Project #26350 - case study

You have recently been named athletic director of HTS (Have the Stuff) University, a liberal arts school located inthe Jackson, MS area. HTSU has a modest athletic program offering the following sports for both men and women: basketball, golf, tennis, baseball, softball, soccer, and track/cross-country. All sports are played at the Division III level.

Current athletic facilities are as follows:

The Spud MacKenzie Gym (built in 1930), which has to provide space for varsity sports, instruction, and intramural/recreational needs and has three full-length basketball courts. When the telescoping bleachers are used, only one court is available.
Within the Spud Gym are both a men’s and women’s locker room with an athletic trainer’s room.
The baseball and softball teams play on the same field, which has a grandstand for 200 people and was constructed by J.R. Housatonic in 1920 when HTSU was founded.
A 25-meter swimming pool serving the instructional and recreational needs of both the student population and surrounding community is adjacent to the Spud Gym.
Eight tennis courts used for varsity competition, instruction, and recreation are located between the Spud Gym and the baseball and softball field.
John Doe Stadium seats 5,000 (from the old days when they used to have football) and was renovated in 1990 through donations generated in a campaign jointly sponsored by the Booster Club (The Stuffers) and the university. A swimsuit calendar used as a fundraising vehicle during the campaign generated some controversy in the community.
The athletic offices are housed in the gym annex attached to the Spud Gym and contain four classrooms, an instructional room for aerobics, a 2,000-square-foot weight room, and offices.
There are 40 acres of recreational land including four groomed soccer/football fields, miscellaneous rolling grassland, 200 feet (61 m) of beachfront property, a boathouse donated by the famous Captain Stubing, and a dock.

The athletic department generates insufficient revenues to support itself and is dependent on monies from the university’s general fund. The athletic department has generated on average $250,000 a year in revenue for the past 10 years and spends about $1.6 million a year. Approximately 60% of these expenses relate to personnel expenses, and most employees have positions in the athletic department and teach as well in the PE department. The university does not intend to increase or decrease the athletic department’s budget. The cost for maintaining the current facilities is not in the athletic department’s budget but is a $300,000 line item in the university’s general budget. These funds are used for upkeep, maintenance, and grounds maintenance. The university normally spends around $180,000 a year on the grounds crew and janitorial staff. Not included in these expenses is the $300,000 spent each year on utilities for the facilities such as water, gas, and electricity. Because of the inability to generate enough income to be self-sufficient, the athletic department has been unable to expand its offerings or its facilities in almost 20 years, with the exception of the stadium renovation and adding two women’s sports to comply with Title IX.

Bubba Baker, while not an HTSU alumnus, has adopted the university because his alma mater keeps getting into trouble with the NCAA for not being clever enough to hide the under-the-table payments to athletes. Bubba is the president of the university’s board of directors and an influential man in town. Everyone knows him from his Bubba’s Car Lot commercials shown on late-night television. He also has been heavily involved with the booster club and dated three of the women who had posed in his swimsuit calendar. Bubba envisions HTSU being the Brain Bowl winners by becoming the top Division III team for its athletic programs. To this end, Bubba offers to give $20 million exclusively to the athletic department if a logical, manageable strategic master plan can be developed and implemented to help reach his goal. Bubba makes it abundantly clear that he does not want to add football because it reminds him too much of his alma mater. Bubba also indicates that he wants the money going only to capital improvements such as new buildings, renovations, equipment, and land acquisition. Not a single penny can go to salaries, supplies, and related costs. These costs would have to come from other sources.

Bubba’s main concern is that because the athletic department has worked without money for so long, it will not be able to manage the funds effectively. One of his concerns is that the university will not have the funds to properly operate and maintain any capital improvement projects that are built. If a new gym is built and the university doesn’t budget for proper janitorial care, then his gym (he wants every new project developed with his money to be named after a family member) would not look good, which would not make him happy. He is very clear that he wants to be happy, very happy.

It is commonly agreed by all constituents that HTSU is in dire need of new athletic and recreational facilities not only for the athletic teams, but also for the 5,000 students, and 500 faculty and staff members. The student population is increasing 3% a year, but adding a new facility is expected to boost the student population by 5% a year. The private school charges a flat tuition of $20,000 a year. It is also hoped that the new facilities and emphasis on athletics will help the student recruitment and retention problem. However, some groups on campus believe that new construction for athletic and recreational purposes is nonessential and in some cases detracts from the school’s academic mission. Others believe that the community has ample facilities and opportunities that could be used if proper arrangements could be made.

The new university president, Ed “Sizzorhand” Jones is very eager to accept the $20 million and would promise almost anything. He has held meetings with various staff members, alumni groups, and current students (including student-athletes), who have for the most part reinforced his views regarding the need for the facilities. His chief financial officer, Trudy “Spitfire” Lorane, is against accepting anything with strings attached, no matter how much money is involved. However, President Jones sees the gift as an opportunity to make a name for himself and stop the constant comparisons people make between him and the past president.

President Jones calls you into his office along with several other big wigs and asks you to develop a five-year master plan to present to Bubba and his attorneys (DuweyCheatem, & Howe) for their consideration. If the plan is acceptable, Bubba would be willing to write a $10 million check that day and another $10 million check a year from that date. Your job throughout the semester is to develop the master plan, which should include:

1.
A comprehensive overview of current market conditions in the Jackson area. (Demographic make-up, income levels, age, population, unemployment, existing facilities, etc...)
2.
Potential revenue sources for alternate uses of facilities. (fees, loans, sponsorships, donors, etc...)
3.
A facility schedule (Like the schedule you did for the in-class assignment)
4.
Booking-related policies and procedures(Policies are statements to help you reach your goal, procedures are steps to accomplish the policy)
5.
Facility marketing strategies (use marketing mix)
6.
A description of how the facilities will be used in the future.
7.
A proposal of what facilities to build, and the cost. Explain how you determined the cost of the facilities. (You do not have to be specific on cost, there are websites out there that determine cost of certain facilities. You may also find other facilities that have similar square footage and are similar in general that you could use for the price of facilities.)

 

You should write this in a paper format but use headings to differentiate each topic.  You should have 7 headings as listed aboveEach heading should be atleast two paragraphs. For example, the format should look something similar to this:

Current Market Conditions in Jackson Area

​Information written here (one paragraph)

​Information written here (one paragraph)

 

Potential Revenue sources for alternate uses of facility

​Information written here (one paragraph)

​Information written here (one paragraph)

The idea is for you to use the information in the lectures, discussion, in-class assignments, guest speakers, textbook information to analyze the situation and be able to formulate your thoughts in to a specific plan. You will not be expected to use information outside of lectures, text book, in-class assignments, guest speakers, etc.... You will only be graded on what is covered in the class. Some information (based on how much we covered it or the book covers it) will be more specific than others.

Subject General
Due By (Pacific Time) 04/02/2014 08:40 am
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