Reviewof Bike NewZealand

FinalReport

September2013

Preface

Thisreporthasbeenpreparedfor BikeNewZealandandSportNewZealand byNickHillfromMartinJenkins(Martin,JenkinsAssociatesLimited).

Ourgoalistoimprovetheeffectivenessandefficiencyoftheorganisations weworkwith.Wedothisbyprovidingstrategicadviceandoperationalsupportinthefollowingareas:

  • Strategy,TransformationPerformance
  • PolicyEconomics
  • EvaluationResearch

MartinJenkinswasestablishedin1993andis100%NewZealandowned.ItisgovernedbyexecutivedirectorsDougMartin,KevinJenkins,MichaelMills,NickDavisandNickHill,plusindependentdirectorsPeterTaylor(Chair)andSirJohnWells.

Contents

Glossary1

Executive Summary2

Introduction4

The“BikeNZ Journey”6

WhereBikeisNow14

WhatContributedtotheCurrentState?18

SWOTAnalysis19

ARobustBikeNZModel20

ASixMonthPlan32

Recommendations35

Glossary

CD / CyclingDevelopment
HP / HighPerformance
HOC / HomeofCycling
MO / MembershipOrganisation
NSO / NationalSportsOrganisation
NZTA / NewZealandTransportAuthority
ODT / OrganisationDevelopmentTool
RST / RoadSafetyTrust

Executive Summary

  • BikeNZhasexistedfor10yearsasanNSOforallbikedisciplines.Ithasabroadmandatesupportingtheachievementofhighperformance,competitivecyclingandeverydaycyclingoutcomes.WhilethenumberofformalmembersissmallcomparedtootherNSOs,thenumberofunaffiliatedcyclistsinNewZealandisverylarge.Becauseofthislevelofinterestincycling,SportNZandothershaveconsistentlyviewedBikeNZashavingthepotentialtogrowandimpacthighperformanceresultsandlevelsofparticipationinameaningfulway.
  • However,todayBikeNZisincrisis:
  • Itwillbecomeinsolventearlynextyearwithnoreasonableexpectationoncurrentpolicyofbecomingfinanciallyviableintheforeseeablefuture.
  • Theorganisation’scapabilityisseverelydepleted
  • It’skeystakeholdershavelosttrustandconfidenceintheorganisation
  • Itisfacingimmediateoperationalchallenges
  • Therearethreeprincipalreasonsforthis:
  • thestrategyitpursuedwasveryambitiousbutpoorlyexecuted
  • theinstitutionalstructureblurredaccountabilities
  • therewasafailureofleadership
  • ThewaytofixBikeNZistotakethefollowingcriticalactions:
  • Adopttheapproachrecommendedandagreedin2008forBikeNZtowork withandthroughitsMOsandshareresponsibilitiesforcyclingdevelopment
  • Developastructurebasedon3profitcentres:
  • Highperformance
  • Cyclingdevelopment
  • EducationandAdvocacy
  • Addresstheseriousgovernanceproblems
  • Introducegreaterknowledgeandexpertiseintothegovernanceover-sightofhighperformanceandeducationandadvocacybyformingtwoBoardadvisorycommittees.
  • ChangethewaySportNZfundsBikeNZbymovingto a3yearbulk-fundedcontractwithbetterperformancespecification,reportingandcontractmanagementpractices.
  • ThoughtwasgiventonarrowingdownBikeNZ’sfocustojusthighperformanceandcompetitivecyclingsoastoimproveitsclarityofpurpose.However,thiswasrejectedonthegroundsthatthenarrowermandatewouldmeanalikelysignificantdropindevelopmentsupportforcycling,theincreasinginterestinfundingwiderBike NZactivitiesfromnewgovernmentandcommercialfundingsources,andthecausesoftheBikeNZcrisiscanbefixedlargelybyaddressingotherorganisationalfailings.
  • BikeNZ willrequiresignificantsupportfromSportNZtomakethenecessarychanges.

Astructuredimplementationprocessisrecommended,withaseriesofsequentialsteps.TheoversightofthechangeprocessshouldbeoverseenbyaSteeringGroupchairedbytheChiefExecutiveofSportNZandincludetheChairofBikeNZ.Meanwhile,BikeNZshouldnotmakeanydecisionsthatconflictwithorcompromisethesuccessfulimplementationoftheReviewrecommendations.

  • Inaddition,BikeNZwillneedtransitionalfinancialsupportfrom SportNZtochangeitsbusinessmodelandcoststructuretoaddresstheprojected$350,000annualoperatingloss.

Introduction

1BikeNZisanimportantpartnerofSportNZandHighPerformanceSportNZ. Itcontributestoimportantnationaloutcomesthroughitssuccessinpinnacleevents,throughthesportingpathwaysitprovidesandthepotentialvalueitofferstoparticipationincommunitysportwithanestimated745,000recreationalriders.

2BikeNZiscurrentlyfacinganumberofchallenges,whichitisseekingtoaddresswithassistancefromSportNZ.

3MartinJenkinswasretainedbyaSteeringGroupcomprisingtheChairofBikeNZ,ChiefExecutiveandGeneralManagerSectorCapabilityofSportNZtoundertakeareviewofBikeNZtoestablish:

  • WhereBikeNZhascomefrom
  • WhereBikeNZisnowandwhatcontributedtoitscurrentposition
  • WhatasustainableBikeNZcouldlooklikeinthefuture
  • Whattheimpedimentsaretomovingfromcurrentstatetofuturestate,andtherecommendationstoaddressthem.

4AcopyofthefullTermsofReferenceisattachedasAppendix1.

5TheReviewhasinvolvedthefollowingsteps:

  • Areviewofrelevantdocuments
  • Interviewswithkeystakeholders
  • InvolvementwiththeSportNZfacilitatedOrganisationDevelopmentTool(ODT)exercise)
  • Developmentofdraftrecommendationsthat weretestedwiththeReviewSteeringGroupandtheBikeNZboard
  • ProvidingfinalrecommendationstotheSteeringGroup.

6Intheinterestsofprovidingtimelyadvicethatoffersapathforwards,adegreeofjudgementhasbeenexercisedinmaintainingahighlevelfocus.Inpracticethishasmeant:

  • Therecommendationsarefocusedonprovidingdirectiononthemorecontentiousissues
  • Placeswherefurtherworkisrequiredarehighlighted
  • SomeareasexplicitlyidentifiedintheTermsofReferencehavenotbeenaddresseddirectly,suchasHPandpotentialinternationalmodels
  • ThefindingsoftheODTarenotrepeatedinanydetailinthisreport,butshouldbereadasacompaniondocument.

7Finally,itshouldbenotedthattheBoardandmanagementofBikeNZhavebeenveryopenandfrankinsharinginformationandtheirviewsduringthisreview.Everybodyrecognisesthattheorganisationisincrisis.Notwithstandingtheuncertaintyandstressmanyareunder,thereisacollectivedesiretomoveforwardandfixBikeNZ.

The“Bike NZ Journey”

Formation

8BikeNZ wasestablishedon1July2003asanewumbrellaNationalSportsOrganisationforcyclingorganisationsBMXNZ,CyclingNZ,MountainBikeNZ,NZSchoolsCyclingAssociation,CyclingAdvocatesNetworkandBicycleIndustryAssociationofNZwiththevisionof“Anationembracingcycling”.

9BikeNZ’sMissionwasbroadlydefined:

“By2008,BikeNZwillbeworldleadinginourapproachtoallfacetsofdaytoday,recreationalandcompetitivecycling,measuredbyhaving:

  • Partnershipsandstrategiesachievingsustainablegrowth
  • Athletesconsistentlywiningmedalsattargetedworld-classevents
  • anextensiverangeofsaleableandmarketablepropertiesandservices
  • Themosteffectiveandsustainableinfrastructureandsystems”1

10Implementationwassupportedwithfinancialandin-kindsupportfromSPARC(laterSportNZ)aspartofits“RevitalisationSport”programmeaimedatbike,athleticsandswimming.Theseweretraditionalsportsthatatthetimewerestruggling financiallyandintermsofperformance,butenjoyedproudtraditionsofsuccessandparticipation,andwereimportantinthedevelopmentoffundamentalskills.

2008 Review

11InOctober2007theBoardof BikeNZdecidedtoreviewitsbusinessmodeltodeterminewhetherchangestothegovernancestructureandsystemswouldresultinmoreeffectivedeliveryofitsStrategicPlan.

12TheReview,completedin2008,identifiedconcernsaboutalackofclarityofscope/purpose,astructurethatwasn’tsupportingthescope/purpose,andtheneedforperformanceimprovement.Itconcludedthattherewere“...numerousactivitiesthatexisting(MemberOrganisations)MOsundertakeindependentofandnotnecessary forBikeNZtocontrol...(and)...therewasnogainforBikeNZfromdissolvingexisting

MOsandformingaunitaryorganisationforcycling.”2

1BikeNZStrategic Plan2003/04–2007/08

2Organisational Structureand Capability Review – Bike NZ,June 2008,page 20.

13Thereviewrecommended,interalia,that:

a.Thescope/purposeshouldbebroadincorporating“...allexistingandpotentialcyclistsinNZincludinghighperformance,competitiveandeverydaycyclists”.

b.BikeNZwillnotcontrolallcycling,andthatitwillfillgapsand/orworkwithpartners:

High Performance

CentrallyledCompetitive

Centrallyfacilitated pathways MO implementation

Everydaycycling Partnershipwith numerous organisationsforfunding and delivery

  • AnewclassofBikeNZmembershipforindividuals
  • GreaterclarityaroundrightsandobligationsofMOs
  • TheintroductionofaformalServiceLevelAgreementbetweenBikeNZandMOs
  • AcoordinatedprocessforplanningbetweenBikeNZanditsMOs
  • Changestoaskills-basedBoardratherthanaBoardrepresentativeoftheMOs.

2011 StrategicPlan

14Anewstrategicplanwasdevelopedin2011basedonthebroadvisionof“anationembracingcycling”3.Theplancateredtoallcyclists:

a.RideEveryDay

b.Recreate

c.Compete

d.Excel

3“Let’s Talk –Our BikePlan”,BikeNZ,September 2011

15Anditsetstretchtargetsfordeliveryfrom20,000kidsperannuminLearntoRideto310trainedcoachesand250registeredofficials.

16Theplansoughttoachievegrowththroughattractingnewmembers.ThegrowthinmembershipwouldleadtogrowthinBikeNZ’srevenuebasedirectlyandassistittodevelopnewcommercialincomestreams.InthiswayBikeNZhopedtoestablishafinanciallysustainablebusinessmodelsupportingactivityatmuchhigherlevelsthanhadbeenpossiblepreviously.

17However,thebusinessmodeldependedupondevelopingamoredirectrelationshipwithcyclists.Toachievethis,BikeNZarguedtheneedtoreviewitsmembershipmodel(“oneofthemostcomplicatedwithinNewZealand’ssportingsector”).

RecentEvents

18BikeNZnowfaceschallengesasaresultofrecentevents:

a.Attheendof2011,Rabobank,BikeNZ’smajorsponsoradvisedBikeNZthatitwouldnotrenewits$XXXXXperannumsponsorship.Asat30August2013noreplacementsponsorhadbeenfound.

b.FollowingtheOlympicGamesin2012amisunderstandingbetweenBikeNZandHighPerformanceSportNZledtoanoverspendof$250,000onthehighperformanceprogramme.HPSNZhassubsequently“loaned”thissumtoBikeNZ,withrepaymentstobemadefromfuturehighperformancefunding.

c.TheneedtofundthecostofmovingtheBikeNZorganisationto Cambridgetooperateoutofthenew“Home ofCycling”.

d.DelaysindevelopingandrollingoutthenewITplatform.Thishasdelayeddeliveryofservices,distractedmanagementandcreatesriskaroundcollectingmembersubscriptions.

e.ChiefExecutiveKieranTurnerresignedinMay2013.AreplacementhasnotbeenrecruiteduntildecisionsaremadeonthefutureofBikeNZ.

Expenditure

19BikeNZexpendituresince2003hasincreased850%from$1.015Mto$9.6Min20124.

$12,000,000

$10,000,000

$8,000,000

$6,000,000

$4,000,000

ExpenditureSalaries

$2,000,000

$-

2004 2005 2006 2007 2008 2009 2010 2011 2012

Funding

20By201275%ofBikeNZ’s$9.6MannualincomeisprovidedbySportNZ5.Theremaining25%($2.4M)ofincomeismadeupfromgaming,commercialandothergrants.Membershipsubscriptionsgeneratearound$200,000perannum.

$8,000,000.00

$7,000,000.00

$6,000,000.00

$5,000,000.00

$4,000,000.00

$3,000,000.00

$2,000,000.00

$1,000,000.00

$-

2004 2005 2006 2007 2008 2009 2010 2011 2012

SportNZMembershipCommercialGamingOther

4Source:Sport NZFinancialAnalysisofBike NZAnnualReports, 2013

5Ibid

21SportNZfundingsince2003hasmostlybeendirectedtohighperformance.However,since2010SportNZhasalsoinvestedincreasinglyinnon-HPprogrammes.6

$8,000,000

$7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

SportNZTotalTotalHP

$2,000,000

$1,000,000

$-

2004 2005 2006 2007 2008 2009 2010 2011 2012

Performance 2003– 2012

HP Performance

22BikeNZ’sHPgoalasoriginallystatedwasfor“athletesconsistentlywinningmedalsattargetedworldclassevents”.Measuredbytop3andtop8finishesinWorldChampionshipsandOlympicGamessince2003,BikeNZhasperformedcredibly7.

30

25

20

Top8

15

Top3

10OGMedals

5

0

2004200520062007200820092010201120122013

6Ibid.Note, breakdown offunding isbased ontotalSNZfundingwithallocationbetween activitiesbased on reported HPexpenditure and HPgrantsexpenditure,so graph reflects differences between SNZfundingcashflowsand Bike NZexpenditure cashflowsbetween differentyears.

7BikeNZdata

23LookingmorenarrowlyatOlympicGames,theconversionofWorldChampionshipresultsintoOlympicsuccesslooksmoremodestonthefaceofit.

Non-HP Performance

24However,BikeNZ’snon-HPperformanceismoredifficulttomeasureobjectivelyandalsodifficulttointerpret.Theorganisationseekstoachieveoutcomesdirectlyformembers(suchasmembershipservicesandthesupportfordevelopmentpathways)aswellasseekingtoachievemoreindirectbenefitsbyinfluencingthebikingenvironmentthrougheducationandadvocacy.

25MembershipincomecouldbeconsideredasaproxyforthevalueofservicesdeliveredbyBikeNZtothoseinvolvedinthesport.(ItisaparticularlyimportantmeasurebecauseitinvolvesjudgementsbyindividualsaboutthevalueofBikeNZ’sactivitiestothem.)

26Totalmembershipincomeshowsaslowincreaseover theperiodto2010buthasdeclinedquitequicklysincethen8.

$300,000

$250,000

$200,000

$150,000

$100,000

Subscription$

$50,000

$-

2004 2005 2006 2007 2008 2009 2010 2011 2012

8Source:Sport NZFinancialAnalysisofBike NZAnnualReports, 2013

27AshiftinBikeNZstrategyaround2008isapparentwhenonelooksatthecompositionofthemembershipnumbersmoreclosely.9

35,000

30,000

25,000

20,000

15,000

10,000

PaidMembersRidestrong+Progs

5,000

-

200420052006200720082009201020112012

28In2008,BikeNZintroducedtheRidestrongprogramme,whereparticipantswereregisteredasmembersbutwerenotlevied.Otherprogrammesbasedonthismodelweresubsequentlyintroduced.Fundingfortheseprogrammeshasbeendrawnfromsponsorship(Rabobank),othercharitablefundersandsomeuser-pays($38,000in2012).Meanwhile,totalmembershipincomehasdropped,ashavepayingmembernumbers.

29DataondeliveryofBikeNZPathwayEducationsince201010shows:

2010 / 2011 / 2012 / 2013(6mths)
BikeNZcourseparticipants / 239 / 5030 / 6515 / 784
Instructorstrained / 4 / 181 / 170 / 85
Level1coachestrained / 16 / 48 / 144 / 32
ClubdevelopmentMeetings/forums / 72 / 255 / 102

9Note:themembershipanalysisis based on incomplete data takenformannualreports.Somesimplifying assumptionshave been usedto provide a complete picture.

10BikeNZanalysis,July 2013

30Inthetimeavailable,ithasnotbeenpossibletogointonon-HPperformancemoredeeplyandtoassesstheimpactthatBikeNZhasachieved.However,somehighlevelqualitativeobservationscanbemade:

a.Interventionlogicandmeasurementfornon-HPactivitiesisnotclear,andperformancehasnotbeensystematicallymeasuredandevaluatedovertime.Totheextentthatithas,thedataisnotreadilyaccessible.

b.Atthesametime,accordingtotheActiveNZsurvey(2008),745,000NewZealandershadparticipatedincyclingovera12monthperiod,whileBikeNZestimatesthat120,000NewZealandersridecompetitively/regularlyasasport.ItisnotclearwhatpositiveimpactatanaggregatelevelBikeNZhashadonthesegroupsifany.

Themes to Emerge

31AnumberofthemesemergefromexaminingthehistoryofBikeNZoverthelastdecade:

a.AconsistentvisionforBikeNZhasbeensupportedoverthelast10years(throughthreestrategicreviews)basedonthreeroles:

  • Highperformance
  • Cyclingdevelopment
  • Recreationalbiking

But,combiningthethreedifferingrolesinasingleorganisationhasledtoongoingdebateabout whetherBikeNZ’spurposeistoovague.

b.TheongoingconfusionsurroundingtheroleandrelationshipwithMOs:aretheyunnecessary(movetoaunitarystructure),oraretheyanimportantnetworkinfrastructurethatneedstobeleveraged(thefederationstructure).

c.IncreasinginvestmentinBikeNZfromSportNZ,particularlyinHP,withsomelimitedgrowthinotherincomesources.

d.ThedeliveryofresultsinHP,butlessapparentimpactinothernon-HPareas.

e.Thechangeinmembershipcompositionfrom2008andthesubsequentreductioninmembershipincome.

f.Ahighlevelofinterestinbiking,suggestingmembershiprecruitmentandcommercialopportunities

g.Limitedsuccessingeneratingnewmembershipandcommercialincome.

WhereBike is Now

Financial

32BikeNZ’sfinancesaremanagedintwoaccounts:oneforHPfundingandspendandtheotheraccountcalledCyclingDevelopmentisforeverythingelse.

33Forthecurrentfinancialyear(ending31December 2013),BikeNZisforecastingaconsolidatedoperatinglossof$306,960onanaccountingbasis.11ThelossisentirelyattributabletoCyclingDevelopment,whichdoesnotgeneratesufficientincometocoveritscosts.

34BikeNZisprojectingacashbalanceat31December2013of$673,333mcomprising

$444,756inCyclingDevelopmentand$228,577inHP.

35Forecastsfor2014and2015oncurrentassumptionsprojectlossesofaround

$350,000perannum.12

Capability

36AnODTreviewwasundertakenbySarahBeamanandBrendanO’ConnorforSportNZinJuly201313.ThisfollowedapreviousODTreviewin2010.

37Thereviewshowsasignificantdeclineincapabilityoverthethreeyearperiod sincethelastreview,whiletheabsolutescoresshowanorganisationatthe“Initiating”levelwheretheorganisationis“...meetinglessthanhalftheexpectations...”ofit.

11FinancialReporttoBikeNZBoard (to 31July 2013),Stephen Connell,5August 2013

12FinancialSummaryOverview,13 June 2013,Stephen Connell

13AssessmentOverviewforBikeNZ,25July 2013

12

10

8

6

42010

22013

Total0

KeyRelationships

38ThefollowingobservationsaboutBikeNZ’srelationshipswerederivedfromtheinterviewsundertakenforthisreview:

Stakeholder / Observations
MOs /
  • OngoingfailureofBikeNZtodeliverservicestoMOs,particularlyfollowingraisedexpectationswith2011StrategicPlan
  • LossoftrustandconfidenceinBikeNZ
  • In-wardmanagementfocus–notcustomer-centric
  • OnbalancesupportiveofBikeNZmodelsubjecttomakingchanges
  • Lookingatde-riskingrelationshipbyincreasingMOindependence

SportNZ /
  • LossoftrustandconfidenceinBikeNZ,butacceptsomeresponsibility
  • ConcernedaboutleadershipofBikeNZandclarityofpurpose
  • CommittedtoBikeNZasapartner
  • Seekingsustainablemodel
  • Seekingvalue-propositionforeducationandrecreationalroles,andwhethertheseshouldbepartiallyorfullyseparatedfromBikeNZ

Stakeholder / Observations
HPSNZ /
  • CommittedtoBikeHPsuccess
  • ConcernsoverleadershipofBikeHPatpresent
  • SeekinggreaterBoardownershipofHP
  • SeekinggreatercomfortovercurrentstateofBikeHP
  • Don’tbelievethetwoorganisationsworkinpartnership

Sponsors /
  • Seecommercialopportunities,particularlyinBikeNZlededucationandrecreationalactivities
  • Strongcommercialpropertiespotentiallybutnotcurrentlydevelopedsufficiently
  • ConcernedaboutBikeNZabilitytodeliverconsistently
  • Pastsponsorstakenforgrantedandnotlookedafter
  • Hasnotbeencustomer-centric

OperationalChallenges

39BikeNZfacesaseriesofoperationalchallengesrightnow:

Activity / Challenges
HP14 /
  • Futureofwomen’strackprogramme

Membership /
  • ITplatform
  • Collectionofmembershipsubscriptions

Events /
  • CloseoutBMXworldchamps

CDProgrammes /
  • Unabletodeliverexpectedtrainingprogrammes
  • Qualityconcernsaboutjuniordevelopmentprogramme

RSTContract /
  • Deliveryofcontractedactivities

MovetoCambridge /
  • Detailedlogisticalexercisetomanage
  • Changemanagementwithsignificantpeoplerisk

14 TheTermsofReference explicitlyinvitedthereviewto examine “...the challengesfacingBike’shighperformance programme”. However,themoreHPspecificaspects ofsuch areviewshould be treated assecond order to resolving issuesabouttheoverall role,direction andleadership ofBike NZ.

Conclusion

40BikeNZisincrisis:

a.Itwillbecomeinsolventearlynextyearwithnoreasonableexpectationoncurrentpolicyofbecomingfinanciallyviableintheforeseeablefuture.

b.Theorganisation’scapabilityisseverelydepleted

c.It’skeystakeholdershavelosttrustandconfidenceinBikeNZ

d.Itisfacingimmediateoperationalchallenges

What Contributed to theCurrent State?

41TherearethreeprincipalreasonsBikeNZisincrisis.First,thestrategyitpursuedwasveryambitiousandpoorlyexecuted;second,theinstitutionalstructureforBikeNZlackedclarity;andthird,therewasafailureof leadership.

Set ambitiousgoals

Raised expectations

Successrequired:

  • Culturechange oNewcapabilities oITinvestment
  • Significant funding

High risk

Sport NZ wasthe effective under- writer of thehigh riskstrategy

Accountabilitiesbetween SNZand Bike NZblurred

Commercial growth model in conflict

with traditional sport federation structure

Bike NZcompetingwith its“resellers”

StrategyStructure

Leadership

Governanceandmanagementroles blurred

Failed torecognisescaleof riskand manage it

Overlyoptimisticfor toolong

Culturenotcustomer-centricor member-centric

Failed todeliver against promises

SWOTAnalysis

Strengths
CorefundofgoodwilltowardsBikeNZmodel
HPresults
ProgrammesandIPdeveloped
LevelofinterestincyclingatalllevelsMOnetworksandvolunteercapacityEconomiesofscope / Weaknesses
Virtuallyinsolvent
GovernancemanagementrolesblurredLackofclarityinSportNZ(HPSNZ)
relationship
DependenceonSportNZ
LackoforganisationalcapabilityPartnerrelationshipsunderstrainRecenthistoryofdeliveryfailure
Opportunities
Rebuildleadershiprole
Setmodest,butrealisticexpectationsmatchedtoresourcesandcapability
RebalancerolewithMOsRefreshorganisationMovetoCambridge
Growingopportunityforeducation/advocacyactivities
Grownon-SportNZincome / Threats
UncertaintyoverBikeNZfutureFailtobedecisiveenoughPartnersturnawayfromBikeNZFurthernon-delivery
Publicreputationdamage
LackofadequatefundingtomakechangeLossofkeypeople

ARobustBike NZ Model

Roleand Purpose ofBike NZ

42AnalternativemodeltotheBikeNZoneistorevertto NSOfunctionscarriedoutbytheMOs,andchargeHPSNZwithresponsibilityforthehighperformancefunctions.

43Therationaleforretaininganumbrellaorganisationforallbikeactivitiesare:

a.Therearescaleadvantagesinasingleleadershiporganisation

b.Notwithstandingthecurrentcircumstances,BikeNZhascreatedprogrammes,servicesandareasofcapabilitythatwouldbeatrisk

c.TheMOsonbalancesupporttheBikeNZmodel

d.Therewouldbedirectandindirectcostsinmovingtoanewmodel.

44However,BikeNZhasabroadlydefinedroleandpurposes.Asummarytableofthepotentialrolesissetoutonthefollowingpage.

CommercialInConfidence
RangeofPotentialRolesforBikeNZ
Role / HP / Membership / Development / Events / Recreation / Education/Advocacy
Purpose / Dominate targeted events on theworld
stage / Attractand retain membersdirectly and through
MOs / Develop andsupport bikeathleteand participantpathways / Develop and support a calendar of successful competitive
bikeevents / Supportmore quality recreationalbiking / Improve the environmentfor biking
Who / Athletes Coaches Technicalstaff / 6,000members / 40 juniorathletes Officials Coaches / 120,000 Competitive riders / 745,000+ recreational riders / 745,000+ recreational riders
Decision-makers
What / HP
programmes Funding / Licensing Membership services / Training productsservices Information / Event services Funding / Recreationservices and products / Educational products andservices Information
How / Develop programmes HPSNZ
support HOC facility
Offshorebase / Regulate ITplatform / Set standards Regulate Develop programmes
Contract outdelivery / Set standards Raisefunds
Contract outdelivery / Securecommercial revenue
Develop productsand services
Contract outdelivery / Win publicsector contracts
Developprogrammes Contract outdelivery Develop industry input
to publicpolicy

21

45DeterminingthescopeofBikeNZ’sroleandpurposerequiresbalancingthefollowingconsiderations:

a.Alargerorganisationhaseconomiesofscalewhichcanreducetheaveragecostofdeliveringoutputs,andhencecanbemorecostefficient.However,diseconomiescanoccuriftheincentivestoperformontheorganisationareweak.

b.Alargerorganisationcanalsohaveeconomiesofscopeallowingittotakeadvantageofitsmoresignificantnetworks,resourcesandpipelineofopportunities.BikeNZhastheabilitytodevelopandleverageapotentiallysubstantialnetworkofinfluencethatiswideanddeepthroughoutNewZealand.

c.However,largerorganisationsarealsomorecomplex,whichcanleadtolossoffocus,morebureaucracyanddissipationofeffort.InthecaseofBikeNZ,thecultureofHPisverydifferenttothecultureof workingwithcouncilsandrecreationgroups.Ifnotmanagedcarefully,destructiveconflictcanarisedistractingeachfromitscorepurpose.

d.Designoftheorganisationcanhelptooptimisethetrade-offsbetweenthebenefitsofscaleandthecostsofgreatercomplexity.

Core RoleandPurposes

46BikeNZ’scoreroleandpurposeshouldbefocuseduponbeingfirstandforemostanorganisationaccountabletoitsmembersandoperatingasatraditionalNSO.ThiswouldinvolverolesinHP,MembershipServicesandDevelopment.AnyotheractivitiesBikeNZtakesonshouldbeassessedintermsofwhethertheycontributetotheperformanceofthesecoreroles.

47ThereisevidencethatBikeNZhasbeeneffectiveinsupportingandattractingfundingforevents.Thisisaroleveryclosetothecoredevelopmentfunction,andonthefaceofitshouldcontinue,providedtheroleisproperlydefinedandtherisksBikeNZseekstotakeonaretransparentandactivelymanaged.

Recreation,Educationand AdvocacyRoles

48ThemorechallengingBikeNZrolestoresolverelatetodealingwiththewidercommunitythroughRecreationandEducation/Advocacy.InthepastBikeNZanditspartnershaveidentifiedthe745,000recreationalridersandthe120,000competitiveridersassignificantmarketstosupportgrowth.Atthesametime,thereisdemandfromgovernment,localcouncilsandcommunitygroupsforanorganisationtoprovidenationalleadershipforrecreationalridersandtoplayaroleinhelpingtoshapepolicy.Increasinglypublicmoneyisavailableforthiswork,asevidencedbytheRSTcontractwithNZTA.

49ItistemptingtoconcludethatBikeNZshouldabandonaroleinRecreationandEducation/Advocacysoastogiveitgreaterclarityofpurpose.However,onbalanceabroadercommunity-focussedBikeNZroleissupportedtoincludeRecreationalandEducation/Advocacygoalsbecause:

a.Thegovernment(beyondSportNZ)andcommercialsponsorsareincreasinglywillingtopayforservicestargetedtowardstherecreationalcyclist

b.BikeNZisalogicalagenttoprovidetheseserviceswithitsbrand,nationalreachandcurrentrelationshipwithNZTA

c.WithouttheseincomestreamsBikeNZwillstruggletofunditscurrentcoredevelopmentactivities

50But,thebroaderBikeNZrolecanonlybesupportedif:

a.Thedistinctfocus,capabilitiesandculturesrequiredtodeliverfordifferentBikeNZrolesarerecognisedandaddressedstructurally

b.TheBoardgovernancecapabilityisaddressed,includingbringinginspecificadvisoryexpertisetoassisttheBoardonHPandonEducation/Advocacy

c.ThereisfinancialtransparencyandseparationbetweenHP,CDandCommunity.

CommercialInConfidence
Bike NZ Role andPurpose Options
StatusQuo / ReverttoMOs / TraditionalNSO / TraditionalNSO+Events / Broad(2008Definition)
Beneficiaries / Eliteathletesand support, Members, Competitive riders, Everydayriders / Eliteathletesand support and Members / Eliteathletesand supportand Members / Eliteathletesand support, Membersand Competitive riders / Eliteathletesand support, Members, Competitive riders, Everydayriders
Functions / HP, Membership, Development, Events, Recreational, Education/Advocacy / HP, Membership, Development / HP, Membership, Development / HP, Membership, Development, Events / HP, Membership, Development, Events, Recreational, Education/Advocacy
Non-HPCost15 / $2M / $0.7M / $0.7M / $1M / $1.7M
Non-HPFunding / $1.7M / $0.7M / $0.7M / $1M / $1.7M
Comment / Not sustainable / Not favoured bymost MOs / Verylimited developmentactivity possible / Verylimited development activity possible / Requiresshiftingmore development responsibilitiesto MOs.

15 Financialassumptions basedon Bike NZSummaryOverviewJune 13 2013 prepared byStephen Connell.The numbersshould betreated asindicative.

24

Governance andManagement

51Failureofgovernanceandmanagementhasbeenidentifiedaskeyreasons BikeNZfindsitselfincrisistoday.

Board

52TheBoardadoptedastrategythatwashighrisk,itfailedtoensuretheorganisationalcapabilityexistedtoimplementthestrategy,anditfailedtomonitortheimplementationeffectivelyandtakeremedialactioninatimelymannerwhenitbecameapparenttheorganisationwasfacingfinancialdifficulties.

53Asaresult,todaykeystakeholdershavelosttrustandconfidenceinBikeNZ.ThestatementsBikeNZmakesaboutwhatitintendstodoarediscounted.TheBoardiscurrentlylackingtheauthoritytolead.

54ThefailurearosebecausetheBoardfailedtooperateseparatelyfrommanagementandholdmanagementtoaccount.Anumberofpracticescreatedthissituation:

a.ThequalityofinformationbeingreportedtotheBoardwaspoor(unreliableperformanceinformation)

b.Thedecision-makingprocesseswereinadequate(lackofbusinesscases,Boardresolutionsanddecisionsnotclearlydocumented,unclearwhichdecisionswerefortheBoardandwhichformanagement)

c.TheBoarddidnotbelieveitneededtoprovidegovernanceoversightofHighPerformance

d.TheChairmanandCEOoperatedtogethertooclosely(compromisedthegovernancerelationship,side-linedotherBoardmembers).

55Toaddresstheseproblemsitisrecommendedthat:

a.AreviewoftheBoardisundertakentoestablishclarityonthegovernancerole,andthepolicies,proceduresandprocessestoenablethegovernanceroletobecarriedouteffectively

b.Governanceover-sightoftheHighPerformanceProgrammeistheresponsibilityoftheBoard

c.Theroleofchairmanisclearlydefinedasnon-executive

d.AfacilitatedBoardworkshopisheldtoensureBoardmembersallagreeandunderstandtheroleoftheBikeNZBoardandhowitwilloperate

e.ManagementreportingtotheBoardisreviewedtoensurethescopeandqualityofinformationprovidedtotheBoardisofastandardthattheBoardcanmeetitsresponsibilities

56Inaddition,giventhebreadthoftheproposedpurposesofBikeNZ,itisalsorecommendedthat:

a.ThedesiredmixofskillsontheBoardbereviewedtoensure thereisthecapabilitytoprovideoversightofthefullrangeofBikeNZactivities(HP,BikeDevelopment,Community)aswellasthecorporatefunctionsoffinance,marketing,legal,andHR

b.NewappointmentstotheBoardare madewithregardtothepreferredskillmix

c.ConsiderationbegiventousingadvisorycommitteesforspecialistareassuchasHPandEducationandAdvocacytoensuretheBoardisreceivingalternativestreamsofexpertadvice.

57FinallywithrespecttotheBoard,giventhelossoftrustandconfidenceinBikeNZ,theBoardneedstoconsiderwhatactionsitwilltaketore-establishitsleadershipauthorityamongstitskeystakeholders.Ingeneraltermsthiswillinvolveacknowledgingresponsibilityforpastfailure,takingdecisiveactiontoaddresstheproblems,andcommunicatingthisactivelyandconstructivelytokeystakeholders.

CEO

58AppointingthechiefexecutiveisthemostimportantroleforanyBoard.Inthecurrentcircumstancesthisrepresentsasignificant opportunitytorepositionandrefreshBikeNZ.TheappointmentoftheCEOisdependentupontheroleandpurposeBikeNZsettlesupon.TheadviceisthatBikeNZundertakeabroaderrole.However,ifthedecisionisforBikeNZtofocusonlyonHP,MembershipServicesandDevelopment,thenitislikelytheseniorexecutiveroleismorelikelytobemuchmorenarrowlyfocussedandpossiblyattheGeneralManagerlevel.

59Keyleadershipattributes16thechiefexecutivewillrequiretotaketheorganisationforwardincludetheabilityto:

a.InspireasharedvisionforBikeNZanditskeystakeholdersaroundthebroadpurposedescribedabove

b.ChallengethemanagersofHP,CDandEducationandAdvocacytosetandachieverealistictargets,whileworkingwithinanumbrellaorganisation

16 Drawson theleadershipmodeldeveloped byKouzesandPosner

c.Enableotherstoactthrougheffectivelysharingdecision-makingrightsandinformation,andinparticularenabletheBoardtoliftitsightstooperateasagovernanceboard

d.ModelthebehavioursrequiredinBikeNZ,particularlydoingwhatispromisedandbuildingacommitmenttoaction.

60Ontopoftheleadershipattributes,thechiefexecutivewillrequiresoundgeneralmanagementskills,commercialnousandexperienceandtheabilitytoworkwithvolunteerorganisations.

61Finally,theappointmentiscrucialinthechangemanagementprocess.Thenewchiefexecutiveneedstoowndecisionsaboutthe organisationandnegotiatewiththeBoardovertheresourcesrequiredtodeliverthestrategy.

Management

62Thecurrentorganisationaldesigncontainsanumberofweaknesses:

a.Theallocationoftasksacrossthemanagementteamisnotcoherent

b.Thedistributedmanagementstructureexacerbatescommunicationandcoordinationproblems

c.Over-sightofHPisinadequate.

63Indesigningtheorganisationitisrecommendedthat:

a.Threeprofitcentresarecreated:

i.HP

ii.CyclingDevelopment(combinesMembershipServices,Development,Events,Recreation)

iii.EducationandAdvocacy

b.AChiefExecutive’sOfficeiscreatedwithresponsibilityforfunding,finance,administration,communicationsandmarketing,supportingthechiefexecutivetomaintainoversightofalloftheorganisation’sactivities

c.Allstaffarerelocatedtoasingleoffice(inCambridge).

64Thesedesignfeatureswillhelptoensureeachbusinessareadevelopstherightfocus,capabilityandculture,whileoperatingwithintheparameters,andreceivingthebenefits,ofanumbrellaorganisation.

Organisation DevelopmentToolResponse

65TheODTreviewprovidesacomprehensiveanalysisofBikeNZ’scapabilityasat25July2013.ThenewchiefexecutiveandtheBoardwillneedtoconsidertheODT

findingsandtaketheseintoaccountindesigningtheneworganisationbasedinCambridge.

66ItisrecommendedthatBikeNZdevelopacapabilitydevelopmentplan thatrespondstotheODTreviewoncethenewchiefexecutiveisinplace.

PartnerRelationships

67BikeNZishighlydependentonkeypartners(MOs,SportNZ,HPSNZ,CharitableFunders,Sponsors,andServiceProviders).Itgeneratesalmostnoincomedirectly,andthisisunlikelytochangeintheneartomediumterm.Thepreviousstrategyofseekingtogrowsubscriptionandcommercialincomewasexecutedin amannerthathasdamagedmostofBikeNZ’skeyrelationshipswithoutachievingnewrevenue.Relationshipweretreatedas“second-order”.

68Adecisivechangeinphilosophyandapproachisrequired.BikeNZneedstoview(andbelieve)itspartnersareessentialtoitsbusinesssuccess.Withoutbuildinggoodwillandaligninginterestsandactivities,BikeNZwillnothavetheresourcestoachieveitspurposes.Accordingly,acollaborativemodelisrequiredwhere:

a.Partnersareformallyidentifiedandacknowledgedassuch

b.PartnersareInvolvedinplanningprocesses

c.Expectationsofpartiesareunderstoodandformallydocumented

d.Performanceisreviewedregularly

e.Eachpartnerrelationshipisactivelymanagedatalllevelsoftheorganisation.

69BikeNZ willneedtotakeactionthatunambiguouslydemonstratesitschangeinphilosophyandapproachasitseekstobuildtheconfidenceandtrustofitspartners.

Membership Organisations

70InparticulartheroleandrelationshipbetweenBikeNZandtheMOsneedstobeclarified.It wouldbeusefultorevisittheworkdonein200817onthestructureofBikeNZanditsmembershipforguidance.ThisenvisagedamoreactiveroleforMOs.

71Furtherworkonrationalisingthemembershipstructuresandtheconstitutionislikelytobedesirabletoaddress“...oneofthemostcomplicated(membershipstructures)withinNewZealand’ssportingsector”.However,thisworkshouldonlyproceedwhen

17 Design ElementsforEnhancedBikeNZ Structure and ModusOperandi2008,3December 2008

BikeNZhasdevelopedaconsensusamongstitsmembershiponthebestcourseofaction.

SportNZ

72TherelationshipbetweenBikeNZandSportNZneedstobemoretightlydefinedandmanaged.Itisoftennotclearwhereaccountabilityrestsatpresentfordecision-making.SportNZ isthemostsignificantfunderofBikeNZandfacesanumberofexposures.Thisleadstoarangeofrelationships,interactionsandinterventionsthatinpracticebluraccountabilitiesandresponsibilitiesbetweentheorganisations.

73Furthermore,BikeNZappearsundulydependentonSportNZ,andasaresultdoesnotactivelyassertitssovereigntyoveritssport.Instead,BikeNZtendstopassivelyacceptSportNZ“advice”initsday-to-dayoperations,butthenblameSportNZintheeventproblemsoccur.ThewaytherelationshipworksatpresentincentivisesopportunisticbehaviourbyBikeNZthatisnotinthelongterm interestsofeitherparty.ThereisevidencetosuggestthatBikeNZoperatebelievingthattheorganisation’sresidualriskiscarriedbySportNZ,andthatintheeventoffailureSportNZwillstepintofixtheproblem.

74ToimprovetherelationshipitisrecommendedSportNZ:

a.clarifyitsprimerolewithBikeNZasfunder(serviceproviderandadvisorrolesaresecondary)

b.Movetoamulti-yearbulk-fundedcontractwithappropriateKPIsandcredibleincentives,andmoveawayfromprojectfunding

c.Introducegreaterdisciplineinmanagingitscontractrelationship(avoidblurringaccountabilityandpromotingdependence)

d.Consideramoreeffectivemonitoringregime.

75ItisrecommendedBikeNZ:

a.DeveloparobustbusinessplanwitheffectiveKPIssupportedbySportNZ

b.EnsureitsfundingrightsandobligationswithSportNZaredocumented,particularlywheretheymaychangefromtimetotime

c.Takeresponsibilityforitsbusinessdecisionsandperformance

d.BuildalternativesourcesofincometoreducedependenceonSportNZ.

HPSNZ

76AgaphasopenupbetweenBikeNZandHPSNZ,wherethetwoorganisationsare“notonthesamepage”.Tensionshavearisenoverfunding,strategyandplanning.

HPSNZdoesnotconsideritfullyunderstandstheriskstotheBikeNZmedaltargetinRio,whileBikeNZisfrustratedaboutfundinguncertainties.

77ThedifferenceshaveoccurredprimarilybecausetheBikeNZBoardandpreviousChiefExecutive hadnotbeensufficientlyengagedonHP,and didnotprovidethelevelofgovernanceover-sightrequired.MuchstrongergovernanceunderstandingandownershipofHPisrequired.

78TheBoardofBikeNZneedstoassumeaccountabilityfortheHPprogramme.Itisrecommendthat:

a.ABoardcommitteebeestablishedforHPandthattheCommitteebesupplementedwithanoutsidepersonwithrecognisedHPexpertise

b.TheBoard(throughtheCommittee)work withtheBikeNZHPDirectorandwithHPSNZtodevelopasharedviewonthecurrentdirectionandexecutionoftheHPprogramme

Funding and FinancialManagement

79AcriticalchallengeforBikeNZistomanagerevenueriskwhileseekingtolivewithinitsmeans.TodothisitisrecommendedthatBikeNZ:

a.EstablishHP,CDandEducationandAdvocacyasprofitcentres

b.DevelopHPandEducationandAdvocacybudgetsagainstcontractedincomeforthoseservices.

c.BudgetHPandEducationandAdvocacymanagementfeestotheCDprofitcentre,whichcarriescorporateandgovernancecostsandcarriestheresidualrisk.

d.SeekacommitmenttoathreeyearbulkfundingarrangementfromSportNZcomprisingthreecomponents:

i.Ongoingcapabilityfunding(assumedtobe$150,000perannum)

ii.Fundingforincreasingparticipationlevels(requiresabusinesscasetoSportNZ)

iii.TransitionfundingtocoverthecostofchangingtheBikeNZ’sbusinessmodelandcoststructuretoaddresstheprojected$350,000annualoperatingloss(tobequantifiedandnegotiatedwithSportNZ)

80ThethreeyearCDrevenueforecastmightresemblethefollowingestimate:

RevenueSource18 / 2014 / 2015 / 2016
Membership / $ / 215,000 / $ / xxxxxxx / $ / xxxxxx
Gaming / $ / 500,000 / $ / xxxxxxx / $ / xxxxxxx
Commercial / $ / 150,000 / $ / xxxxxxx / $ / xxxxxxx
SportNZCapability / $ / 150,000 / $ / xxxxxxx / $ / xxxxxxx
SportNZParticipation / TBC / TBC / TBC
SportNZTransition / TBC / TBC / TBC
ManagementFee / $ / 250,000 / $ / xxxxxxx / $ / xxxxxxx
Total / $ / 1,265,000 / $ / xxxxxxxxx / $ / xxxxxxxx

81TherearefiverevenueareasthatneedattentiontosupportCDactivity:

a.Aplantomaximisemembershipincome(whichhasremainedrelativelystaticoverthelast10years)

b.Aplantomaximisecommercialincome.ThisinvolvesreviewingBikeNZ’scommercialproperties.

c.Aplantosustaingamingincome

d.NegotiatingathreeyearbulkfundingarrangementwithSportNZ

e.Riskmanagementthroughbuildingincostflexibilitytomeetbudgetedrevenueshortfallsand/orbuildingupfinancialreserves.

18 Assumptions:

Membership / 2013 base +10% growth each year
Gaming / Conservative viewbased on average of$600,000over last3 yearsand riskaround gaming sector
Commercial / Based onStephen ConnellassumptionsinSummaryOverviewpaper ofJune 2013
Managementfee / Currentbase +growth in contracted Education/Advocacy

ASix MonthPlan

82SportNZisproposingtounder-writeasixmonthplanforBikeNZ.Thefollowingsetsoutthekeyelementstherecoveryplanneedstoencompass.

KeyElements

StabilisetheOrganisationunderBusiness asUsual

83BikeNZissubjecttoanumberofrisks:

  • Staffuncertainty
  • Deliveryoftheoperatingplanfor2013
  • ImplementationoftheITplatform
  • MovingtheorganisationtoCambridge
  • Stakeholderdemands.

84AninterimchiefexecutiveisrequiredtoensureBikeNZmanagestheserisksuntilsuchtimeasapermanentchiefexecutiveisappointed.

Agree aSixMonth PlanwithSport NZ

85SportNZandBikeNZagreeasixmonthplanthatincludes:

  • One-offfundingtocovertransitiontoanewmodel
  • AnagreedroleforSportNZthroughthetransitiontoanewmodel
  • Aseriesofperformance-basedmilestones
  • Athree-yearbulkfundingarrangementforCD
  • Outcome-basedKPIs
  • Anongoingmonitoringprocess.
Recruita Chief Executive

86AppointmentofachiefexecutiveiscriticaltomakingthenecessarychangestoBikeNZ.Thispersonneedstoberecruitedurgentlytoprovideguidanceonthedesignandprocessofchange.

Address theGovernance Issues

87Thesetofrecommendationsonimprovinggovernanceshouldbeprogressedimmediately.

Develop aBusinessPlan for2014

88TheBusinessPlanfor2014needstoreflectthechangesproposedforBikeNZintermsofcontentandprocess.ItisrecommendedthatBikeNZembarkonthefollowingprocess:

  • Reviewthe2011StrategicPlanandsetsomehighlevelgoalsfor2014withSportNZ
  • UndertaketheworkdescribedaboveonCDincomeandriskmanagement
  • DevelopthreebusinessunitplansforHP,CDandCommunityandanoverallcorporatebusinessplanthattogetherseektodeliverthehighlevelgoalsfor2014
  • Runworkshopswithrelevantpartnersonthebusinessunitplansanddevelopagreementsonexpectations
  • DevelopSLAswithpartners
  • Signoffbusinessunitplan,corporatebusinessplanandSLAsby31December2013.

(Thistimetablemayneedtobeextendedinpractice)

Develop aNewOrganisation

89TheODTexercisehighlightedseriouscapabilitydeficiencies.ThechiefexecutivewiththeBoardwillneedtoputtogetheraplantoaddressthecapabilitygaps.

90Moresignificantly,onthefaceofit,thecurrentorganisationstructuredoesnotalignwellwiththeproposedbusinessstructure.Thenewchiefexecutivewillneedtoconsiderwhatcapabilitiesarerequiredandwhethertocreateanewmanagementstructure.

91ItmakessensetoconsiderthispotentialsetoforganisationalchangesonceBikeNZhasconsolidatedallitsoperationsinCambridgeunder“BusinessasUsual”assumptionsandoncethenewchiefexecutiveisinplace.

92ThisapproachassumesthatBikeNZhassufficientfinancialsupporttomanageanychangestostaffinglevelsarisingfromthe2014BusinessPlan.

Engage withPartners

93BikeNZneedstoengageitsstakeholdersactivelyinredefiningitspurposeandstrategy,andtorebuildtrustandconfidencethroughsettingandmeetingexpectations.Actionsrequiredinclude:

  • CommunicatingtheoutcomeofthereviewandthestepsBikeNZ willtake
  • ExplainingwhatBikeNZisseekingfrom itspartners inthefuture
  • Involvingpartnersintheplanningprocess
  • SigningSLAswithpartners
  • Puttinginplaceactiverelationshipmanagementprocessesandpolicies.

Financial

94Further work isrequiredbyBikeNZ withSportNZtodefinethefinancialtransition tothenewbusinessmodelandcoststructure.ThisinvolvesreducingBikeNZcosts17.5%oraround$350,000perannum fromthebeginningof2014whentheexistingorganisationrelocatestoCambridge.Theadditionalcostfortheperiodofadjustmenttoasustainablefinanciallevelwillneedtobefunded.

Recommendations

RoleandPurpose / 1.1 / ConfirmBikeNZ’sscope/purposeshouldbebroadincorporatingallexistingandpotentialcyclistsinNZincludinghighperformance,competitiveandeverydaycyclists(thedefinitionagreedin2008);
Strategy / 2.1
2.2
2.3
2.4 / AgreethatBikeNZadoptastrategythatisbasedonworkingwithandthroughitsMemberOrganisations;
AgreetodevelopitsstrategycollaborativelywithitspartnersincludingSportNZ,HPSNZanditsMemberOrganisations;
Agreetosettargetsbasedonarobustriskassessmentofkeyfactorsincludingrevenueandcapability.
Agreetodevelopamorerobustperformancemeasurementframework;
Structure / 3.1
3.2
3.3 / AgreethatBikeNZ’sstructurewillinclude3separateprofitcentres:
HighPerformance
CyclingDevelopment
EducationandAdvocacy
AgreetoestablishBoardadvisorycommitteesforhighperformanceandcommunitywithqualifiedoutsideexpertsappointedtothem;
Consideranorganisationstructurethatsupportsclarityofpurposeforthethreeprofitcentres,whileprovidingtheChiefExecutivewiththesupporttoprovideorganisation-wideover-sight.
Governance / 4.1
4.2
4.3
4.4
4.5 / AgreethattheroleofChairmanisclearlydefinedasnon-executive;
AgreetoundertakeareviewoftheBikeNZBoardgovernancepoliciesandprocesses;
AgreetoholdafacilitatedBoardworkshopfollowingtheBoardreviewtodevelopasharedunderstandingofhowtheBoardwilloperateinthefuture;
AgreetoreviewmanagementreportingtotheBoard;
AgreethatfurtherappointmentstotheBikeNZBoardwillbemadeonlywiththeagreementofSportNZ

4.6CommunicatetostakeholdershestepstheBoardistakingtoleadthechange;

Management5.1AgreetorecruitaChiefExecutivebasedonasearchbriefagreedbetweenBikeNZandSportNZdevelopedonceboththeBoardsofBikeNZandSportNZhaveformallyagreedtotherecommendationsinthisreport;

SportNZFunding

6.1

6.2

6.3

AgreethatHPfundingwillcontinuetobecontractedonthecurrentbasis,unlessBikeNZandSportNZagreetodootherwise;

AgreethatSportNZwillprovideBikeNZwithathreeyearbulkfundingagreementfornon-HPactivitiessubjecttoBikeNZmeetingagreedannualtargets;

Negotiatethequantumofnon-HPfundingbasedonthreecategories:

2.Capabilitydevelopment

3.Increasingparticipation

4.Transition

CommercialIncome

7.1

7.2

AgreetoundertakeanimmediatereviewofBikeNZ’scommercialpropertiesandopportunities;

AgreenottocommitBikeNZtoanynewcommercialarrangementsuntilthereviewhasbeencompleted;

CapabilityDevelopment

8.1

8.2

ConsiderandadopttheODTreview;

Agreetodevelopanorganisationdevelopmentplantoaddress theissuesraisedintheODTreviewonceChiefExecutivehasconsideredthefutureoftheorganisation;

HPProgramme9.1

9.2

DevelopaprogrammetobringtheBoardthroughtheHPCommitteeuptospeed withtheHPprogramme;

InviteHPSNZtowork withtheHPCommittee

Implementation10.1

10.2

10.3

AgreetothefollowingsequenceofstepstoimplementtheReviewdecisions:

Step0 / AppointatransitionmanagertodelivershorttermBusinessasUsualactivities.
Step1 / BikeNZandSportNZBoardsreceive,considerandagreeallReviewrecommendations.
Step2 / DevelopandagreeChiefExecutiveSearchbrief,searchprocessandfurtherBoardmemberappointments
Agreekeytermsof3year SportNZbulk-fundingarrangement
UndertakeareviewofBikeNZ’scommercialproperties
DeveloptermsofreferenceforBoardAdvisoryCommitteesandidentifypotentialexpertmembers
Develop2014businessplanningprocessandtimetableandkeyassumptions
Step3 / UndertakegovernancedevelopmentworkDevelop2014businessplan
AppointChiefExecutive,newBoardmembersandexpertBoardCommitteemembers
Step4 / ChiefExecutivereviewsorganisation

AgreethatBikeNZwillnotactindependentlyfromSportNZinimplementingtheReviewdecisions;

AgreetoretaintheBikeReviewSteeringCommitteecomprisingPeterMiskimmin(SportNZ,Chair),DaveAdams(SportNZ)andRichardLeggat(BikeNZ)toover-seeallimplementationactivity.