SBJ/Dec. 2-8, 2013/People and Pop Culture
Dave Brandon, athletic director, University of Michigan
The former Domino’s Pizza chairman and CEO on connectivity, pay-to-play for college athletes, and the pressures of running one of college football’s most visible programs.
Published December 2, 2013, Page 66
W e are trying to keep our fans connected, involved and give them a reason to come to our venues, instead of sitting in front of their 72-inch flat-screen.
We’ve got the largest football stadium in the country, dug into a hole in the ground, with no overhangs or second decks to hang stuff from. So, we’re still trying to figure out how to get it Wi-Fi compliant and have a pipe big enough to accommodate 112,000 people. That’s a bit of a riddle.
I was the CEO for 22 years of two different companies. I’m sure a lot of that translates, but this is a very different job. I don’t have shareholders and my stakeholders are very different in general and in it for a very different purpose.
I was considered an unconventional choice, as a CEO and someone from the business world. Almost four years later, I think it’s become far more common for university presidents to reach out to someone with business experience.
You’ve got to generate revenue, you’ve got to manage costs, you’ve got to appropriate capital, you’ve got to hire and build a great team, you’ve got to recruit, you’ve got to fundraise, and you’ve got to follow NCAA rules, which is a lot like following SEC rules, in the final analysis.
A lot of the skills are very transferable, which is why I think you’ll see more people come into this role from the business world. Once upon a time, this [job] was where retired coaches went. It’s different now.
The only thing you don’t know about this job until you get into it is the intensity. There’s hundreds of thousands of people out there that all think they can do this job better. They all speak their minds. So, there’s the intensity of this environment, where every decision is scrutinized, and if it isn’t controversial, we’ll make it controversial.
This is a job that never quits.
I ran a multibillion-dollar global company before this, and my schedule now is way more demanding. However, my view is that a lot of athletic directors around the country wish they had people who cared about what they do. I don’t have that problem.
We have 900 student athletes; they’ve got to go to school, get degrees and prepare for the next 50 years. That’s something the average fan doesn’t always think about.
One of our initiatives is to leverage our facilities as much as possible. We are renting out our facilities now for corporate events, bar mitzvahs, weddings.
More people get married on the block M in the middle of our stadium than you would believe. The most popular wedding photo is the groom holding the ball for the extra point, while the bride is going through the motions of kicking the ball.
Paying student athletes is a stupid idea. We have 900 student athletes. Tell me who I should pay and who I’m not going to pay? It ruins the whole collegiate model.
If any individual wants to be paid to perform in a sport, go somewhere and have somebody pay you. I don’t want anything to do with it. We’re running a not-for-profit enterprise here that is an auxiliary unit of a public university. We’re here to provide great experiences to student athletes. If somebody just wants to be an athlete and they want to be paid for it — leave.
Meeting-mania can take over a culture. To me, they are a necessary evil. So I’m big on meetings having a clear agenda, a starting time, an ending time and a purpose. Otherwise, you can end up in a meeting room doing nothing but eating doughnuts.
Everybody keeps saying that somebody is going to make a lot of money [from a BCS playoff], but the last data I saw, there were 127 Division I schools with 85 football scholarships [apiece] at large stadiums. Of those 127 schools, 23 are cash-flow break-even or positive. That means 80 percent of the schools participating are losing money. The average subsidy per institution was estimated at $11 million.
If anyone suggests that any of these athletic programs are getting rich, there is tremendously specific evidence to refute that. The 23 of us that are cash-flow positive are running cash-flow margins that are VERY small and all that surplus ends up getting reinvested in capital because we have big facilities to maintain.
We’ve been growing our top-line revenue pretty aggressively. It helps when you have a men’s basketball team competing for a national championship and a football team that’s very competitive. We’re not going to continue to grow at double-digit rates, but there’s still strong middle single-digit growth left.
I’ve always gotten my best ideas talking to the people at the grassroots of any organization.
When I ran Domino’s, the best ideas always came from the franchisees. So I’d go to the stores and ask the people making the pizzas how we can do this better. It’s the same thing here; the people on the front line are going to be much smarter about that kind of stuff than some of the people you’ll meet in the boardroom.