Franchise values on the rise Fanatics-UA to field MLB jerseys in 2020 Licensees prep for campaigns ESPN starts anew on ‘Countdown’ NBA on target for $8B in revenue BDA gets into NBA game League Pass keeps mobile in mind Sponsored backdrops by league Leaving a lasting impression So much data; what gets shared?
SBJ/November 29 - December 5, 2004/SBJ In Depth
Class in session
Published November 29, 2004
For A.J. Maestas, clarity came on a British Airways flight to London, where, at the end of his performance review, his boss asked why he was nose deep in Sports Illustrated rather than Energy Times.
For Brett Dombrova, it hit during an interdepartmental strategy session at Cinnabon, when the call went out for better, brighter ways to sell cinnamon rolls.
For Brian Finch, it set in after one too many calls to uncooperative insurance providers on behalf of his physical therapy patients.
Early in careers that they didn’t find fulfilling, each chose to change direction, running headlong into a pipe dream. Their common goal: to turn avocation into vocation.
They want to work in sports.
So they have come here, to Arizona State University, where the MBA program at the W.P. Carey School of Business offers a specialization in sports.
More than 150 U.S. colleges and universities offer undergraduate degrees in sports administration, sports management or sports marketing. More than 50 of them offer master’s degrees in those areas. But toss into the mix an MBA — the common educational currency of senior management in many other industries — and the field narrows dramatically.
Only about a dozen schools offer MBA degrees with a concentration in sports, a distinction that requires only 12 hours of study — typically four classes or three classes and an internship — dedicated specifically to the sports business. Only five programs ask students to take at least 18 hours on the sports side: ASU, the University of Central Florida, Ohio University, the University of Oregon and the University of Massachusetts.
Each of those five programs has its niche.
The court is a classroom for Jim Kahler and students at Arizona State University's sports business program.
Ohio University, known as the cradle of college athletic directors, has been around since 1966 and boasts the largest network of graduates. UMass, born soon after the program at Ohio, has a faculty of 10 with full-time experts in most industry disciplines. Oregon has the acclaimed Warsaw sports marketing think tank, along with proximity to Nike and Adidas. UCF offers sports business with a conscience, headed by social activist Rich Lapchick and marketing guru Bill Sutton, who still consults with the NBA. ASU’s hook is that it is the only one of the sports shops married to a B-school that is ranked in the nation’s top 50. Also, the program is led by Jim Kahler, the former senior vice president of sales and marketing for the Cleveland Cavaliers who came to campus in 2002.
All of the schools say they offer a valuable service to the sports business, training future leaders in the advanced business skills that are necessary in an increasingly complex, maturing industry.
“This is a business that needs better business people,” said Paul Swangard, a former TV sports anchor who got his MBA at Oregon, worked for Intel and returned as managing director of the Warsaw Sports Marketing Center in 2001. “There is a value proposition that says companies can actually save money by hiring people with these skill sets. There’s a need here.”
The question, of course, is whether that perfectly logical contention will resonate with those doing the hiring. With the cost of B-school running $25,000 to $50,000, the stakes are high, particularly when you consider that those who get jobs in sports likely will make far less than the students who sit beside them in finance class. Many who already were in the work force will end up taking a pay cut to crack a field where dozens apply for almost every job.
“Money was the biggest mental hurdle for me; I have no problem admitting that,” said Vipin Motwani, a first-year student at ASU who walked away from a job at a management consulting firm after four years in the defense sector. “To be earning a level of salary, then go and get your master’s and come out earning less? That’s crazy. But I feel like it’s the tortoise and the hare. This is a slower path. But ultimately I think it’s the one where I’ll be happiest.”
When Maestas decided to make the switch, he started by cold-calling executives at teams, leagues and agencies across sports and asking for advice on the best way to break in. The most common response: You already have an education. Take whatever job you can get and work your way up.
Looking for a plan that would make better use of his background, he crafted an impassioned e-mail to Dallas Mavericks owner Mark Cuban, who responded: “You already know the answer. Just go for it.”
Maestas still couldn’t accept the idea that his finance degree and four years as a business analyst and sales rep had to evaporate once he crossed over into sports. The MBA in sports offered the chance to gain experience and build a network while developing traditional business skills.
The company that hires him may not reward him for the degree initially, but he expects the skills to help him advance quickly.
“You have to win them over,” said Guy Groff, director of the career management center at W.P. Carey. “We have to educate many small companies on the value of an MBA. It’s not just those in sports. A lot of times they have to see it in order to understand what an MBA can do.”
On the other side of the equation, those enamored with the idea of working in sports sometimes must see it up close to understand what they’re getting into.
“When the first line in a cover letter is ‘It has always been my dream to work for a professional baseball team,’ that résumé ends up in the trash,” said David Samson, president of the Florida Marlins, who went to law school and was working for an investment banking house when his stepfather hired him to run the Montreal Expos. “Say you wanted to be a major league pitcher. That, I’ll believe. But nobody grows up wanting to do what I do.
“Understand this: When you work here, it’s your job. So if you are enthralled with hanging out in the clubhouse, you’re not going to last too long.”
A week before meeting with a reporter to discuss the sports MBA program that he directs at UCF, Lapchick sent a copy of his latest book, teased with a note. “When you read page three,” it said, “you will understand where my passion comes from.”
The book begins with the story that has drawn so many to Lapchick and his causes over the years.
“‘Nigger,’ they carved ‘nigger’ on his stomach!” As I heard one of my students say this to his friends while pointing at me, I realized with horror that my life might never be the same again.”
Lapchick was teaching at Virginia Wesleyan in 1978 when he was attacked in his office by two men who beat him until he passed out and then used scissors to carve the word “nigger” (which they misspelled “niger”) into his abdomen. A burgeoning social activist and the son of former New York Knicks coach Joe Lapchick, he was leading an anti-apartheid push to cancel Davis Cup tennis matches between the United States and South Africa.
The events of that night set the stage for a career of activism tied to the role of sports in society.
“The biggest lesson that I’ve learned over the course of my lifetime was that sports can be a platform to involve people in social issues that they might never have been involved in,” Lapchick said. “I think that’s a worthwhile lesson to pass on to the future leaders of sport.”
If you get lost on your way to the DeVos sports management program at UCF, look for the intersection of Lapchick’s social awareness and Bill Sutton’s business acumen.
Kahler (second from left) puts his students in real-world business situations so they can gain the experience demanded by the industry.
Sutton is the most highly regarded sports marketing educator in the nation, a curriculum builder who has moved back and forth between academia and industry for three decades, teaching at Robert Morris College, Ohio State University and the University of Massachusetts, working for DelWilber & Associates, as commissioner of the Mid-Ohio Conference and, most recently, as a vice president of team marketing for the NBA. He came to UCF as associate director of the sports MBA program in January.
Sutton chuckles when it is suggested, as if often is, that he and Lapchick make an odd academic couple.
“We’re totally different in approach but almost identical in where we want to go,” Sutton said. “That’s what will make this program great. We both want to produce innovative business leaders with a strong moral compass.”
When Orlando Magic owner Rich DeVos, who funded the start of the program with a $2.5 million endowment, and UCF President John Hitt chose Lapchick as its architect, they committed, by that very choice, to creating something different.
As B-schools go, UCF’s is a workhorse, training almost 500 MBA students a year in a rapidly growing market that is hungry for executives. The sports business specialization is a small slice of it, accepting 30 students a year.
Students in the DeVos program, who take all their MBA core courses together, are held to different standards than their counterparts. They can’t use laptops in the classroom. They follow a dress code: business casual.
Those are minor sacrifices compared to the requirement that sets the program apart from the others. Working in teams of five, students are required to spend at least 15 hours a month on one of five community service projects, most of which involve using sports to connect with inner-city children and drive them to achieve.
“We’re in the business of developing leaders and we believe that this is an important part of it,” said Fritz Polite, who joined the program as a professor in 2002 after getting his doctorate at Florida State. “We value this work in the community. We believe that the industry should value it. We hope to pass it down as a legacy.”
The DeVos program also differs from others in that it includes training in diversity management, along with several courses that explore the place of sports in society.
All three professors are quick to concede that it’s not right for everybody.
“We make sure they understand what they’re getting into,” Polite said. “I’m not going to recruit a wishbone quarterback into a drop-back system.”
Steve Hank was fresh off selling his stake in a small satellite TV services company in Chicago when he decided to go back for his MBA three years ago. He thought he might like to put it to work in a college athletic department. Hank had already worked in corporate sales for the Chicago Bulls and then managed the Olympics campaign at Reebok, but found neither fulfilling.
He was accepted at Northwestern, home of the top-ranked B-school in the nation according to Business Week, when he got a call from Kevin White, a friend who had taken over as athletic director at Notre Dame after serving in that capacity at Arizona State.
White suggested that the mix of education and experience that ASU offered might be a better fit.
Hank was interning in the marketing department at ASU when White’s advice began to pay off. Taken by strategies he saw for the first time at a customer relationship management conference, he came back to ASU convinced that the department needed to invest in a program.
“This is the intern bringing this to everybody’s attention,” Kahler said. “Organizations realize pretty quickly that an MBA intern isn’t like the interns they’re accustomed to getting.”
Hank wrote a plan explaining how a customer relationship management system could work at the school. His bosses were impressed enough to let him run with it. Then, when he graduated, they hired him to manage and expand the system. As marketing and revenue generation manager, Hank already has made his first hire: another MBA from Kahler’s program.
“It remains true that you have to pay your dues if you want to work in sports,” Hank said. “The degree does not exempt you from that. Anybody who thinks it will should turn and go in the other direction. You have to be willing to sacrifice. For two years, I killed myself. But it’s paying dividends for me now.”
For more than half the students in Kahler’s program, the MBA is a vehicle for a career change.
Karina Bohn, the president of the MBA association at Arizona State, was working on the Qwest account for Momentum Worldwide, dealing with several Phoenix sports properties, when she made the jump.
Jeremy Lange was doing media planning for Grey Advertising, handling Tanqueray and Johnnie Walker, when he realized that the sports-related work he enjoyed so much might evaporate if he were assigned to a different client.
Both wanted into sports full time. They figured they would benefit from a program that offered the chance to do real work in front of those doing the hiring. Bohn did market research while interning with the Diamondbacks last summer. Lange interned in NASCAR’s corporate sales office in New York.
Like Sutton, Kahler stresses real-world application when discussing business strategies with students. He wants his students to have work experience before they enter the program and gain sports experience while they’re in it, realizing that much of the industry will demand it.
“For the Gatorades and the Nikes of the world, the value of that MBA degree is pretty widely known,” said Rebecca O’Sullivan, vice president and general manager of Fox Sports Net Arizona and a regular mentor to students at ASU. “But when you’re on the sports side of it, and not the product side of it, the response is going to be: That’s great. I’m glad you’re very educated. But now, where’s your experience?”
In addition to regular coursework, students at the University of Central Florida spend 15 hours a month with community service projects.
That’s what Kahler asked Chris Carlton when he applied to the program three years ago. Carlton was fresh off a six-year stint as a Navy intelligence officer, serving in Operation Enduring Freedom, where he managed a staff of 30. He sent résumés to several teams, but none returned his phone calls.
“I thought I had a résumé and qualifications,” Carlton said. “But nobody else saw it but me.”
Kahler told Carlton he’d welcome him to the program if he got some civilian experience, or, better yet, sports experience. He hooked him up with the Phoenix Suns, selling tickets over the phone. Carlton hated it, lying awake many nights wondering if Kahler had steered him wrong. Now, a semester away from graduation, he knows the answer.
“Chris was learning the culture,” Kahler said. “Some day if he’s a team president, he’s going to know what it means to work the phones. I’m not saying that everybody has to bang the phone 100 times a day. But learn it. Appreciate it.”
While many use the sports MBA as a vehicle to change careers, some see it as a way to accelerate advancement.
Dave Schifrin, another ASU first-year, managed marketing and client relationships for the nation’s top soccer agent, Richard Motzkin. He wanted to stay in soccer, but on the team or league side or working for a major marketer like Nike. Kahler predicts — and not jokingly — that he’ll be commissioner of Major League Soccer one day.
Mark Dunkerley was an assistant director of marketing in the athletic department at Vanderbilt University when he decided to pursue his MBA. He wants to be an athletic director, but thinks the best way to prepare is with an advanced business degree, rather than the master’s of sports sciences common among many ADs today.
“All of us will tell you that we came here because it’s a top MBA program,” Dunkerley said, “and we didn’t want the sports administration [master’s] degree because, really, outside of the network that you’re building while you’re getting it, what’s that worth?”
Dunkerley knows he might come out of the program with a job title similar to the one he had when he entered it. But he says he trusts that the skills he has assembled will help him land his next two promotions more quickly than his contemporaries who don’t have MBAs.
It’s a common expectation within the programs.
“We always talk about, ‘What level are we going to go in at?’” said Kristin Shaff, a second-year at ASU who interned at Host Communications and is working a fellowship at Fox Sports Net this year. “Sports hasn’t quite yet grasped the concept that MBAs have this knowledge and they can come in and make some real decisions. You still have to come in near the bottom. But you’re going to get to the top faster because you can add value.”
There are a few shining examples of sports executives who rocketed forward after stints at distinguished B-schools (see story, this page). One of them, Larry Baer, was vice president of marketing for the San Francisco Giants when he left to get an MBA from Harvard. He landed in the entertainment industry, made his mark there, then returned to the Giants as chief operating officer with a stake in the team.
“A place like Harvard business school has no applicability to sports management and every possible applicability to sports management,” Baer said. “You read a lot of cases and analyze a lot of business situations. Those real-life business situations can occur in disguised ways in sports.
“The increase in sophistication in the last five to 10 years clearly warrants individuals with advanced training in this business. I don’t want to sound like an elitist snob. You can be a very talented executive and go far without an MBA. But the need for advanced training is much more than it was 10 years ago.”
When Doug Carlucci, president of the Chicago-based software company Stadia Group, walked in to address Sutton’s sports marketing class at UCF last month, he was without an agenda. He was in Orlando to present the latest data from a project his company was doing for the Magic to the team’s vice president of marketing, Chris D’Orso. D’Orso, who was scheduled to speak to the class, asked Carlucci to join him.
D’Orso began as he and Sutton had planned, walking the students through a history of the team’s branding efforts, reviewing ad campaigns and explaining other Magic marketing initiatives. He took questions. Then, he turned the podium over to Carlucci.
And a typical day in a sports marketing class turned into an extraordinary glimpse behind the curtain of an NBA team.
NBA Commissioner David Stern discusses the sports business with students at Central Florida.
Carlucci began by explaining what his cutting-edge software does: build models that allow teams to predict how many fans will buy tickets to a given game, how early they’ll buy them and what sections they’ll choose to sit in.
He planned to keep it basic. But then the questions started coming. He thought they might stop when he mentioned regression analysis, but Sutton’s students, all second-year MBAs, had learned it in their stats class and wanted to know more.
So Carlucci, himself a Kellogg MBA, started peeling the onion. One PowerPoint slide yielded another and, the next thing he knew, he was making the very presentation that he had planned for D’Orso in front of an entire class.
Standing arms-folded in the back of the room, D’Orso smiled as he watched along with the students. He, too, was seeing the data for the first time, hanging on each click as Carlucci moved through a program that may one day change the way teams plot ticket strategies.
“You guys are following this better than some of our own people do,” D’Orso told the class. “You’re asking the same questions that I do. You’ll be a rising star in whatever organization you go to because you understand things like this.”
Perched on a stool on one side of the room, Sutton looked like a proud papa. This is what he means when he tells students, as he has since he started teaching sports marketing at Robert Morris College, that he is “the application” within their education.
“You can go to marketing class [in the core MBA program] and learn theory,” Sutton said, “and then come to me and I’ll tell you if it works for us.”
Like most programs, UCF delivers a second year that is rich in application.
Students return from internships with pro teams and leagues, sports marketing agencies and recreational sports programs to work on projects where they apply the skills they learned in their first year. Many also work on game operations or in the ticket office for the Magic or in the UCF athletic department. One commutes to Daytona Beach to work for NASCAR.
Second year also means a large project run in conjunction with the school’s athletic department. This year, they’ve split into three groups that are challenged to put on revenue-generating events in conjunction with the conference volleyball championship, a football game and a women’s basketball game.
Students work with a UCF assistant athletic director to make sure they don’t run afoul of NCAA rules or trample on contracts the school or league has with sponsors.
“Like many Division I schools, we recognize that we don’t have the staffing to correctly market all our sports,” said Steve Orsini, UCF’s athletic director. “When they said they wanted to do this I said, ‘Really? How many events do you want? Three? Five? I’ll give you 10.’
“You’re getting MBA students here, not gofers. I know they will be effective helping me fill the seats and create the event. They add to my resources.”
Sutton knows that the industry values practical experience over all else, so he gears his curriculum to put students in positions that they’re likely to encounter in the work force.
The project in his “Strategic Sport and Entertainment Marketing” class is a sponsorship presentation. Students are assigned categories — such as financial services or insurance — and must research them and craft a pitch as if they were selling on behalf of a team, in this case, the Minnesota Timberwolves. On Dec. 9, two Timberwolves executives, vice president of corporate sales Conrad Smith and director of corporate sales Ethan Casson, will come to campus to listen to the presentations, pepper students with questions and make recommendations on grades.
“You’re getting your MBA and you’re getting real experience,” said Praveeta Panday, a second-year student who interned in corporate sales with Major League Soccer. “When you come out of this program, you won’t just have the degree. You’ll be prepared for whatever they throw at you.”
Foot in the door
Before Kahler came to ASU, the program was headed by Michael Mokwa, who as chairman of the marketing department championed the idea that there might be room at W.P. Carey for a specialization in sports. Because he saw the industry as an outsider who studied other businesses, his take is an intriguing one.
“Sports is in more desperate need of people with advanced business skills than many people in the business recognize or would like to admit,” Mokwa said. “So the MBA by itself isn’t necessarily going to get you in the door. This is a network industry, and more so than most. You have to be part of the fraternity. And, if you’re not, you’re not going anywhere.”
At ASU and UCF, they’re selling the idea that they can deliver advanced business training, bolster it with real-world experience, plug the product into a network and turn out executives who will make others reconsider the value of an education that includes the study of sports.
“The measure of whether we’ve done our job is whether these people can come out and compete with somebody from a Wharton or a Northwestern,” Sutton said. “I really believe that can happen. We can create programs that will distinguish themselves.”