Blog Entry Our Choice #4: The Financial aspects of Keeping a Head Coach and Restructuring Contracts

In my last blog entry I talked about the financial ramifications of firing a head coach before his contract is up. For this entry, I will discuss the impact of retaining a head coach and the financials that go into restructuring a coach’s contract. This only seems fitting after what Louisville fans had to endure with the Charlie String saga. Obviously, Strong did not stay at Louisville because of the money; he stayed because he has integrity and is loyal, which is a trait that often is overlooked nowadays in college sports. It was reported that the University of Tennessee offered Strong a lucrative contract believed to be around the $3.5 million range, which would have made him the tenth highest paid football coach in college football (McMurphy, 2012). Strong declined that offer and is now reportedly expected to sign a contract extension with the University of Louisville reportedly to be an eight year extension that will keep him here until the year 2020. One of the aspects that some people may forget or overlook with his contract is that he receives a large amount of money in achievement bonuses. These primarily include winning the big east conference, going to a BCS bowl, ranking in the AP top 25, and gaining coaching awards. What really stood out to me about this situation is that a coach has finally decided that having morals and immense gratitude towards their athletic director are more important than jumping to  another job that may appear on the surface to be the next “big thing”. Far too many coaches get greedy and decide to take the job that offers the bigger paycheck without really considering any of the consequences it may have or the fact that it may tarnish their reputation. One of the points that some people were bringing up was that generally when a coach is coming off a good year and has other suitors, they can gain more leverage and use that to force the schools to either pay them enormous amounts or they will walk away from their current job and go to the school that throws them the most money (Fowler, 2012). It is so hard to predict and pinpoint whether or not the coach will continue to have sustained success at a high level. Sometimes athletic directors act too swiftly and offer their coaches long term extensions and the coaches end up doing poorly. One of the crucial things to remember is that the more years that are added to the contract extension, the more money that is owed in the buyout in case they are fired. Many head coaches do not even get to coach up until the courtesy three years that is usually the time that most universities give head coaches to turn the program around. If they do not show significant progress or demonstrate that the program is headed in the right direction than they can be terminated early. For many programs, it is better to have a head coach that is highly pursued or desired than be stuck with a coach who is unsuccessful and needs to be essentially paid to leave.    

 Fowler,
J. (2012, November 27). Seeking stability, contract extensions for coaches
can be expensive error
. Retrieved from http://www.cbssports.com/collegefootball/story/21159156/seeking-stability-contract-extensions-for-coaches-can-be-expensive-error/rss

McMurphy, B. (2012, December 6). Charlie strong gets new deal. Retrieved from http://espn.go.com/college-football/story/_/id/8719806/charlie-strong-staying-coach-louisville-cardinals

 

 

 

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