The National Football League (NFL) is the organization that oversees the management of America’s most popular sport. The entity acts as a trading association composed of 32 franchised operators (Vrooman, 2009). NFL carries out a wide range of activities that facilitate the progression of American football. Some of the functions undertaken by the league include governing and promoting gaming activities. The organization also sets rules and regulations applied in the football game. In addition, it is involved in the enforcement of these rules. NFL also regulates matters relating to team ownership in America (Vrooman, 2009). As such, individuals and corporations who wish to sponsor or operate football clubs have to register with the organization.
It is important to note that NFL is a non-profit entity. Most of the revenues generated by the organization come from licensing of merchandise and marketing sponsorships. In addition, NFL sells national broadcasting rights related to the games arranged under its jurisprudence. On their part, NFL teams operate separately as business entities. However, revenues generated through them are shared as a percentage of the overall income.
In the last half a century, NFL has emerged as one of the most economically successful organizations in the world. Its success is attributed to the egalitarian nature of its operations. It is noted that the individual clubs making up the league are mutually interdependent. What this means is that they have to support each other in the production of competitive and economically viable games. For instance, in 2008, the clubs managed to generate over $8 billion in revenues (Quinn, 2009). The 32 franchises shared two-thirds of this amount among themselves. The success of NFL is also attributed to the ‘survivalist’ mentality of the organization. The management team does its best to make sure that the firm remains at the forefront in the promotion of football in the country.
NFL is an unincorporated association. As such, it is exempt from taxes. The reason is that the organization does not generate profits (Jennings, 2014). However, the individual clubs forming the association are taxed. The franchises have to pay taxes since they are involved in profit making ventures. Basically, NFL and its associates can be regarded as trade associations.
The structure of the organization is made up of three officers who are part of the senior management team. The officers include the commissioner, the treasurer, and the secretary (Vrooman, 2009). The commissioner operates as the most senior executive officer. The official appoints the treasurer and the secretary. In addition, it is the duty of the commissioner to settle disputes arising in the association.
A number of factors determine the success of NFL. The factors are made up of both internal and external elements. Some of the external agents include the status of the economy and the nature of the target spectators. However, the economic trends appear to be more influential than the audience. The reason for this is that the spending power of the spectators is determined to a large extent by prevailing economic factors.
According to Walker and Kent (2009), many people cut back on their expenses during periods of economic downturns. NFL oversees a number of sporting events, which people attend for entertainment or recreational purposes. Consequently, during economic depressions, attendance to these events becomes low. Such situations impact significantly on the success of NFL.
National Football League: Analysis of Stakeholders
Overview
Lawrence and Weber (2014) provide a working definition of the concept of stakeholders. According to Lawrence and Weber (2014), these agents are made up of individuals and groups of people who affect or get affected by policies, decisions, and operations carried out by an organization. To this end, NFL’s stakeholders entail those individuals who are impacted on by the sporting events organized and managed by the entity.
Major Stakeholders
The most prominent or salient stakeholders at NFL include the community, the participants, and sponsors. Community members are very significant and influential to the operations of NFL. Member clubs work hard to attract as many participants as possible. They also seek to recruit volunteers and spectators. The source of these agents is the community (Vrooman, 2009). In addition, the activities of the clubs are supported by the sponsors.
NFL builds relationships with the community in various ways. For instance, the association provides news coverage for the games through the media. In addition, the association holds events that seek to attract individuals and create awareness about football. The events are held in schools and other places. In addition, NFL takes part in community projects (Vrooman, 2009). The sponsors are drawn to the games based on the potential success of the events.
The community constitutes a major stakeholder for NFL in relation to development of sports facilities (Lawrence & Weber, 2014). Construction of new facilities depends largely on the support from the society. For instance, the community can impact on operations of NFL when it comes to the development of new stadia in residential areas. People may complain that such a measure may lead to parking and other problems in the future. Sponsors may refuse to support games that are played on stages mired with controversies.
Fundamental stakeholders of NFL entail the participants. The group is made up of, among others, event organizers, club managers and coaches, and football players. The participants determine the ability of NFL clubs to achieve their goals. Professional football players rely on the financial success of their clubs. Other participants, such as the players, expect NFL to guarantee them security when taking part in sports.
Since NFL clubs seek to attract more participants to their sport, the association prioritizes the needs of these stakeholders. For instance, players are insured and assured of appropriate and quality medical services in case of injuries. Participants are also relied upon in the creation of competitive events, which assure the success of the organization.
Five Ways through which the Primary Stakeholders can Influence Financial Performance of NFL
First, the community and participants are very significant with regards to the financial performance of NFL. A huge chunk of the revenues generated by this organization is associated with airing rights sold to media outlets. Other sources of revenue include fees collected from spectators attending the events. Second, participants greatly determine the returns made by NFL each season. It is their duty to ensure the sporting events are successful. If execution of sporting events fails, NFL is likely to lose money (Matten & Crane, 2005).
Thirdly, the players influence the financial performance of the firm by providing high quality games. Quality games attract more spectators and increase the popularity of the sport. The result is increased revenue for NFL. Fourth, the management team affects the financial performance of the organization. They negotiate all deals relating to football events. Consequently, the executive enters into deals that enhance the financial performance of the organization (Jennings, 2014).
NFL’s management is also responsible for the smooth operation of events in the league. For instance, they settle disputes between clubs and players. Fifth, the sponsors influence how games are played. When participants generate high quality events, these stakeholders are likely to support the venture.
Controversial Social Responsibility Issues at NFL
According to Matten and Crane (2005), corporate social responsibility is concerned with the voluntary activities that organizations undertake in order to operate in a manner that gives back to the society. Organizations practicing social responsibility operate in a social, economic and environmentally sustainable way. According to Kent and Walker (2009), NFL has continued in its quest to incorporate more socially responsible activities in its events. For instance, the organization recently introduced life medical covers for their players.
NFL is grappling with some issues related to social responsibility. The issue of racism in NFL has been very controversial. According to Vrooman (2009), in the early 1930s, no black players were admitted into NFL. Although this was reversed later on, racism related issues still come up in NFL. Racist remarks recently from senior NFL members have been very controversial (Vrooman, 2009). Names of some of the NFL clubs, such as ‘Red Skins’, have also raised concern among the people. Overall, however, NFL is embracing very socially responsible practices in its events.
A Plan to Form a Stakeholder Coalition to Address the Controversial Issue
Addressing controversial issues in NFL would require the support of key stakeholders. Addressing the racism issue at NFL will require the leader to bring together like minded stakeholders. A plan is needed to achieve this. First, the most influential stakeholders (participants) will be identified. Second, a number of members from this group will be convinced to join the coalition. Senior management will also be brought on board. Finally, other members from different races will be brought on board.
The composition of the stakeholders’ coalition is based on their power to influence events. The top executives can adopt policies to eliminate racism. Diversity and collaboration will be enhanced by having members from different ethnic backgrounds.
Challenges in Forming a Stakeholders’ Coalition
Forming a stakeholders’ coalition can be a very challenging task, especially since not every approached individual might have the same view. One of the major potential challenges in this task is opposition (Jennings, 2014). Some of the stakeholders may strongly oppose the move in a bid to protect their personal interests.
Funding is another potential issue that may impede formation of the coalition. Executing the solution for the issue may require funding, for instance, to facilitate media campaigns. Consequently, winning funding for the initiative from the organization may prove very challenging. Furthermore, the coalition may lack proper leadership and direction needed to attain the desired objectives. Coalitions require special collaborative leadership for them to succeed. Lack of this element will render the coalition ineffective (Lawrence & Weber, 2014).
Leadership challenge can be overcome where necessary by training. External facilitators can be brought on board to assist in this training. Opposition, on its part, can be resolved through persuasion and elaborate communication of the intentions of the coalition. Opposition can also be addressed by winning over some of the most influential individuals in the coalition. Finally, funding challenges can be resolved by convincing the senior executives to support and own the goals of the coalition.
Conclusion
NFL is a successful non-profit organization. It is involved in the management of football games in the country. A number of stakeholders determine the success of the entity. The management should identify the issues affecting the performance of the organization to sustain its growth in the future.
References
Jennings, M. (2014). Business ethics: Case studies and selected readings. New York: Cengage Learning. Web.
Lawrence, A, & Weber, J. (2014). Business & society: Stakeholders, ethics, public policy (14th ed.). New York: McGraw-Hill Irwin. Web.
Matten, D., & Crane, A. (2005). Corporate citizenship: Towards an extended theoretical conceptualization. Academy of Management Review, 30(1), 166-179. Web.
Quinn, K. (2009). The economics of the National Football League: The state of the art. Sports Economics, Management and Policy, 3(2), 7-31. Web.
Vrooman, J. (2009). Theory of the perfect game: Competitive balance in monopoly sports leagues. Southern Economics Journal, 34(1), 5-44. Web.
Walker, M., & Kent, A. (2009). Do fans care?: Assessing the influence of corporate social responsibility on consumer attitudes in the sport industry. Journal of Sport Management, 23(1), 743-769. Web.