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SBJ/June 12 - 18, 2000/Special Report
Unearthing the AD of the future
Published June 12, 2000
Because he came from the hierarchy of Oscar Mayer, a $2 billion Kraft Foods Inc. brand, Pat Richter assumed that the budgetary aspects of his new job would be a layup.
As the newly coronated athletic director at his alma mater, the University of Wisconsin, Richter knew he had mounds to learn about negotiating contracts with high-profile coaches. He realized he was a neophyte when it came to maximizing licensing deals and navigating the rules and procedures of the NCAA.
But the budget, that was a language that he spoke fluently. Revenue and expenses. Cash flow and debt. Next to Oscar Mayer's wealth of wieners and lunch meats, Wisconsin's $14 million bankroll, the bulk of which was earned and spent on football, amounted to a short stack of bologna.
"When I came here, I had no real understanding of the total political aspect of a public university," said Richter, who in the last 10 years has helped grow Wisconsin's athletic budget into one of the nation's 10 largest at more than $40 million. "The faculty, the legislature, alumni — everybody likes to dabble in the way the department is run.
"After a budget of $40-some million, we receive about $600,000 in public funds. But everybody wants a say in it. The complexity and multiplicity of some of the budgetary things can make it more complicated than a $2 billion company."
Richter's arrival came at the beginning of a wave of athletic directors hired away from large corporations, as universities grappled to deal with the changing economics of collegiate sports. In fact, six of the Big Ten's current athletic directors came from the business sector — a semblance of what's happened in all of college sports during the last decade.
Some, like Richter, have flourished. But others have found intercollegiate athletics to be a puzzling mix of demand and conscience that asks its administrators to win but to do so within the university's broader mission. Finding that utopian mix of administrator, marketer, bean counter and fund-raiser to lead programs through their current growth binge and beyond has proved daunting.
"There's nothing easy about this job, nothing easy about finding the right person for this job," said Dr. James S. Jackson, a psychology professor at Michigan who is leading the school's search for a new AD.
Richter was able to make the transition because he learned the rules rapidly.
He scored a coup when he hired Barry Alvarez as football coach in 1990, a choice that turned the football program back into a winner. Attendance at football games, which had slid to 40,000 in '90, returned to 70,000, erasing the $2 million budget deficit that he inherited. Another wise hire got the basketball program on track.
Richter's brilliant work, coming from the human resources side of corporate America and applying his skills to sports management, made the University of Wisconsin look savvy for searching beyond the borders of traditional athletic administrators.
But not every attempt to cross from private industry to university athletics has yielded points.
Three years ago, the University of Michigan appeared to be mimicking Wisconsin's thought pattern when it tapped Tom Goss, a former Michigan football player who'd gone on to corporate heights on the sales and marketing side for Procter & Gamble Co., R.J. Reynolds Tobacco Co. and Del Monte Corp. before heading a California merchandising company with annual sales of about $120 million.
Michigan was coming off a year in which its athletic program recorded a record profit of $3.1 million, even after paying down debt on renovations for the football stadium. Two years after taking over, Goss spent Michigan into a shortfall of nearly $4 million. Then, after predicting a fiscal turnaround this year, Goss lost $3 million more and was fired.
With escalating television revenue and expanding stadiums pushing athletic budgets to the point that they qualify as midsize businesses, the logical step is for schools to look to the corporate sector to find people with the skills and experience to manage such operations. But, as Michigan has learned, running a company — even a publicly traded one that must answer to shareholders and directors boards — does not necessarily prepare one to run an athletic department.
"Today's athletic director is in a situation where you're maintaining the values of a university setting while at the same time running what for many universities has become a big business," Jackson said. "That's the task, and it's a difficult one. The ways I might go about maximizing profits may not be the ways that I'd go about maximizing the experience of an intercollegiate athlete.
"That's the reason I think that people's experiments of bringing in [administrators] from outside may not necessarily be the wave of the future. It is big business. But it's also the university's business. And there are certain aspects about the university that are very hard to learn."
In many ways, it's easier for a school to find a left tackle than an athletic director.
With a left tackle, you know you want somebody who will grow to be bigger than 300 pounds, so he won't get bulldozed. And you want that 300 pounds to be spread across a tall frame, so that he retains some mobility. He's got to have nimble feet, because he's going to spend much of his time going backward. And he's got to be smart enough to comprehend what the snarling beast across the line of scrimmage is trying to do to him.
The good news is that you can measure most of those things. You can have him weighed and timed and put through drills. You can watch videotape of his previous games.
There is no video library or scouting composite to consult when you're a university president looking for an athletic director.
His height may be an asset when he's standing in front of the television cameras, but it won't be enough to overshadow the fact that he'll frequently be there to deliver somber news: the firing of a coach; the suspension of a star athlete; the investigation into a sports agent's activities on campus.
His weight might keep him from getting jostled physically, but it won't deter those in a fractured constituency with conflicting needs from tugging him in opposing directions. University administrators, boosters, students, sponsors and state legislators — he'll need the nimble feet to dodge those constituents sometimes. Other times, you'll be better served if he faces them head on.
The athletic director of the coming decades will be asked to meld the demands of business with the constraints of politics, all within the unique parameters of academia. It's a far cry from what it was only 20 years ago, when many schools simply ceded control of the department to the most powerful coach on campus. Or even 10 years ago, when an AD with a knack for managing coaches could get by on a superficial understanding of business principles, so long as he surrounded himself with a few bean counters.
"There's no question that with the dollars that are involved and the facilities that are involved and the legal issues that are involved, the person behind this desk has to understand business — and I mean really understand business," said Jeremy Foley, who as athletic director at the University of Florida manages a program that last year had a $50 million operating budget. "It's changed because the dollars have gotten bigger and continue to get bigger every day. The expectations get bigger every day.
"Most of it is positive. But it's also totally different."
Foley's path to success is the polar opposite to that of Richter, the corporately trained Wisconsin AD.
He set out to be an athletic administrator, receiving a master's degree in sports administration in 1976 from the University of Ohio, which at the time was one of only two schools to offer the degree. His first job was in the ticket office at the University of Florida.
He never left.
Foley thought he'd spend his career managing coaches and filing paperwork with the NCAA. But that vision veered in 1981, when Bill Carr, who then was the AD at Florida, asked him to run what Florida quaintly called its business office.
"I thought he was crazy," Foley said. "I didn't have a business background or an accounting degree. But he wanted me to do it, and so I did.
"That was probably the biggest boost in my career. I was involved in facilities projects and bond issues. And those are the sorts of things I've been working on since I became AD."
Andy Geiger, who runs the nation's largest athletic program, managing a $64 million budget at Ohio State, comes from the generation before Foley. He was a coach who quickly switched to administration, landing his first athletic director's job at age 25 and graduating to progressively larger programs, including Maryland and Stanford, before taking over at OSU in 1994.
Two years ago, Ohio State opened a $115 million basketball arena, with $100 million of the funding coming from private channels. Now, the Buckeyes are in the midst of a $200 million renovation of 77-year-old Ohio Stadium that initially was built for less than $2 million.
Geiger says the numbers stagger him, even as he tabulates them.
"What I've seen is a sea change of business influences that's made this a corporate kind of job as compared to an athletic management job," said Geiger, 61. "But with that said, there are some real differences between this and the corporate sector.
"If you're the equivalent of the corporate CEO whose company leads the market in producing whatever you produce and you're trading well on the stock market, you will be heroic. If your athletic program is successful and your teams are winning, your coaches will be heroic. You need to be happy with that and understand that and work very hard to make other people healthy, wealthy and wise. That's a big difference. You can't change everything in your own image and think that's going to bring you victory. Because it won't."
So where should a university look to fill this position that is changing as rapidly as the business climate that surrounds it? Aside from a consensus that the department must be well-rounded enough to make up for inevitable shortcomings or blind spots, the reviews are mixed.
Foley believes the answer will come from the swell of sports administration programs that are churning out degrees.
"There are thousands of young people coming out of these schools now," Foley said. "You see an influx of young people who want to make athletics their careers. These are young, intelligent, aggressive people. I see them being the next wave of ADs. They got in on the ground level.
"What you see with corporations developing executives, I see the same thing happening here. All across the country, we're going to take talented people and develop them. They're going to have the intellect that you need, but also the experience that nobody can teach you."
Geiger agreed that those lifers will provide the bricks and mortar that hold athletic departments together. But he's not so sure they'll be the ones at the top.
"I think those programs are valuable, but not necessarily for training athletic directors," Geiger said. "Knowing what I'm going to do today and tomorrow, I'd go for a JD MBA [law degree with a master's in business] or something like that — a combination of law and business training that would give me real training for managing the types of things that we have to deal with now."