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Cosgrove: third Business and Sport Summit

Hon Clayton Cosgrove
Minister for Sport and Recreation

Embargoed until 1pm, 31 July 2008 Speech


Clayton Cosgrove’s speech to open the third Business and Sport Summit

Venue: The Private Room, Westin Hotel, 21 Viaduct Harbour, Auckland
Time: 1:00pm, Thursday 31 July 2008


Phil O’Reilly, Chief Executive Officer of Business New Zealand; John Wells, Chairman of Sport and Recreation New Zealand (SPARC); members of the business and sport communities, ladies and gentlemen.

Good afternoon and a very warm welcome to you all. It is a privilege to be at the third Business and Sport Summit and I thank you all for taking time out of your busy schedules to attend.

It is fantastic to see such a strong turnout from the business and sport sectors.

I would especially like to welcome members of these two sectors who are part of what is being announced today – in particular, TVNZ Chief Executive Officer (CEO), Rick Ellis; Netball New Zealand CEO Raelene Castle; Kiwi Rail CEO David Jackson; Yachting New Zealand CEO Des Brennan; DHL General Manager Derek Anderson; Surf Lifesaving New Zealand CEO Geoff Barry; Triathlon New Zealand CEO Dave Beeche; BankLink Chair Malcolm McDonald; and Rowing Chair Bill Falconer.

Having so many of you agreeing to participate today reaffirms for me the level of interest and commitment to the business and sport partnership initiative which we first started formally exploring in May this year.

This is the third time in three months that the government has brought business and sport leaders together. In the meetings in May and June, we challenged you to think beyond the traditional business-sports ‘sponsorship’ model and to embrace new ways the sectors can benefit each other.

Those gatherings produced some great ideas. They got people talking to each other and led to some exciting concepts. But while there will be more discussion, today it is really about action. The rubber is about to hit the road.

Today we are going to hear about some existing informal partnerships between business and sport which ‘leave for dead’ the old concept of mere sport sponsorship. And we are going to hear about some businesses and sports, which are about to embrace the partnership initiative.

So where do I come in as Minister, and what role does SPARC have to play in all of this? While the government obviously invests and fosters both the sport and business communities in a wide variety of ways, I think our key role in this instance is to act as a facilitator, by bringing parties together and supporting the growth of new partnerships beyond the traditional sponsorship role. The government through SPARC can also help alert each sector to opportunities, and assist business and sports organisations to grow their relationships or establish new ones.

I have been inspired by innovative, smart and ‘out of the box’ thinking exhibited by some businesses and sports. These approaches have produced some tremendous outcomes.

Those relationships have developed as a result of some pretty smart thinking and visionary planning. But the unfulfilled potential in the wider business and sport sectors is huge. What we want to do is provide the catalyst for more of these new business/sport partnerships, to encourage them, monitor them and profile them.

This is not about more theory and strategies. Businesses look to profit and added value, and sports want to be strong and competitive. It is all about results.

As America’s Cup and round-the-world yachting great, the late Sir Peter Blake, said – “if it doesn’t make the boat go faster, don’t do it.”

So who is making the boat go faster? I will touch briefly on a couple of examples, that you will be hearing more about this afternoon.

The other day I saw a DHL courier van drive by. It was covered in the iconic red and yellow colours of Surf Life Saving New Zealand and of course had signage to signify DHL is a partner with that particular sporting and recreational organisation.

Their relationship extends well beyond the traditional sponsorship model. In fact DHL does not expect the value of its investment to be returned in a commercial sense: sponsoring Surf Life Saving New Zealand does not directly boost freight sales. So what on earth does DHL get out of this? How is this making their boat go faster?

What we have discovered is that DHL is benefiting from being associated with a brand and an image that says trust and security. It also aligns itself with an organisation associated with being intrinsically New Zealand. What’s more ‘kiwi’ than going to the beach and having a swim or surf? That kind of imagery and feel resonates with the public. DHL might be a global company, but its links with Surf Life Saving give a particularly New Zealand flavour. You see the van – you think of the safety flags at the beach at Piha, Mt Maunganui, Sumner or St Kilda.

But it goes deeper than that. DHL has embraced key Surf Life Saving brand values. For example, DHL’s human resource training has adopted Surf Life Saving thinking and phrases such as “stopping customers from drifting outside the flags.”

On the flip side, Surf Life Saving gets far more than cash and branding from DHL. For example in the area of intellectual property transfer, on specific Surf Life Saving New Zealand projects, DHL helps with marketing, PR and strategy support. That kind of assistance from an international company is invaluable to a sports organisation – worth far more in the long term than constantly writing cheques.

Then there is the relationship between Contact Energy and Triathlon New Zealand. Contact has been the principal sponsor of Triathlon New Zealand’s national series since 2006. “That’s nice, so what?” some of you might say.

Well Contact also accesses Triathlon New Zealand’s membership database - with the consent of its members of course. With over 70,000 participants in some clearly defined niches, that is powerful and valuable data to have. The membership databases and profiles that sport organisations possess can be like gold.

Working with Contact, Triathlon New Zealand has developed a totally new direction to recruit members and is building its membership base exponentially. As that membership grows, so does the value of that database to Contact. This is the kind of relationship light years ahead of simply donating some money and slapping your logo on the club jersey.

I am hoping those of you who have yet to explore these kind of areas are thinking “I want some of that”. And today is about getting things moving in that direction.

SPARC has undertaken to help you improve on your existing sport/business relationship or to help you establish a new one. And we are giving our commitment to support and help facilitate relationships which will end up making your business more competitive and robust, and your sports organisation more efficient and sustainable.

To assist that process, today provides an opportunity for idea sharing, feedback and discussion to refine what has been established in the previous two summits. My challenge to you, building on the previous two summits, is to bring new ideas and initiatives to the table. What is the ‘next big thing’ that sport can benefit from business or business can benefit from sport? We have got a room full of creative minds here, and I Iook forward to the result of your workshop.

Business leaders, we need you not only to think outside the square about how an association with sport could benefit your business - but to think about how you can implement this – and tell the group – today.

Sports leaders, I ask you to also broaden your minds to what you see a relationship, beyond sponsorship, looking like with businesses.

I want you to firmly establish what you want and need – then draw up a list of businesses you need to speak to – again... today.

We should ask ourselves what is the impact of not taking such action? Aside from being a huge missed opportunity for both sectors, we also need to acknowledge that the old way of doing things won’t work on its own, anymore.

The demands on sporting clubs and organisations are tougher than they have ever been. Pressures on time and finances are putting the squeeze on the volunteer and participant base that have traditionally fuelled the sporting sector. Modern clubs have to compete with such new activities for young peoples' leisure time, including sedentary activities such as computer games and watching television.

In fact the discretionary time of all New Zealanders is under increasing pressure from other commitments and changing lifestyle patterns. Yet most traditional sport and recreation organisations still rely on the regular commitment from members to keep going.

I would argue that unless we change with the times, then businesses might start questioning their involvement with sport if it remains anchored in the traditional cheque-book writing mode. And sports organisations might fall off the pace if they are not getting the support they need to run efficiently and balance their books.

As both the Minister for Small Business and the Minister for Sport and Recreation I have a unique opportunity to appreciate the issues faced by both the commercial and sport and recreation sectors. I see many similarities between the sectors and many areas of synergy.

So what can sport offer business?

Businesses need staff that can work together as a team, focus on a common goal and be motivated. Sport and recreation helps develop those skills in people.

Sport and recreation organisations can also help connect corporates with the community – not only through an overt relationship such as being a sponsor - but also through working with sports and adapting their grass roots ethos into their operations.

What can businesses offer sport, outside of sponsorship?

Let us start with your expertise in governance, human resourcing, information technology, marketing, and finance, from the board room right down to the club level - the list goes on.

The trick is, how can we actually get this initiative underway? Well it already is.

To start this summit session off on, I have the honour of inducting five businesses and five sport organisations as inaugural members in the Business and Sport Partnership Initiative. Three of these partnerships are already established and are exhibiting innovative and creative approaches well beyond financial ties. They are;

• DHL and Surf Life Saving New Zealand
• Contact Energy and Triathlon New Zealand
• BankLink and Rowing New Zealand

And business and sport organisations about to embark on relationships under the business and sport partnership initiative are;
• TVNZ and Netball New Zealand
• Kiwi Rail and Yachting New Zealand

In conclusion, I look forward to seeing everyone rise to the challenge – putting forward constructive ideas – and putting the Business and Sport Partnership Initiative into action.

I would like to conclude with a quote from Henry Ford who knew a bit about making cars and plenty about making money. He was also someone who could think outside the square and he certainly was when he said...”a business that makes nothing but money is a poor business.”
Thank you.

ENDS

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