Sports Business

Q&A: Former Steelcase CEO and Michigan AD Jim Hackett

October 2, 2015
| By Pat Evans |
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Jim Hackett Harbaugh
Jim Hackett, right, chats with Michigan head football coach Jim Harbaugh. Courtesy University of Michigan

The University of Michigan Athletic Department is nearing a year with former Steelcase CEO (and Wolverine football player) Jim Hackett at the helm.

Hackett has helped turn the football program around with the hiring of head coach Jim Harbaugh, and he continues to grow other sports even as he helped land the richest apparel deal in college athletics — $169 million over 10 years with Nike.

He’s using some skills he learned while leading Steelcase, but he’s also learning plenty of new things. Business Journal staff reporter Pat Evans conducted, edited and condensed the interview with Michigan’s athletic director.

Q: What was the process that led to you becoming University of Michigan athletic director?

A: Well, I was just finishing up recovering from a hip replacement, and I had planned that right in the summer after I was finishing up as vice chairman at Steelcase.

I’m a really busy guy. I never sit down. The surgery just made me stop; I felt what it was like to not be busy. And so if you just imagine that as the background, I got a call because (new University of Michigan president, Mark Schlissel) was searching for input into what was happening down here.

Originally, he was just seeking input and a recommendation to work with the existing athletic director and help him adjust. He’s a really capable guy, Dave Brandon. He’s a capable business executive.

A few weeks later, he called back and said, “(Brandon) resigned, and I need a short-term solution.” I gave him a couple of names and he said, “Well, I’d rather have you think about it.”

And I was like, “Wow, I haven’t been busy the last six weeks because I’m rehabbing a surgery, and I need to talk to my wife.”

That led me to a friend of mine, a headhunter, and I asked him, “When people get this kind of surprise request for something, how should one process it?”

He was being metaphorical and said there are assignments you take for the service of others. I’d been working for others in my CEO role — I had a mindset like that — but this put on hold all my own desires, and I wanted to go help out. That was the logic.

Q: Are you still technically interim and what does the future hold?

A: I am still interim. The reason for that is, in the beginning we weren’t sure how long my term needed to be. There were a number of issues that were sitting on the president’s desk and — I know this sounds like a head fake, but it’s the truth — rather than say, “Here’s a stopwatch and here’s how long you’re here,” he handed me a number of the issues and said, “Can you help me with these?”

I constructed a reality with my wife and myself that I won’t worry about the interim title or any of this. Just go to work. I’m still busy.

Q: It seemed like the athletic department was slipping a bit before you took over. What was the internal buzz when you arrived?

A: Well, they had had a tremendous amount of success. They had a lot of things to be proud of. They had raised a tremendous amount of money for the future. They had designed a new sports complex, one of the best in the world for what we call the Olympic sports — the smaller revenue sports, but popular sports.

In a way, the speed at which the (change) happened was probably surprising to all of them. … In the flash of the moment, it had kind of blinded all of them. They were stunned. It reminded me of another situation I’ve been in when we embarked on coming out of a bad recession at Steelcase.

Q: The most public project of your tenure, it seems, is the hiring of Jim Harbaugh. How did that unfold? Was he the only choice going into it?

A: He’s like catching lightning in a bottle. He’s already well-documented as a very successful coach and person. I don’t want to take a lot of credit for him. The transaction of finding a football coach and the transaction of finding Jim Harbaugh are different because of his talent.

The business side of me helped me prioritize. The football program in Michigan’s pool of sports is by far the largest revenue producer and drives the whole motion of the place. We need to be winning here. We needed to go to something that was proven.

The program is so strong that we didn’t have to try to make a romantic scenario of finding a coach hidden somewhere in a small college that wanted to coach at Michigan and could come here and find success. That was a narrative I wanted to move away from, and back toward “let’s look out there and see who’s already mastered the sport and wants to be here.”

Yes, he played here. But he didn’t own the job just because he’s been here. It was because of how he coached wherever he went.

Q: Are you surprised at how quickly the program has improved?

A: I’m not surprised. We’re not where we’re going to be. I’m really happy with the developments. I was telling the press last spring that I could walk into a facility and meet the assistant coaches, see the players, talk to the head coach, and all phases of the business are in light of what (Harbaugh) knows matters to winning.

I could see that, like I could at Steelcase. Before the board knew we were going to be doing well, I could see facets of us doing well. If we were an investment, I would have invested last spring and not be surprised the stock is up today, and know that the stock is not near where the real value is going to be.

Q: The Nike deal was a major project. What’s left to accomplish?

A: The Nike thing was already going to be on the athletic director’s desk. What I was proud of was I introduced a new way for a team of people in the athletic department to unpack the problem to figure out what we wanted to do. It was not about the largest check. We wanted to be more compelling to the providers, and I think we were able to accomplish that.

There are a number of regulatory projects that take time and thought, and I’m in the middle of that right now.

We’ve also begun to use design thinking inside the athletic department. Those techniques matter here. The mechanics to experiencing a big venue like this is a very big design challenge, so we’re starting to use techniques that I learned and honed in my old career. It’s hard to see it right away, but I’m excited about getting to that.

Q: What have you learned running one of the most prestigious athletic departments in the country that you didn’t experience at a global firm?

A: I’ll use a Jim Harbaugh phrase: It’s a white-hot media environment. Steelcase did not put me in that. I was in the press but not nearly as much as this job requires it.

I had a great teacher at Steelcase who said, “The whale who stops gets harpooned,” and it’s a great ethos about the nature of how you see yourself in public ways. I hopefully brought that here, but some of it you can’t avoid because you’re swimming in open waters and everyone is paying attention.

I’m learning how to handle that differently because of the challenges it offers.

It’s a media-enhanced enterprise. There’s a lot of television, print, videos that encompass all of the sports. All the sports are now in high-profile settings. I’m learning how to maximize the exposure without jumping the shark. That can happen in sports if we overdo it. There are really smart people I get to work with.

Q: Is there anything you learned at Steelcase that you can apply at this job?

A: I think lean systems thinking. Those things haven’t kicked in at universities with the same intensity. We’re exporting some of that thinking.

In the back of the mind, I ask myself: If the athletic industry that I’m leading were a global company, what aspects of our fitness here need to step up their game to be competitive?

We had to think like that in the Ford boardroom or the Steelcase boardroom. We constantly had to think about competing globally. That’s been helpful to me here. It makes you pay attention to things that maybe you wouldn’t.

Q: How has football changed compared to when you played?

A: Well, it’s documented in the physiology of the players: They’re faster, taller and heavier. It’s hard to imagine people that size being that athletic. It’s changed so much.

The game has spread the field — a lot more throwing than I’m used to.

We were proud of the visibility of the program from a distance, but I had no idea how intensely scrutinized the program is now. That wasn’t the case when I was here.

Q: How much did you follow U-M athletics while in day-to-day operations at Steelcase?

A: The challenge was because I was so busy around the world. I never gave up on my season tickets, and there were a few years where I maybe only made one game.

I didn’t have an appreciation for the adjacent sports, which have really taken off: our swimming and diving team, women’s tennis, women’s softball, hockey. I knew some of these had great coaches, but I had lost track at a distance.

I’m really proud I get to see how pervasive that culture is, and I credit Dave Brandon and Bill Martin for making sure the other sports were really sound.

Q: What is the relationship between the school and the athletic department?

A: The history of the school is approaching its 200th birthday, and athletics is celebrating its 150th this year, and the origination of baseball here in 1865 was our first sport.

The history is intertwined. Appropriate attention at institutions like Michigan or Duke is you don’t want the athletic department to cast a shadow on the academic achievements of the school. The core belief here is the great education is what will secure you for life.

Athletics can be important for everyone while they’re here and for a few that get to continue. But all that continue will have to rely on other skills to take care of themselves.

Having an academically forward-leaning school is really an advantage.

Q: Do you wear khakis more often now?

A: I told the president, if it wasn’t offensive to him, I really wanted to dress like I was in the sports business. I wear tennis shoes more often. I wear jeans almost every day. Athletics is youthful and informal, and I wanted to be able to embody that, so I’m really happy with the dress code.

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