The National Football League Increased Revenue to $12 Billion - But you can learn from their mistakes

“The single greatest advantage any company can achieve is organizational health. Yet it is ignored by most leaders even though it is simple, free, and available to anyone who wants it”

– Patrick Lencioni - The Advantage.

On Monday, Mike Rosenberg announced on Twitter that there have been 260 NFL player arrests over the last five years – which averages to a tidy, if rather alarming, one arrest per week.

This Tuesday, the New York Jets announced that their quarterback, Geno Smith, will miss 6-10 weeks while recovering from a broken jaw suffered during a fight in the team locker room, apparently over a monetary dispute.

Yesterday, a federal judge met with representative of the NFL and its players union, the NFLPA in an attempt to reach a settlement that would head off a court case between the league and Tom Brady, one of its most popular players, over what ostensibly is nothing more than a minor rules violation.

That's quite a week so far. They say all publicity is good publicity. We're about to find out.

The NFL is big business. The league projects 2015 revenue to exceed $12 billion and it has no plans to slow down with Commissioner Roger Goodell seeking to grow to $25 billion by 2027. The NFL is the most popular sport in the U.S. No one would deny the NFL leadership are experts in strategy, marketing and finance. In his book, The Advantage, Patrick Lencioni describes these as characteristics of a smart organization. The NFL may be a smart organization, but that is not the same as being a healthy one.

Unhealthy organizations struggle with politics, dysfunction, confusion and bureaucracy. Anyone who has worked in an unhealthy organization understands this all too well.  Given the movies, television programs and comic strips devoted to the topic, we certainly enjoy poking fun at these organizations, but in the real world these problems have serious financial implications.

The amount of money that organizations spend dealing with these issues and the money they have to spend to recover from them is incredible. Sure the NFL has managed to increase revenue to $12 billion, but one thing is certain, the league owners aren’t likely to turn down the chance to make more money. But imagine the wasted time and resources that the NFL league offices and individual teams spent dealing with what amounts to a player arrest essentially every week for the last five years!

But it’s much easier for those owners to turn to metrics like television revenue, ticket prices, and other hard data when they seek to grow the business of football precisely because these things are easy to measure, while the impacts of a healthy organization are more difficult to quantify.

The NFL is a financial powerhouse, and despite its recent bad press, appears on track to continue revenue growth. It's unclear if the arrests and other missteps are affecting the growth of the sport, but recent numbers show a decline in youth participation in football. The NFL offices are full of smart people and they will continue to work on increasing revenue. But ery few companies, particularly those which operate on the national/global scale, lack the intelligence necessary to succeed, but many will not reach their full potential because they are unhealthy. Many others will eventually make decisions that doom them to failure. History is littered with companies that once dominated their industries. 

As Lencioni argues “…don’t underestimate the cost of allowing our organizations to remain unhealthy”. Creating a healthy organization provides an incredible competitive advantage and improved profits. It also has a tangible positive affect on the people who work there.