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Experts say that it is more critical than ever to see technology as a necessity, as opposed to an afterthought. Regardless of business size, investing in technology solutions and leadership must be a given.

Your Chief Technology Officer Is Key to Your Health Club's Business Strategy

As technology becomes increasingly ubiquitous, hiring an effective technology officer has become an essential step in executing a modern, member-centric business strategy in the health club industry.

Today, the role of technology in every type of business, but particularly customer-focused industries such as fitness facilities, has become essential to compete and even just function. Health clubs today use technology in basic operations, such as automated member check-in, online payment systems and mobile-friendly sites that enable members to easily view class schedules and other club information.

And just as technology has evolved, so has the role of the information and technology leaders who oversee its implementation in health clubs.

As technology has become even more ubiquitous over the years, the role of the chief technology officer (CTO) and chief information officer (CIO) has become less about developing a specific technology and more about executing a business strategy, according to Bryan O’Rourke, president of Fitness Industry Technology Council. Some club operators can't afford a CTO or CIO. The median annual income for CIOs in the United States. is $257,725, while the median annual income for CTOs in the country is $277,244, according to Salary.com. Those smaller operators may need to rely on software and equipment vendors to support the execution of their strategy. And club operators who have decided to adopt a low-tech operating model may only need a turnkey software system.

For clubs that are large and complex enough to warrant a CTO/CIO, O’Rourke said that those technology leaders playing two critical roles. The first is to gather information on members’ patterns and understand how to apply that data to improve the member experience. The second is to oversee the automation of operational processes to improve member interface, cut costs and add or increase revenue streams.

Adam Zeitsiff, CIO of Gold’s Gym International, Dallas, has been working with his team over the past year on a two-phase plan to enhance member experience. First, they set out to improve their technology infrastructure. Now, they are focusing on becoming disruptors.

“It's you either disrupt or you get disrupted,” Zeitsiff said. “And I preach that to my team every day. We've got to be the disruptors because the last company that came in with the disruptive technology in a brick and mortar business world was Netflix, and you saw what happened a few years later to Blockbuster.”

Noticeable differences have included an improvement in the clubs' wireless access and a revamp of the gym company’s mobile app to be more user-friendly, including the development of a separate mobile app to drive their studio business, he said. Members are able to easily view schedules, book classes, reserve bikes and update their membership packages.

“The member engagement and experience piece is just a tip of the iceberg for those couple of little things, but we just had to get back to some basics and solve for better there,” Zeitsiff said.

Other updates resulted in a reduction in expenses. By improving the network and replacing older, slower technology, club staff now work more efficiently, he said. As Zeitsiff noted, if you’re able to save five minutes per transaction when signing up a new member, you are improving that experience by five minutes. And when you are processing multiple new members each day, that can make a significant difference in a business’s bottom line.

However, as O’Rourke points out, the CTO/CIO can’t do this work in a vacuum.

“It’s really the purview of the organization because the lines between technology and everything else in clubs are blurred,” he said. “There’s nothing in the company that technology can’t touch, yet technology can’t be the driver.”

Before implementing new technology, consider whether that technology will improve your operational agility, make a positive impact on your staff, enhance the member experience or create new revenue streams. According to Zeitsiff, the technology should address at least two of these benefits before you proceed with implementation.

When club operators call O'Rourke to ask about how to incorporate wearable technology into their facility, he tells them that that is not the right question. Instead of simply jumping on the wearable technology bandwagon, O’Rourke encourages operators to spend time thinking about their business model, their customer profile and how they may not be meeting customers' needs or expectations.

“When you answer those questions, then you can maybe think about wearables,” O’Rourke said.

And businesses that are fortunate enough to have a CTO/CIO in place are increasingly looking to that individual to help steer those conversations, as the role of the CTO/CIO has shifted from simple technologist to business leader.

Adam Podber, senior director of technology at Blink Fitness, New York, has seen his role evolve over the past few years.

“Technologists today in the gym industry, you’re three-quarters marketing, one-quarter operations, and if you have any room for technology, that’s what’s left,” he said. “The technologist that just understands how the pipes work is no longer enough of a value to companies.”

Podber has seen the value of his role grow through the blockages he has been able to remove from transactions, particularly through the optimization of the online experience. Fewer sticking points mean less frustration and confusion for the customers when they visit the website, which in turn translates into higher member retention.

Today, Podber partners closely with the vice president of marketing on this and all other areas of the business. But this kind of strong partnership between technology and marketing didn’t exist years ago. As Podber recalled, the attitude was once, “What can IT do for me?” Now, businesses are seeing IT—and its leaders—as key contributors to business strategy and the overall customer experience. 

CTO/CIOs can—and should—play a critical role in understanding the customer.

“You need to understand those indicators that may lead an individual consumer to trend toward attrition or leaving,” said Al Noshirvani, chairman and chief strategy officer for club membership software company Motionsoft, Rockville, Maryland, which sponsors a Technology Summit each fall for CEOs, CTOs and CIOs in the fitness industry. “And without a good technology team to be able to analyze that data, it’s virtually impossible.”

As Noshirvani further points out, it’s a lot easier—and cheaper—to keep an existing member than to go out and find a new one.

Noshirvani sees the role of the CTO/CIO as being more critical than ever, so for any small-to-midsize clubs and chains that can’t afford a CTO/CIO, finding a consultant or vendor who can advise them on a technology strategy or fill in knowledge gaps is critical.

As Podber points out, having a dedicated technology team—even if only to offer the occasional consultation—can expand your thinking beyond the fitness industry. Many technology consultants and vendors have experience working in various industries and could offer some fresh perspectives that allow you to become a leader in your area. And cloud computing and apps now offer plenty of solutions that can offer real value without a full-time technology leader.

But the key takeaway is, it has become more critical than ever to see technology as a necessity, as opposed to an afterthought. Regardless of business size, investing in technology solutions and leadership must be a given.

“Technology is not just a tool that allows you to do basics in the business,” Zeitsiff said. “Technology really can be a driver of brand new revenue opportunities that you wouldn't have thought of.”

TAGS: Technology
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