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Cost of AD Search

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April 4th, 2010 at 10:42 AM
#1
formerlyanonymous
formerlyanonymous's picture
Joined: 06/30/2008
MGoPoints: 38897
Cost of AD Search

Ann Arbor.com's David Birkett FOIA'd the cost of the search for the new Athletic Director. While I jokingly accuse him asking who the other candidates were in an effort to poll each of them on whether or not they would have fired Rich Rod already, it's got some pretty interesting content to it.

According to records obtained from the university, Michigan paid Spencer Stuart $75,000 in retainer fees, a $25,000 incentive bonus and $23,545 in expenses. The bonus was payable at Michigan president Mary Sue Coleman’s discretion.

Expenses included $7,621 for a “candidate background check,” $2,779 for an unspecified number of “candidate hotel rooms” last Dec. 5, and $2,319 for a “banquet” the same day at a Hyatt Regency hotel.

[...]

The total cost for the search was $124,159.

Interesting other stuff peppered in otherwise. He did ask for the other names involved in the search, but due to the search being performed by the consulting group, that information wasn't available through FOIA.

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April 4th, 2010 at 10:57 AM
#2
bronxblue
Joined: 11/22/2008
MGoPoints: 59158
Personally, I'm fine with the

Personally, I'm fine with the money they spent on the AD search. I know $125,000 sounds like a great deal to most people, but this is a high-profile position that needed a fair bit of vetting. I understand that Brandon had the inside track, but UM had to put some effort into the search to make sure all the backgrounds worked out and that he looked like the best fit. I just finished the book Game Change about the 2008 presidential run (I know, I am getting close to politics here), and one thing that stood out was the relative paucity of research done on Sarah Palin before she was selected as VP. I'm not saying she was a good or bad choice, but there were skeletons in her closet that did not surface until she was already on the campaign trail, causing quite a bit of consternation and damage control by McCain's team.

The AD position at UM is a high-profile spot, and the last thing the University needed was a story to pop up or some skeleton to emerge after the hiring was completed. I really like the selection of Brandon, and even if it was a foregone conclusion to some, I'm still fine with the amount of money spent to make sure it was the right fit.

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April 4th, 2010 at 11:02 AM
(Reply to #2) #3
formerlyanonymous
formerlyanonymous's picture
Joined: 06/30/2008
MGoPoints: 38897
Yeah, I can't fault anyone

Yeah, I can't fault anyone for the cost either. It seems fair as it's someone we'll be paying somewhere around $700-800k per year for the next couple years. When adding in the extra security by making candidates and process outside the reach of FOIA, which I think is okay in this situation, it seems worth it.

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April 4th, 2010 at 11:05 AM
(Reply to #2) #4
Blue_Bull_Run
Blue_Bull_Run's picture
Joined: 11/25/2008
MGoPoints: 1336
Pretty cheap if you ask me

$125k is nothing when you consider the importance of the position being filled. If this had been a CEO search, it probably would have run quite a bit higher.

Given the amount and quality of work required by the search firm, I think this is a good price to pay.

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April 4th, 2010 at 12:49 PM
(Reply to #6) #5
Jedelman11
Jedelman11's picture
Joined: 12/15/2008
MGoPoints: 952
Night Game

It apparently took a new AD to push through the night game, and I guarantee the University's athletic fund makes it all back plus some when Michigan plays ND under the lights.

count me among those who believe the cost is totally justified...

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April 4th, 2010 at 2:32 PM
(Reply to #14) #6
Blue_Bull_Run
Blue_Bull_Run's picture
Joined: 11/25/2008
MGoPoints: 1336
Yup

Put it this way ... I don't think the search firm is raking in the big dough (unless it's just a one man operation run from someone's basement).

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April 4th, 2010 at 11:02 AM
#7
OMG Shirtless
OMG Shirtless's picture
Joined: 08/16/2009
MGoPoints: 1739
I like that Tater has already commented there.

I like that Tater has already commented on the article. For as bat shit crazy as I think he is, he is diligent in his search for the latest Michigan info and is always willing to put his point of view out there.

(It's Easter, I can at least be nice for a few hours.)

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April 4th, 2010 at 11:22 AM
(Reply to #3) #8
Ernis
Ernis's picture
Joined: 09/23/2008
MGoPoints: 2554
Tater quote

Since he is neglecting his fellow MGoBoarders while frolicking at AA.com, I'll provide this lovely quote of his from that article:

"For those of you who are green with envy and white with mortification, which are usually the two covert motives of those who troll UM articles, just take a deep breath and hope that your favorite school can do it right someday."

I lol'd

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April 4th, 2010 at 11:03 AM
#9
PackardChug
Joined: 02/08/2010
MGoPoints: 85
That's Cheap

Considering how much money the AD deals with on a yearly basis, I'm too lazy to look it up but:
-Ticket Sales
-Luxury Box Sales
-Coaches Salaries
-Booster donations
-Construction/renovation
-BRAND MARKETING AND LICENSES

It looks like the operating budget, via google, is 45 million.

That's an immensely cheap cost for finding a new AD

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April 4th, 2010 at 11:39 AM
#10
Tater
Tater's picture
Joined: 08/13/2008
MGoPoints: 30564
Bat shit crazy?

Gee, I thought I had actually toned that comment down a little bit. I guess I'll go hang upside down in my cave for awhile.

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April 4th, 2010 at 11:42 AM
#11
The Big House
Joined: 04/04/2010
MGoPoints: 0
It's not really my place to

It's not really my place to say whether or not the cost was justified. A donor footed the bill for this, and they can do whatever they please with their money.

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April 4th, 2010 at 11:58 AM
(Reply to #9) #12
formerlyanonymous
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Joined: 06/30/2008
MGoPoints: 38897
That's a great point.

That's a great point.

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April 4th, 2010 at 11:43 AM
#13
HermosaBlue
HermosaBlue's picture
Joined: 08/05/2008
MGoPoints: 5001
If you amortize the search

If you amortize the search costs over the life of Brandon's contract (5 years, before extensions), it's $25k/year.

As PackardChug noted, the operating budget is $45mm per year (though I thought it was more). $25k / $45mm is less than 0.1%.

It was an incredibly cheap search process.

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April 4th, 2010 at 12:31 PM
#14
VAWolverine
Joined: 11/06/2008
MGoPoints: 3665
It's OK...

we will get it back in free pizza.

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April 4th, 2010 at 1:05 PM
#15
BlueinOK
BlueinOK's picture
Joined: 12/06/2009
MGoPoints: 14207
The cost was covered by a

The cost was covered by a donor so the total price should not be a big deal. The Athletic Department isn't covering the bill.

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April 4th, 2010 at 1:51 PM
#16
UMICH1606
Joined: 02/21/2010
MGoPoints: 3157
I don't get why Dave Birkett

I don't get why Dave Birkett would care enough how much they spent for the AD search to go through all the trouble for a story. What exactly was he expecting to uncover? This urge to investigate anything the University's Athletic Department ever does is getting a touch old.

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April 4th, 2010 at 1:54 PM
#17
MaizeAndBlueWahoo
MaizeAndBlueWahoo's picture
Joined: 07/02/2008
MGoPoints: 32944
In other words, you could ask

In other words, you could ask everyone in attendance at a single home game for a $1 donation and just about cover it. Sounds cheap to me.

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April 4th, 2010 at 2:15 PM
#18
wile_e8
wile_e8's picture
Joined: 06/30/2008
MGoPoints: 6033
We're supposed to be upset

We're supposed to be upset that they spent $125k on a guy who will be overseeing an athletic department that generates close to $100M in revenue every year (probably more than that once the luxury boxes are finished)? Hiring the wrong guy could cost the AD way more than $125k. I'm actually surprised they didn't spend more, since we only have to look back to the guy before Martin to see how bad things can get with the wrong guy in charge.

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April 4th, 2010 at 3:29 PM
#19
M-Wolverine
M-Wolverine's picture
Joined: 10/04/2009
MGoPoints: 42199
Yeah, a non-starter if you ask me

The article, not the post. When I read the headline, I was guessing a lot more. Having a pretty sure candidate in mind probably made the "Search" pretty non-existant, and made it mostly "vetting" (want to make sure there are no photos of Brandon clubbing baby bunnies online or anything). And that had to be pretty cheap too, because he's be so involved in politics, his closet has pretty well been dug through.

Sometimes I cringe at what my money is going for at the University, but I would say we got a bargain deal on this one.

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April 4th, 2010 at 4:02 PM
#20
colin
colin's picture
Joined: 07/01/2008
MGoPoints: 1467
The AD is responsible for

~$10 million in profit PER YEAR. So you tell me whether or not that was a valuable investment.

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April 4th, 2010 at 4:15 PM
#21
bouje
bouje's picture
Joined: 09/30/2008
MGoPoints: 4703
What I think ia funny is that the general public

Has no idea how much the university spends in recruiting for sports and for academics...

125k is a drop in the bucket and birkett needs to get a life he's a piece of shit.

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April 4th, 2010 at 4:30 PM
(Reply to #23) #22
Muttley
Muttley's picture
Joined: 07/07/2009
MGoPoints: -74931
$125k probably looks rather large to someone making $12.5k

;)

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April 4th, 2010 at 5:10 PM
#23
OHbornUMfan
OHbornUMfan's picture
Joined: 01/22/2010
MGoPoints: 2183
About right.

As others have said, this seems like a reasonable amount. I'd be curious what other schools spend. I'm guessing 125K might even be toward the low end of the spectrum, especially if there is a situation in which the search becomes protracted.

There are certain things you should definitely buy by the price tag. I'm pretty sure ADs aren't on that list.

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April 4th, 2010 at 6:39 PM
#24
mgovictors23
mgovictors23's picture
Joined: 05/03/2009
MGoPoints: 99
Cost of AD

It's a pretty big job so I have no problem with how much money we spent.

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April 4th, 2010 at 7:16 PM
#25
MGoBlue95
Joined: 11/27/2008
MGoPoints: 165
As an executive recruiter...

That is a pretty minor fee for a major search. I work at a comparable search firm and $75k is usually considered a minimum fee in the industry for any search, much less one of this magnitude. Even with the "bonus" paid, UM got a really good deal for the search. Of course, it's also fantastic publicity for Spencer Stuart...

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April 5th, 2010 at 12:09 PM
#26
jmblue
Joined: 11/07/2008
MGoPoints: 56299
That's a lot cheaper than I

That's a lot cheaper than I had assumed. And covered by a donor? Nice.

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