Analysis: Why Doug Logan Is Out At USATF And Where It Goes From Here
by: Weldon Johnson
September 15, 2010
Monday, the USATF Board of Directors terminated USATF CEO Doug Logan.
The immediate question is why?
The Board of Directors, perhaps as expected, is not giving us very concrete reasons. If they don't want this whole process to repeat itself, they must be able to state what they want the next CEO to do that Logan was not doing.
Until it was leaked to the press a month ago that Logan's job was in jeopardy, a lot of very knowledgeable people about track and field (the LetsRun.com community) had no idea Logan's job was in jeopardy. Having it play out in the press with advance warning was pretty amateurish (Logan just as easily as the board or the USATF staff could have been the leaker), but not surprising considering this is USATF.
After putting some thought into it, it may not be that difficult to see why Logan was terminated. I think it comes down to two simple reasons.
1) He overpromised and underdelivered and 2) He was an outsider.
Since the Board of Directors is giving us very little to evaluate Doug Logan on, we'll use the very criteria Logan said he evaluated himself on.
1. Maintain and improve the US position at the top of the medal charts in World Championships and Olympic Games
2. Be a passionate messenger in the battle against performance-enhancing drugs
3. Be a firm and fair agent for change as the organization goes through a restructuring of governance
4. Improve grass roots membership numbers
5. Foster better relations with the USOC, IAAF and IOC
6. Grow sponsorship sales, television outreach and number of domestic events (our emphasis added)
7. Institute a "customer service culture" in the National Office in its dealings with the volunteer leadership and membership
There perhaps is some debate on some of these items, but #6 is the one item where Doug, by his own admission in his own performance evaluation he posted online in 2008, was coming up short.
What did Logan promise in terms of sponsorship and revenue? How about doubling the size of USATF in 4 years. He said, "We will take this $16M business and grow it to a $30M business by the year 2012. We will forge new partnership alliances and negotiate higher prices for existing sponsorship arrangements."
Doubling the size of any organization in four years is very difficult, much less doubling it in arguably the worst economy since the Great Depression. It's way too simplistic to say, "USATF wasn't run very well in the past. Doubling sponsorship values shouldn't be too hard." If USATF was so poorly run in the past, why did the leader in sports marketing, Nike, hire Craig Masback, USATF's CEO before Logan?
I talked to USATF board member Jeff Darman on Monday. He said that USATF "is financially in decent shape." He indicated that the budget for 2010 is likely to miss on the top line (revenue) but make up for it with reduced expenses. Darman then called me back on his own accord Tuesday to clarify the financial picture. He first pointed out that "the area where we will not have brought in as much is sponsorship." I don't think it takes too much reading between the lines to say that the lack of sponsorship growth paved the way for Logan's exit. As we said in our analysis of Houston winning out over New York for the Olympic Trials, follow the money.
|Competitions & Athlete Programs||812,310||1,073,355||4,108,804||1,141,089|
|Merchandising and Other||2,064,141||1,379,202||1,495,766||1,056,981|
A brief factual point: USATF's budget this year calls for $20.4 million in revenue (54.8% bigger than last year). As you can see from the chart on the right, the biggest increase is from a 78.1% increase in sponsorship revenue this year. That is ridiculously ambitious in this economy. It will be real interesting to see how short of this number USATF ends up. More on this at the bottom of the article. Logan could come up short of his goal and still leave USATF way better off than where it was financially.
Being An Outsider Hurt Logan Two Ways
The second related factor that led to Logan's dismissal in my opinion was that he was an outsider. Being an outsider meant two things: 1) No one ever had Logan's back and 2) He had to make big promises to get this job. Let's address the second point first. Do you think for a second Logan would have been hired if he said, "I don't know anything about track and field, but I promise I'll grow revenues 5% a year and run a tight ship."? There is no way in hell he would have been hired. Logan had to say, "I can do much, much better. The people before me didn't do a good job. I'm a pro and have been the commissioner of a pro sports league already."
Thus, when Logan didn't go big with the revenue numbers, it was time for him to go home because no one ever had his back. Believe it or not, when Logan was hired, the only contact he had with the Board was a phone call the day before. Logan has published the speech he gave the Board that helped him get hired. Here is an excerpt:
"I believe I can be a good faith agent for change in this process. I have no history with the organization, have no alliances, have no friends and, for now, have no enemies. If entrusted with stewardship of the sport, I will value the legacy and lessons of the past, commit to giving voice to those who may feel disenfranchised, yet firmly lead this body and its successors into the adventures of the future."
The key part above is I "have no friends." Logan definitely ruffled a few feathers, shook up the old guard, and made some enemies. The one thing he didn't really do is make many friends. We've yet to hear from a single insider who said, "I'm really going to miss Doug Logan."
Consequently, when he failed to deliver on his goals, it is not too surprising he was shown the door. Logan was an outsider. He made enemies but no friends. Unless he put one USATF group before another, the way he was going to get friends was to buy them. It clearly did not work out. Instead of shooting for a $20 million budget this year, Logan could have said, "This is way too ambitious." Think that would have won him any friends?
How Do We Prevent This From Happening Again?
The big question is not why was Doug Logan fired, but how do we prevent this from happening again? It's not the same USATF board that hired Logan (Logan, at the USOC's urging, helped restructure the USATF board from an unwieldy 27 to the current 15 member board. A sign of progress is that it is unlikely the old board could have ever agreed on firing its CEO). But it's not an entirely different cast of characters (4 of the 15 current board members, including President Stephanie Hightower, were on the old board that hired Logan and many more have been involved with USATF for years).
The board for legal reasons may have to be nebulous on why they fired Logan, but they have to be crystal clear on what they expect from the next CEO and what will define a successful CEO. When most of the USATF members have no idea whether the current CEO is doing a good or bad job, that's a problem. The vision should be clear and that needs to come from the board. A leader cannot be successful until success is clearly defined.
There are some very bright people on the board whom I respect. Hopefully, the firing is the sign of a new board that takes its responsibility seriously and is going to lead USATF in the direction it needs to go. The jury is still out.
Jeff Darman said of the current board, "This is the best board I've ever seen. They have plenty of other things going on in their lives. They don't need this on their resume ... It's the most intellectually stimulating USATF board I've ever been around." Before I could synthesize that last sentence, Jeff added, "Maybe that's not saying much."
Two current board members who were on the previous board, Darman and Stephanie Hightower, indicated that they did not like how Logan's search was conducted. Darman said to us, "I think the hiring process had some severe flaws ... There were things in the process before Doug was even the name (that I objected to). I spoke up and did not prevail ... I think this board would do it differently ..." Hightower told Reuters she abstained from voting on Logan because, "I did not have enough information and did not think the process was transparent enough."
It is certainly convenient for Darman and Hightower to now say they objected to the process that hired Logan, but they were a part of it and need to accept responsibility. USATF is a non-profit corporation and it would serve the greater good of the sport if board members that disagree with the direction USATF is going either speak up or resign. If a board member is vehemently opposed to Logan's firing, they should speak up now or step down from the board. If the board is not a resumé padder, then board members should not care too much if they resign over a matter of principal.
Darman indicated the board felt rushed to have a candidate before the Olympics, the search committee gave them one name (a unanimous pick), the board then had a phone interview with Logan (the remarks Logan gave the board are here), and he was hired the next day. How's that for board responsibility? Last time around, Cathy Griffin of The Griffin Network administered the search along with the search committee of former VISA Chief Marketing Officer John Bennett, two-time Olympic medallist Adam Nelson, four-time Olympian Joetta Clark Diggs, 1996 Olympic head coach Deanne Vochatzer and former USATF Board member Cynthia Doyle.
Darman, who said he objected to the process, admitted, "I did my due diligence after he was chosen."
What Skills Does The Next CEO Need?
This time around, hopefully the board gets it right. So far, they are saying the right things, as Darman said, "We'd much rather do it right than quick." The board first needs to think about what skills it wants in a CEO and what the CEO's primary objectives will be.
USATF is dysfunctional by its very nature in that it serves many masters, from youth to pro, from the race walk to the discus (those may be my words, but USATF Communications Director Jill Geer says the same thing in this interview on Logan's firing with Scott Douglas).
Navigating the complex nature of USATF is no easy task. When talking about what he wants to see in the next CEO Darman said, "... to me, you need a real understanding of the anthropological make up of USATF. It is a very complex organization. It takes unique skills. Not only knowledge of the sport, but political skills, board skills ... skills to work with youth to masters. The skills set are very complex."
Darman talked about the need for the board to determine "which skills must the person absolutely must posses." He talked about how you can "buy some other skills" - i.e., go out and hire someone do them. So it's a very real possibility that the USATF CEO could be more of an administrative type navigating all the constituencies and then he/she could hire an outside firm or a marketing person to do all the sponsorship deals. Not a bad model, but if that's the model, the CEO doesn't need to be making $450,000 a year (Masback took home over $370,000 in total compensation during his final full year).
Outsource the marketing or bring in someone and have them eat what they kill. Mary Wittenberg runs the NYRR and thanks to a $125,000 bonus she hit last year, she took home $415,000. So her base salary is $290,000. The NYRR is a much bigger organization financially than USATF; they brought in $12 million in sponsorship revenue last year and Mary accomplished her objectives and got her bonus. Let's hope USATF goes down a similar path instead of repeating the one they just came down.
Note: I didn't say anything about Doug Logan's Project 30, which we thought was a complete waste of time. However, Deena Kastor was on the Project 30 Committee and is a current Board Member, and Logan presented Project 30 to the current Board. So if that was a reason for his dismissal, we hope they would have spoken up a year ago.
Logan 2009 Interview: "I can pick up the phone and can bind anybody you want on a phone call without a piece of paper on my good name for $10 million, $20 million, $30 million. Before I put the phone down, I can make a deal at that level because people know me and know my good name and somebody coming in from the outside cannot do that."
Logan Says He Increased Nike Deal By Nearly 50% "One way we have already done this is by reaching a deal in mid-2009 that increases the value of Nike's contribution to USATF by almost 50 percent." Note: one complaint we heard when the Project 30 fund was announced from athletes and agents was that it was money Nike gave to athletes directly in the past and now it was just channeling through USATF. So USATF's revenue went up but the athletes stayed about the same.
*A Blog Post On The Value Of Nike's Sponsorship Of The Olympic Team
*Considering USA Swimming gets $4 million a year in sponsorship, we'd hope USATF would do much better.
Effect Of Recession On Sports
*NFL Lays Off 10% Off Its Staff
*NFL Team Values Down, Nascar Team Values Down, US Open Tennis Doing Better