Strategic Management & Sports Organizations

1. Day 3 Strategic Management &Sports Organizations http://cortoleo.free.fr/ISM.htm Lionel Maltese Maître de Conférences Paul Cézanne University (Aix-Marseille III) Affiliate Professor Euromed Marseille School of Management

2. Focus on Relational Resources & sports organizations Public Relations & Hospitality Social capital & Networking

3. Public Relations (PR) ? • Public Relations is a management function which tabulates public attitudes, defines the policies, procedures and interest of an organization followed by executing a program of action to earn public understanding and acceptance. " (Edward Bernays) • According to Michel Crozier (1957) : Public Relations is a set of processes used by managers to gain external publics’ sympathy and goodwill.

4. Public Relations activities • Public relations involves: • Evaluation of public attitudes and opinions. • Formulation and implementation of an organization's procedures and policy regarding communication with its publics. • Coordination of communications programs. • Developing rapport and goodwill through a communication process. • Fostering a positive relationship between an organization and its public constituents.

5. PR = Marketing asset • A very « large » communication tool : financial communication, lobbying, media, Sponsorship… • More than 200 definitions… for us : It’s a marketing activity implemented by a firm, a public or private organization, a person or a group, to create, establish, maintain or improve, on the one hand loyalty, understanding and sympathy, and on the other hand, the relationships with the public inside and outside the institution, at the origign of its development (Kotler and Dubois, 2004).

6. 5 « PR activities » (Kotler and Dubois, 2004) • Press-relations : introducing « positive informations » in the medias • Editorial advertising : facilitating media (TV, Press, Radio, Internet) insertion for your customers or prospective customers. Special events organization (new products presentation) are good exemples.

7. 5 « PR activities » (Kotler and Dubois, 2004) • Institutional communication : Gathering all the internal and external actions about the institution (corporation, association…) • Consulting : Informing or advising the firm about developments on environments linking to the positioning or image.

8. 5 « PR activities » (Kotler and Dubois, 2004) • Lobbying : defending institution’s interests against public actors (political). • Lobbying can consist of the private “cajoling” of legislative members, public actions (e.g. mass demonstrations), or combinations of both public and private actions (e.g. encouraging constituents to contact their legislative representatives). As a professional occupation it is also known as "public affairs". Practitioners may work in specialist organizations or as part of public relations consultancies.

9. PR “specifities” • Help for new products launching • Help for product positionning (ex : « I love NY ») • Increase interest for a product category (ex : bread) • Influence specific targets (ex : Euromed Marseille) • Products defense (if problems before) • Construction of Corporate Reputation with a positive returns for the products.

10. Presentation« Event Networks » Erickson G.S, Kushner R.J (1999), “Public Event Networks : an Application of Marketing Theory to Sporting Events”, European Journal of Marketing, 33, 348-359. (Jean-Maxime)

11. PR for events managers • Press-relations : control & development • Events creation during your event • Political PR • « People » exploitation (dedicated person in your organization) • Construction and management of relational networks inside and outside your event • Forging an « iron cage » for your event network : be carefull about the balance between quantitative and qualitative interpersonal relationships

12. « Celebrity utility » : people and ex professional athletes • « Open the doors »… • Personal relationships with important CEO • Adress book • Relationships with the athletes • « Special » information access

13. PR « ambassadors » • You can explore and exploit new contacts using external ambassadors (shareholders) : • Intermediary or contributor for prospection • Creation of new kind of networks • Loyalty need between this ambassador and the event manager • Ex : Euromed, HEC, sport institutions…

14. PR & Press Relations • Do not reduce PR with press relations • Generally, PR are using to (Occurrence Agency Study, 2003) : • Brands and products communication (70 %) • Institutional communication • Press relations (53 %) • But on the fiels, the tools are : • Press relations (97 %) • Institutional communication (91 %) • Internal communication (89 %)

15. PR trades • For the sponsor (communication department) • Agency (in France : Pampelonne, Quaterback, Derby…) • « Freelance specialist » (Christian Bîmes for TF1…)

16. PR efficiency & evaluation ? • Difficult ! • Before and after… • Press quantification • CEO « hobbies » (personal pleasure & non rational behavior…) : you can try to identifie CEO « fan » or « extra professional » activities • Relational networks / internal satisfaction : stimulation of commercial / organizational relations • Event = « network place » to sign commercial contracts (ex : BNP Paribas & Cyrille Comar)

17. Networking : CEO & Social Capital • Social Capital (Pierre Boudieu, 1986) : « the aggregate of the actual or potential resources which are linked to possession of a durable network of more or less institutionalized relationships of mutual acquaintance and recognition ». • New resources & strategic informations access = it’s a kind of « resources activation » • CEO in sports organizations & social capital = development of individual and corporate reputation with their stakeholders (Sebastian Coe, Jean-Michel Aulas…) So a large part of CEO activities for his event are linking to exploration and exploitation of contacts with stakeholders to build relationships for personal and organizational success.

18. The example of China : the importance of interpersonal relationship (GUANXI - 关系 ) in Business • The Chinese word « guanxi » (关系) refers to the concept of drawing on connections in order to secure favors in personal relations (Luo, 2000). Key characteristics : • Implicit mutual obligations, assurances and understanding • Attitudes toward long term social and business relationships • More than a friendship or a simple interpersonal relationship : it includes reciprocal oblogations to respond to requests for assistance. • So Guanxi means interpersonal linkages with the implication of continued exchange of favors  in my experience in a PR agency we can tranfer this phenomemon in sports events context !

19. Presentations • Luo, Yadong (2003), “Industrial Dynamics and Managerial Networking in an Emerging Market : The Case of China”, Strategic Management Journal, 24, pp. 1315-1327. (Houyan, Haiying & Guoshang) • Standifird, Stephen S. (2006), “Using Guanxi to Establish Corporate Reputation in China”, Corporate Reputation Review, 9 : 3, pp. 171-178. (Bo, Li, Fegyuan & Haiyan)

20. The relationship grid(Baker, 1994) The Other’s Spectrum Deal-Oriented Spot Market : Economic area in which « relationships » are short-term, fleeting transaction Exploitation : You get exploited by others who don’t make investments in the relationship and who take advantage of the investisment you make. Your Spectrum Relationship - oriented Deal - Oriented Partnerships : Loyal, mutually beneficial, long term relationships Exit : Danger : « stakeholder » power ! Relationship - Oriented

21. Interpersonal “ties” efficiency (Granovetter, 1973) “The Strength of Weak Ties”, 4 criteria : • Relation duration • Emotional intensity • Intimacy • Services reciprocity between stakeholders

22. PR evaluation from customers perspective • Setting measurable PR objectives • Launching : • Example : Using press and event to ensure better returns on special targets. • The event facilitates the access to media.

23. PR evaluation from customers perspective • Communicating a targeted message : • Example : informing targeted B to B customers about the firm diversification (ex : Pasino) • Measuring through surveys after the event

24. PR evaluation from customers perspective • Convincing public authority • Example : activation of a special campaign to make public authority committed • Measuring though an opinion survey conducted before and after the campaign

25. Measuring tools : quantitative indicators • OTS : Opportunity To See : message exposition rate • TRP : TV Rating points (if a 30 seconds message is watched by 1 % of the targeted population, the rate = 1 point TRP)

26. Measuring tools : quantitative indicators • GRP : Gross Rating Point : Total number of opportunities for the target to see, to read or to listen to the message. • AVE : Advertising Values Equivalents : based on the equivalent cost for buying an advertising space

27. Remarks… • Can we separate the PR impact for advertising ones ? • Analyse and try to evaluate the ties between the target members more than the target itself ! Very difficult to measure : a thesis ?

28. Main objective of a PR strategy ? Gathering your network thanks to an event (partner club, community…) and make it Valuable – Rare – Non Imitable (or Substituable) - Organizational

29. Dangers ! • Too much ties to manage ? Strength or Weak Ties ? • Dependency ? • Be careful to the rumors inside the networks…

30. Occade exampleNow Canal Plus Event… Grand Slam of Tennis of Lyon GPTL

35. Partnership Strategy (GPTL) SFR 2003 ARKEMA 2006 Banque Rhône Alpes 2006 « 5 balls » Strategy Beghin Say 2005 Historique PERRIER 2004

36. GPTL Corporate Reputation Sport Reputation Reputational Resources Partnership Resources Relational Resources Physical Resources Relational competencies Opportunism CEO celebrity Learning Organizational capabilities

37. Cascade of assets Relational Resources « Axes » Learning Organizational Capabilities Partnership Resources Physical resources Reputational Resources Stock of resources Dynamic Capabilities « Bricolage  »

38. Event development ? • Balance between PR / Public event or Sport / Business ? • Question : sponsors turnover and control ? • PR rarity ? Overflowing ?