As the sport business grows at an ever more rapid rate, the education sector which serves it is growing to meet its needs. James Skinner, director of the Institute for Sport Business at Loughborough University and his colleague Aaron Smith, professor of sport business, run the rule over current and emerging trends in sport administration education.
The global sport industry yields at least $650bn (£500bn) annually, at a rate exceeding the growth of most nations’ gross domestic products. According to figures compiled by Global Sport Jobs, this impressive industry expansion is surpassed by increases in the number of jobs offered in several bellwether sectors – most notably sport media, technology, and broadcasting, followed closely by sport agencies and elite performance. As the demand for new recruits to fill a strengthening global sport industry continues to escalate, greater attention is being cast over the composition of that talent, as well as the critical skills they will need in order to meet the challenges of a turbulent, technologically-driven, rapidly changing marketplace.
Compressed between the inertia of its rich traditions and unprecedented technological innovation, the sport industry is navigating uncharted territory. In this new world, success will go to those agile enterprises capable of converting to the digital map, giving space to a new generation of opportunities at the same time as re-imagining the needs of stalwart fans and stakeholders. Disruption has become business as usual, backed by an ever-increasing technological intensity. Traditional sectors such as sport facilities, major events, and broadcasting, for example, are faced with an immense reengineering task in order to remain relevant in a sporting ecosystem propelled by multiple media content distribution channels, a closure of the engagement distance between sport fan and sport property, and the vast insights offered through big data. More than ever before, the sport industry needs new skills.
In Asia, over the last decade, China, Japan, and India have invested heavily in professionalising their sport industries. Changes in the dynamics of political and economic power in the region have opened the doors to international sports businesses, especially from the West. In fact, Asia has become the most significant high potential growth sport region in the world and is rapidly becoming a favoured destination for investors aiming to grow their sports businesses over the next decade. However, the region will require a dramatic upsurge in professional management in order to capitalise on the opportunities.
Australia and, to a lesser extent, New Zealand, comprise the gravity of sport business in the Australasian or Asia Pacific region. The two nations share many similarities as a consequence of their British Commonwealth history, economic and legal models, and sporting traditions. Both also share a fierce passion for sport, mixed with a professional industrial environment that is progressively growing, particularly in broadcasting. Increasingly, Australian and New Zealand sport businesses and competitions have sought trans-Tasman connections as well as involvement in Asian-wide competitions. Navigating the tension between distant Western traditions and proximate Eastern opportunities remains a great challenge which will require a rare blend of culturally-savvy leadership and international marketing.
The sport business landscape in Europe features high levels of professionalisation, immense financial investments, and a coterie of powerful market players including billionaires, broadcasters, and banks. Some of the world’s most valuable sporting brands gained their ascendancies in the European market. In particular, the United Kingdom, Germany and France are the main centres of gravity in the industry, while Russia, some would suggest, is playing an increasing pivotal role. Nevertheless, a fragmented industry with numerous overlapping markets and competing sport products looks set to become even more granular. In the midst of a divergent European landscape, many sport enterprises will face a shortage of professional managers capable of operating both locally and globally.
The North American region continues to host the world’s most mature and wealthy sports market. Commercial dividends drive the sport industry in the United States, but what makes the model so unique is its highly professionalised college sport system. Canadian sport looks more like a hybrid European club structure that co-exists with a more advanced school and university model and some professional team franchises. The entire North American sports market is projected to grow at a healthy annual rate of about 3.5 per cent. However, the transition from analogue to digital will prove decisive, especially as sport properties seek to deliver upon consumers’ expectations for mobile, ubiquitous, and relentless content.
A number of the 20 or so Middle East and North African countries have made hefty investments in sport over the last decade. In addition, the region has eased it traditional protectionism, opened its borders, and encouraged access to international investment. Some of the wealthiest states have continued to aggressively take ownership positions in globally recognised sport brands in the West. A combination of growth, commercialisation, professionalisation, and internationalisation signals major shifts in MENA’s market dynamics, although it scarcely has sufficiently trained sport managers to cope with existing demand, let alone the accompanying growth.
Political instability frustrates the development of sport business in the South American region, undermining the confidence of potential investors. Much of the sport business industry lacks professional management, while many nations’ sport policies are subservient to government resources and whim. Football shows no signs of losing its immense following, however, despite allegations of governance impropriety. On the other hand, European and North American brands continue to make inroads into the South American fan base, chiefly through merchandise and broadcasting opportunities.
Key skill domains
As globalisation in sport increases, regulatory and governance requirements will become increasingly important. Rules and laws presently governing individual sports will give way to national and international regulations. There will be further reliance on international sports law, particularly in those areas relating to intellectual property, and to sporting technologies, patent rights, insurance, sponsorship agreements, contractual issues, and general employment law. Sound digital and IT capability will not simply be useful, it will be an essential requirement, particularly for anyone in a management position.
Laws concerning individual participation in sport, especially with reference to equity, will become debatable issues. The very concept of equity will be argued in many spheres. Most spectators and participants retain a fundamental belief that in competition, every athlete or team should possess an equal chance of winning. Some technologies, confined to individual teams or countries because of their expense or intellectual property or patent, will be subject to international scrutiny. As a consequence, the use of some technologies may be prohibited. Technology may well become the new drug problem.
Agreements on the definition of international rules of sport and the regulatory requirements governing sport will need to include input from developing countries. Sports law will continue to grow in importance while specialised courses will become both core and critical. Meanwhile, the role of women in sport, both as participants and as leaders and administrators, will intensify, perhaps opening new avenues for female consumers to engage with sport. As a result, the attraction of sport as a career opportunity for young women will escalate.
There will be strong growth in allied external organisations over the next decade as a growing number of sporting enterprises grasp the opportunity to outsource their own specialised activities with consultant companies. Niche companies will customise their businesses to cater for data, medical, logistics, hospitality, marketing, sponsorship, legal, and human resource nuances. These niche areas are likely to be combined with various forms of expertise at the intersection of digital, media, and data. At the same time, in-house generalists will become the backbone of sport business. This will require increased knowledge of national and international regulatory requirements, governance issues, and laws. Middle and senior management roles will require postgraduate degrees in areas like sport management, finance, business administration, or law, all peppered with strong components of technologically-driven marketing and customer engagement in the fully connected ‘Internet of Things’ world.
What is clear is that the sport industry is in the midst of a fundamental shift in operational structure, which has and will further affect the necessary composition of its practitioners’ critical skills. In particular, the increasing complexity of the industry has driven an inflating band of sport specialists. More of these specialists will be employed in allied organisations. Furthermore, organisations delivering sport business products—that is sport itself—are likely to respond to the turbulent environment by assuming more flexible work structures and arrangements characterised by agile expansions and contractions in staff as needed. This exponential change rate will lead to a relentless need for innovation, in turn demanding a skill set featuring mental dexterity and creative solutions. A constantly reconfiguring work environment means that sport industry practitioners must be able to adapt swiftly to fluid work patterns and structures. Moreover, the proliferation of data will require the skills to sift through it efficiently, recognising what is important and drawing decisive insights to improve and co-create customer and fan experiences. Whatever aspect of the sport business world an individual seeks to enter, an ever-increasing skill will be the ability to understand, manipulate, and work with the influx of new technology that will constantly hit the market. Consequently, sport business programmes must inspire sport business students to navigate and embrace the need for relentless innovation.