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'Urgent' change required for NZR's 'not fit for purpose' operating model
By Ben Smith
An independent review into New Zealand Rugby’s (NZR) operating structure has revealed that “urgent” changes are required according to the report released on Thursday.
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The review panel, led by David Pilkington, concluded that NZR’s structures were “not appropriate” in the modern era, with the game undergoing much change since the dawn of professionalism.
Its current model was “not designed for a business of this size” with many pain points causing headaches as NZR battles commercial interests, the Provincial Unions, and the development of the game.
The National Provincial Competition is one of the contentious issues, which has a wide professional player base despite the lack of self-generating income to support it. Game income revenue for Provincial Unions had fallen by roughly 67 per cent from a peak in 2005.
The report concluded that the NPC can only continue “with the financial support of NZR” while Super Rugby clubs are struggling to make money also.
Wednesday night’s clash between Manawatu and Auckland hosted at Eden Park was perhaps the perfect symbol of this struggle, with the two teams playing in front of a near-empty stadium that holds over 50,000.
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“We question not only whether New Zealand can support so many fully professional rugby players but whether it can afford the overhead costs of 26 different Provincial Unions,” the review stated.
The conflict with NZR for Provincial Unions stems from too much priority on high performance over community and fan initiatives. The report found that on average “59% of the NPC Unions’ expenditure is on high performance.”
The challenges identified included “falling participation rates for the game, falling spectator numbers for domestic rugby, fan engagement, and misaligned use of funding towards strategic initiatives.”
The Silver Lake capital injection that was provided to the Provincial Unions was used to clear debt with the NZR amongst other things, with whispers some provinces used up the $1 million on funding their men’s side.
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Despite having financial dependence on NZR, the Provincial Unions possess the collective power to throw the NZR board out under a special general meeting.
Thus, a struggle of interests eventuates with NZR fearful of cracking down and upsetting the provinces too much.
The review panel recommended an “Independent board” be set-up to govern the NZR organisation and secondly a “Stakeholder Council” be formed to deal with everyone else in the game.
“New Zealand Rugby in the professional era is a large and complex business,” said review chair Pilkington.
“The structure it sits within was not designed for a business of this size and complexity. There is widespread recognition that change is needed to address the many challenges.
“We are confident that what we propose is the best route forward. The conclusions are not novel, they exist and work in other organisations and environments.
“There have been a number of reviews in recent times and it is this panel’s fervent hope that this is the last review of this type and that walk, finally replaces talk.”
The NPC requires a makeover, it should not be gotten rid of. It has been the lifeblood of provincial rugby and will continue to be so.
NZR needs to put aside the Blazer brigade and turn itself into a fully professional organisation with "Business managers" (albeit with a firm background and understanding of the game) running the Provinces.
I'm sure there are many things these loyal rugby folk can do at the grass roots level.
NZR needs to find a modern way to support the provinces and colleges at club level.
NZR should also be aware of the Player Power v Player Input issue. One only has to look to Aust to see the damage that Player power has created at the top level.
Been saying this for years, a structure which has a power base of one vote per province is no way to run a professional outfit. Setting up the Stakeholders Council where provinces have "significantly diminshed power", to consult with the Board (along with other stakeholder reps) makes perfect sense. Just do it.
The lack of free to air viewing or promotion and relegation between Super Rugby and NPC is what has killed rugby in NZ.
Putting all your efforts into pay tv operators takes the game out of the clubs, provinces, and franchises of the unions.
They need to own their own content production, localise and personalise the consumer experience, and charge advertising and licensing royalties to the media aggregators not just let Sky do all the broadcasting.
New Zealand cannot afford to pay for more than 200 professional players. That is 5 professional teams. This dream that many New Zealanders have of dissolving Super Rugby and having a fully professional NPC is financial suicide.
How could the NZR pay for 14 NPC teams (560 players)? Even if the NZR cut the NPC to 8 teams (the minimum number of teams required for a legitimate professional league) they still could not afford to pay 320 professional contracted players. That is over a 50% increase of pro players currently.
Therefore, whether Kiwis like it or not in the professional era we are in, NZ has to form a league in partnership with other countries, they have no choice.
The NPC is a wonderful competition (I would prefer to go back to the 3 division model from amateur era with promotion and relegation). But it should be fully amateur to reflect what it is- the third tier of rugby. Play in small stadiums and lower ticket sales and play afternoon games only to encourage crowds and families to attend.
It's Super Rugby that needs the chop, not NPC. A club competition similar to the URC between NZ, Australia, and the pacific islands.
30ish clubs in two divisions, or 20 clubs with a reserve grade or U20 competition running in parallel.
NZ would have to combine some of it's unions to allow enough Australian and pacific clubs.
If all international players from NZ, Australia, Fiji, Samoa, and Tonga took part it would be a great comp that would bolster all the unions involved.
Could it work commercially though?
They need some new methods for fan engagement - day time games that families can go to to breed the next generation of fans and players. Club games regularly sell out 30,000+ seats every weekend in the UK. If NZ and Australia can't find a way of replicating that they have a very sad future in World Rugby.
Big question is how to help players progress from club to Super Rugby if there's no NPC. As Australia are finding there needs to be something there
NZR also needs to take control of high school rugby from the glory hunting head teachers because we're losing far too many teenagers from the game.
It is surely up to the national union to secure the warm up games for the WC. Other than the annual Bledisloe round 2 the AB's had no games and that played a big part in their lacklustre performance at Twickenham. Everyone is blaming coaches and players and the ref - a smokescreen for the real culprit NZR.