Recession tested Finchem’s leadership skills
Tim Finchem faced a number of major challenges over the course of his 22-year tenure as PGA Tour commissioner. None tested him more than The Great Recession of 2008-09.
The economic collapse crushed the financial and auto industries, the lifeblood of PGA Tour title sponsorships. A handful of the tour’s sponsors went bankrupt, including General Motors, which caused Buick to drop its tour relationship that spanned decades and included two tournament title sponsorships.
In addition, the $105 billion federal TARP bailout brought sharp scrutiny of corporate sponsorship spending in golf and buffeted the tour’s business model.
All this came just as Finchem began a new round of TV negotiations.
Finchem went to work to preserve the tour’s sponsorship and to change the conversation on such deals, providing steady and firm leadership when the sport needed it the most.
“There was great public outrage about corporate waste and he managed to prove to everyone that a sponsorship was not some frivolous pro-am, but was something that was really good for business,” said CBS Sports Chairman Sean McManus. “The fact that the tour came out of the recession with a strong business reputation is a great tribute. Your mettle is earned in tough economic times and that was the toughest in many years.”
By 2011, the tour had signed a new nine-year TV deal with CBS and NBC worth more than $3 billion. Its ability to navigate the economic turbulence under Finchem came as no surprise to top executives within the organization.
“A lot of the media at that time predicted the demise of the tour because the recession was so severe and we are so sponsorship driven,” said Tom Wade, PGA Tour chief commercial officer. “While the rest of the world was worried sick about us, we were never worried. When he locks onto an objective, there is no question if it’s going to happen. When you project that kind of competence, in the most severe storm, he can stand there and lead us to believe that we can get through something like this and maybe be better than we thought we could be.”
Finchem and his staff labored hard to show the return on investment of the tour’s integrated sponsorship model. They met with CEOs and ran the data to prove the value of a golf sponsorship through TV, hospitality and, just as important, the charitable aspects of the deals. The strategy preserved the business during the downturn.
“It was a drastic and steep drop,” Finchem said of the recession. “We’d been through a couple of these prior. We’ve got multiple streams of value. So you start comparing to other companies, and at the end of the day, nobody was getting rid of us when they do those kind of analytics.”
Many insiders still marvel at Finchem’s response to the financial challenges facing the tour a decade ago.
“Tim’s biggest accomplishment was how he got through the crisis,” said Gary Stevenson, a former PGA Tour executive and current deputy commissioner and president of business ventures for MLS. “I still shake my head at that. They just blasted through that period and grew, which was fantastic.”