Reds, Rebels & Waratahs consider merging operations

[Badger]

The SMH is reporting that a proposal to pool the assets of the Rebels, Reds and Waratahs, while maintaining their independence, will be presented at the ARU board meeting later this month. The head of this new organisation (Jim Carmichael is the reported front runner for this role) would report to the ARU CEO.

The Brumbies and Force have opted out at this stage. Sounds similar to a shared services set up in the corporate sector.

The thing that got me was the comment in the article stating that “The ARU is trying to save money to avoid going into receivership …” Didn’t realise things were so dire.

Link to full article:
http://www.smh.com.au/rugby-union/u...new-east-coast-powerhouse-20140213-32nar.html

Interested to see how this unfolds as it sounds like the ARU is looking to head down the NZRU route with greater influence over the Australian Super Rugby teams. No surprise the Tahs are interested as it should help reduce the back office costs for the organisation. Must be some nervous people in the administrations of all three provinces in light of this proposal.

So much happening in the rugby world and the season proper hasn’t even started.

 

[Hugh Jarse]

Just pay the unpaid interns less.

Do some serious questions need to be asked about the finances under the JO'N reign.

Just what happened to the alleged $30 million profit ( I thought it was $48 million) from RWC 2003?

 

[Bruce Ross]

The SMH is reporting that a proposal to pool the assets of the Rebels, Reds and Waratahs, while maintaining their independence, will be presented at the ARU board meeting later this month. The head of this new organisation (Jim Carmichael is the reported front runner for this role) would report to the ARU CEO.

The Brumbies and Force have opted out at this stage. Sounds similar to a shared services set up in the corporate sector.

I hesitate to assist the enemy in any way but feel obliged to caution the Reds that they should exercise due diligence and make sure that the 'Tahs actually have some assets to pool before signing up.

And my mail was that it wasn't a question of the Force opting out. Their participation was vetoed by the other franchises when it was discovered that they had sneakily tried to include "Michael Foley" among their list of assets.
.

 

[Train Without a Station]

It's pretty concerning to hear that it's near the state where this needs to be considered, but at least plans are being put in place to try and ensure Super Rugby franchises run solvently.

Reading a half baked article on the roar yesterday people keep saying the ARU needs to stop propping up the Rebels or the Force, but let's face it, they're helping bringing in another 20% of content, another potential capital city market and therefore likely bringing in 20% TV revenue, which the game cannot afford to lose.

Hopefully the most recently successful Aus Super Rugby CEO heading up 3 of the franchises which are pooling resources, will enable them to maximise their revenue sources and control costs.

The Reds are running in the black. I believe that the Waratahs have the potential to do so, being in a large, rugby union market. In a perfect world, they should in fact be able to be more successful off the field than the Reds being in a much bigger market. The Rebels in an emerging market have a battle, but it doesn't mean they cannot improve from their current state.

 

[Boomer]

It's pretty concerning to hear that it's near the state where this needs to be considered, but at least plans are being put in place to try and ensure Super Rugby franchises run solvently.

Reading a half baked article on the roar yesterday people keep saying the ARU needs to stop propping up the Rebels or the Force, but let's face it, they're helping bringing in another 20% of content, another potential capital city market and therefore likely bringing in 20% TV revenue, which the game cannot afford to lose.

Half-baked is right. Furphy, to be more precise.

Rugby WA ie - the Force, are, as mentioned in numerous threads, solvent and had $3.97 m in cash reserves in 2011 (most recently available annual report, Dec 31, 2011, http://issuu.com/western_force/docs/2011_annual_report?e=0)

No doubt they dipped into that in 2012 and last year.

Aside from the ARU's standard handouts - and WA receives far less than the states considered player nurseries - Rugby WA receives no additional support from HQ.

It has never been bailed out, a la the Reds and 'Tahs.

Crucially, if WA can get its house in order, what's wrong with the eastern states and the confederacy of Wise Men from The East?

 

[RugbyReg]

It has never been bailed out, a la the Reds and 'Tahs.

seriously? Never? In the ENTIRE history of the Force? Wow!

Crucially, if WA can get its house in order, what's wrong with the eastern states and the confederacy of Wise Men from The East?

well, we'll let you know just as soon as you get your house in order.

 

[Boomer]

seriously? Never? In the ENTIRE history of the Force? Wow!


Yep, never.

well, we'll let you know just as soon as you get your house in order.

The point is, Rugby WA, for better or worse, is not a drag on the ARU.

And that is a fact (or #FACT!, as you have to say on the interweb machine.)

 

[Ash]

The point is, Rugby WA, for better or worse, is not a drag on the ARU.

And that is a fact (or #FACT!, as you have to say on the interweb machine.)

Really? You are saying that Rugby WA does not take money from the ARU?

 

[TOCC]

 

[TOCC]

Half-baked is right. Furphy, to be more precise.

Rugby WA ie - the Force, are, as mentioned in numerous threads, solvent and had $3.97 m in cash reserves in 2011 (most recently available annual report, Dec 31, 2011, http://issuu.com/western_force/docs/2011_annual_report?e=0)

No doubt they dipped into that in 2012 and last year.


Crucially, if WA can get its house in order, what's wrong with the eastern states and the confederacy of Wise Men from The East?

Actually those cash reserves you mentioned would now be closer to $2.5million, which is really besides the point because net assets would now be around $1million in deficit.


The Western Force revenue in 2006 was $22.5million, in 2012 it had fallen to 17.53million.. Furthermore the Western Force hasn't posted an operating profit since 2008, since 2009 the Western Force has posted a total of $2.9million in losses, thats not even including 2013 which i suspect will be another heavy loss.


I'm not saying they are financially ruined, but I don't understand this attitude that RugbyWA's house is in order and is above such a proposal...

Who gives a shit whether it's an east coast or west coast proposal, rugby union across Australia is struggling and this selfish attitude of looking out just for yourself is a reason why rugby is in such a precarious position to start with.

 

[TOCC]

ASK a simple question of Queensland Reds chief executive Jim Carmichael and you get a complicated answer.
It’s not that he obfuscates but rather that he understands that complicated matters - like how does Australian rugby again make itself competitive in the most competitive sporting marketplace in the world - can’t be reduced to a simple sound bite.
That, in fact, is precisely what has brought the game to its knees - a sound bite. “As long as the Wallabies are winning, the game will flourish”. For the past half-dozen years, that was all we heard. That was the Australian Rugby Union’s strategic plan. Build a winning Wallabies side, pay whatever it took to attract cross-code talent and to retain the existing talent within the game - even if that involved paying them money the game didn’t really have - and everything else would take care of itself.
Grassroots rugby? Don’t worry about it. Kids would be so excited by what they saw the Wallabies doing that they’d come flocking to the local junior rugby club. Corporate support? Hell, we took the “suits” down into the Wallabies’ dressing room after the Test ... what more do they want?
It is only in this light that the unfairness of what was dumped on to the shoulders of Robbie Deans during his five years as Wallabies coach becomes truly apparent. And not just Deans but his players too. No wonder the Wallabies’ game shrank even while Australian rugby itself was shrinking. The pressure from the top must have been crushing.
The national team needed to be competitive to make up for a national body that was utterly uncompetitive. It needed to perform to cover the tracks of an utterly underperforming ARU. And then - the ultimate insult, this - the Wallabies were forced to sit silently while berated by an ARU official after a Test about how badly they were failing the game.
The “top-down” strategy, one-dimensionally simplistic as it was, manifested itself in another guise. The ARU alone knew best. It didn’t negotiate with its stakeholders. It directed them, bluntly and insensitively, and woe betide any organisation or individual who dared to raise a dissenting voice.
Thankfully, the ARU has recognised the error of its ways and moved on from those grim days. The organisation now headed by Bill Pulver is collaborative and consultative, which brings us back to Carmichael. The Reds’ boss is one of the few genuinely strategic thinkers in Australian rugby and one of the few administrators who views rugby not just as a game but also as a business.
Frankly, that second attribute earns him more than his share of critics. The amateur ethos runs deep in Australian rugby. The Southern Rugby Union, forerunner of the NSWRU, was formed in 1874. The Queensland Rugby Union came into being eight years later. Only for the past 18 years of their long histories have those two organisations administered a professional game so the concept of treating rugby as a business, subject to the same dispassionate rules that govern the broader corporate world, still does not sit comfortably with many.
Nonetheless, it made Carmichael a natural ally for Pulver to enlist as he set about restructuring the game in Australia. The work they have done since Christmas in collaboration with all the major stakeholders in the game has been presented in the media as focusing on Super Rugby but, in fact, that’s not even the tip of the iceberg. And certainly from Carmichael’s perspective, it’s not about economies of scales. As he put it yesterday: “If this is about saying we have five marketing managers and we can reduce that to one, then here are my keys because I’m out of here.
“This isn’t about Super Rugby in isolation. This is about looking at all of the assets of rugby in Australia, understanding how they’ve performed and competed, and ensuring that we, across the game, make ourselves highly competitive over the next number of years at all levels of the game.”
The only economically sustainable part of Australian rugby at the moment is Queensland so it makes sense the ARU should make a study of what the QRU is doing. And it literally is a study. The stack of manuals Carmichael presented to the ARU detailing how each component part of the Reds operation functions stands about a third of a metre high.
Not that Carmichael speaks in sound bites, but one statement never to escape his lips would be: “As long as the Reds are winning, the game will flourish.”
At the height of the Reds’ success in 2011, the year Queensland won the Super Rugby title, he made certain that his own restructure of Queensland rugby broke the nexus between the Reds’ on-field results and the off-field performance of the organisation.
He looks to have succeeded. In 2012, the Reds finished sixth overall but top of the Australian conference, while last year they finished second in the conference behind the Brumbies yet, despite the fact the on-field performances have dropped away over the past two years, their membership numbers have steadily climbed.
The ARU’s own recent audit of the game showed that Queensland has surpassed NSW as the biggest rugby market in Australia. That’s a slightly misleading stat since it mostly registers exposure to the game, not actual involvement - in which NSW is still the strongest state. Worryingly, participation numbers in NSW are stalling, and surely while the ARU is investigating how the game should be restructured, it should look closely at the fact that rugby in NSW is administered by three different organisations, the NSWRU, the Waratahs and the Sydney clubs. And if that is not confusing enough, the ARU also plays a direct role at the grassroots development level.
It’s a messy, unwieldy structure but then so is the ARU.


http://www.theaustralian.com.au/spo...licated-business/story-e6frg7v6-1226827813912

 

[Bairdy]

Compelling reading. Let's hope Pulver is actually reading the manuals, rather than have them stashed under the near barren trophy cabinet at St Leonards.

 

[FairWeatherAussie]

Carmichael said "it's not a takeover". I might not be alone in hoping that that's code for "it's really a takeover". The Queensland management has been a revelation over the past few years and shown what serious, professional management can achieve. Bringing the professional not parochial ethos to St Leonard's and Melbourne would be beneficial to those states and to Australian rugby generally,

 

[Badger]

Follow up after the ARU board meeting. Strong words from the Rebels CEO.

http://www.smh.com.au/rugby-union/u...s-boss-20140226-33ifq.html?rand=1393404657461

 

[oztimmay]

Follow up after the ARU board meeting. Strong words from the Rebels CEO.

http://www.smh.com.au/rugby-union/u...s-boss-20140226-33ifq.html?rand=1393404657461

He's got a good point, it's not a silver bullet to end our woes. Like any good problem solver you need to get to the root cause, e.g why is our revenue drying up? Don't think that's totally clear yet.

 

[Sully]

I have to say I really don't like the idea at all. By all means if the Reds model is good send guys up here to copy it but how can we merge backrooms and still compete against each other.

Sent from my ASUS Transformer Pad TF700T using Tapatalk

 

[Badger]

^The Tahs are already copying the Reds. Haven't you seen this?

The Tahs marketing must desperate to "borrow" the slogan from the Reds.

So I doubt the current Tahs admin would be able to copy the Reds model even if it was laid out for them.

 

[TOCC]

I have to say I really don't like the idea at all. By all means if the Reds model is good send guys up here to copy it but how can we merge backrooms and still compete against each other.

Sent from my ASUS Transformer Pad TF700T using Tapatalk

I think if you look at things like marketing, memberships and and corporate support the teams aren't exactly competing against each other, they operate in separate markets... Those 3 issues represent a large proportion of revenue and potential growth.

 

[SteveMerrick]

Outsource the lot to RL / Football or an NFL club for their off season. Australian rugby has held on to too many sacred cows for too long and needs to radically change structure and strategy if it is to survive as serious professional sport in Australia vs. a resurgent RL, cashed up AFL and maturing Football culture.. It never ceases to amaze me that Netball Australia can run a national competition on a the smell of an oily rag with players who are professional in all but their salaries whilst Rugby has not been able to do so - even the proposed National competition has a whiff of failure attached to it before it even kicks off.

I am a lifelong fan, player and coach but have never been more disillusioned in Australian rugby than I am today - every time I hear an official refer to Rugby as big business I have to laugh - their are suburban pubs turning over more and making more money than the ARU or any of the provincial unions.

 

[Tip]

the less fatcats on the NSWRU board the better I say