| Title | Proper Strategy Selection as Essential Survival Prerequisite for Small Sport Clubs |
|---|---|
| ID_Doc | 69704 |
| Authors | Tripes, S; Kral, P; Zelena, V |
| Title | Proper Strategy Selection as Essential Survival Prerequisite for Small Sport Clubs |
| Year | 2013 |
| Published | |
| Abstract | The positive impact of sport on health is no longer being questioned. Information on health and other benefits of sport has been spreading through life style media what increases the demand on sport services and sport facilities. Recently, there has been a boom of new fitness clubs and private sport facilities what threatens traditional sports organizations. Thus, the sport market has become more varied and also more competitive as some clients demand for lower prices while others are willing to pay huge sums of money for exceptional services. Accordingly, each sport manager is faced with the problem to choose a business-level strategy based on Porters generic strategies. Each manager has to decide whether to employ low cost strategy and attract customers seeking for low prices or, whether to employ differentiation strategy and focus on exceptional quality of services. Such a strategic decision should be based on deep knowledge of internal processes and external environment. Thus, our paper brings a system dynamic model evaluating internal and external influences as a tool to choose an appropriate strategy for sport managers. In our previous research, we found satisfaction is the most important tool for sport client sustainability. However, sustainability may be influenced by both low-cost and differentiation strategies. Hence, first think for a manager to consider is competitive advantage. Competitive advantage results from the relationship between internal processes and external environment. Our model embodies important aspects of internal processes, such as quality and quantity of staff, strong leadership, and organizational culture, capacity of facilities, marketing approach, creativity and financial strength and, aspects of external environment such as knowledge of population and behaviour of competitors. In the final paper, different competitive strategies will be incorporated to the system dynamics implementation of small sport club performance management system. Our system dynamic framework is based on extended Balanced Score Card and is validated by historical data and experts' knowledge. We have tested five scenarios derived from Porters' generic strategies (i) low-cost strategy, (ii) "stuck in the middle" strategy, (iii) differentiation strategy, (iv) focused low-cost and (v) focused differentiation strategy. We found that current potential or active population is more sensitive about differentiation strategy based on bringing emerging sports. Launching emerging sports as competitive advantage is not sustainable in long term period because of very dynamic environment and fashion effect. Some of emerging sport (such as Spinning program or Zumba) became popular and in such case competitors offer same services within a season or two. Apart from those, a lot of emerging sports does not take hold or, goes out of fashion within a short period of time. On the other hand, the low-cost strategy could be successful under particular conditions as well. For example, a manager decides to offer unlicensed sport without massive marketing. On the whole, our model covers a variety of possible situations and helps managers to choose the right strategy utilizing available resources in particular environment. |
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