Octagon Sports Organizational Structure and Strategy

Overview of Organizational Structure and Octagon's Mission

The most fundamental tool for establishing a successful organization is its organizational structure. Organizational structure refers to the hierarchical arrangement of lines of authority, rights, duties, and communications within an organization, defining how powers, roles, and responsibilities are assigned, coordinated, and controlled, and how information flows between the various levels of management. All these aspects are directed toward the attainment of an organization's aims and goals. An organization's structure depends on its core objectives and strategies. There are two broad categories of organizational structure: (i) centralized structure and (ii) decentralized structure. Within a centralized structure, top management owns most or all of the decision-making powers, as well as firm control over the organization's departments and divisions. In a decentralized organizational structure, decision-making power is distributed more broadly across the organization's divisions, and each department may possess a different degree of independence. This paper analyzes Octagon Sports' organizational structure by defining and examining its existing structure and modes of performance. Octagon is one of the global organizations piloted through a decentralized structured system.

Octagon is the sports and entertainment marketing arm of the Interpublic Group of Companies, Inc. (Octagon Worldwide, 2013). It is one of the world's pioneering marketing services and advertising agency organizations (Job, Woods & Howard, 2008). The organization holds recognition as one of the most powerful and dominant global sports marketing companies. Through its annual global marketing revenues, it generates in excess of $300 million (Staffa, Lewis, Braham & Griffins, 2011). The two principal divisions making up Octagon are Marketing and Athletes and Personalities. The Athletes and Personalities division is further separated into sport divisions, primarily handling event management and corporate sponsorships. According to Octagon Worldwide (2013), the aim of Octagon's athlete marketing department is to establish and maximize off-field corporate relationships with every client. The organization pursues its corporate opportunities tactfully and aggressively at regional, local, national, and international levels (Octagon Worldwide, 2013). Octagon's personnel develop a distinctive, individualized marketing plan for every customer; this strategic approach aids the organization in maximizing clients' earning capabilities throughout their playing and entertainment careers (Octagon Worldwide, 2013). Career enhancement is achievable through the provision of enjoyable off-field and community-related activities in which clients participate. Octagon's ultimate mission is to create new avenues for professional and personal fulfillment that provide both short-term and long-term opportunities enhancing the development of an individual's character and community life (Octagon Worldwide, 2013).

Octagon's core commitment is to combine the resources, power, and relationships of international sports organizations with the highest levels of personal attention and dedication to clients — a behavior commonly associated with traditional small firms. The organization strives to deliver the highest level of personal attention to its clients by offering them direct access to each staff member at all times (Staffa, Lewis, Braham & Griffins, 2011). While Octagon takes pride in negotiating over one million U.S. dollars in NFL and marketing contracts, it also takes pride in providing both quantity and quality of personal attention to each client's needs (Staffa, Lewis, Braham & Griffins, 2011). Ultimately, the organization's success is measured through the quality of the comprehensive relationships it maintains with its clients. This commitment to personal attention extends to any additional individual recommended for direct access to the organization's management. Only by maintaining control over the organization's size and scope of practice is it capable of delivering such guarantees for the length of a client's career, both on and off the field.

Octagon's main objective in public relations is to establish and maintain a favorable image, persona, and brand that can help leverage its marketing efforts on behalf of its clients (Octagon Worldwide, 2014). Octagon believes that establishing a strong public image for every client is a vital component of career development, both on and off the playing field. The first image is developed as a client performs on the field, and is subsequently reinforced by building a healthy relationship with the media and the public off-field. As an individual professionally grows within the NFL, Octagon strongly advocates assuming a leadership role within the community. Participation in community-driven programs and charitable foundations results in the most rewarding and satisfying experiences of a client's career. Through its decentralized structure, Octagon is committed to assisting its clients in developing and implementing programs that encourage an individualized realization of personal impact within the local community.

Through the success of its management and organizational strategies, Octagon celebrates its 31st anniversary as the world's principal sponsorship consulting practice, serving hundreds of corporate marketing clients and managing over 13,300 events annually. According to Staffa, Lewis, Braham & Griffins (2011), it manages and influences approximately $3 billion in sponsorship-related spending yearly, with approximately 1,000 employees globally. The organization's presence is particularly dominant across the Asia-Pacific region, pioneering athlete and personality management and representation, and working with over 800 athlete and personality clients.

Octagon's Global Leadership Hierarchy

In its organizational structure, Octagon is led by Rick Dudley, the CEO and President Worldwide. Dudley is accountable for all functional disciplines of the organization. Octagon Worldwide (2014) notes that he envisions Octagon's success based on a solid record of organizational performance. In affirming the organization's new Asia-Pacific strategy, the CEO expressed confidence that it would propel strong regional and global progression. Under Rick Dudley's leadership, Octagon has advanced to become the world's largest sports and entertainment activation and consulting practice, and a leader in athlete and personality management. The major concern of sports management is understanding the nature and meaning of sporting activities in people's lives, together with the management and planning of financial, physical, environmental, and human resources in order to meet sporting requirements (Octagon Worldwide, 2014).

The Managing Director of Octagon Football, Phil Carling, based in London, oversees the organization's global football business, including overall management and sponsorship strategies for rights and brand holders. Carling's 12-year tenure at Octagon encompasses managing sponsorships for several of the world's premier companies, such as Mars, AB InBev, NIVEA For Men, and Saudi Telecom (Octagon Worldwide, 2014). Previously, he served as a commercial director of the UK Football Association (UK FA) and was responsible for creating the UK's most significant domestic football program. Further down the hierarchy is the Chief Strategy Officer Worldwide, Simon Wardle, who oversees the organization's multifaceted strategic research, ensuring the most effective and influential impact for clients (Octagon Worldwide, 2014). Among his achievements is the creation of "Passion Drivers®," a pioneering proprietary research tool aimed at understanding why sports fans are fans.

The Executive Vice President and Chief Marketing Officer (CMO) Worldwide, Lisa Murray, has supported the agency's growth for over two decades (Job, Woods & Howard, 2008). The CMO manages all marketing and communications for Octagon brands worldwide, and leads the firm's marketing practice development and deployment (Hoffer, Hunt & Collins, 2009). She is responsible for driving cross-border growth among existing clients and leading teams that develop new business in emerging markets such as China, Brazil, India, Russia, and the Middle East. The Managing Director for Octagon India, Europe, and the Middle East, Jeff Ehrenkranz, leads the agency's marketing strategies in those regions, including business growth initiatives across Europe (Job, Woods & Howard, 2008). He formerly served as Octagon's head of the marketing solutions group in North America, successfully managing teams across sports, music, entertainment sponsorships, digital events, and hospitality services. Alexandra Leitao, the President of Octagon Brazil, develops strategic plans for companies using football as a brand-positioning tool, encompassing sales and business development. His wide-ranging marketing experience in advertising, retail, hospitality, and entertainment extends across Latin America and Europe. Similarly, John Shea, the President of Octagon Marketing Americas, heads Octagon's sponsorship consulting group in South and North America (Octagon Worldwide, 2014). He has successfully run sponsorship programs across a variety of industry segments in these regions and has managed business relationships with numerous major organizations and sports leagues.

Segmentation of the Sports and Football Industry

Regarding Octagon Football, it is useful to outline a framework for better understanding of the worldwide football industry and its management structure. The sports industry is currently divided into three principal segments: sporting goods, consulting, and sports services (Octagon Worldwide, 2014). The sporting goods segment includes equipment manufacturers, licensed products, and sports materials — for example, Adidas, Reebok, and Nike. The consulting segment involves firms offering services such as sports medicine and management; this is where Octagon falls, alongside IMG and others. The sports services segment involves organizations offering sport as their end product, and is further divided into three facets. The first facet — Events — involves organizations generating their revenues, either directly or indirectly, from spectators, where athletes are professional and examples include teams and leagues (Staffa, Lewis, Braham & Griffins, 2011). The second facet — Participants — involves entities that provide opportunities for individuals to engage in sporting activities. The third facet — Hybrid — ensures the provision of a mixed offering of events and participants, including government agencies (Job, Woods & Howard, 2008).

An alternative view of the football industry divides its structure into a producer market, a consumer market, and an intermediate market (industrial and resale). In this framework, football fans constitute the consumer market, holding a direct commercial relationship through the box office or producer market mechanisms represented by the football associations (Hoffer, Hunt & Collins, 2009). This market also consumes from the intermediate industrial market (sports marketing companies) and the intermediate resale market (including television and licensed companies). The intermediate industrial market and the intermediate resale market interact with the producer market through the marketing of operations and the sale of broadcast rights, respectively.

Hoffer, Hunt & Collins (2009) assert that the producer market follows a global hierarchy in which FIFA is the highest authority in football. Beneath FIFA come the continental federations accountable for football activities within their respective regions — for example, UEFA (Union of European Football Associations) and CONMEBOL (the South American Football Confederation). Below these are the national federations and confederations, such as the Brazilian Football Confederation (CBF), state federations, and domestic sports leagues.

References

Hoffer, C. W., Hunt, C., & Collins, W. (2009). Strategic approach to sports globalization. Journal of International Marketing, 12(1), 57–74.

Job, P., Woods, J., & Howard, C. (2008). Description of roles of sports agencies, operational and educational programs to prepare for a successful organizational and field performance. Journal of Sports and Entertainment, 45, 27–34.

Octagon Worldwide. (2013). Octagon executive biographies. Retrieved March 15, 2014, from

Octagon Worldwide. (2014). The Octagon announces strengthened senior management structure and new leadership appointments. The Octagon Sports Marketing, 9(4), 17–24.

Staffa, P., Lewis, D., Braham, G., & Griffins, W. (2011). The laws of returns under competitive sports conditions. Economic Journal, 36(2), 35–50.