=========== I. Overview =========== The purpose of this report is to take a critical look at the OUSA Executive Director (ED) initiative over the past 6 years (CY 2010-15), from a expense and performance perspective. It is based on data available to any OUSA member. This was originally written Jan 2016. =========== II. Summary =========== ED Expense: 675K over last 6 years Cash Burn: 122K over last 5 years; (liquidity event possible at current run rate in 5 years) Grants and Sponsorships generated: 97K over last 6 years A Event Weekends: 11.9% _decline_ since 2007 Starts: 18% _decline_ over last 6 years ====================================== II. ED Expense ($675,000 over 6 years) ====================================== Year Payroll ED Expense Net Income 2010 78,745 37,394 (30,533) 2011 79,533 32,373 (31,365) 2012 80,159 20,885 22,870 2013 84,033 27,692 5,662 2014 83,354 33,187 310 2015 95,542 32,783 (23,707) Total: 501,366 184,314 (56,763) Overall total expense: $685,680 * It is believed that about 10K of the 2015 payroll number is 4Q salary for the Director of Sport Development, so we'll say the total ED cost over the period is about 675K. * Net Income is the OUSA net income from the federation financial statements. It is unknown what the "ED Expense" is, at least it is unknown from the financial statements, as it is not itemized. I have been unable to get a straight answer as to what it is. It has been speculated that it is "A meet travel expenses". As someone who went to about 75% of the listed A meets, who was traveling from the same geographic area, it does not cost nearly this much if using the same class of accommodation as the OUSA sponsor hotel chain, and flying budget airlines or driving. It has been speculated that it is "Cost of attending conferences". If so, it would be nice to know what the ROI is on this expense. In general, I think donors and prospective donors would like some color on this expense item so that they are comfortable that their funds are/will be put to productive use to grow the sport, especially, when in 2014 and 2015, this item ballooned, without explanation in the financial statements, to about 180% of the budgeted amount in each of those years. What are y'all spending 35K a year on _above and beyond_ the ED salary? Is this expense helping to grow the sport, or provide higher quality experiences? (sources) http://www.us.orienteering.org/sites/default/files/files/documents/2011USOFfinancials_0.pdf http://www.us.orienteering.org/sites/default/files/files/documents/2011USOFfinancials_0.pdf http://www.us.orienteering.org/sites/default/files/files/documents/2012USOFfinancials.pdf http://www.us.orienteering.org/sites/default/files/files/documents/2013USOFfinancials_0.pdf http://www.us.orienteering.org/sites/default/files/files/documents/Dec2014FinStmts.pdf http://www.us.orienteering.org/sites/default/files/files/documents/Dec2015FinStmts.pdf ====================================== III. Cash Burn ($122,547 over 5 years) ====================================== CY 2011 End: 235,312 (Item 3010, (Net Assets, unrestricted)) CY 2015 End: 112,765 (Item 3010, (Net Assets, unrestricted)) Burn: 122,547 The burn is presently greater than Net Assets, unrestricted. Therefore, at the current run rate, ceteris paribus, it would be expected that OUSA would face a liquidity issue at the end of the next 5 year period, if bucket 3010 (and its constituents) were the only buckets available to fund operations. Note that bucket 3010 is assumed to be cash and assets with similar liquidity, tho the financial statement is silent on the contents of bucket 1070. (sources) http://www.us.orienteering.org/sites/default/files/files/documents/2011USOFfinancials_0.pdf http://www.us.orienteering.org/sites/default/files/files/documents/Dec2015FinStmts.pdf ============================================== IV. Grants and Sponsorships (97K over 6 years) ============================================== It was stated to me, in a 4 hour phone conservation with a then USOF board member, when I presented my original objection to the ED initiative, that, over time, the initiative would eventually pay for itself via "grants and sponsorships" that the ED would bring in. I do not have pre 2010 data, but here is the data over the last 6 years. Grants Sponsorships 2010 1K 0.4K 2011 3.7K 7K 2012 -- 15K 2013 1.5K 22K 2014 -- 28K 2015 -- 18K Total: 6.2K 90.4K Overall total: 97K There is some nice growth in the sponsorship column, and were that to continue, it could possibly justify the expense. However, it is clear from the data that it is leveling off at about the 20K point, more or less. Note that tis total is about half the "ED Expense" total (from section II) of 184K, forgetting the payroll expense (500K). This "ED Expense" is presumably a cost to obtain this revenue, since none of the other revenue sources (races, memberships), should require an expenditure on the part of the ED (they never have prior to the ED initiative, for example). Thus, it would be financially prudent to forgo the grants and sponsorships, and eliminate the ED Expense. Ceteris paribus, tho we are comparing 5 to 6 years, the savings (184K - 97K), or 87K, would cover about 71% of the cash burn. You can apply a ratio of 5/6 on the 71% for a more accurate number, if you want to. If, OTOH, I'm wrong and the "ED Expense" is used to produce traditional revenue, then, well, I'm wrong. But no one will tell anyone what that expense is, so I'm likely not wrong especially since starts and A meet weekends are _declining_ (more on that following), and logically do not require an ED expense. (source) financial statements as in section II ============================================ V. A Meet Growth (11.9% decline over tenure) ============================================ One of the stated objectives of the ED initiative was "A Meet Growth". Every orienteer wants more A meets, with more geographical diversity. Here is the data, A meets by year (this means weekend or festival, not race day. A future draft may include race days, tho the movement from the 2 day classic format to the SML format may make those numbers non- comparable; festivals is the most important metric, IMHO). 2015 11 2014 13 2013 13 2012 11 2011 13 2010 12 2009 14 2008 14 2007 14 2006 14 2005 10 2004 17 2003 19 2002 15 2001 15 2000 10 1999 15 1999-2007 avg: 14.33 A-events/yr 2008-2015 avg: 12.63 A-events/yr That represents a _decline_ of 11.9% over the ED tenure. (source) http://www.us.orienteering.org/orienteers/on-foot/results Orienteering North America (years 2007-2009) USOF ranking data Eddie Bergeron assisted in compiling this data ================================================ VI. Start Growth (18% decline over past 6 years) ================================================ The next metric to look at is starts, as this was one of the goals of the initiative. Here is some of the data. I do not have data for all years. 2010 53165 2014 44659 2015 43520 (estimate) The decline in starts over the 6 year period in question is approximately 18%. (source) OUSA member; personal communication ============ VII. Website ============ The next factor to look at is the website. When the ED position was initiated, the website went thru a much needed improvement, and the ED and the volunteers he recruited need to be commended for that improvement. However, in today's digital world, website improvement is a constant process, not a one and done thing. The website has the following problems, that affect both its usability and SEO. IMHO, an effective executive should be expected to be aware of, and stay on top, of these issues (including seeing that they are fixed), over the six year tenure in question. Note that I am not a professional programmer, (tho I was one years ago), so there is much I am missing, good and bad -- a) the OUSA website is not mobile friendly. This affects both usability and SEO, as most web access, especially among the younger market OUSA should be focused on, is done via mobile devices today. Google mobility test -- https://www.google.com/webmasters/tools/mobile-friendly/?url=http%3A%2F%2Fwww.us.orienteering.org%2F (this page, BTW, gives a simple cookbook of things to fix). Google announcement of SEO penalty to non-mobile friendly web sites -- https://googlewebmastercentral.blogspot.com/2015/04/faqs-april-21st-mobile-friendly.html b) OUSA website is not https:// compliant. This can affect the security of the user's data, perception of security thereof, and will incur an SEO penalty with google. The SEO penalty is minor at present, but google has hinted that the penalty may be increased in the future. I did not find any instances of where security of data or impersonation would be compromised on the OUSA web site. Forgetting the SEO issues, which indeed are minor at present, here is an example of what I'm getting at. This page -- http://www.us.orienteering.org/support has a donate and credit card logo. Hovering over them does not show an https:// connection. It is not necessary here, but its absence will spook some users. The text before and after logo claiming it is a secure server will be ignored. Next, clicking thru leads to this page -- http://www.us.orienteering.org/onlinedonation I would not fill out data and click on this form. I had to look at the code to verify that the submission was https:// No one else is gonna do that. It needs to be clear via browser cues that users are used to that it is a secure form. Making the whole site https:// fixes this, and is now considered an expected best practice. Look at any professionally done web site, and see if similar situations are not https://. While it would appear that I am being nit-picky here, it misses the larger point; https:// makes websites look more professional to both google and users alike, and not doing so shows lack of engagement with evolving best practices in the digital world, as well as giving users unnecessary things to worry about and excuses not to donate or engage with the web site. Google announcement of SEO penalty to non https:// web sites -- https://googlewebmastercentral.blogspot.com/2014/08/https-as-ranking-signal.html c) SEO is sub-optimal I've brought this up previously, so I won't spend much time on it. The point is, that since I brought it up, many months ago, it has not been addressed. This is something, IMHO, that the ED is ultimately responsible for. I'll just reiterate the example. IMHO, the most likely phrase to be typed in a search query would be "Navigation Racing". On the first page of google's results, the wiki for "Orienteering" shows up, Meridian Geographics shows up, and AttackPoint shows up. I checked 6 pages in and still could not find the OUSA web site, meaning it is at least 61 results deep. Last time I did this test, it was on page 16 (about 160 deep). The goal should be to show up whenever MerGeo and AP show up. No one will go past 2 or 3 pages. OUSA should be the flagship website for navigation racing, but prospects are simply not finding it. Since I brought this up previously, it is disappointing to me that this has yet to be addressed. How can MerGeo and AP afford to get this right, and not OUSA? Do MerGeo and AP have a 675K budget? Yes, it comes up for "orienteering". But you are not trying to reach (or shouldn't be anyway), people who already know orienteering. You need to hit on a variety of search terms that prospects are going to type in. Experience junkie millennials will not be typing in "orienteering". Donors and prospective donors really do start to wonder if their contributions will be effective if something as obvious as this is not fixed over the period in question. I feel after 6 years and the expense incurred for the ED initiative, the ED should have taken the initiative to fix these issues. I get the sense that the executive/board is not even aware of them, tho I could be wrong. If the current expenses are not going to fix these issues, then perhaps the expenses should be redirected. ========================= VIII. Digital Engagement ========================= I am an ultra trail runner, letterboxer, geocacher, and spend alot of time on related web sites. I have Facebook friends who are also some of these things. I am always signing up for and "liking" outdoor things that involve running and racing, finding things, outdoor puzzles, and the like. I see all sorts of advertising for these and related activities, but never once have I seen in any digital or social media ads in my face, that mentions OUSA and the racing the federation offers, despite the cross appeal to my other hobbies. I have never once seen it on a race calendar, tho I can find any other sort of outdoor race I want on the popular calendars, including "extreme" racing such as "Mudders" and "Spartans". An effective executive, over the time and expense in question, should have gotten OUSA races onto the popular forums and calendars, at least IMHO. One the goals of the original 5 year strategic plan, dated 2010, was digital engagement. This appears to have simply not have been done. Why has it not been done, given the 675K expense? If you can't reach me, and people like me, who are you trying to reach? What effort has been put into digital engagement over the past 6 years? Shouldn't some of the "ED Expense" be going to this? ========================== IX. What _Is_ Being Done? ========================== Six years, or 12,000 hours in terms of 40 hour work weeks, is alot of time to accomplish things, and no doubt alot has been accomplished. I've managed to lay out a huge expense of 675K , some of it unexplained, that, ceteris paribus, may lead to liquidity issues over the same period going forward, and a whole lot of stuff that is important to me that seems to not have gotten done. I think it would be constructive to donors and prospective donors what _is_ being accomplished, and what the ROI on the 675K has been. For example, you can build a really first class web site of OUSA's size, that addresses the issues in section VII and others, for, I'd estimate, much less than 10% of that figure. When will this program, now in its 8th year, start to pay off, in ways that mean something to rank and file racers, prospective and otherwise, like me? We do apparently know the ED is part time faculty at Towson University while also a "C-Level Executive" at OUSA. While this wouldn't necessarily disqualify anyone, especially if the metrics were improving, I, if I were on the board, would question whether or not it is a distraction to the full time task of turning OUSA around (now in its 8th year), and why this position is not disclosed on the ED's LinkedIn profile. (sources) https://www.towson.edu/cofac/departments/communication/facultystaff/ https://www.myedu.com/TU-Towson-University/Schorr/professor/1467717/ https://www.linkedin.com/in/glen-schorr-bab8921a (BTW, notice how every single reference is prefixed by https://, except for OUSA. Back to my previous point in section VII, there is a reason for this). ================================== X. An Anecdotal Look at Race Fees ================================== This is just an anecdotal look at race fee changes from 2006 to 2016, for one race, the Flying Pig. But, looking over other A meet advertisements, and my past experience, I believe it is representative enough to make a point. Race fee in 2006: $23 Race fee in 2016: $40 Increase: $17, or about +74% Cumulative CPI over that period: +18.38% Therefore $23 in today's dollars is $27.23 Sanctioning fee in 2006: $2.50 Sanctioning fee in 2016: $10:00 (Yes, you need to look at non-member fees, cuz you want to attract non- members). Remainder of the increase left over for quality improvements (17 - 4.23 - 7.50) = $5.27 The improvements, at least at the Pig (and apparently are "standard", according to the MD), are an EMT and AED at the race (neither provided by OUSA, but provided out of that $5.27 per entrant). These are worthy improvements, but it is sad that such a small percentage of the race fee increase goes into quality improvements of the race. What has that $7.50 cost increase bought race participants? As insurance costs have been static to declining, the website is no easier to use, especially on today's mobile devices, the answer appears to be nothing. You are competing against trail races with free beer. I don't need beer at races, and maybe insurance prevents it (tho the trail races seem to manage it just fine with their insurance); the point is more money should go to quality improvements and a festive race atmosphere, and you should be aware of other competing products in the market, and what they are offering, and what their consumers want. They don't want $7.50 going into a black hole; they prefer beer. I thought it was interesting to put these numbers into perspective. The speculation is that if you sold races at the old adjusted price of $32.50, with the new rescue improvements, you would sell more races, as today's younger crowd is price sensitive. Also, note the correlation between declining starts and real rising prices, tho, we of course know correlation is not causation. Is anyone else looking at this? Is anyone else out there? (sources) http://inflationdata.com/Inflation/Inflation_Calculators/Cumulative_Inflation_Calculator.aspx http://www.ocin.org/flying_pig/pigXX/entry_info_2016.html Personal communication with Mike Minium =============== XI. Conclusion =============== There is no conclusion. I had intended to bid the ED job at about 40K and no expenses, but I decided not to. I mean, I can get to a few board meetings, would always be at the team trials to show support, and blow off conferences, cause I don't think they pay off, all within the 40K, and still get stuff done. I would not need a 35K expense account over my part-time salary. I don't feel anyone should have a 35K expense account for an organization the size and revenue of OUSA, unless there is a demonstrated ROI on this expense, and the performance on the above metrics is positive. So, my interest in writing this was to competitively bid this. But, I didn't. Even so, everything in here is sourced fact to the best of my knowledge (obviously errors are possible), so it exists whether I write it down or not, so don't hate on the messenger. So, keep jacking race fees into a shrinking and aging customer base, without improving the quality, diversity, or appeal of the races, and see how that works out in the long run. Don't worry about the web site and digital engagement in the modern, mobile, digital world. The data show how it has worked out so far over the last 675K and several years of the initiative. (And yes, I have given many suggestions on how to improve the appeal of the races; has a single board member been to a trail or extreme race since my suggestions? Has anyone taken the time to look at any of this -- ED performance, cash burn, and so forth?) Please keep an eye on that cash burn. I still care about OUSA and orienteering. That is the conclusion. And, finally, please take a look at the VP of Finance's letter at the end of this document -- http://www.us.orienteering.org/sites/default/files/files/documents/2016-january-16-minutes.pdf He resigned shortly after submitting this to the board.