How David Koch turned the Power back on

Turning a business around can be challenging – but the tougher the turn, the sweeter the rewards. David Koch, Chairman of Port Adelaide Football Club, explains how he helped take the Power from financial hardship and the bottom of the AFL ladder to the finals in three short seasons.

By

David Koch, Chairman of Port Adelaide Football Club

David Koch knows a lot about reinvention.

Accounting student, finance writer, business owner, Sunrise celebrity: Kochie has presented many faces to the Australian public. So when the Australian Football League (AFL) hammered at his door looking for a Chairman for the beleaguered Port Adelaide Football Club, they knew they had the right man for the job. “The club was in crisis – its very future in the AFL was being questioned,” says Koch. “The challenge was to turn around a club that was seen as almost irrelevant.”

The club, known as The Power, was indeed at a low ebb. Tottering on the brink of insolvency and languishing at the bottom of the league table, the team was hit by an almost knockout blow in September 2012 with the tragic death of popular midfielder, John McCarthy. “That was the ultimate tragedy,” says Koch. “But coupled with the other problems the club was dealing with, it was a catalyst for real change.”

Starting at the top

Koch’s first challenge was weathering the storm of criticism that accompanied the appointment of a President that didn’t live in the same state as his club. But the Sydney-based Koch was clear from the outset that turning the club around wasn’t dependent on his geography, but on setting the right behaviours and values at the top, and making sure everyone was performing the right role – exactly the same priorities involved in running any business.

“The Chairman’s role is to provide direction, accountability and to oversee pricing – not getting involved in the day to day activities of the club,” he explains. “My first priority was creating a policy document on the behaviours and values of the board which all the directors had to sign off on. This included not getting involved in management issues or hanging around the club and confusing staff.”

Having enshrined the principles and values that provided a strong framework for rebuilding the club, the next crucial step was finding the right people to move Port Adelaide towards a new future. Recognising the importance of wooing the Eastern Seaboard audience, the club appointed a new Melbourne director, Cos Cardone, Chief Executive Officer of McGuire Media.

They also pursued and won the hand of Amanda Vanstone, former Senator for South Australia and Ambassador to Italy. “After she picked her jaw up off the floor she was excited,” chuckles Koch. “And she’s proven to be a huge asset – her experience is as vast as her enthusiasm.” As a former member of the World Anti-Doping Agency, she also brings real credibility to the team given recent doping scandals and club cover ups.

Senior coach Ken Hinkley, Alan Richardson, director of coaching and strategy, and high performance coach Darren Burgess were other key appointments. “We had to build a team of quality people on and off the field, and together they’ve driven our success,” says Koch. “Our product is entertainment – we had to establish our value as a product and needed the people on board who could help build and support a team of players who played hard, entertaining football.”

The strategy is already paying off in spades. In 2013, Port Adelaide CEO Keith Thomas reflected in his annual letter: “Through our new Chairman David Koch and coach Ken Hinkley, the language of Port Adelaide began to change. We were positive, confident and spoke of playing a bigger game on the national stage. We declared this team would never, ever give up! We started to look and sound like Port Adelaide again.”

This renaissance of identity is showing on the field too. In 2011, the Power ranked number 16 on the AFL’s ladder of 17 teams, before finishing in 14th place in 2012. But the following year, Port Adelaide were the talk of the league – rocketing up to 7th position, with Hinkley voted Coach of the Year by the AFL Coaches’ Association. And this year the Power have made the 2014 AFL semi-finals.

Developing the brand

With so much work to do to rejuvenate the side and so many stakeholders to bring on the journey –including players, staff, sponsors and fans – Koch is characteristically blunt about what it takes to align such disparate interests: just be the best. “We had to give them all a vision of where the club could go,” he says. “From the start I said we needed to have the best football program and be an employer of choice for talented young players. I wanted to create a stellar brand.”

Signing Renault as the club’s major sponsor was an important step towards repolishing the Power’s tarnished brand. In 2012, the French car giant first came on board, persuaded by Koch’s promises of the best business practice and the best service for the best value in the game. “We probably undervalued our product at the time, but with the kicker that if we succeeded Renault would lock into a longer term commitment.” The strategy worked. Back in March 2013, Renault signed a three-year deal with the club.

A broader focus

Part of the rationale for pursuing an international brand was to reflect another major goal – broadening the very narrow focus of the club. “We needed to get out of the 5015 postcode and start thinking nationally,” says Koch. “When you’re playing a national game, you’re in a national business; a local focus just isn’t good enough.”

The Power essentially faced the same problem all challenger brands do – building relevance in an environment where others had a far stronger footprint. “Our issue was building our brand in Victoria and further afield. We did it by changing our style of footy and making it fun, entertaining footy,” comments Koch.

Ultimately, the task facing challenger brands is quite simple: do everything better than the competition. “You have to set yourself what others may see as unachievable goals. Then bring the best business practice to everything you do,” he says. “You have to be more aggressive, more creative. But most of all you have to knuckle down and not bemoan the fact that you’re a challenger brand and lift yourself to a new level.”

A new customer experience

The club has certainly hit new heights in 2014 after it relocated from AAMI Stadium, a venue in the Western suburbs of Adelaide, to Adelaide Oval right in the city centre. “The venue essentially provides new packaging for our product – the customer experience of watching a game,” says Koch. As one of the world’s best sporting venues, Adelaide Oval is giving the Power a better foundation to secure its financial future. “We have more options at Adelaide Oval that allow us to offer different price points, so we can be more flexible on how we put our product together,” he adds.

With so much momentum behind the club, Koch says the team’s definition of success has changed. “Filling stadiums and winning a premiership flag,” says Koch. “You don’t need to overcomplicate your goals, just aim for the absolute top.”

This article was published in Business View magazine.  For more articles and interactivity, download the iPad edition for free via our new app NAB Think.

More from NAB: