Case Study – Make Green Delicious
————————————————- A. ————————————————- Introduction/Statement of the Problem: As the executive director of the National Hockey League Players’ Association (NHLPA), Bob Goodenow is faced with the issue of developing a communications strategy for the NHLPA. It must establish a strong bargaining stance for the players that effectively communicate their position on the salary cap issue, while also retain the loyalty of hockey fans. B. ————————————————- Analysis:
The current Collective Bargaining Agreement includes a limited salary cap and entry-level salary cap, and expires September 15th, 2004. It is no longer successful at controlling rapid growth in player salaries and forming a direct link between salary growth and league revenues. The Unified Report of Operations claims that the majority of NHL teams have lost money in recent years. Owners believe that there are “major deficiencies in the current contract that has led to significant financial losses and a competitive imbalance. Smaller teams can’t compete with larger teams; therefore the league can’t be competitive.
There is a transition from a local market to a league-wide market, so players’ salaries are escalating to levels that are unsustainable. Entry-level salary caps are ineffective due to signing bonuses. The NHL revenue growth equals 173%, while the players’ salary growth equals 261% over the term of the CBA. The players’ salaries account for 75% of NHL revenues, which is much higher than other sports. Owners believe a mechanism is needed to control player salaries and tie them to revenues. Players question the validity of the financial information, URO, and Levitt Report.
Players argue against the proposed solutions and say free market forces should determine players’ salaries. There is no validity in the owners’ financial statements, which may support that the lack of revenues is due to poor business decisions, not high player salaries. C. ————————————————- Alternatives: A) Strategy that focuses on the players’ current stance on the salary cap, using free market forces, questionable financial validity, and poor business decisions as their platforms for gaining the media and the fans support.
B) Strategy that emphasizes on the lack of financial transparency of the NHL and its owners that has led a delayed agreement. C) Continue with the current communications strategy. D. ————————————————- Recommendation: Bob is recommended to choose alternative A and pursue a communications strategy, which emphasizes the NHL players’ current position on the proposed salary cap. E. ————————————————- Implementation Plan: Bob should begin by clearly establishing the players’ values and goals in regards to the negotiation and how he intends on communicating them to reach the fans.
This would involve taking the players’ stance on the salary cap and communicating it consistently through the NHLPA’s website, players’ personal social media, radio interviews, etc. It would include reasoning to support the players’ position, such as the lack of transparency and validity in financial information presented by the NHL owners, as well as the importance of free markets in the determination of salaries. By using the players as a source of free media and publicity, the NHLPA can emphasize their position and sympathize with the fans and their common love for the game.
Here, the players can explain that a salary cap would essentially be equal to a salary cut for players. This is something that nobody would agree with if it came to their own job, whether they are rich or poor. By effectively communicating the players’ stance on the proposed salary cap to the fans and public, the NHLPA can gain a favourable bargaining position over the NHL owners for the upcoming negotiations in September 2004. It will also help retain fan loyalty to the NHL and its organizations, which is a common interest for both parties.
