Norman Girvan, Contributor
Cricket World Cup (CWC) 2007 is a salutary lesson to the Caribbean on dealing with globalisation. Hosting the tournament provided an excellent opportunity to showcase the region and develop non-traditional tourism markets. But, it is turning out to be a financial and public relations disaster.
The blame game is on and the International Cricket Council (ICC) is being made out to be the villain.
I do not agree. If there was a bad agreement with the ICC, it is we in the Caribbean who must take responsibility for having negotiated it. Cricket is a global business. The ICC controls one of its most valuable commodities in the form of Cricket World Cup. Like any corporation, CWC Inc. seeks to maximise the return on its assets. It cannot be blamed for 'imposing' an agreement that is not to our liking.
The negotiation is no different, in its essentials, from that made with any transnational corporation for an investment, or with a foreign country for a trade agreement. That is why I believe that the lessons of CWC 2007 go beyond the boundaries of cricket. Based on the press reports I have seen and on conversations with colleagues, there are several lessons that can be drawn, which have wider applicability.
Lesson 1: Negotiate, don't capitulate
It cannot be that we had no choice but to accept the terms and conditions of the 'Host Venue Agreement' presentedby the ICC - not unless an open-ended commitment had been given to the ICC beforehand. This would mean that any cost, no matter how high, was considered worth paying for the 'privilege' of hosting the event; which can hardly be right. You have to negotiate with a clear idea of the minimum terms that will meet the region's objectives and the level of risk that is acceptable for the financial and other commitments you are required to make. There is always the option of not signing if it is simply not worth it.
Were high ticket and product prices, and onerous security arrangements, really cast in stone? If they were, did it not occur to those responsible that these would affect attendance? And if some are now being relaxed, were they really necessary in the first place?
Lesson 2: Evaluate costs, benefits and risks
The figure of 100,000 expected visitors and $500 million revenue came to be accepted as fact. On this basis, some $400 million was reportedly spent by regional governments. An elementary principle of investment decision-making is that the assumptions on which financial projections are made are identified; and that risk, uncertainty and sensitivity analysis is undertaken. Natural disasters, crime, terrorism - and team under-performance - are facts of life. At least one financial expert I know questioned what would happen if one or more of the major teams were knocked out of the competition at an early stage, but his concerns were dismissed.
One also needs to factor in indirect costs, such as security, supplementary infrastructure, and the rumoured fleet of luxury cars that each LOC was said to be required to purchase. The biggest cost of all might have been the failure to do adequate research to prepare for negotiations on tapping the potential of the event. For instance, the South Africans are reported to have done a much better job on negotiating ticket prices for CWC 2003.
Lesson 3: take care of your core product
In this case, the West Indian cricket team. There are widespread reports of the players' lack of discipline, commitment, professionalism and regional team spirit. There were rumours of a possible strike of players in the first round and a public row between the captain and one of the selectors in the second. Relations between West Indies Players Association and West Indies Cricket Board are rocky. This is simply unacceptable. Has there been too much emphasis on product marketing, and too little on product quality. Perhaps a full-blown Commission of Enquiry into the state of WI cricket is called for.
Lesson 4: respect the customer
The customer comes first, the first rule of any business, was largely forgotten in CWC 2007. The interests of cricket fans seem to have been sacrificed to the demands of overseas security agencies (the FBI and CIA were said to have been heavily involved) and to short-term profit-making.
Information to the public on entry conditions and parking/transport arrangements came almost as an afterthought. Lack of local enthusiasm inevitably diminished the degree of foreign enjoyment. People come to the Caribbean for a Caribbean experience; and TV viewers hardly enjoy watching matches played in half-empty stadia.
Lesson 5: maintain a united regional front
The argument that too many national jurisdictions were involved in the negotiations won't wash. The umbrella agreement was negotiated by regional entities and the Heads of Government were party to the arrangements. Problems that subsequently arose should have been dealt with at the regional level, with the West Indies speaking with one voice. In dealing with powerful international organisations, regional unity is vital, and disunity is fatal.
Lesson 6: consider all your options
Examine what other means exist to achieve your objectives and compare these to the project being considered. There are many in the tourism business who believe that the way to get people to come here on a sustained basis is by means of creating a secure, safe, efficient and friendly environment. In the absence of this, mega-events only have one-off effects. So the money might be better spent o that entail lower risks and greater certainty of long-lasting returns.
CWC 2007 is symptomatic of the way in which we deal with globalisation. We can genuflect before foreign offers or we can be critical, and bargain purposively and as a single unit to get what is in our own interest. Will the lessons be learnt?
