The PGA Championship that teed off this morning will be JOE STERANKA's last as CEO of the PGA of America. In seven years in the CEO post, Steranka oversaw a golf industry that experienced significant travails as it rode in and out of the recession. More and more, he found himself in the role of spokesperson for the entire golf industry and not just the PGA. That suited Steranka just fine. One of his goals when he took this job was to give golf, as an industry, a stronger and more unified voice. As he leaves at the end of this year, Steranka looks forward to his next challenge, but said he has no idea what that will be. He talked this morning at The Ocean Course on Kiawah Island about the last seven years, the Olympics and what's next.
Q: How has the CEO job changed or evolved since 2005 when you took over?
Steranka: In 2005, when I took this job, I had several friends tell me “You’re going to be surprised at how much of a job this is to help the industry, not just the PGA of America." ... I also was in the office for two distinctly different times. In 2005, our economy was a rocket ship. Our championships, our sponsorships, all of the association’s ancillary revenue, what people spend on golf over the course of a year, from vacations to custom fit clubs and outings with big buffet lines and gift packages, were truly at all-time highs. Then you go through the recession -- the biggest business challenge that any of us have seen in our lifetime. Those were two distinct periods. To protect and manage our assets and protect the revenue streams for the association was very important, if we were going to help golf in the present and the future. ... It also served to bring the CEOs from other organizations closer together. Our working relationship with the USGA is the best it’s ever been. There’s a whole new level of collaboration that’s never been seen before. That investment has helped hold the industry together.
Q: You’ve also been very visible in establishing a presence for the PGA in Washington, DC. Is that something you foresee continuing, or what it just a necessity of the times?
Steranka: (Golf is) a big industry. We’re bigger than the motion picture industry. We’re bigger than the recording arts industry. Major industries have to have a presence in Washington, have to have relationships with key people in state capitals. Regardless of how you feel politically about government regulations, it’s there. To have a presence in Washington give us a chance to articulate that golf is the epitome of small business. America’s golf courses are 16,000 small businesses and they need a voice in Washington. That’s the power of the PGA brand. I feel very confident National Golf Day will continue and more importantly, that we’ll continue to speak to the industry’s effectiveness with regard to economic and environmental impact.
Q: What does the next CEO need to know that he or she doesn’t know right now?
Steranka: (pause) I’m going to wait and tell that person privately. I got a lot of great advice when I was named CEO. DAVID FAY from the USGA was a great help. There was a saying: “The water is a lot swifter in this chair than any of the others.” There’s a lot coming at you. After 25 years, I’ve got a lot of insights and I’ll be there to help the next person.
Q: Was there anything that you wanted to get done that you didn’t get done.
Steranka: I’d have to honestly say no. This was a really difficult decision to step down from something that makes me excited to get up every morning. But when I presented the “Decade of Excellence” plan to the board of directors in Chicago in October 2005, I painted this vision that the PGA would be a lot more relevant to the grassroots golf professional. What we’re doing with Golf 2.0 is one of the most relevant things we’ve done -- I will say THE most relevant thing we’ve done in our history. We’re connecting people with the game through PGA golf professionals. The second leg was to elevate the stature of golf, whether in Washington, DC, or in state capitals or the global view. We have much higher regard than we did. The final thing was to protect and grow the revenue-producing assets of the association with arguably the most recognized brand in sports. To come out on the other side of the recession just as strong or stronger than how we went into it, I’m very proud of that.
Q: What is the budget now?
Steranka: We’re in a domestic Ryder Cup year, so we’ll go over $200M ($227M]) this year, and then we go down to the $130s to $140s range in non-Ryder Cup years. It can go up or down based on revenues from a particular championship or a big advance on media rights. We can have anywhere from a $60M to $100M swing in a given year. ... Our all-time budget was probably 2005, at maybe $240M. That was when everything was at its peak, and we were coming off a Ryder Cup at Oakland Hills and the first PGA Championship at Whistling Straits [in 2004], which was a blockbuster.
Q: What is your next challenge?
Steranka: I can’t imagine this was my last job. I haven’t taken two weeks off, much less two months off. But I am going to take the next few months and work on my short game. I look forward to joining a private club, play some member-guests, take some special trips with JOANNE, all of the things you give up when you’re traveling 180 days a year and working 24/7 to lead an industry.
Q: You spent a few days in London at the Olympics. What stood out to you?
Steranka: [PGA President] ALLEN WRONOWSKI and I were guests of NBC and went with their first wave of guests. I really enjoyed the pageantry of the opening ceremonies, we saw (RYAN) LOCHTE's dominating performance in the 400 IM, went out to Wimbledon one day, saw beach volleyball and finished up with men’s gymnastics. That was the one where Japan protested the results of the pommel horse and moved up from fourth to second. I was unaware that you could file a protest and have a routine re-scored. You learn something new at every sporting event. ... We were thoroughly impressed with London and its preparation and the level of hospitality they showed to the world. It’s clear they had great buy-in, in terms of the tourism opportunity it presented. They certainly delivered.
Coincidentally, we were there at the same time as MIKE DAVIS and GLEN NAGER from the USGA, and [PGA Tour Commissioner] TIM FINCHEM. We’re all excited about what 2016 has in store for golf in Rio. Omega House brought in GREG NORMAN and MICHELLE WIE to talk about the Olympics, and it’s clear that it will have a significant impact on the game.