Daily Management Review

Is the fate of the NFL tied to that of Roger Goodell's?


04/01/2015


Roger Goodell’s fortunes appear to be tied to NFL’s bottom lines. In a game of nerves, it is yet unsure as to who will be the catalyst for change, NFL’s fans, or the general public who don’t give a damn.



The National Football League (NFL) has become the topic of conversation not because of its player’s in-game-behavior but more so for their off-track acts. This is not limited to just those who worship at the altar of Football but for non-football fans as well. This is the problem that has been plaguing Roger Goodell, the embattled commissioner of the NFL. His fate will be decided not by footballs fans but by those who hold on and grind and chew the life out of a piece of gossip.

What nobody seems to be getting is the fact that the NFL is still very much a corporation, and like all such entities its actions are in fact determined by its bottom line regardless of the fact that the NFL is a NPO.

As with all such bodies, corporations, have a governing structure in place which is designed to ensure that the stakeholder’s interest are well represented. For the NFL the stakeholders are in fact the 32 teams. Roger Goodell is their employee, they are his bosses, and thus they have the contractual right to take appropriate decisions at any time regarding his employment.

If one were to argue that Goodell can be removed on the basis of the handling of the Ray Rice and Adrian Peterson incidents, it would certainly hold water. However, that decision needs to be placed in an appropriate context: since 2006, when Goodell was appointed as commissioner, NFL has reached higher grounds that most owners could only imagine and his term as commissioner has been outstanding. Thanks to him, NFL’s revenues have jumped by a whopping 55% to a massive 9.5 billion. Naturally the owners have rewarded him with $44.2 million in 2012.

The reality of the situation is that until the NFL’s bottom lines are affected, the owners are unlikely to want to have a change of guard at the top. Moreover, the fans will not be act as a catalyst for this change, for the simple reason that although they are taken aback by the actions of a few players in the league, but they are still NFL fans, and will thus still continue to be glued to the game and follow its results.

This naturally, does not mean to say that Goodell can now relax. Agents of change are every corporations worry, and the ever growing activisms by fans and investors only fan that fire even further. Corporates invest around $2 billion a year in the form of sponsorship deals with the NFL, their fidgety feet can certainly be major headache for Goodell.

For example, the decision by Minnessota Vikings to reinstate Adrian Peterson saw the suspension of sponsorship by Radisson Hotels, which prompted the Minnesota Vikings re-suspend Peterson. Similarly quite a few sponsors have taken a watch and wait approach towards the current situation. If NFL fans boycott their products, they then will be compelled to act accordingly. However, the fans also know if they in fact boycott the products, their Sunday viewing is likely to get affected. In this Game of Thrones, the non-fans could have an impact on the corporations bottom line.

Goodell though received a piece of good news when PepsiCo, NFL’s largest sponsor, issued a statement in support of him. Right after this announcement though, “Boycott PepsiCo” picked up traction in the social media. Thus, only time will be Goodell’s judge and jury.

References:
http://www.forbes.com/sites/forbesleadershipforum/2014/09/19/the-nfls-activist-investors-hold-the-key-to-goodells-future/







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