author of the e-learning text from Hoye, Nicholson, Smith,
Stewart, & Westerbeek (2012)

State (public) sector – includes national, regional and local authorities, agencies for
development of policies and funding in sport and sport specialists (development of athletes,
drug control).

Non-profit sector (volunteering) – includes local sports clubs, their associations and
international organizations, which organize sport competitions, regulate and manage sports
rules and organize the main Championship competitions.

Professional (commercial) sports organizations – include professional leagues and their

teams, various sports competitions, tournaments, which includes producers of sports
clothing and equipment, media, operators of large stadiums and managers of sporting
events.

Cooperation and overlapping of functions of the three sectors

The state provides financial support to non-profit organizations for the purposes of
development of athletes and sport development as such. In contrast, non-profit
organizations offer the general public opportunities to engage in sport and develop sports
elite.

The state is interested in commercial sport by supporting the construction of large stadiums
and other places intended for sport, regulating the legal framework of professional sport and
supporting the organizations organizing sporting events.

The non-profit sector supports the professional sports by supplying league competitions
with young talents, developing sports coaches, sport professionals and elite competitions. In
some cases, the sports leagues themselves are composed of teams that are technically non-
profit organizations, although they support a group of professional managers and players.
Conversely, professional sport provides a portion of its benefits to the non-profit sector to
support its participation.

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Application of managerial functions in sport

Fig. 4 Business Idea Concept

Source: Image courtesy of 89studio
FreeDigitalPhotos.net

Fig 5 SWOT
Source: Image courtesy of 89studio
FreeDigitalPhotos.net

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Sports managers use similar managerial theories and techniques as the managers of other
organizations (hospitals, banks, car manufacturers, etc.). Still, there are aspects that are
different, especially in the following areas:

 strategic management,
 organizational structure,
 human resources management,
 leadership,
 organizational culture,
 financial management,
 marketing,
 performance and assessment of productivity.

A manager in the field of sport runs:

 sports activities of any kind,

 professional sport and institutions active in it,
 participation of amateurs in sport and organizations that provide services for them,
 sports facilities in the management of cities and municipalities,
 associations involved in sports,
 organizations that produce sporting equipment and clothing,
 high schools and colleges dedicated to sport,
 professional organizations dedicated to sports marketing and management of
players.

The work of a sports manager is dependent on the products of the sports

industry, which he manages and which may in the broadest sense be:

 participation in sport,
 elite sport, professional competitions,
 equipment and accessories for sport,
 promotional items and media outlets to promote sport,
 services of sports facilities,
 marketing research in sport,
 managerial services for sport and athletes.

II. Sport management as a profession

There are many definitions of sport management as a profession and all agree that this is a
profession, in which general management functions and processes are applied in a specific,
i.e. sports, context.

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Sport Management

“A field, which focuses on the coordination of the provided human and material resources,
relevant technologies and possible eventualities in order to successfully perform and
transfer certain services in the field of sport” (Chelladurai, 1994).

Sport Manager

“A person who focuses on the coordination of the provided human and material resources,
relevant technologies and possible eventualities in order to successfully perform and
transfer certain services in the field of sport” (Chelladurai, 1994).

According to Ziegler (2007), a sports manager is traditionally defined as the person who
plans, organizes, does staff recruitment, directs, controls (monitors and assesses) gradual
steps leading to the previously set objective in various sports programmes for people of all
ages.

Traditional work positions in the field of sport management are according to the results of
the AEHESIS project (2006) as follows:

1. sports manager or director at the local level (an organization at the municipal level,
municipal authority, etc.),
2. manager or director of a sports club,
3. manager or director of a national sports federation,
4. manager of a fitness centre.

Tasks for self-study:

1. Review pages 6–24 from the monograph Nová (2014a) and discuss possible content
of the standards for the study field of Sport Management in the Czech Republic. Do
so with regard to the concept of kinantropology referred to in the mentioned
publication (p. 22-24).
2. In the report for the third year of the solution of the AEHESIS project
(http://www.aehesis.de/images/FilesForDL/reports/aeh_report_3rd.pdf), locate,
analyse and describe the differences in the sample job descriptions and required
competencies for work positions of sport managers, as defined by this project (by
171-183).

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Role of State in Sport Development
This chapter contains the following topics:

 Reasons for state interventions into sports

 Regulations, control and the extent of state intervention in sport

Reasons for state interventions into sport

Fig. 6 Politics Book

Source: Image courtesy of Stuart Miles
FreeDigitalPhotos.net

The state still seeks to intervene in the affairs of the company so as to ensure the national
economic and social goals. There is a strong belief that prosperity in society is possible to
attain by various interventions by the state (e.g., road, rail networks, improvement of the
transportation system, improvement in the overall efficiency of industry and trade; schools,
universities, hospitals – improving knowledge on the state level, improving health and
possibilities to work).

The same logic applies to the intervention of the state into the field of sport, where the
state’s objective is to have a healthy, able-bodied population and achieve international fame
and recognition (strong political capital) through the success of national athletes.

Sport also brings various social benefits and, therefore, the state wants to invest in it, which
is difficult in a time of budgetary restrictions. The reasons for state intervention, however,
exist even in terms of optimizing the use of resources.

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The state is trying to reduce the degree of market externalities (pollution, drug abuse, anti-
competitive behaviour, anti-social behaviour, discriminatory behaviour, etc.) through
regulation of the behaviour of its citizens and various institutions. In this context, the state is
trying to regulate sport to secure the safety of sporting event participants (e.g., regulation in
boxing should reduce high risk of injury).

In the traditional market-oriented economies (where our resources are allocated to the
market and are dealt with through supply, demand and price), sport was not considered
something the state has to take care of. Sport was seen as something that is outside the
market, it was considered the domain of volunteers and amateurs.

But there are situations when this market mechanism cannot automatically ensure certain
necessary services for the citizens (the so-called market failure). Either there is a low supply
of needed services and products, or there is a high supply of less desirable products and
services (the need of the customer vs. price must always be taken into account).

In sports, there are two kinds of benefits from the implementation of sporting activities:

 commercial benefits – participation in important sporting events, going to a fitness

centre, a golf class, visiting a ski centre;
 social benefits – include the added value that a company gets from the production of
goods and services, and there are also private benefits.

Identification of social benefits is important. It is better to allocate additional resources for

the construction of necessary sports infrastructure and services for these activities. Sport
produces significant social benefits and deserves the attention and support of the state,
because it increases the welfare of society as a whole.

Social benefits arise from both the active and passive participation (improved health of the
population, reduction of expenditure on health services, reducing the crime rate, instilling
discipline and desired character qualities, development of ethical standards, greater
involvement of citizens, building social capital, stronger company and inclusions – sport can
include people from different social classes). They are the so-called soft and fragile benefits
that are difficult to quantify.

Equality in access to sport and inclusion

The state should fund sport in order to guarantee the equality of opportunities. If the society
as a whole benefits from the health and well-being of individuals, no one should be excluded
from sport consumption due to low income or lack of opportunities. The optimal benefit of
society can be achieved only in the case where everyone has access to appropriate sports
and recreational activities. This will help them improve their health, condition, and image,
thereby helping them to build social capital of the company.

The state should therefore build low-cost sports facilities, subsidize their existing operators
and create targeted programmes for disadvantaged groups of citizens.

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Regulations, control and the extent of state intervention in
sport
Regulation and control

Fig. 7 Law Smartphone Means Legislation and Justice Information Online

Source: Image courtesy of Stuart Miles
FreeDigitalPhotos.net

There are many situations where the state wants to regulate and control the provision of
sports activities and restrict resources into certain activities. For example, it is necessary to
issue laws and rules to ensure safety of the spectators and participants of the major sporting
events. At the present time, there is no law in the Czech Republic that would directly address
the issue of spectator violence. However, Article No. 40/2009 Coll. of the Criminal Code and
some of the facts referred to therein (disorderly conduct, harming foreign things, injuries,
brawl, and others) can be used to solve inappropriate behaviour. Another law that can be
applied to inappropriate behaviour of sporting event participants is the Article No. 200/1990
Coll. on offenses, as amended, which are defined by the nature of the offenses, e.g., breach
of the peace.

In some countries, the law specifies parameters for the construction of sports facilities
(specification of design, number of seats, number of entry and exit lanes, fire precaution
equipment). In the Czech Republic, it is the Act No. 183/2006 Coll. on town and country
planning and building code (Building Act), as amended, and regulations of the Sports
Associations (if any) that apply for the construction of sports facilities. For example, the
parameters prescribed by the “UEFA License Proceedings” in the area of infrastructure.

17
Each association and club may also issue rules regulating the behaviour of spectators
(alcohol consumption, indecent and violent behaviour, etc.).

There is also an effort to regulate the sporting activities to prevent corruption, limit gaming
and gambling procedures for betting and not to undermine the gambling market by leaking
information needed and unfair agreements.

Scope and forms of state intervention

The state may interfere with the sport in different ways. It depends on the state ideology,
state values and the overall philosophy of the state and Government structures. According
to the fundamental values that apply to the state intervention, Hoye et al. (2012) recognizes
four basic approaches.

A: Conservative approach – traditional values, traditional solutions

 The state makes efforts to regulate social life of the people – control and regulation
of everything that is considered offensive, control of the distribution of legal drugs,
such as alcohol, protecting people from themselves.
 On the other hand, there is the belief that business has to be left to the operation of
market mechanisms and a strong private sector is the key to great progress, which,
however, does not exclude state assistance and protection of the industry if
necessary.
 There is respect for sport as an integral part of life for most people but there are no
efforts to assist or protect it as an industry because it is not part of the world of
business.
 Sport works best when it is left to itself when amateurs play, volunteers manage and
the overall management is left to the sport itself.

B: Reformism (welfare-state/state of well-being, social democracy)

 The accepted values are social justice and equality.

 Reformists are aware of the necessity of the existence of a strong private sector but
they believe that it is able to provide fair and just results; therefore it must be strictly
controlled.
 Management of the private sector is in the form of additional, state-owned
businesses, or in the form of strong regulation of business behaviour.
 Reformists share the view with conservatives that the existence of assistance and
protection can be in the public interest.
 Reformists, unlike conservatives, believe primarily in social development based not
only on freedom, but also social justice.
 Redistribution of income for disadvantaged groups is, according to the reformist
group, important, therefore the wealthy individuals and corporations are taxed more
heavily.
 Public consumption is understood as a tool to stimulate the economy at a time when
demand and consumption are low.
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  Centralism is seen as a mechanism for achieving positive social results.
 Sport is seen as a tool for social development, and, therefore, it must be accessible to
the entire society.
 Support programmes are aimed at minority groups, the disabled, migrants, women
as well as less elite sports.

C: Neo-Liberalism

 The belief that a healthy society is based on people who live their daily lives without
chronic interference by the state is important.
 The rule of law state is important, but in addition, there is the freedom of the people
to organize their lives and businesses, as is appropriate for them.
 Neo-Liberalists do not see the importance of state-owned enterprises and argue that
the privatization of government services brings their efficiency and quality.
 The deregulated industry brings advantages and works better than the regulated
one.
 The state should not be directly involved in most economic activities, but it should
rather provide basic infrastructure together with the legislation so that the private
sector could develop and survive.
 Sport is regarded to be an important social institution, but should not be strictly
controlled.
 Sport can also be used as a tool for building national awareness and economic
development. It should be supported in these cases.
 It prefers the politics of sport, which focuses on elite sport at the expense of
community sport.

D: Socialism

 Socialism believes that the combination of private and unregulated market produces
a range of inequality and alienation.
 The capitalist way of production and distribution must be replaced by a strong state
where the allocation of resources is centrally controlled.
 Similarly to the neo-liberals, socialists agree that sport is an important social
institution but, unlike neo-liberals, socialists bet on the application of the control of
sport from the centre to ensure that there is equitable distribution of clubs and
facilities in the society.
 Development of sport is supported by central bureaucracy that controls sport.
 The state provides funds and resources through which it develops elite and
community sport.

Systems of organizing sport according to national policy in

this area
The investigators of the VOCASPORT project (Vocasport Research Group, 2004,
http://www.easesport.org/art.php?id=3218) defined within Europe the
19
following categories of national policies in relation to management of sport
(sports political systems):

1. “Bureaucratic configuration” – shows a high degree of involvement of the state; this

category includes 16 states including the Czech Republic.
2. “Missionary configuration” – the voluntary sector operates in delegated scope of
authority; this category includes 6 states: Austria, Denmark, Germany, Italy,
Luxembourg and Sweden.
3. “Business Configuration” – is characterized by a high degree of involvement of
market forces; this category includes Ireland and the United Kingdom.
4. “Social configuration” – strong presence of social partners in the framework of
multilateral system; into this category belongs only to one state – the Netherlands.

Specific sketches of the different political systems in sport

We can realize the definition of the basic differences of the above-mentioned four
configurations of political systems in sports, as shown in Table 1, according to the following
basic criteria:

a. Decentralization (public sector works as a partner to achieve change)

b. Centralization (public sector works as an agent for the implementation of specific
requirements of the state)
c. Continuity and stability
d. Innovation and competitiveness
e. Crucial actors in the politics of sport

Table 1 Basic difference in political systems in sport

Criterion Bureaucratic Missionary Business Social

configuration configuration configuration configuration
Decentralization Weak Strong Weak Strong
Centralization Strong Weak Strong Weak
Continuity and stability Strong Weak Weak Strong
Innovation and Weak Strong Strong Weak
competitiveness
Crucial actors in the State sector Voluntary Private Social
politics of sport sector sector partners

Source: Own processing on the basis of Henry (2009)

Other difference in political systems in sports is possible to realize, as listed in Table 2,

according to the following economic criteria:

a. Focus of the provision of services

b. Main objectives

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Table 2 Basic differences in political systems in sport according to objectives and main
aims

Criterion Bureaucratic Missionary Business Social

configuration configuration configuration configuration
Focus of Throughput Short-term Short-term provisions, Long-term
the and processes and medium- outputs results and
provision term results capacity-building
of services
Main A: Regulation of A: Expansion, A: A: Commitment,
objectives processes adaptation Monitoring/auditing/ belief, influence
through state B: Innovation, maximizing of B: Long-term
authorities flexibility immediate outputs investments/
B: Monitoring C: Monitoring B: Achieving output on results in culture
of standards of results the basis of contractual change, building
and systems obligations capacities
C: Joint policy in
making in sport

Source: Own processing on the basis of Henry (2009)

Consequences of bureaucratic policy configuration of sport in the Czech Republic

1. Public authorities play a very active role in the regulation of the sport system.
2. There is a legislative framework for specific areas (e.g., the Act on Promotion of
Sport).
3. This is a system characterized by rules that derive from the activity of public
authorities, which have a political/democratic legitimacy, and, during the formation
of the rules, they necessarily need not negotiate to any great extent with the other
actors in sport so as to achieve a harmony of interests.
4. The voluntary sports movement operates on the basis of authorization (e.g., the Act
on Volunteering).
5. Social partners in negotiations may be absent, or are ignored.
6. Users/consumers of sports products and private entrepreneurs have a low impact on
the realization of the state policy in sport.

Tasks for self-study:

1. Read, analyse and search for passages from „Concept of the Sport Development in
the Czech Republic“, which points to the bureaucratic policy configuration of sport in
the Czech Republic (http://www.msmt.cz/sport/koncepce-statni-politiky-v-
telovychove-a-sportu-v-ceske-republice).
2. Compare the concept of the sport development in the Czech Republic with the
concept of development of the same in Australia in the years 1980–2012 (Hoye,
2012, p. 25–27).

21
Non-Profit Sector and Sport
This chapter contains the following topics:

 Definition and role of non-profit organizations in sport

 Types of non-profit organizations in sport
 Volunteering in sport

Definition of non-profit organizations in sport and their role

You can find non-profit organizations under different names: volunteer, non-profit, non-
governmental, community, club, association, cooperative, friendly companies, civil societies
and the third sector.

We will define this concept by emphasizing the basic identification features:

 They are institutionally separate from the state.

 They do not pay profit to the owners.
 They are self-governing.
 They are associated with volunteer work.
 They are formally separate legal entities.

Non-profit organizations and their importance for sport

Fig. 8 People Rainbow Star

Source: Image courtesy of Vlado
FreeDigitalPhotos.net

22
According to Hoye et al. (2012), all non-profit organizations in sports have these features in
common:

 they are not focused on profit,

 their mission is to enable and facilitate its members with opportunities to do sports,
 their members are individual athletes, coaches, official representatives,
administrators, clubs, associations, and other sports organizations,
 they are independent, rely only on themselves with the issues of player talent
resources and trainers (and their development),
 they obtain information for participation in competitions and the means for their
activities,
 volunteers are at the core of their activities, but to ensure their operation and
provision of services, they must also employ paid workers.

Non-profit sports organizations work on the principle of the public interest (i.e., they do not
produce wealth for individuals). They exist to:

 ensure the needs of identifiable marginal and very specific groups in the society, in
defined geographical areas or its members,
 cover the gap in the provision of sports services, which are not managed by the state,
nor the market sector, and are based to a large extent on the efforts of volunteers,
with the occasional support of paid staff,
 create a space for the involvement of citizens and enable individuals to engage their
talent, time and energy to group sport activities and things that would not otherwise
be ensured neither by the state nor private sector.

Non-profit organizations are generally managed by volunteers. Their activity is based on

time and finance of volunteers, to whom they enable to contribute to the development of
local, regional, national and global communities.

Sports services are different. The cost, number of volunteers, amount of paid staff and
management level are derived from this. Large and significant non-profit organizations
receive financial support from the state and, vice-versa, small charitable and socially-
oriented organizations have a problem to cover the demand, because they have difficulties
with providing the financing of their activities and obtaining volunteers.

International classification of non-profit organizations in sport:

ICNPO (International Classification of Non-Profit Organizations) determined the category for

sport and recreational organizations, which includes three major subgroups:

1. sport, amateur sport, training, fitness and sports facilities and sports competitions
and events;
2. recreational and social clubs, children’s playgrounds, the Apex Association, interest
associations;
3. service clubs, such as Lions, Rotary, Kiwanis and Apex.

23
Special attention is to be given to the organizations that work in the sport industry on a non-
profit basis, including professional service organizations, groups of the industrial lobby,
organizations for the provision of sporting events and sports governing bodies.

Types of non-profit organizations in sport

I. Professional service non-profit organizations

They work similarly to a professional association, for example the Association of

Lawyers and Accountants.

Standards for practice and relevant industries are set and provide professional
accreditation for qualification of their members. They also offer opportunities for
professional development through organizing conferences, seminars and training
programmes.

They work on a similar principle as business, but their aim is to return profit to the
members by improving services and create wealth for the owners.

Example: The Australian Council for Health, Physical Education and Recreation
(ACHPER); Canadian Association for Health, Physical Education, Recreation and
Dance; British Institute of Sports Administration; Physical Education New Zealand.

II. Lobbying groups that represent the interests of non-profit organizations

They are independent organizations for the national governing and representative
bodies in the field of sport and recreation. They promote their interests in relation to
the Government and players in the sports industry.

Example: Central Council of Physical Recreation (CCPR) in the UK – the representative

body for national sports organizations; Sport Industry Australia in Australia.

The largest and most influential non-profit organizations in the world of sport are
ranked within this category:

The International Olympic Committee (IOC) and the Commonwealth Games

Federation (CGF).

IOC was founded in 1894. It is an independent, non-profit organization that provides

for the Olympic movement and whose primary task is to supervise the organization
of the Olympic Games.

Every four years CGF supports the main event – games, in which there are 53
Commonwealth countries involved.

24
 IOC and CGF operate on the basis of contributions from the governments of the
countries where the games are organized, from the sales of broadcasting rights, from
corporate sponsorships, from ticket sales and licensing and from the sales of goods.

III. Specialized/professional non-profit organizations that focus on small

groups in the community
o International Paralympic Committee (IPC), the Paralympic games
(http://www.paralympic.org/)
o Cerebral Palsy (in children), International Sports and Recreation Association
o International Blind Sport Federation
IV. Sports governing bodies and sports clubs

In all the countries where the sport is based on the club activities, the so-called club
based sporting system (United Kingdom, Canada, New Zealand, Australia and Czech
Republic), almost all sports teams and competitions are organized by non-profit
organizations and take on different forms:

o small local clubs — a few teams in the local football league,

o regional associations – coordinate competitions between clubs,
o national or regional organizations – support competitions, but also the
development of coaches, talent identification, training of volunteers,
marketing and sponsorship,
o national sports organizations/associations – regulate the rules of
competitions in the country, coordinate competitions at the national and
regional levels, coordinate national championships, manage programmes for
elite/top athletes, for development of workers and carry out other tasks to
support participation in sport.

“The governing bodies in the field of sport in the Czech

Republic”
The governing bodies are defined by Act No. 115/2001 Coll. on the promotion of sports,
which defines the status of sport in the society as publicly beneficial activity and establishes
tasks of the ministries, other administrative authorities and the scope of territorial self-
governing units in promoting sports. This law lays down the tasks of the ministries, other
administrative authorities and the scope of territorial self-governing units in promoting
sports.

Tasks of the ministries in relation to sport

A key role, in particular with regards to the development of sports, is played by the Ministry
of Education, Youth and Sports in the Czech Republic. Under section 3 of the Act, the
Ministry:

25
 a. prepares the draft of the concept of state policy in sports (referred to as “concept”)
and submit it to the government for approval,
b. coordinates the implementation of the government-approved concept,
c. provides financial support for sports from the state budget,
d. creates conditions for the state sports representation, for preparation of sporting
talents, for development of sports for everyone and for the sport of disabled citizens,
e. issues an anti-doping programme and organizes and controls its implementation,
f. decides about the accreditation of educational establishments operating in the field
of sports,
g. establishes resort sports centre and ensures its functioning,
h. coordinates the activities of the resort sports centres of the Ministry of Defence and
the Ministry of Interior.

`Other ministries that ensure mostly the state sports representation are the Ministry of
Defence and the Ministry of the Interior, which in their scopes create conditions for the
development of sport, preparation of the national sports representation and the preparation
of sporting talents. They set up resort sports centres and ensure their activities. The Ministry
of Health then organizes within its scope of activity health care for state sports
representatives and sporting talents and creates organizational conditions to allow specific
access of sports representatives to clinical care, establishes a Doping Control Laboratory and
secures its activity in the range specified by the International Olympic Committee; Doping
Control Laboratory is an organizational component of the state.

Tasks of regions, towns and municipalities in relation to sports

Regions in their separate scope create conditions for sports, in particular

a. ensure the development of sport for everyone and the preparation of sporting
talents, including the disabled citizens,
b. ensure construction, reconstruction, maintenance and operation of their sports
facilities,
c. provide financial support for sports from their budget,

Municipalities in their separate scopes create conditions for sports, in particular

a. ensure the development of sport for everyone and the preparation of sporting
talents, including the disabled citizens,
b. ensure construction, reconstruction, maintenance and operation of their sports
facilities and provide them for sports activities of citizens,
c. check appropriate use of their sports facilities,
d. provide financial support for sports from their budget,

Separate or umbrella associations in sports

The CZECH OLYMPIC COMMITTEE (COC) http://www.olympic.cz/

26
According to the Olympic Charter, it is to develop and disseminate the Olympic ideals and to
represent and ensure the participation of the Czech Republic in the Olympic Games. The COC
aims to improve the status of sport in society and make it available to the general public. It
seeks to improve the financing of sport; it particularly focuses on the youth.

The CZECH UNION of SPORT http://www.cuscz.cz/

The Czech Union of Sport is the largest sports organization in the Czech Republic. It brings
together 73 sports associations and 77 regional associations and more than 9,000 sporting
unions (TJ and SK) with more than 1.5 million members, of whom approximately 160,000
volunteers dedicate their free time to organizing sports activities. In addition to participating
in regular competitions, sports unions organize TJ and SK in ČSTV annually more than 2,000
open sporting events within the framework of the programme “Sportuj with us” (“Sport with
us”).

The ASSOCIATION of SPORTS FEDERATIONS http://www.sporty-cz.cz

The Association of Sports Federations in the Czech Republic is, with the number of more
than 620,000 members, the second-largest sports organization in the country. It brings
together 17 member associations whose athletes are in the long-term period amongst the
successful representatives of the Czech Republic at top-level international competitions and
annually receive dozens of medals from the World Championships, Europe Championships
and World Cups. Activities of the Association of Sports Federations, however, are mainly
focused on the development of amateur and youth sports, but also on the daily activities in
the various unions within organizations in towns and municipalities in all regions of the
Czech Republic.

The CZECH ASSOCIATION SPORT FOR ALL http://www.caspv.cz/

The Czech Association Sport for All offers all those interested a varied selection of effective
physical activities: general gymnastics, recreational sports, aerobics, rhythmic gymnastics,
yoga, physical education for health, psychomotorics, exercise and outdoor activities, dance
sport, step, exercises for preschool children, exercises of parents with children, traditional
Chinese exercise and other experimental activities, whose suitability is being checked. CASPV
currently has 60,000 registered members and over 40,000 members in associated legal
entities. In addition to its members, CASPV appeals to the general public via the movement
„Pohyb je život“(“Movement is life”), which is aimed at promoting the importance of
physical activity, healthy diet and mental well-being in the life of a modern human being.

The CZECH SOKOL ORGANIZATION http://www.sokol-cos.cz

The Czech Sokol Organization (CSO) is the fourth-largest club in the Czech Republic, whose
nearly 190,000 voluntary members are voluntarily dedicating their time to sports, physical
activities in sections of Sokol versatility and cultural activities, primarily in folklore and
puppet ensembles.

27
OREL (EAGLE) – Christian sports organization http://www.orel.cz/

The objectives of the Orel (Eagle) are carried out via sports activity, which is the basis of
eagle activities. In addition to sports, the Orel (Eagle) also focuses on culture. The activity of
the Orel (Eagle) is based on Christian values. The Orel (Eagle) currently has 17,000 members,
who are members of nearly 250 clubs. The Orel (Eagle) operates throughout the territory of
the Czech Republic.

ASSOCIATION of CORPORATE SPORTS and HEALTH http://www.asociacefiremnichsportu.cz/

The Association of corporate sports and health, registered company, is an association of

companies and organizations that aim to be partners with companies that support and
actively participate in the inclusion of sport and sporting values of fair play in the business
environment in the Czech Republic. The main activities of the Association of corporate sports
and health, registered company, are to coordinate all activities in the area of company
sports in the Czech Republic, to organize their own sports and social events and inform
about all activities related to corporate sport, in which Czech companies and their
employees can participate. AFSZ now brings together 82 companies that support a healthy
lifestyle of their employees and their own business networking develops in conjunction with
sports.

Other separate or umbrella associations:

 Autoclub of the Czech Republic – www.autoklub.cz,

 Czech Shooting Federation – www.shooting.cz,
 Czech Tourist Club – www.kct.cz,
 Czech School Sports Clubs Association – www.assk.cz,
 Czech Paralympic Committee – www.paralympic.cz,
 Amateur Aviation Association – www.laacr.cz and others.

Volunteering in sport in the Czech Republic

There are approximately 200,000 organized volunteers in sport in the Czech Republic and
they ensure various kinds of the activities necessary for the operation of organized sport all
over the country. This is a highly professional work (coaches, trainers) that is tied to certain
education and work requiring professional competence (organizing, transport, maintenance,
etc.). Sport would become much less available without the contribution of volunteers. The
estimated value of their work exceeds the amount of financial support of sports from the
budget of the Czech Republic.

(http://www.dobrovolnik.cz/).

28
Fig. 9 People Network
Source: Image courtesy of Vlado / FreeDigitalPhotos.net

The activities of volunteers in sport are the basis for the activities of more than 10,000
sporting unions and sports clubs, which represents more than 25,000 sports departments
and almost 2 million members (http://www.branasportu.cz/).

Czech Union of Sport is the largest sports umbrella organization in the Czech Republic
(http://www.cuscz.cz/). It brings together 73 sports associations and 77 regional associations
and more than 9,000 sporting unions (TJ and SK) with more than 1.5 million members, of
whom approximately 160,000 volunteers dedicate their free time to organizing sports
activities. In addition to participating in regular competitions, sports unions organize TJ and
SK in ČSTV annually more than 2,000 open sporting events within the framework of the
programme “Sportuj with us” (“Sport with us”).

Tasks for self-study:

 On the website www.risy.cz – in the non-governmental non-profit organization part,
there is a database containing more than 3,600 organizations with national or even
local scope that have in individual regions a wide range of important activities. This is
an action in the field of health and social services, culture and education, providing
assistance in the times of need, etc. Choose two non-profit organizations, which
operate in the area or region which you come from and describe their focus.

29
Professional Sport
This chapter contains the following topics:

 Structure of professional sport

 Relationship between professional and amateur sport
 Management of athletes
 Strategies of results evaluation

Structure of professional sport

Fig. 10 Start Line Running Track

Source: Image courtesy of Sippakorn
FreeDigitalPhotos.net

Structure of professional sport consists of:

 professional sport leagues,

 professional sporting events,
 organizations that build and maintain their businesses on the basis of the existence
of professional sport (all business organizations in the field of sports industry).

Characteristics of professional sports organizations

Professional sports organizations have, according to Hoye et al. (2012) two main
characteristics that determine their definition:

30
  They have a scope of operations that range from commercial to financial operations,
and they usually exist at the top of the sports industry.
 All players or athletes are “professionals” – sport is their employment and they are
paid for the full-time training and sports performance. Sports, in which players or
athletes are required to find another job to supplement their income, cannot be
regarded professional.

Importance of professional sports leagues

They are characterized by stability and cohesion, on which their popularity is built. They
were rooted in what is now called that it “belongs to a cultural or social group”, and in this
way, professional sports leagues and their clubs have become an important factor for
personal identification and understanding of who they really are, for many of their fans.
They have become part of our cultural and commercial consumption because they are held
periodically and are gaining interest of the audience, to which they provide a unique
sporting experience.

The most famous sports leagues abroad: in the U.S.: the National Basketball Association
(NBA), the National Hockey League (NHL), the National Football League (NFL), the Major
League Baseball (MLB).

Mostly football leagues are famous in Europe: UEFA Champions League, UEFA European
League, Premier League (England), 1st Bundesliga (Germany) and Ligue 1 (France), Primeira
Liga (Portugal), Eredivisie (Netherlands). From the hockey league, it is the Continental Cup
and European Trophy.

In the Czech Republic it is, e.g., football – Gambrinus League, ice hockey – Czech Extraliga,
basketball – Mattoni NBL.

Importance of professional sporting events

There are dozens of professional sporting events organized daily in the world.

The best known are, e.g.: Rugby Union, Cricket World Cups, tennis tournaments the
Australian Open, US Open, French Open and Wimbledon, in football the FIFA World Cup, the
European Champions League. Of course, this includes both winter and summer Olympic
Games.

In the Czech Republic a large number of sporting events is also organized, and therefore we
refer to Internet portals, where you can find relevant information about the events and their
organizers:

 http://kalendar.odkazynaweb.cz/
 http://www.sportmart.cz/sportovni-akce
 http://www.kalendarakci.atlasceska.cz/sportovni-akce/

31
Professional sport as a business

Prior to the commercialization (at the end of the 1970s), the subject of interest was only
focused on an area of sport, but nowadays, it includes everything else related to sports.
Companies operating in the sports industry, including sports clubs (usually it is a
requirement of the league where it operates) are business entities.

The sports industry is a market, in which operate people, entrepreneurs and organizations,
business enterprises and all the others who are involved in the production, facilitating,
support, or organizing any activity or experience focused on sport. It is a market, on which
products related to sport are offered. It may be goods, services, people, places or ideas
(West Virginia University). Examples of organizations belonging to this group are NIKE,
PUMA, ADIDAS, FILA, and media corporations, for example, TSN, The Score, Sun Sports, and
corporations running business in the area of products for health, for example Goodlife, or
Sports Medicine Clinics. Virtually any organizations that offer products or services related to
sport are included in this category.

“The development of sport entrepreneurship in the Czech Republic, according to data from
the Administrative Register of Economic Entities (http://wwwinfo.mfcr.cz/ares/ares.html.cz)
is oriented by CZ-NACE (classification of economic activities), it focuses in particular on the
following areas: management of sports facilities, activities of sports clubs, fitness centres
and other sports activities. A popular form of business in sport is also franchising –
www.franchisinginfo.cz. In addition, on the basis of the traditions of the textile and clothing
industries business with sports clothing and accessories develops (see domestic brands:
AlpinePro, Hannah, Litex, Draps, Husky, AXIS).”

Relationship between professional and amateur sport

Professional sport and industry that works around it dominates the world of sport.
Professional athletes are celebrities on a global scale. Local, regional and national sports
organizations often focus on the provision of offers for professional sports leagues by
developing the talent of the players and the interest of the audience. Ironically enough, it
must compete with professional sport for the interest of the media, sponsorship and support
in general (from fans, governments, cities and municipalities), unfortunately, this often
happens in vain.

In the relationship of the professional and amateur sport, two alternatives can occur (Hoye
et al. 2012):

 better case – professional sport is the peak of the sports industry and generates
financial resources and cultural prestige even for amateur organizations at lower
levels;
 worse case – professional sports acts as a predatory commercial animal with an
insatiable appetite for financial, cultural and social resources that it consumes for its
own interests.

32
Management of Athletes
Its development depends on the professionalization of sport and the amount of money
obtained through broadcasting rights and sponsorship, which enabled an increase in the
wages of players and athletes. Wage increases are reflected in the current rise in
anticipation of clubs and leagues, increasing complexity of negotiations in the conclusion of
contracts and broader possibilities for the use of prominent athletes in commercial activities.

Fig. 11 Long Boat Competition

Source: Image courtesy of Hinnamsaisuy FreeDigitalPhotos.net

All this has led to the emergence of new area of business in field of management of players
and athletes. It is the provision of services to athletes for a fee (usually as a percentage of
revenue of the athlete).

IMG – International Management Group

IMG – International Management Group, one of the most prestigious companies in this area,
founded in 1960, it now has 2,000 employees and 70 offices in 30 countries. Division of
players management spread over time on TV and editorial division.

The founder was Mark Mc Cormack who “branded” the golfer Arnold Palmer (winner of the
US Master Golf Tournament in 1958, 1960, 1962, 1964; the US Open in 1960; the British
Open in 1961 and 1962, the first athlete to be branded).

It consists of interconnecting sport and business in a unique range of the so-called vertical
and horizontal integration (“Sportsbiz”), (Boyle & Haynes, 2000).

Mc Cormack has changed the traditional relationship between the agent and the athletes:

 He started to proactively negotiate contracts and seek opportunities for business.

 He planned sales for longer periods of time (vs. ad-hoc).

33
  He founded an important precedent – the sale of athletes as tradable commodities.

Octagon Case

It is a global marketing company. It is competitive to IMG, it represents and promotes more

than 700 athletes in more than 35 different sports throughout the world. It provides the
athletes with the following services:

 negotiations of contracts,
 marketing activities and support,
 PR and involvement in charities,
 financial planning,
 media management,
 developing,
 involvement of the speaker.

Česká sportovní a.s.

In the Czech Republic, Česká sportovní a.s. is an example of a company dealing with
management of players. Česká sportovní a.s. was founded in 2001 and it is a leader in the
field of sports marketing in the Czech Republic, even in the context of the Central European
region. It provides comprehensive services in the field of the organization service, marketing,
sponsorships in conjunction with top sports projects, personalities and client actions,
implemented on a European scale and according to international standards. In addition, it
organizes more than 3 dozens large international sporting events (Euroleague Final Four
2006 / NHL Premiere 2008, 2010 / SWATCH FIVB WorldTour 2008, 2011, 2012 / CEV Indesit
Champions League 2009 / FIBA World Champinship for Women 2010 / 2012 Fed Cup Final /
2012 Davis Cup 100th Final...).

For more information, see http://www.ceskasportovni.cz/.

Strategies of results evaluation in professional sports

In professional sports, there are different types of ownership and management models to
achieve efficiency. In principle, however, according to Hoye et al. (2012), there are two types
of professional sports teams and leagues, depending on their priority:

 Profit maximizers (financial priority)

 Winning maximizers (operational priority)

The difference is important for maintaining a competitive balance – maintaining the

unpredictability of results in order to maintain the interest of the audience, sponsors and the
media. Dimensions of competitive balance are described in Table 3.

34
Table 3 Dimensions of competitive balance

Dimensions of Definition
competitive balance
Game Each game is associated with uncertainty; the greater is the
uncertainty, the higher the competitive balance.
Seasonal unpredictability The degree of uncertainty in the league in a given season.
Championship The degree of uncertainty whether someone becomes a
champion.
Relegation Uncertainty associated with whether or not the team will face
relegation at the end of season
European football Uncertainty about which team will qualify for various European
competitions.

Source: Translated by the author of the e-learning text from Groot (2008)

American professional sports leagues – private ownership and interested in maximizing the
financial return of investments is typical for them.

English, Scottish and Australian football and cricket – they are more interested in winning
than in profit, but this leads to financial threats to the clubs (purchase of players that the
club cannot actually afford).

Tasks for self-study:

 On the website www.justice.cz, locate information on sports clubs with the legal
status of s.r.o. (limited liability companies) or a.s. (joint-stock company) and choose
two of the same league. On the basis of available documents (in particular, the
annual reports, profit and loss reports and balance sheets) and the position of the
club in the league, try to analyse what strategy clubs use (financial priority, the so-
called profit-maximizers, or operational priority, the so-called win-maximizers).

35
Principles of Strategic Management and
Strategic Choice in Sport
Strategic management (SM):

It includes an analysis of the position of the organization in a competitive environment, the

determination of the direction and goals of the organization, the selection of an appropriate
strategy and the use their distinctive assets. The success of sports organizations largely
depends on the quality of their strategic decisions and that is the reason why sports
managers in a competitive environment must learn to implement a meaningful marketing
analyses, establish a clear goal of development and create a strategy, which will match the
opportunities.

This chapter contains the following topics:

 Characteristics of strategic decision-making in sport

 Strategic sport management and strategic management process

Characteristics of strategic decision-making in sport

 The strategy affects the direction and the scope of activities of the organization.
 The strategy includes the activities of the organization that correspond to its
environment.
 The strategy requires a comparison of the organization’s activities with its resources
and capabilities.
 The fundamental of strategy is influenced by the opinions and expectations of key
owners and interest groups.
 Strategic decision-making affects the direction of the organization in the long run.

36
Fig. 12 Business Success Pyramid
Source: Image courtesy of Stuart Miles
FreeDigitalPhotos.net

The main purpose of the strategy

 The manager should understand the organization as such, know its environment and
determine the organization against the competition (e.g., how is my football club
different from another, why should the customer choose my resort and not another
one in the same region).
 Uniqueness is our competitive advantage, we have to be able to name and define it,
and our competitors find it hard to imitate it.

Difference between strategy and planning

 Strategy is the process of determining the direction of the organization and the scope
of its activities with regard to its capabilities and the environment, in which it
develops its activity.
 Planning is the process of documentation of these decisions, the step by step
process, which indicates what should be done, by whom, with what resources, and
when.
 Strategy reflects a combination of analysis and innovation.
 Planning identifies in a systematic and deductive way steps and activities that must
be carried out for the implementation of the strategy.
 Strategic management ties strategy and planning into one single process.

Why should we apply SM in sports?

Many people argue that SM is not applicable due to the natural characteristics of the sport –
that it is rapidly changing and evolving, therefore, they prefer to apply the approach of
responding to emerging circumstances and events. SM, however, stresses the importance of
active creation of the future of the sports organizations.
37
A proactive approach during the creation of a own proper strategy helps to reduce the high
level of uncertainty, which is typical for the chaotic and ever-changing sports industry –
sports performance has a radical impact on the success of the organization.

Strategic sport management and strategic management

process

Fig. 13 Success Chart

Source: Image courtesy of Stuart Miles
FreeDigitalPhotos.net

The key question, which shall be dealt with in the process of strategic management (Table
4), is how to achieve a balance between two or more divergent commitments. These
commitments usually are:

 achievement of elite success,

 improvement of the level of participation,

which brings problems from a strategic point of view with the allocation of financial
resources. International success in a given sport usually motivates people to participate
more, but the sustainability of this indicator is not proven in the long term.

38
Table 4 Strategic management process

Strategic analysis Internal (abilities, weaknesses, SWOT, Porter’s model,

interested parties) competition analysis, analysis
External (environment, of customer needs
competition, customers)
Strategic direction Vision, mission, goals Performance indicators
Formulation of the Strategic options Generic strategies:
strategy
 Cost price leader
 Differentiation
 Aiming at the target

Implementation of the Implementing the strategy Products

strategy Services
Systems
Structure
Culture
Evaluation of the strategy Measurement of performance Corrective action

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

Strategic analysis

Alongside the SWOT analysis, there are also these tools for strategic analysis:

 analysis of the needs of the customers and interest groups

 competition analysis (Table 5)
 Porter’s five forces analysis

Analysis of the needs of the customers and stakeholders/interest groups

 Stakeholders/interest groups – i.e. all who have an interest in the organization (staff,
players, members, the league, or associated managing authorities, the government,
the municipality, the city, the owner of the facility, sponsors, broadcasters and fans).
 The constant question is: What is the benefit of these activities that we (can) bring
and what implications does it have for our work?
 A strategy is largely influenced by beliefs, values and expectations of the most
influential stakeholders.
 Customers – it is necessary to specify their needs, where we can take advantage of
the division of target groups in sport according to lifestyle (Koncepce rozvoje
tělovýchovy a sportu ve městě 2005).

39
Table 5 Analysis of competition – dimensions

Dimension Description
Geographic scope Sites and overlap
Vision and intention From survival to gaining dominance
Goals Short-term and medium-term
Market share and From small players to virtual monopoly
position
Strategy Methods of obtaining competitive advantages
Sources Quantity and availability
Target market Who are the products and services intended for
Approach to marketing Products and services, promotion, pricing and distribution

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

Strategic direction

Conventional tools for determining strategic direction:

 Mission statement,
 Vision statement,
 Organization’s goals,
 Key indicators of performance.

Formulation of the strategy

On the basis of strategic analysis, it is possible to determine the competitive position of a

sports organization and determine its strategic direction. The sports manager has readily
available three generic strategies and the choice of one of them depends on the source of
competitive advantage of the organization. It can be:

 price/cost leader,
 differentiation,
 focus.

Implementation of the strategy

A range of measures to secure the implementation depends on the chosen strategy and
goals. The degree of involvement is important as well as the understanding of the strategy
by all departments and employees of the sports organization. Changes in the allocation of
resources, organizational structure and culture, systems and leadership are important.

Evaluation of the strategy

It is a continuous process that is focused on three aspects:

40
  Key performance indicators associated with organizational goals that must be
compared with current results,
 You must ensure that the activities leading to the implementation of the strategy
have been successfully implemented,
 It is important to deal with organizing and securing of the strategy, also known as
strategizing at the same time.(1)

Tasks for self-study:

 Study the following two strategic materials (the Strategy of the Slovak Football
Association and the Czech Rugby Union) and critically evaluate the extent, to which
all the components of the process of strategic management at the time of their
creation have been implemented.

http://www.futbalsfz.sk/fileadmin/user_upload/SFZ_official/20130301_Strategicky_
plan_2011-2014.pdf
http://www.rugbyunion.cz/strategicky-plan-2012-2016

1. Strategizing – organizing way of thinking

41
Organization and Organizational Structure in
Sport
The organizational structure is important for defining the status of paid people and
volunteers in the process of carrying out the tasks, decision-making, cooperation, the level of
responsibility and the mechanisms of reporting in sports organizations. Finding the “right”
structure means for sports organizations to find the right balance between the formalization
of procedures and room for innovation and creativity of workers at present adequate control
so as not to “kill” the motivation and the approach to work.

In a complex sports environment, the responsibility of the manager is to clarify lines for
communication and reporting between different groups of external and internal interest
groups so that the levels of management do not increase unnecessarily. Unique cooperation
between paid and voluntary labour in sports is something that other managers do not need
to deal with.

This chapter contains the following topics:

 Conditions of internal organization in sport

 Specifics of the performance of the managerial function in the organization of sports
organizations
 Challenges for sports managers in sports organizing

Conditions of internal organization in sport

Fig. 14 Networking
Source: Image courtesy of digitalart
FreeDigitalPhotos.net
42
A manager at any level of sports hierarchy must secure the creation of conditions for the
implementation of the proposed organizational activities. They must therefore ensure that
the necessary actions and their groupings according to sources and situations are identified
and classified. An integral part of this is also (especially in the case of the major sports
organizations or during the organization of major sporting events) the delegation of
horizontal and vertical coordination of powers and information flows and relations, which
create conditions for effective management and control.

The structure of sports organizations when organising in sport, is influenced especially by:

 The strategy of the organization,

 The size of the organization,
 The technology,
 The uncertainty of the environment.

Strategy and structure

Sports organizations solve the implementation of their strategic development of the internal
structure so that they have available human capital to use up all the possibilities of financing
their activities. Non-profit organizations where there are paid and non-paid employees
(professionals and volunteers) working, the organizational structure must be set so as to
make it possible to realize the benefits arising from the professionalism of the staff and the
decision making of the volunteers who typically have, as members of decision-making
authorities, influence on the determination of the strategy of the sports organization. It is
then important to achieve understanding in the field that changes to the structure of the
organization are inevitable for the new strategy.

Technology and structure

Robbins et al. (2004) argue that the more there are routine tasks in an organization, the
higher degree of division into departments and the higher level of centralization there is. A
professional sports club that uses ICT also needs new specialists (video technicians,
statisticians, network programmers, etc.). The final effect is higher departmentalization and
specialization. When dealing with the process of organizing in a sports organization, it is
necessary to determine, which tasks can be replaced by technology and new specialists.

Uncertainty of the environment and structure

Uncertainty in sports organization is caused by the behaviour of:

 suppliers,
 service providers,
 customers,
 sponsors,
 athletes,
 volunteers,

43
  employees,
 stakeholders/interest groups,
 the state,
 changes in economic and market conditions.

Organizational structure in a sports organization

The organizational structure is a framework that provides a scheme of how tasks are split,
grouped and coordinated in an organization (Robbins et al., 2004).

Each sports organization has its structure outlining tasks to be done by individuals and
teams. Finding the right organizational structure in sports includes the solution of
requirements to formalize procedures while encouraging innovation and creativity.

Dimensions of organizational structure:

 Specialization of work
 Division into departments
 Hierarchy
 Scope of control
 Centralization
 Formalization

They apply when creating any kind of structure but have their peculiarities in the formation
of the organizational structure of a sports organization.

Specifics of the performance of the organization function in

sports organizations
Specialization of work

It means creating roles for individuals so that they are able to specialize in the performance
of their work, which brings higher productivity and reducing wage costs. It can be applied to
organizations that produce sporting goods or that need to process a large volume of
resources, for example distribution of uniforms and information for volunteers at large
sporting events.

Most sports organizations employ a small number of people who are required to perform
various tasks. The principle of a low specialization of work applies, which, however, requires
that an individual has a whole set of skills required for the performance of tasks.

44
Division into departments

It means the organization of employees into groups that carry out related tasks.
Different approaches to division are applied (individually as well as at the same time).
They are applied according to:

 Function,
 Product or service,
 Process,
 Geography,
 Type of customer.

Examples of division into departments in sports organizations:

 Functional – national and regional sports organizations have departments for the
development of athletes, the management of competitions and sporting events,
contacts with companies, etc.
 According to the product – for example, a manufacturer of cricket equipment
creates separate departments for production, sales and services for clothing,
manufacture of cricket bats, equipment for training; each of them has its own human
resources departments, financial services and marketing.
 According to the process – it is usually an organized company for the management of
players.
 By geography – a company engaged in legal services for a sporting area has its
branches where there are its clients and their requirements.
 According to the type of customers – individual athletes or teams,
for example: Australian Institute of Sport http://www.ausport.gov.au/ais or
http://www.slavia.cz/zobraz.asp?t=klub-vedeni-klubu

Organizational isomorphism
Organizations that operate in the sports industry can, when it comes to their organizational
structure, meet with a phenomenon that is called organizational isomorphism (DiMaggio &
Powel, 1983).

Isomorphism is a process that causes organizations in the same “business area” to become
similar in regards of their internal organization.

There are:

 Coercive isomorphism –organizations are similar because a law, regulation or parties

involved develop pressure to do so.
 Mimetic isomorphism – organizations become more and more similar to one
another on the basis of mutual imitation.
 Normative isomorphism – organizations that employ one and the same professionals
become similar because these professionals have similar values and ideas.
45
Using the classification for sports organizations, designed by Gómez, Opazo, a Marti (2007),
there is a possibility to a relation between the type of organization, their activities, and their
typical organizational structure, as follows:

 Sports governing bodies which are aimed at the development of formal rules.
 Organizations organizing sporting events which are focused on economic
competition.
 Organization providing sports activities which are aimed at providing physical
activities.

In the Czech context, we propose to incorporate the existing sports organizations in the
above classification as follows (Nová, 2013):

1. Sports governing bodies are all sports associations at the national and regional
levels, including the administrative authorities, which work for regional or local
administrative units (regions, cities, municipalities).
2. Organizations organizing sporting events are professional teams, leagues and
competitions mostly organized by business entities.
3. Organizations providing sports activities are local sports clubs and sports
organizations that implement sports activities on the basis of authorization from local
and autonomous authorities or are within the framework of inclusion in the structure
of the relevant sports association.

Types of organizational structures, which usually occur in sports organizations, were defined
by Hoye et al. (2012). Sports organizations most often organize their internal structure
according to the four standard models:

1. Simple organizational structure

2. Bureaucratic organizational structure
3. Matrix organizational structure
4. Team organizational structure

Their differences can be described using the dimensions of organizational structure, as listed
in Table 6.

Table 6 Differences of generic organizational structures occurring in sports organizations

Dimension Simple Bureaucratic Matrix Team

Specialization of work Low High High High
Division into departments Low High High Low
Hierarchy Low High High Low
Scope of control Wide Narrow Narrow Wide
Centralization Strong Strong Strong vs. Weak Weak
Formalization Weak Strong Strong Weak

Source: Own processing on the basis of Hoye et al. (2012)

46
Challenges for sports managers in sports organizing

Fig. 15 Hand Pointing on Mail Connection

Source: Image courtesy of Nujalee
FreeDigitalPhotos.net

The main challenge for sports managers in organizing sports is to keep balance between
cutting costs and increasing productivity. It means a wider use of ICT, management of data
and information, acquisition of competent employees, strengthening the team work, i.e.
creating an organizational structure that is flexible enough.

Among other challenges when creating an organizational structure in sport, there is,
according to Hoye et al. (2012):

 creating a reasonable level of formalization within the flexible organization (flexibility

in modifying the formal procedures),
 the ability to manage full specifics in sports organizations, i.e. simultaneous
management of paid staff and volunteers and the creation of an adequate
organizational structure, which is especially useful for efficient mutual
communication,

47
  implementing of changes in the organizational structure so as to allow the
implementation of the strategy,
 creating an opportunity to participate in important decision-making processes to a
large number of interested parties/stakeholders who have influence on the strategy
of the organization,
 creating an adequate organizational structure to involve relevant partners and
sponsors in internal decision-making processes. It is closely related to the creation of
functional positions for the maintenance of external relations.

Tasks for self-study:

1. On the basis of your own survey (web or any other sources), select any two
organizations active in sports (a non-profit one and a private/professional/business
one) and examine their organizational structure.
2. On the basis of available materials and documents, such as statutes, organizational
regulations, reports from meetings, or other sources published on the organization’s
website, describe the dimensions of the organizational structure and define them on
this basis the type of organizational structure of the selected organization. Critically
analyze the levels of management, distribution of rights, competences and
responsibilities in the organization in relation to its mission or strategy.

48
Human Resources Management in Sport
Human resources management is about ensuring an effective and motivated workforce. In
the complex sports environment, which includes the size of the organization, paid and unpaid
workforce, it is difficult and important because successful sports leagues, clubs, associations,
dealers and sporting event depend on the quality of human resources.

This chapter contains the following topics:

 Contents of human resources management in sports organizations and its specifics

 Modification of remuneration of human resources in sports environment
 Volunteers management

Contents of human resources management in sport and its

specifics
Logical framework of human resources can be structured in different ways; one of the
options is shown in Figure 16:

49
Fig. 16 Logical framework of Human Resources Management
Source: https://managementmania.com/cs/logicky-ramec-rizeni-lidskych-zdroju

Fig. 17 Darts On Target

Source: Image courtesy of ddpavumba
FreeDigitalPhotos.net
50
Human resources management in the sports environment is a very complicated
matter and it means:

 finding the right person for the right place at the right time,
 securing training required for the performance of work and ensuring that the
employees are satisfied,
 that it has a broader dimension than personnel management, which involves only
mechanical functions.

All sports organizations (sports leagues, clubs, associations, dealers, organizers of sporting
events) need high-quality human resources for successful fulfilment of their goals of their
strategy, therefore human resource management:

 becomes the central element in sports organization planning,

 cannot be separated from other management tools, such as strategic and financial
planning, and organizational structure and culture management,
 is a factor influencing the success of the organization and is a result of good
management and planning,
 is a holistic managerial function, which is “aimed at both goals as well as people”
(Smith & Stewart, 1999).

A comprehensive perspective on the management of human resources in a sports

organization is offered by a guru in this field, P. Chelladurai. His model is shown in Figure 18.

51
Fig. 18 Human Resources Management in Sports Model
Source: translated and edited by the author of the e-learning course from Chelladurai (2006)

52
Specifics of human resources management in sports context

Fig. 19 Businessman Pushing Human Button

Source: Image courtesy of phanlop88
FreeDigitalPhotos.net

In professional sports organizations, such as the NBA, MBL, or NHL, which are focused on
profit (profit-oriented), successful human resources management is identified with
profitability, long-term success and growth, which is measured by unbiased business
indicators. Management of human resources is considered to be a tool for promoting
business towards selected goals of the organization.

High fees for professional players have its business reason. Motivated players with good
results and behaviour are the workhorses of a positive public opinion and attract not only
fans, but also sponsors and lead to greater profit of the organization.

A non-profit organization operating in sports (such as the local football club) has an interest
in the development of responsible club culture for young players and its purpose can in the
first place be limiting alcohol consumption, which is primarily a non-profit purpose. The area
of human resource management focuses on the implementation of programmes for players,
coaches and administrators who may be paid or work as volunteers. It is, therefore, a
priority to implement programmes of social care for staff and players in the club. The result
is improved culture and persisting interest of the volunteers to continue working for the
club.

Taylor, Doherty and McGraw (2008) identified different profiles of employees in sports
organizations.

53
For example, professional Spanish La Liga has alot of paid staff who work in marketing,
coaching, sports science and general administration.

The functioning a local football club is based on the work of volunteers. Most likely, the club
has no paid employees.

Other sporting organizations usually have a mix of paid staff and volunteers with the usual
legal form being the responsibility of the paid staff towards the unpaid members of the
Board of Directors.

Professional and non-profit sports organizations must ensure the fulfilment of the same
functions, such as the organization of sporting events, promotion, raising financial resources
and membership services management, but the conditions for their performance in terms of
securing human resources vary.

The extent and the type of organization have an impact on the strategies and
practices in human resources management

The application of strategies and practices in the area of human resources management can
significantly affect the degree of professionalism of work in non-profit organizations.

For example, the implementation of social programmes for players in sports organizations
pursues different goals. Professional teams have social programmes for the players, which
are perceived as a tool for the maintenance and management of the brand’s credibility. A
local club would use this as a tool to keep the volunteers. The important thing is that the
strategy of human resources is in both cases focused on the goal and on the people.

Seasonality – pulsating need of human resources

Fig. 20 Pulsating Need for Human Resources Management in Sports

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

54
A majority of sports is played on a weekly basis and has either a summer (football), or winter
(hockey) season, or is played throughout the year (basketball). The regularity of the season
and competitions on either the elite or local level means that the human resources needs of
the sports organizations are predictable and remain relatively stable.

But there are plenty of sporting events and championships, for which it is difficult to plan the
number of visitors; therefore the number of employees significantly changes. These are
events that do not take place regularly in the region (Olympics), or Grand Prix (e.g., the
Monaco Grand Prix), which require a large number of employees for an intense period of
time. This phenomenon is illustrated in Figure 20.

Differences in institutional securing human resources management

Human resource management in the major sports organizations is is dealt with specialized
departments led by a member of the top management. Minor sports organizations do not
have the financial capacity for the creation of a separate department; therefore human
resources management belongs to the responsibility of the managers who are at the same
time responsible for other functions – marketing, planning and finance.

Modifications of remuneration of human resources in sports

environment
Personnel pyramid and remuneration

There usually are three types of employees in professional organizations who make up the
personnel pyramid:

Fig. 21 Professional Sport – Pyramid of Remuneration

Source: Edited by the author of the e-learning text from Hoye et al. (2012)

55
 1. Top level management – managers of business development, sales, marketing, etc.
2. Middle level management – sports department, coaches, etc.
3. Team – players.

There are people in non-sport organizations, e.g., the Director-General and other higher
positions, who are remunerated on the basis of financial bonuses based on the performance
of the organization (they have a share on the organization’s profitability that they control),
while employees at the bottom of the personnel pyramid do not have access to similar
bonuses.

The peculiarity of the sports organizations is that the people at the bottom of the pyramid
are paid the most (Fig. 21). In professional sports organizations, they are the producers (the
players) who are paid bonuses for performance.

Volunteers management
The estimated number of hours worked by volunteers in the UK is 1 billion annually.
(http://www.sportengland.org), in the 1990s, the Australian Sports Commission in
cooperation with the Australian Society of Sport Administrators have introduced a
programme aimed at professionalizing of the volunteers.

Volunteers represent a challenge for managers in terms of human resources management

because many sporting events happen at local, regional or national levels, and their
organization requires the participation of volunteers to provide services and maintenance of
sports equipment, etc. Their involvement depends on the type of sport and its popularity.
Even in the Czech Republic, working with volunteers gets a lot of attention in order to ensure
their engagement in all sports. The Czech Union of Sport has published a manual for working
with volunteers on its website, which stresses the need to care for them from their
acquisition, selection, familiarization with the club, training and rewarding up to their
keeping up or replacement strategy (http://www.cuscz.cz/sluzby-servis/dobrovolnici.html).

Tasks for self-study:

 Study the current manual for working with volunteers published at
http://www.cuscz.cz/sluzby-servis/dobrovolnici.html and the chapter from the
Chelladurai, P.’s book (2006) Human resource Management in Sport and Recreation
(3rd ed.). Champaign, IL: Human Kinetics (Chapter 1 in Part One, pp. 3 – 16) and
critically analyse the differences and similarities in approach to the motivation of
volunteers in sport. On the basis of your own experience, consider the applicability of
the mentioned motivational tools in practice.

56
Leadership
The success of the sports industry is based on organizations that have their leaders. They are
able to cooperate effectively with other organizations, operate professional leagues, work
with government institutions and agencies, national, international, and other interest groups
during the organization of major sporting events.

This chapter contains the following topics:

 Definition of leadership
 Theory of leadership
 Leadership in sports organizations
 Multidimensional model of leadership in sports
 Behavioural dimension of a leader in sports

Definition of leadership
There are many definitions of leadership but all identically say that the basic elements of
leadership are the following:

Fig. 22 Leadership Signpost

Source: Image courtesy of Stuart Miles
FreeDigitalPhotos.net

 a leader’s ability to influence behaviour of people, which is important for the

implementation of the goals,
 a leader’s ability to captivate people to follow the leader because they believe in him,
i.e. people identify with the vision that is offered to them.

57
The leader has a natural power but the source of his power can be different. They may not
always be associated with authority – the so-called informal leader.

Definition of leadership

Leadership is:

 skilful influencing and allowing others to achieve goals, which they are longing for
(Hoye et al., 2012),
 focusing on goals,
 seizing others in the form of trust and delegation,
 the ability to see the wider context – the “big picture”,
 about the need for cooperation with others,
 about the strength of character.

Theory of leadership

Fig. 23 Leadership
Source: Image courtesy of digitalart
FreeDigitalPhotos.net

Northouse (2010) divides the theory of leadership into categories that apply to:

 the characteristics of leaders,

 their styles,
 the situations, in which they must lead the people,
 the eventualities they face.

Other division recognizes the following theories:

 path – goal,
 transactional leader (leader-member exchange),
 transformation,
 authentic approach,
 team leadership,
 psycho-dynamic approach.
58
Features and personality of the leader

The theory of traits is generally based on the assumption that social origin, physical traits
and personality distinguish good leaders from the bad ones. These so-called great man
theories are criticized as incomplete because a good leader cannot be determined only on
the basis of innate characteristics.

Locke and Kirkpatrick (1991) say that certain characteristics are important for effective
leadership, such as energy and honesty. Leaders should be able to take advantage of their
features to develop skills, formulate their visions and implement them. Empirical research
demonstrating the relationship between the personality of the leader and their success is
weak, popular literature is still focused on defining the features of leaders for their better
understanding.

Psychological-Behavioural approach

The theory belonging to this group argues that the important thing is the behaviour of the
leaders who are effective and that anyone can become a good leader if they learn the
behaviour of successful leaders.

Behaviour is considered to be the sign of learned responses to events, i.e. if a certain

behaviour brought success in the past and then we will behave in that manner. The founder
is Elton Mayo (Hawthorn experiments), which includes the theory of X, Y people by D.
McGregor, i.e., it is managerial grid (Blake, Mouton), which differentiates the orientation of
the leader to people and tasks.

Contingency approach

The features of the leader and their styles are studied in relation to a given situation
(situational contingencies). Situational variables (structure of the task, characteristics of the
environment and the subordinates) may have an effect on the relationship between the
behaviour of a leader and different results. Therefore, you can apply different management
styles and approaches for possible managerial situations. The leading theories in this area
are:

 Fiedler’s LPC (Least Preffered Co – worker approach)

 Hersey and Blanchard (Situational Leadership)
 Path Goal Theory (Path – Goal)

Transformational leadership

To understand the difference between transactional and transformational leader, it must be

pointed out that:

59
The transactional leader

 leads in such a way to successfully reach present goals (improvement of the system
of remuneration for work performed, ensuring the work means, etc.),
 motivates its subordinates by providing rewards for performed work tasks.

The transformational leader (Bass and Avolio, 1994)

 is the provider of change, creates visions, inspires others, engages others in the
implementation of these visions,
 motivates employees to work on higher goals rather by giving rise to a sense of
complacency in them.

The transformational leader has five key functions:

 create a vision,
 set a strategy,
 set goals and lead to performance,
 influence and motivate people,
 facilitate change and develop the culture of the organization.

Leadership in sport organizations

Managers at the wheel of sports organizations must be able to:

 influence others to follow their vision (vision of the entire organization), strengthen
their sense of belonging to the team to achieve the common goals,
 cooperate with the leaders of other sports institutions to create an alliance to solve
conflict situations and to coordinate common business and development plans.

Leadership in sport gain different dimensions, depending on the specifics of sports

organizations, in particular as regards to the level of control and the main challenges and
issues to their leaders it is defined by Hoye et al. (2012) as follows:

1. Local sports clubs and regional associations and leadership

The major challenges for leaders at local and regional level

o How to survive in an environment where the interest of volunteers decreases.

o Competition for free time increases, therefore a potential source of cheap
and unpaid labour decreases.
o There is a need for its own transformation in order to increase
professionalism to provide competitive services.
o These are challenges that are tactical and operational in nature.

60
 The questions addressed by the leader on the local and regional level

o Can our clubs survive, or is it necessary to combine them and reallocate?

o How can we keep the younger members and our most prized volunteers?
o How can we attract new resources for the club to pay for professional
services?
o How can we maintain the culture of the club?

2. National sports organizations

The major challenges for leaders at the national level

o The main dilemma is the fact that they have only one core product – sport –
and that has its limits for expansion on an existing or new market.
o They are confronted with the requirement of commercial organizations for
high performance in sports.
o They also solve the dilemma between supporting elite sport and sport for all,
between the popular Olympic sports and minority sports. (Can this dilemma
between elite and mass sports be solely left to the market to solve?)

The questions addressed by the leader on the national level

o On which market should we or will we operate – national, international?

o What is better for our sport – focus on elite or mass sports? Or a balance
between them?
o What should we do for sports services to be better utilized through regional
and local associations?
o How can we change our control system so that we are ready for the radical
changes on the sports market?

3. International sports federations and professional sports

The major challenges for leaders in international sports federations and professional
sports

o They differ in size and structure, a professional sports organization differs

from local clubs and governing bodies.
o They must make strategic decisions even outside the present scope of their
activities, e.g., UEFA – has concerns that leading clubs will start their own
competition outside the Champions League – the competition is owned and
operated by UEFA.

61
 The questions addressed by the leaders of international sports federations and
leaders in professional sport

o Are we actually doing business in sports, or do we only compete for people’s

free time?
o How strong should be our control over our distribution network? (Do we need
our own sports facilities, private TV, or is contracting enough?)
o How will the sport, entertainment and leisure time evolve in the next decade?
Where should we position ourselves so that we do not lose our position of the
main players on this market?
o Who will be the leaders in sports in the future?

Multidimensional model of leadership in sport

It is an attempt of one of the best-known authors in the field of sports management, P.
Chelladurai, to make a synthesis of all existing theories of leadership in order to be used in
the environment of sport (Fig. 24).

Fig. 24 Multidimensional Model of Leadership in Sport

Source: Translated and edited by the author of the e-learning course from Chelladurai (2006)

Behavioural dimension of a leader in sports

In the context of coaching, Chelladurai and Saleh identified five dimensions of a leader
behaviour in sports situations (Table 7).

62
Table 7 Behavioral dimensions of a leader in sports

Dimension Description
Training The behaviour of the coach is focused on improving
performance of the athlete by emphasizing the hard and tough
training; the leader gives instructions to acquire skills,
techniques and tactics in sport; making clear everything about
positions in the team, structuring and coordinating activities of
individual team members.
Social support The behaviour of the leader is in relation to the interest in
satisfaction of individual athletes; there is a positive
atmosphere in the team as well as warm interpersonal
relationship among team members.
Positive feedback The behaviour of the leader supports athletes by recognizing
and rewarding good performance.
Democratic behaviour The behaviour of the leader allows greater participation of
athletes in decision-making that relates to the goals, methods,
strategies and tactics of the game.
Autocratic behaviour The behaviour of the leader includes independent decision-
making and emphasizes personal authority.

Source: Translated by the author of the e-learning course from Chelladurai and Saleh (1980)

Tasks for self-study:

1. Choose a personality from the sports environment whom you know and who shows
signs of leadership. Do you think that it is a transformational leader? If so, please
indicate the reasons why you think so. If not, please give reasons why. Can we
consider the selected leader to be charismatic? Please explain the reasons why, or
why not.
2. When considering the leader you have selected and his position in the organization,
describe the situations, in which you have identified different styles of decision-
making and management according to the classification from Chelladurai and Saleh
(1980) and assess their suitability for the solution of a given problem or situation.

63
Organizational Culture in Sport
Organizational culture in sport consists of norms, values, and ideas that individuals and
groups have within their organization and which affect the way in which they implement
activities, fulfil goals, and the way of working in the organization. Organizational culture
affects organizational performance, excellence, dedication to work, cooperation, efficiency,
performance and decision-making. Its definition, diagnosis and the process of change is
something that a sports manager must know in order to understand its importance for
increasing its efficiency or inefficiency.

This chapter contains the following topics:

 Basic elements of organizational culture

 Definition of culture in a sports organization and organizational identity,
 Specifics and the importance of organizational culture for sports organizations
 Specifics and the importance of subculture in sport
 Diagnostics and management of changes in organizational culture of sports
organizations

Basic elements of organizational culture and its definition

The culture of an organization is made up of values and beliefs, which are shared by a group
of people. The culture of an organization is essentially the “personality” of the organization
and includes all that makes the organization unique. An overview of the essential elements
of organizational culture is shown in Table 8.

Table 8 Basic elements of organizational culture

Ideas Approaches Values

about own work to work in general recognised
about the meaning of work to co-workers shared
about the success of the company to the goals of the company respected
about remuneration to conflicts openness
about the future of the company to new ideas honesty
about the image of the company to change justice
about career to the products of the company reliability, etc.

Types of cultures according to Handy (1985)

 Power culture
 Role culture
 Task culture
 Person culture

64
The generally accepted view is that culture:

 is usually not flexible and is resistant to easy and rapid changes,

 is created by the conditions in the organization, its history and its members,
 is reflected in the common understanding and faith; it is being learnt and shared by
the members of the organization,
 is often hidden; deep values and beliefs that affect the behaviour of the members of
the organization are hardly identifiable,
 manifests itself in different ways, which have an impact on the performance of the
organization and its members.

Psycho-dynamic perspective on culture in sports is offered by Schein (2010) who notes that
sports culture is a partially unconscious phenomenon. It is driven by deep-rooted
assumptions and beliefs, while the conscious view is provided only by artefacts and symbolic
representations. Sports clubs declare that the most important thing is a victory. The question
is why? Does it have anything to do with the need to belong to the successful; is it caused by
peer pressure, or anything else? This seems to be an easy question but it is that much harder
to specify supporting values, which trigger unusual rituals, ceremonies, myths, legends,
tales, beliefs and approaches. They are the surface symptoms of deeper issues. We are
looking for just those unconsciously held, fundamental concepts of what is right and what is
wrong, which the organization may perceive as correct or incorrect values. The values that
are the basis of the organizational culture, however, do not exist only on the basis of the
personal will of the members. On the contrary, they are carefully built by the members of
the organization while they gradually learn to cooperate in order to achieve the collective
and individual goals. The founders of the organization, along with the most influential past
and current members are usually those who have the greatest influence on the culture of
the organization (the importance of long-term values).

Definition of culture in a sports organization and

organizational identity
“A sports organizational culture is a collection of fundamental values, beliefs, ideas, and
approaches that are shared by its members and, as a result of that, standards of conduct and
standards for all members are laid down “. This definition expresses that sports organizations
can develop their culture. Culture provides a summary of how “things happen” and “what we
think about these things.” Hoye et al., (2012)

Culture and organizational identity

Culture is about how I do things. In contrast, identity is about how we perceive things and
how we are perceived from outside.

Organization can perceive itself in a manner that is incompatible with the way others
perceive it from outside. Identity reflects the long-term and stable perception of the
distinctive characteristics of the organization. Culture is contextual, unspoken/silent and

65
emergent. Identity is more textual, explicit and instrumental, expressed via artefacts of the
culture.

Specifics and the importance of organizational culture for

sports organizations

Fig. 25 Teamwork and Success

Source: Image courtesy of renjith krishnan
FreeDigitalPhotos.net

We can find different kinds of cultures in sports organizations. Professional clubs and the
national leagues put emphasis on unbiased business values, while small clubs and non-profit
organizations value more participation and fun. Italian and Spanish football clubs are
focused almost exclusively on winning, even at the cost of loss. Formula One Holdings hold
the commercial rights to major sporting events, and money is in the centre of its interest.
The Federation Internationale de l'Automobile is looking for ways to control the automobile
sport. The International Olympic Committee (IOC) has an interest in the development of
sports in the world and gains huge amounts of money for this purpose, which it liberally
uses. Sports organizations are increasingly forced to engage in the world of business and to
accept its operating structural characteristics. This is also influenced by the development of
communication technologies. Sports results are available everywhere and sports
organizations on the given field must provide entertainment that is comparable to other
sports that are spread through the TV only to be able to sustain themselves. The
organization at the same time realises that there are also other, alternative forms of leisure.
The adaptation of business tools has brought interested in organizational culture, in
particular as regards to the possibility of its change.

66
Subcultures in sport
The culture of a sports club has a lot of cultural subjects, levels and subcultures.

 The administrative part of the club is comparable to other business units, such as
the support department of the organization aims to win.
 Player team – has different ambitions: from glory to money.
 Fans – are passionately connected to club colours and traditions and they expect
success in the field in exchange for their loyalty.

Subcultures and sport

The ideal business culture, which means the adoption and adaptation of performance
standards, which are associated with the quality of production and services for the purpose
of profit, cannot be satisfactorily applied in diversified structures of sports organizations.
There are cultural differences between the individual sports. The manager must be aware of
the cultural nuances of his sport and how they affect the players, staff, members, fans and
the public.

Culture is not simple even within individual sports. For example, cultural attitude is different
in professional players, amateurs and spectators. Variability of views is a symptom of a more
problematic area – clash of cultures within the sport. It is most visible on the international
level where there are often players from different countries, brought up in deeply different
ideologies in relation to the game and how it should be played.

As well as other living cultures, sport gradually changes as the interpretation of the sport
dynamically changes for its participants and spectators. The consistent element in the
culture of sport is an effort to contest, love for winning and an ability to summon strong
emotions in the case of victory and defeat.

Sports organizations are eager for traditions and achievements, and at the same time they
are resistant to change. Therefore, it is necessary before any change of the culture to
diagnose it.

67
Diagnostics and management of changes in organizational
culture of sports organizations

Fig: 26 Success Achievement

Source: Image courtesy of ddpavumba
FreeDigitalPhotos.net

According to Hoye et al. (2012) when you try to do a diagnostics of a sports organization
culture, you should assess:

1. visible symptoms of the culture of the sports organization (environment, artefacts,

language, documents, logos, heroes, stories, legends, rituals and ceremonies)
2. culture dimensions
o stability/variability
o cooperation/conflict
o focus on the objective/orientation
o rewarding/motivation
o control/authority
o time/planning

Examples of diagnostics in sports

 The end of the season and the method of rewarding players speak about the values
of the organization when it comes to motivation and remuneration.
 Obvious and observable qualities of sports organizations – physical environment,
public declarations of official representatives, method of communication of
individuals, the form of language used, clothing, memorabilia which are located in
the premises of the buildings.

68
  Attention devoted to the sports heroes has a distinctive information value about the
culture.
 Selection of Heroes – indicates the qualities that are valued by the members of the
club. The hero represents the values recognized and admired by the wider
community. He is a strong figure in the sports organization and may be a current
employee and ex-player. He may be charismatic and enterprising. By mapping the
heroes from the past and present, we can conclude on the trends in the change of
culture. The hero can be reactionary or progressive person. And the hero, which is
close to the dominant culture, will not be inclined to change the values, which the
culture stresses. The hero can be an important catalyst for change of the behaviour
and the values of the club.
 Tradition – can be observed through memorabilia; it consists of important moments
in the history, which may even shape contemporary culture.
 External manifestations: rituals, ceremonies, jargon, artefacts, etc. We can find the
meaning that is attached to them in all of them.
 Analysis of the subconscious parts of the organization, which are controlled by
individuals (values, habits, ideas, behaviour, attitudes). Analysis of this level of
culture is complicated and may be misinterpreted easily because it is necessary to
compare the current behaviour of the individuals with what they say. It is important
to concentrate on models, exceptions and values targeted at change.

Tasks for self-study:

1. Choose two sports organizations and identify, describe and compare on the basis of
the data on their websites or internal documents:
A. visible symptoms of the culture of the sports organization (environment,
artefacts, language, documents, logos, heroes, stories, legends, rituals,
ceremonies),
B. dimensions of culture (stability/variability; cooperation/conflict; focus on the
objective/orientation; remuneration/motivation; control/authority;
time/planning).
2. Categorize each organization according to the typology of Ch. Handy (1985) and give
reasons for your categorization.

69
Performance Assessment in Sport
The professionalization of sports organizations meant application of business principles in the
marketing of sports products, planning, human resource management, and other aspects of
organizational activities. Performance management is one of the most important principles.
The diversity of the missions of the sports organizations led to the development of various
tools and criteria for evaluating their performance. Sports manager must, therefore, know
the ways how to define, analyse and present performance in the environment of sports
management.

This chapter contains the following topics:

 Specifics of performance assessment in sport and sports organization

 Theory of performance assessment in sport
 Multidimensional approach to performance assessment and its criteria

Specifics of performance assessment in sport and sports

organization

Fig 27 Business Progress

Source: Image courtesy of pat138241
FreeDigitalPhotos.net

The same criteria apply in the assessment of performance in sports oranization as during
assessment of business organizations, which reflects their development towards
professionalism. This means that players and other administrators are paid as employees,
sports games and activities are branded sports products and fans are considered clients and
alliances with companies are concluded (Carter, 2011; Slack, 1997).

70
Due to the specific characteristics of sport we observe differences in the assessment of
performance, which are based on:

 the symbolic significance and emotional intensity of sport (associated with the
tradition – the romantic vision, emotions and passion can prevail over the
commercial logic and economic reality),
 predictability and certainty, which the world of business wants to achieve; especially
when it comes to the quality of the product, they are not considered important in the
sport industry (on the contrary, uncertainty of the result and chaos are attractive),
 the fact that sport is not driven by the need to optimize the profit; sports
organizations have a dual conflicting missions which are maximize profits and at the
same time maximize utility, which highlights the rivalry between the clubs and the
desire to win.

How to define performance in sport?

Elite athletes are ranked and evaluated through various scales. Coaches in various
professional leagues are permanently evaluated with the ratio of wins and losses, the
effectiveness of the score and the movement of players. Many sports clubs do not pay the
necessary time to a comprehensible evaluation of their performance outside the game, or
they only dedicate their time to certain parameters, such as the operating profit and the
number of members. It is therefore necessary to introduce a systematic approach to
performance evaluation, which is a prerequisite for objective identification of strengths and
weaknesses and paths for an overall increase in the performance of a sports organization.
That is important for proper allocation of insufficient resources. An objective view of one’s
own performance is used for comparison with other similar organizations, clubs or leagues.

Theory of performance assessment in sport

Fig 28 Indicator
Source: Image courtesy of photoexplorer
FreeDigitalPhotos.net

71
1) Performance management bound to the goals and the objectives of the
organization

The goals of a sports organization differ from those of a business organization because there
is a conflict between profitability and the desire for victory.

In the professional leagues, however, there is a clear correlation between income and sports
achievements. Teams that have enough resources, are not limited by space, and have the
best players and coaches, have the best ratio of wins and losses. The question remains
whether they can find yet another way to measure their performance and evaluate their
successes and failures. It is also important to evaluate procedural factors, such as: keeping
employees, development of players, overall level of morals, job satisfaction, etc.

2) Theory of performance evaluation in sport – from the perspective of interest

groups (stakeholder perspective) – (Table 9)

 Different types of sports organizations have different indicators of performance

evaluation.
 Sports retail – the important markers are large profit and dividends for owners and
shareholders.
 In member-based sports clubs, game performance and services for members are
more important than massive profit.
 The interests of the registered players have the highest priority in sports associations.
 Interest groups may have conflicting needs – the sponsors want visibility in the media
and access to the players for the implementation of sponsorship activities but the
clubs want the players to have space for improvement of their performance.
 Governments and the national sports authorities want to achieve international
success, by which investments in elite sports would be justified.
 Common players who make up the majority of the sports base want better
conditions for sport and sports equipment.

72
Table 9 Performance evaluation in sport from the perspective of interest groups
(stakeholder perspective)

Stakeholder type Expectations of sport organization

Players Success in the game, adequate salaries and benefits, low
accident rates
Staff Adequate salaries and benefits, job security, professional
development
Equipment supplier Reliability of demand, approved players, brand awareness
Members Services and benefits, overall satisfaction
Owners/shareholders Return of investment, public recognition of the club or
association
Sponsors Positive reputation of the club or association, brand awareness
and recognition
Players’ agents High morals of the players, payments according to market rates
Fans Equality in the game and excitement, high ratio of victories over
losses
Community/society Civic pride, providing role-models for the youth
Media Mass market, high level of public interest

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

3) Theory of performance assessment in sport (input – output)

The theory of performance assessment in sport (input – output) is another method of

performance assessment in sport, especially from organizational perspective. The chosen
indicators (Tables 10 and 11) are part of the assessment of the economic efficiency of sports
organizations, in particular as regards the assessment of the effectiveness of the use of
resources.

Table 10 Input – output: access to performance in sports

Dimension Marker
Performance: quantity Premiership, attendance, number of members,
participation/attendance
Performance: quality Standard of the game, properties of the location/facility,
standard of the service, the overall customer experience
Performance: Operating profit, operating costs, net profit, social benefits
costs/benefits
Investments/inputs: The cost of the provision of services, administrative support
effectiveness costs, waiting time
Investments/inputs: Evaluation of satisfaction (customers, members, fans),
performance of the achievements of the staff, skills and experience of the
employees employees

Source: Translated by the author of the e-learning text from Hoye et al. (2012)
73
Table 11 Indicators of effectiveness for a community leisure centre

Indicator Description
Profitability of the Ratio of total revenue to costs
investment
Charge for admission The total amount of charges for admission divided by the
number of visitors
Space available for Number of admissions divided by the amount of space
visitors
Cost of the promotion per The cost of the promotion divided by the number of visitors
visitor
Measure of maintenance Ratio of total maintenance costs to total revenues of the centre
costs
Labour costs per unit of Labour costs divided by the surface
the area

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

Multidimensional approach to performance assessment and

its criteria
Balance Scorecard (Kaplan & Norton, 1992) puts emphasis not only on financial indicators
but also on the so-called anticipated indicators, which can help to identify a wide range of
potential problems long before consequences in the financial scales can be seen. Application
of this method of evaluation of performance was offered by Hoye (2012) and is listed
in Table 12.

74
Table 12 Application of Balance Scorecard for the needs of a sports organization

Dimension Indicators
Victory, evaluation, Table of results (ranking)
achievements
Financial stability Growth in revenue, earnings, liquidity, return on investment,
growth of assets, debt
Market division The scope of the consumption of sporting events, participation,
the number of sports facilities, potential attendance, range and
breadth of TV broadcast
Market size and share Consistently large and a larger number of visitors compared to
the competition
Customer satisfaction Results of surveys and questionnaires
Procedures and processes Quality of players and members recruitment, total quality,
sustaining members, players’ ability to improve their
performance, the quality of the coaches, quality of
administrative functions
Improving product Game innovation, improving conditions for visitors, the design
of the stadium, sports facilities and equipment for the
development of the game
Development and training Organizational culture for learning and development,
of employees opportunities for development
Economic, social and Triple-bottom-line methodology
environmental impact

Source: Translated by the author of the e-learning text from Hoye et al. (2012)

Another example of how we can apply the principle of evaluation of performance in sports,
is shown in Table 13. It is a model of evaluation of the performance of national sports
leagues in Australia from 2011, as shown in The Australian Football League.

Table 13 Performance indicators for the Australian National Sports League

Financial stability Turnover of the league, nett assets

Corporate support Revenue from sponsors, suite at the stadium
Fees for broadcasting Fees from TV stations and radios
rights
Exposure in the media Television ratings, print media coverage
Public interest Brand awareness, attendance of the match
Extensions/coverage Media coverage, expanding teams and places
Competitive equilibrium Ratio of wins and losses for each team, the premiership is won
by each team
Game development Programmes for the development of young players, regional
development programmes

Source: Translated by the author of the e-learning text from Hoye et al. (2012)
75
Tasks for self-study:
1. Study the detailed dimensions of the Balance Scorecard by Kaplan and Norton (1992)
– www.balancedscorecard.org – and add at your own consideration indicators
proposed by Hoye et al. (2012). Please give reasons for your proposal.
2. Review articles and analyse the options of connecting quality systems and
performance evaluation systems in the selected sports organization. Suggest possible
common indicators.
a. Nová, J. (2014). The managerial concepts of the quality and performance and
their integration in the sports organizations. SPORT MONT, 40-42(12), 73-80.
Retrieved from
http://www.sportmont.ucg.ac.me/download_pdf_arhiva.php/SM_40-41-
42.pdf
b. Nová, J. (2013). Current Concepts of the Quality in Sport and their Utilization
in the Czech Republic. Ekonomika a management, 2013(4). Retrieved from
http://www.ekonomikaamanagement.cz/getFile.php?fileKey=CEJVB0NUCAdV
CEZIU1VHB0MIUUMEBAVDVFVWQ1VUBAVGQ1VCXgQFBERIREFAZQ==&lang=
cz

76
Sport Governance
It includes the way of how decisions are made in the organization and the way in which
control and management are performed in the organization. In sports organizations, there
often are elected groups of volunteers, which are responsible for the administration, which is
in conflict with the daily management to achieve the desired performance.

The task of a sports manager is to achieve a balance between the elected officials, who have
the power to make decisions, and the paid employees, who ensure effective operation of the
institution to attain meaningful results.

This chapter contains the following topics:

 Basic strategic concepts of management and models in global sports industry

 Theory of governance in sports
 Principles of good governance in sport

Fig. 29 Business Meeting

Source: Image courtesy of digitalart
FreeDigitalPhotos.net

Basic strategic concepts of management and models in

global sports industry
Organizational management means the way, in which the organization implements the
execution of power. It provides a system, by which elements of organization monitor and
control their direction. The managerial system is a must for all groups of organizations
(national companies, associations and sports organizations) to work correctly and efficiently.
Management focuses on topics ranging from policies and direction to improving
organizational performance and fewer operational management issues. Good governance of
the organization must ensure that the Board of Directors and the management are looking

77
for ways to achieve results in favour of the organization and its members and that the
resources for effective monitoring of results are being used.

“If management is about running businesses, governance is about its proper running”
(Tricker, 1984)

The Australian Sports Commission (ASC, 2004) defines sports governance as “the structures
and processes used by an organization to develop its strategic goals and direction, monitor
its performance in relation to these goals and for assuring that its board acts in the best
interests of the members”.

The theory of business governance is divided into two areas:

 Corporate governance of profit organizations (focused on protection and increase of

the value for the owners)
 Non-profit corporate governance, which is engaged in the governance of
organizations functioning on the base of volunteers; (focus on service to society and
promotion of the participation of individuals in the social, artistic and sports
activities)

A mix of corporate and non-profit governance in sport:

 Sports organizations, such as sporting goods manufacturers, organizations managing

players, wholesale organizations and organizations organizing sporting events, can be
classified as profit organizations.
 Most sports organizations provide the conditions for sport participation and
participation in competitions. They can be included among non-profit organizations
(large clubs, regional associations and leagues, state and regional managing
authorities and national sports associations).

Theory of governance in sports

Fig. 30 Top of Businessmen

Source: Image courtesy of supakitmod
FreeDigitalPhotos.net
78
Clarke (2004) provided an overview of the theory of corporate governance. There are two
basic streams of theories:

1. Focus on the monitoring of the internal affairs of the organization

Agency theory

o It proposes that the interests of the owners should be crucial when deciding
about the running of the organization.
o Manager/agent appointed for the purpose of the organization’s management
must be extensively checked in order to minimize management errors or
improper behaviour that could endanger the best interests of the owners.
o This approach tries to find the best ways for the purpose of maximizing
corporate control over managerial actions in order to inform the owners.
o This theory is not applicable for most non-profit organizations because they
do not have an ownership structure.

Stewardship theory

o in order to achieve the result, the manager is motivated, there is

responsibility, recognition and respect for the authorities (the opposite
position than in the agency theory).
o The interests of the owners and managers are connected; therefore the
managers are working in favour of the owners.
o This theory is applicable in sports organizations as Nike, FoxSport, or
organizations listed on the stock exchange.
o It can be partially applicable in non-profit organizations, which have former
players in the administration of the club. These players have a deep sense of
obligation to the club, which is why it is more likely that they will act as
responsible managers.

2. Focus on the relationship of the organization to external organizations to

obtain resources

Institutional theory

o The organization forms its administrative structures in response to the

pressure of external circumstances in such a way that they are conforming
with generally accepted business practices and legal requirements.
o Organizations with the same focus and size tend to adopt a very similar
management framework, the so-called institutional isomorphism.
o This can be seen in the club-based system where national, state and regional
sports organizations have similar structures of administration.

79
 Resource-based theory

o In order to understand the behaviour of an organization, we have to

understand its relationship to its environment.
o Organizations are looking for stability in the exchange of resources and enter
into inter-organizational relationships (which results in a loss of flexibility and
autonomy) in exchange for obtaining control over other organizations.
o Inter-organizational relations take the form of mergers, joint ventures, joint
decisions (i.e. the inclusion of people from outside to the directing the
decision-making processes of the organization), political interest, or
restrictions on the distribution of information.
o The extent to which interest groups/stakeholders are involved in decision-
making and the transparency of the decision-making process has an influence
on the structure of the administration.

Network theory

o In addition to purely legal contracts for the provision of services, the

organizations also conclude socially binding contracts.
o These socially determined relations create a certain degree of informal
communication and flow of resources between organizations.
o Sports organizations rely on personal contacts while organizing major sporting
events, such as: ensuring support for elite athletes, the use of a large number
of volunteers from other sports organizations, or government aid dependency
for building large sports complexes.
o This explains how the structure and management processes (in particular, the
Board of Directors) evolve to support informal relations.

Stakeholder theory

o It explores the relationship between an organization and its

stakeholder/interest groups/parties.
o Sports organizations must manage the quantity of relationships with
sponsors, grant agencies, members, affiliates, employees and board
members, places of sporting events, governmental agencies and suppliers.
o It is a whole series of relationships and responsibilities. Governance of a non-
profit organization must create a framework for their fulfilment.

Principles of good governance in sport

Beech and Chadwick (2004) defined 7 key principles of good governance for sports
organizations:

80
 1. Transparency

Ensuring that the organization has clearly given procedures for allocation of
resources, reporting and decision-making.

2. Accountability

Sports organizations must be responsible to all of its stakeholders/interest groups.

3. Democracy

All interest groups should have their participation in the administrative structure.

4. Responsibility

The decision-making authority should be responsible for the organization and

demonstrate ethical stewardship in carrying out this responsibility.

5. Equality

All the interest groups should be treated equally.

6. Performance

The organization must implement improvement processes for the best use of its
resources.

7. Efficiency

The decision-making authority should define and monitor performance criteria in

accordance with the strategy of the organization.

The concept of “good governance in sport” is dealt with in

relation to the threats in sport, such as:
 doping
 corruption and negotiating matches
 lack of transparency and sustainability
 high level of commerce
 “you scratch my back and I’ll scratch yours” attitude, etc.

81
Promotion of the importance of good governance in sport
It happens at various levels of sport, as it can be seen in the examples below, from
multinational (European Union) down to the level of individual sport clubs:

 EU – draft resolution “good governance and ethics in sport”, adopted in March 2012
by the Committee on Culture, Science, Education and Media, expert group “Good
Governance” http://ec.europa.eu/sport/library/policy_documents/xg-gg-201307-
dlvrbl2-sept2013.pdf
 National level – United Kingdom; Voluntary Code of Good Governance for the Sport
and Recreation, issued in 2011
http://www.sportandrecreation.org.uk/sites/sportandrecreation.org.uk/files/Govern
anceCodeFINAL.PDF_.easyprint%20Version.pdf
 Sports clubs – FC Barcelona – Ethical Code for the Good Governance
http://www.fcbarcelona.com/club/board-members/detail/card/ethical-code-of-fc-
barcelona
 UEFA’s Club Licensing System (from the season 2013/14, the applications for licenses
will have to include the observance of the financial fair play)
http://www.uefa.org/MultimediaFiles/Download/Tech/uefaorg/General/01/85/85/2
5/1858525_DOWNLOAD.pdf

Who is responsible for compliance with the principles of

good governance in sport?
Everyone who participates in sport should play its role – individuals as spectators, fans,
governments, teachers and coaches, athletes and others who help them, referees,
commercial agents, media, sports federations and the managing authorities. The principles
of good governance in sport should be applied primarily by the new generation of sports
managers.

Tasks for self-study:

 Look up available websites of sports organizations in the Czech Republic and find out
about the existence of similar materials, such as the Ethical Code of FC Barcelona and
describe the differences and similarities that are in these documents in relation to
the principles of good governance in sport.

82
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Recommended resources
Čáslavová, E. (2000). Management sportu. Praha, Czech Republic: East West Publishing Company.

Hoye, R., Nicholson, M., Smith, A., Stewart, B., & Westerbeek, H. (2012). Sport Management: Principles
and applications (3rd ed.). Abingdon, United Kingdom: Routledge.

Chelladurai, P. (2006). Human resource management in sport and recreation (3rd ed.). Champaign, IL:
Human Kinetics.

Slack, T. (1997). Understanding sport organizations: The application of organization theory. Champaign, IL:
Human Kinetics.

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Discussion forum
Dear students,

to express and share your views concerning the outputs of IMPACT project feel free to use
the discussion forum of the project.

 https://is.muni.cz/auth/bt/impact/

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Test your knowledge...
Online version of Czech source of this e-learning material available at
http://www.fsps.muni.cz/impact/management-ve-sportu/ includes an interactive test so
that you could find out how much information you have absorbed during course.

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Authors
The main author (authors)

Ing. Jana Nová, Ph.D., MBA

Technical processing

Jakub Doležal, Mgr. Aneta Fedrová, David Jindra, Mgr. Olga Krčmařová, DiS., Jiří Matoušek,
Mgr. Milan Mojžíš, Mgr. Martin Novotný, Mgr. Jindřich Pavlík, Ing. Jiří Voldán, Mgr. Petr Zaoral

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