The influence of public funding on the strategies and performance of non-profit basketball clubs from South-Eastern Europe

Abstract

The purpose of this study is to examine how private funding affects non-profit sport clubs in terms of their strategic decisions and organisational performance. Data for the study were collected from a survey of 73 basketball clubs’ managers from four South-east European countries. Explorative factor analysis and structural equation modelling were employed. The results show that stronger influence of public institutions, reflected in a higher proportion of clubs’ funding from public resources, affects clubs’ strategies so that clubs with a greater percentage of public funds: (1) emphasise risk reduction more than fast results; (2) emphasise local community aims more than top sport results; and (3) emphasise organisational growth more than cost reduction. The study empirically verified the thesis that clubs with a larger proportion of public funds are less successful in terms of sport and financial results, which is partially a consequence of their different strategic focus. The study offers a better understanding of the relationships among the structure of clubs’ funding and its direct (clubs’ strategic conduct) and indirect (clubs’ performance) consequences.