Q&A: Vancouver 2010 VP Dave Cobb

(ATR) The Number Two man in command for the Vancouver Olympics says on-time completion of venues has made the final year to the 2010 Games that much easier.

VANOC vice president Dave Cobb spoke with Around the Rings in February around the one-year-to-go mark for the Olympics, while a series of test events were under way in Vancouver and Whistler.

Cobb joined VANOC in July 2004 as senior vice president for revenue, marketing and communications. He is well known in Vancouver sports business, having served as CEO of Orca Bay Sports and Entertainment and as an executive with the Vancouver Canucks NHL team.

ATR: Are you at the stage you wanted to be with one year to go?

Dave Cobb: I think the big accomplishment we've made, and that's what most organizing cities hope to accomplish, was our venues, getting them done so early.

Being ready early also takes the risk away of not being done on time, to give you time to operate and to train and learn.

But it also takes away the financial risk of running late and running past your schedule deadlines. That has allowed the majority of our team's focus to be on actual preparing for the Games and not building stadiums.

ATR: What about the Olympic Village in Vancouver and the city’s efforts to secure financing to finish the project? What implications does this have for the village to be available for you, ready to use next year?

DC: Our sole concern, as an organizing committee, is that it's done on time for us. Our organizing committee is just renting them for the period of time for the Games.

If you go down there now, you'll see a lot of activity. You'll see all the buildings. Some of them are even being painted and appliances put in. So I think it is in quite an advanced stage with still a year to go.

I don't want to downplay the challenge to get it done, because we are looking at it very carefully, and obviously it has to be done to deliver the Games, but we think the risk is a manageable one to have the construction complete in time for the Games.

ATR: Are there any lessons to be taken away from the Olympic Village experience and your overall approach for preparation?

DC: When you look at the projects an organizing committee is responsible for, there's two things that we did that put us in the position we're in now.

One is that the financing was secured before the bid was even submitted and two was that we had very early completion dates and we stuck to them.

So we have a buffer zone, from the schedule standpoint, and we haven't needed it, which is fortunate. But it puts us in a great position to now get ready for the Games.

When we've talked to Sochi and others, it’s ‘get your time, build lots of room into your schedule and be built early.’ And the target, I believe for all competition venues for Olympic Games, should be at least one to two years complete before the Games. That allows a cushion for contingency if you need it. But just as importantly, it gives you that time to operate them.

ATR: Time is money, as the saying goes. Could you put a value on what you have there with that two-year lead time by having the venues done instead of having to worry and rush?

DC: It's really hard to put a dollar amount, but the biggest value is where it allows our senior management to focus their attention and time on.

It puts you in a much better position to execute the Games more efficiently.

ATR: Such as the downhill being cancelled for four days in a row?

DC: What are the implications on ticket holders, on your staff, on your workforce? You see the snow storm coming and you know it's going to dump a foot of snow in the city of Vancouver. What's the impact on the airport? What about our transportation? How [are] our workforce and volunteers going to get to the venues?

If our venues weren't done, if we hadn't raised the majority of our revenue already, if we hadn't advanced the planning as far as we had, we wouldn't have the opportunity to spend that type of time preparing for what might hit us during Games-time.

You know, we're ahead, but if there's time to rest or to relax a little bit, let's do it at the end when we know we're there yet. We're not there yet.

ATR: What about keeping projects within the scope you planned, avoiding cost overruns?

DC: We didn't allow that, and in fact we shrunk what we were doing. We took out a sledge hockey venue in Whistler in large part because we thought it would be a white elephant up there and we could do it down in University of British Columbia.

We ended up not converting General Motors Place from a North American size hockey rink, instead using a standard international size. We would have spent $10 million, and it never would have been used again.

So we looked at reducing scope, where we felt there was no legacy value to what was being spent.

ATR: What about your final stages of fundraising from sponsors, ticket sales?

DC: We were very fortunate to have our sponsorship program 98 percent done when the economy downturn hit. But we're not done yet.

We did go in and cut about $35 million out of our budget. And those are dollars that could go back in later on, if we find we're in good shape. But at this stage now, we're going to have to be very disciplined and very careful managing this budget to get through on a balanced operations budget.

We still have about $15 million in domestic sponsorship to raise. We still have tens of millions of dollars in royalties from our merchandise program, which translates into hundreds of millions of dollars in merchandise sales.

So we still do have revenue to generate, and when we were updating our budget, we were just about complete with the update in September, and we were comfortable with where we were at, then the economic downturn hit, and we hit on the brakes.

We said, ‘Hang on a second here. We probably can't expect to raise the type of revenue we thought we would.’

So we needed to cut costs to free up contingency in case we don't, because it's a privately funded budget. If we don't raise it, we don't spend it.

ATR: At one point, there might have been expectations of 10 or 11 TOP sponsors for Vancouver, but so far the IOC has only lined up nine. What does that mean for you and your revenue? Will you expect some help from the IOC to cover the gap?

DC: I can say it's a major concern of ours. We have planned a lot to have 11 top sponsors. We need to work through with the IOC to see what those, what that means from a financial standpoint and what the ramifications on our program could be.

But that's just one of those things that you have to deal with. I mean -- the world has changed. And I would expect that if the economic downturn hadn't hit, they probably would have signed those sponsors.

The IOC has been a very good partner of ours. I think one of the reasons we're as well prepared now as we are is because of the guidance we received from the IOC.

Everybody could always use more money, but the reality is that we have to live within a budget, and we'll live within the revenues we get.

ATR: The sponsors are finding it more difficult to activate with their marketing budgets being cut. How does this affect the image, the way the Games are promoted?

DC: We haven't seen that yet. In fact, if you put on your TV today in your hotel room, you won't be able to watch a show without seeing at least a couple of our sponsors running advertising campaigns. And CTV, our broadcasters, companies like RBC, Coke. They're out in a very big way right now. So we haven't seen that reduction.

We may see it, but at this stage, we're being told that the marketing budgets for the Olympic Games have been protected for the companies that we've talked to.

ATR: Are we expecting to see maybe fewer people at these Winter Olympics in the form of the corporate guests, the hospitality packages from the sponsors?

DC: I don't think so. In fact, I think it'll be significantly more than any previous Winter Games.

ATR: But if you're still having difficulty selling the VIP packages is that a barometer?

DC: That's a very, very tiny piece of the overall program and it's a local program. So when you're looking at visitors, we've got the ticket orders and hotel orders from our sponsors and are they smaller than what maybe they would have been? We haven't seen any evidence of that. We think that our sponsors have made significant investments in the Games, and what they do during Games times is a very important piece of that.

We still can't meet the demands of our sponsors for hotel rooms and tickets. We expect every ticket we make available will go. And you know, we have that level of confidence, because of what happened last fall with domestic ticket sales.

We had $350 million in [domestic ticket] orders in five weeks, after the economic downturn started, so there's no question Canadians want to come. National Olympic committees around the world, we've had some of them flying out here pleading with us to increase their allocations even though they got what they got in Salt Lake.

ATR: What’s your take on how the test events have gone? Some people have noted that the events are not the same caliber of organization that might be expected for the Olympics?

DC: I don't think you try to exactly replicate what the Olympic experience will be. It would be too expensive. One thing you just simply can't do is have that many events going on at one time.

But it gives us a good opportunity to learn the venue in particular, even though it may not look exactly the way it will next year.

We'll test different things at the different venues, but you won't see everything done at one venue. ... You try and simulate as best you can, but even though we had three events going on last weekend instead of 15, it still just gives you a great experience to start thinking about, okay, this is what we're doing now. What will that be like at Games time?

ATR: It seems like this is a city that should be able to handle the crowds and the extra traffic that would come as a result of the Games.

DC: We are by far the largest city to host Winter Games, and we do have very good transportation infrastructure, especially when you add in the rapid transit line to the airport which will be complete in time. But our city is very compact. We don't have big open spaces, big squares, big boulevards on our streets downtown.

So if you look at hotels and look at what's been done at previous Games, where you have dozens of motor coaches pulling up to a hotel and loading people in and out. Where are your loading zones outside of hotels? In many places, they simply don't exist. So that's where you really need to get in the details of planning when and how many of these buses are pulling up here. How are you going to get the athletes there? How do, where are the Olympic lanes going to go, because we are so compact?

ATR: You are also planning for the Paralympics. How do you make sure that goes along with the work that you're doing with the Olympics?

DC: Our structure doesn't allow us to not plan for that, because every one of our functions have the same responsibilities for the Paralympics Games. So we haven't created a separate department or a company to run the Paralympics.

... But you know, you have to be quite disciplined to make sure you do keep it front of mind, because it would be very easy to think 'okay, let's just work, focus on the Olympics, and we'll deal with the Paralympics later.' But the transition period between the Games is so short. You really can't do that.