The organization that I choose to evaluate is the South Carolina's Own Sports Bar in Columbia [not its real name], South Carolina. SouthCarolina's Own Sports Bar (SCOSB) is a bar/tavern that specializes in broadcasting several televised sporting events at a time. Many of these games cannot be seen on local television stations due to regional programming. SCOSB is equipped with thirteen televisions and six satellite dishes that provide the capability to show sixteen different sporting events at once. SCOSB sells several varieties of beer to its patrons, from the tap or in bottles, however the focus is on popular domestic beers. A pool table and some video games are an option to the patron, though the attraction of the bar is certainly the televised sporting events. SCOSB is also equipped equipped with a full-sized, operational basketball goal and dart boards. The walls are covered with various team pennants, banners and signs. Neon beer signs and even the hood of a race car also accentuates the bar giving it a distinctive, yet comfortable sports environment.

Because of their unlimited range of broadcast capabilities, SCOSB caters to fans of any team of any sport. Local fans come from miles to see their college's team play, whether they are home or away, locally broadcast or not. They also come to see all of their favorite professional teams play. Transplants into the area can see all of their team's hockey or basketball games that they used to see at home but could not see here because they are not locally broadcast. Since SCOSB can deliver every National Football League game, fanatics pay a cover charge to have access to all the games including their favorite team's game. They come to cheer for their team whether the game is on their television at home or not. Intra-team camaraderie is the established with the weekly association with fans of similar interests. SCOSB is the home for several local NFL fan clubs providing a steady, if not robust Sunday turnout. Complete coverage of special events such as the NCAA basketball tournament, the World Cup, Stanley Cup playoffs and NBA playoffs are also televised. Four people are required to operate the business on NFL Sundays. The owner keeps everything in order, from the bar to the satellite equipment, and maintains a social contact with his clientele. Two bartenders and a person to handle the cover charge at the door are also needed. SCOSB is a small organization that may not exhibit some characteristics of a "typical" organization but is a fine tool to use in order to understand and evaluate organizations.

FOUNDING

SCOSB's founding is an interesting story in an individual context, but is a normal and functional way to conceive an organization. Dan Gibson had just moved from Spartanburg, SC to Columbia because he was laid off from his old company. The company was private and the owners' sons were infiltrating the company, pushing Dan out of a job. Now unemployed, he was living off his wife's income. One Sunday in September 1989, Dan was walking up and down Assembly Street, Columbia's main street, looking for a place to watch the Los Angeles Raiders game. He went into every bar in the college town and could not find his favorite team on television. Only locally broadcast games were being shown by a few bars. Dan discovered there was not a satellite dish in the town. Armed with an idea and no job, Dan immediately began giving "serious thought" to opening some sort of sports bar.

Evolution 1, 2

The evolution of organizations results from the operation of four generic processes: variation, selection, retention and struggle. Variation is any kind of change, a source of variety for an organization or industry. Dan recognized that there was nowhere people could congregate to watch their team, whatever team it was, play on television. There were bars in Columbia, but there was not a sports bar. This was a unique concept that was not realized within the town or in surrounding areas. This idea of specializing to feature sporting events was the step of variation, or creating a niche. Step two of selection went by the wayside because the owner knew what sort of organization he wanted to create from the beginning. Selection involves the selective elimination of some variations. A good example of selection involves the John Morse case when he was uncertain in which industry he would enter. He narrowed down lists as part of the selection process. Dan combined variation and selection when he thought of creating a sports bar in Columbia.

Legitimacy

After discovering that there was not a satellite dish in the town, he set out to find out why. He thought there may have been a town ordinance prohibiting satellite dishes because of cosmetic reasons. He went to the town inspector and was told that there was not an ordinance and that it was okay to have satellite dishes. Dan told some of the local bar owners that he was contemplating opening a sports bar to show all sports, collegiate and professional. He was inherently requesting feedback from those involved in the local industry. One of the most common activities for business owners is seeking advice from experts in their industry. Everyone understood the concept of Dan's idea but most said that he would be on the wrong side of town and the only team that people wanted to see in Columbia was Carolina. One friend, to the contrary, believed it to be a good idea. Whatever people's opinions were of the idea, legitimacy would not be a problem to establishing the organization. Legitimacy refers to its public acceptance. There are three types: cognitive, normative and regulatory. Cognitive legitimacy refers to the spread of knowledge about a new venture. It answers the question "Do people understand the concept?" In Dan's case, those with whom he spoke understood exactly what he was talking about. A bar is a familiar institution. So is television. Combining a bar and a satellite dish in order to show sporting events is an easily understood concept. In some new ventures where there is no history of the activity, establishing a cognitive understanding is crucial step. Although no one in the area had ever seen a sport-specific pub, it was an idea that was easily comprehended. Normative legitimacy deals with conforming with cultural norms, and acceptance by society. It answers the question: "Are their actions appropriate and right?" This can be gauged by whether or not the new form is attacked by religious and civic leaders. Dan had no problem in obtaining this legitimacy. The most uncertain element in achieving normative legitimacy was the bar/alcohol serving function. Columbia was a college town already littered with bars, thus the precedent had already been set. Another tavern in the area would not offend anyone. The other element, broadcast of sporting events, is a wholesome practice that is in no way considered to be a societal dilemma. Regulatory Legitimacy refers to an organization's conformity to government rules and regulations. It deals with questions of legality regarding the operations of the organization. Dan's inquisition of the local ordinances dealing with the erection of satellite equipment answered one question of local regulatory legitimacy. He knew that the transmission of the networks' programming was legal because he had seen it done before (I will elaborate further on this point later). Also selling alcohol provided no regulatory roadblock, again because of precedents set by other bars and taverns. Dan's conceptual enterprise had achieved all three types of legitimacy before he even had a place to conduct business.

Nascent Entrepreneur

In his next step toward deciding whether or not to start his business, Dan performed some unorthodox market research. He sat in some local bars all day, drinking beer and doing crossword puzzles, and counted the number of kegs of beer that were delivered. He was amazed by the amount of beer that these local bars sold. This research sold Dan and he was now fully intent on implementing his business idea. His next step was to look for a location for the bar. Until now, Dan was just another part of the adult population who had only been giving "serious thought" to opening a sports bar (conception). Upon actively looking for a place of establishment, Dan became a 'nascent entrepreneur'(gestation). Someone is called a nascent entrepreneur if they not only say they are now giving "serious thought to the new business" but are also engaged in at least one of 17 possible entrepreneurial activities. Dan's first entrepreneurial activity was looking for a place of establishment.

Capitalization Requirements

From the onset, Dan wanted his establishment, or business location, on Assembly Street. This was the towns main street and the lifeblood of the community. He found that the 100 block, the most desirable location, was too expensive, costing roughly $25 a square foot. Dan found that just a few blocks west on Assembly Street the rents plummeted to a fifth of the 100 block's. He found a building that he thought would be suitable for his venture and contacted his banker from Spartanburg. Dan estimated that he needed roughly $40,000 to get the business off the ground. This is unlike most businesses because they usually require no more than $5,000 dollars to start. They start small because they use the limited resources that are readily available to them. Dan's case is a bit different because he not only needed a location for his business, but also had to invest in the hardware such as satellites, receivers and televisions that were a necessity for his business. It must also be noted that the 40,000 dollars is sort of an overstatement. It was line of credit available to Dan and not all of it was used immediately to make the business functional. Thus, although fairly high, the capitalization requirements were not too far from the ordinary. Unlike Dan, most owners do not borrow capital to start their businesses, either because they do not need it or they draw upon their own savings. Dan's requirements were too extensive to draw from his own savings. Recall, too, that he was unemployed. He received his loan from a commercial bank. This is the most common means of borrowing for owners who must borrow. Borrowing from other family members (about 6% of entrepreneurs) is second to obtaining loans from a commercial bank (about 14%).

Networks

When Dan needed a loan to get his business off of the ground, he went to his banker in Spartanburg. The banker had no problem giving Dan the credit line that he needed. Dan explained that if he had gone to a large commercial bank, he would have been laughed at and denied funding. He said that he would win the lottery before NationsBank would give him $40,000 to start yet another bar in Columbia. Because they were from a small town and had done business for years, Dan was able to get the financial support that he needed. The banker knew that Dan owned cars, a house and had good credit. A sort of mutual trust existed between the two, a tie if you will. Networks are patterned relationships between individuals, groups and organizations (Aldrich, Dubini 1991). Dan's relationship with his banker was a strong tie. The two had done business in the past and could count on each other. A trust within their working relationship had evolved over a long period of time.

Once his finances were in order, Dan signed a lease and his business was off the ground. His next step was to name and incorporate the business. Incorporation meant that he would pay more in taxes, but his personal assets were protected in case of business failure or debt. From that notable Sunday in September to the time that he incorporated, only three to four weeks had passed. This is an exceptionally short period of time when starting a legitimate business. Most businesses average about fifteen months from the time someone began to give "serious thought" to a business and the first activities taken toward constructing an organization. Dan's business took just one month to do this. On average, those nascent entrepreneur who succeed take a little less than a year to become a fledgling firm (infancy). Dan's sports bar took only two months to enter infancy.

Knowledge requirements

Once he incorporated Dan claimed he was in the dark when it came to operating a sports bar. After all, some research shows that owners tend to set up businesses in areas similar to those in which they previously worked. His last job was an office job that provided no value in setting up a sports bar. What he did not realize was that as far as knowledge was concerned he as bad off as he thought. Dan worked in the Navy's Satellite and Communications division for eleven years, so he had the technical background that he needed in order to install and maintain the intricate satellite/receiving system. This is the most technical aspect of the business and he was well prepared to handle it. The idea of a sports bar was certainly not Dan's own. The idea was crafted from the several sports bars that he had visited. He mentioned Legends Sports Bar in Chicago, his favorite one in particular. Most founders try to reproduce the forms most common in the populations they have encountered. The knowledge they require is widely available from these venues. Dan used Legends as a general model not to duplicate, but to mold his own business. He was familiar with the goings on of a sports bar through second-hand observation. These prior experiences with sports bars furnished him with the standard of comparison that he needed in order to shape his business.

Dan was the main contributor to the organization, but he was not alone. The idea was his, however the implementation of the business was more than an individual effort. Very few start-ups are solo endeavors. On average, 2.2 people are involved. Dan was supported by a friend who became his chief partner, and loyal investor. This friend provided physical labor as well as investment and financial services to the organization (he was an accountant by trade and as Dan explained to me, had always wanted to tell people that he owned a bar). The two tirelessly worked together, along with two part-time hires from the local college, to renovate the auto garage into a functional sports bar. Dan's wife was also an important contributor to the organization. She assisted with various operations once the bar opened. More importantly, however, she financially supported the family while Dan was unemployed and pursuing this venture. Thus, when evaluating it from a founding perspective, considering legitimacy, funding, capital requirements and the number of individuals involved, SCOSB falls in line with the average American business startup.

The four of them worked endlessly, often working sixteen hours a day and sometimes sleeping in the building, to open the business. Dan did not need to use any networks to obtain the resources that he needed for the bar. The profit producer, beer, was he easiest resource to find. Instead of actively pursuing beer distributors, they came to him. This is common practice when a bar is opened. Whatever else he needed, coolers, taps, furniture, Dan bought on the open market--usually through classified advertisements in the regional newspaper (South Carolina Times) or superstores (Lowes, Kmart). When the bar opened, the NFL season was over but college basketball was just starting. The first three weeks that the establishment was open, business was exceptional. This put any cognitive legitimacy concerns to rest.

TRANSFORMATION

Dan opened his business on December 19, 1989. SCOSB started out with six televisions, two satellite dishes and two receivers. They had the capability to show seven events at once. Dan brought in four pool tables in order to generate an immediate source of revenue. His market research indicated to him that there was only one pool table in the entire town. These tables added to his "sporty" niche. The two temporary workers were home for the semester, and Dan's main associate had assumed his primary duty of keeping the books while Dan ran the show. (Dan's partner is still a part-owner of about eight percent but is inactive in the organization's routine operations).

Evolution 3,4

Since late 1989, the functionality of the sports bar has remained constant. It still fulfills its initial purpose of televising sporting events and selling beer. In fact, SCOSB has been quite successful in performing its duty. This continuity exemplifies the third process of evolution, retention. Retention occurs in an organization when selected variations are preserved or reproduced so that the selected activities are repeated on future occasions. Retention is seen in SCOSB's preservation of activity. The fourth stage, struggle occurs in every business. A struggle over opportunities simply refers to the firm's drive to survive. The every day battle to compete and generate enough money to stay open. SCOSB is not unlike any other profit seeking enterprise in these two regards.

Intra-organizational Change

The focus of the organization has always been to pay off its debts first, and then to grow and expand. This is what Dan envisioned when he considered beginning his business. Only natural, evolutionary changes to the organizations resources have occurred as the organization has grown. In the seven years that it has been open and following this policy, SCOSB has more than doubled its broadcast capability, added ten televisions and tripled its number of satellite dishes. The pool tables that were employed to produce income became less important and eventually eliminated as crowds grew. They had been used for stools and took up too much floor space for the patrons convenience while generating minute revenues. Several new pennants and banners were brought in by fans intensifying the sports environment. More furniture was added as an expanding clientele demanded it. SCOSB still employs five people and does not intend to hire any more in the future. However, Dan is the only full time employee. This falls in line with most businesses because the majority of firms do not add employees.

Inter-organizational Change

Any radical change to the organization itself has yet to occur. This immutable state of organizational existence will more than likely occur in the near future. The sports bar is a successful enterprise and has been outright profitable for two years now. Dan has yet to lose the capitalist focus of his investment. His entrepreneurial alertness is evident. An opportunity from insight has arisen that could functionally alter the original concept. From the beginning, the temptation to sell food has enticed Dan from a financial standpoint but was never considered because of a limited knowledge about food service and an exorbitant addition to his administrative duties. He is now working to essentially merge with a food vendor that would ultimately make SCOSB: SCOSB &grill. Dan feels that this modification is not necessary but would be extremely beneficial to his business. Plans include equally dividing the overhead costs while each partner maintains independent operation of their contribution to the entire entity. They would, however, keep their specifically generated revenues, meaning that the bar retains all alcohol receipts and the grill retains all food receipts. Dan explains that rent is "cheap" in the first place and splitting the cost would nearly eliminate his primary monthly financial burden. He added that because the establishment would serve food, Dan could sell liquor that he could not sell before. He proclaimed that this would make his business more advantageous because his business could cater to an additional audience. Also, serving food would lengthen a patron's stay, and he would get greater returns on mixed drinks in comparison with beer.

THE FUTURE

Incentives

For almost eight years, SCOSB has been a very successful enterprise in relation to the original intentions of the bar. Dan Gibson is better off today then he was when he started the business. He is quite content with what he does for a living and enjoys all of the economic and social benefits of owning a business. From what I could gather, SCOSB makes a considerable profit of which 92% of flows directly into Dan's pocket. Material incentives, or rewards such as money, are not the driving force of the business. Dan professes that the greatest incentives are purposive incentives, which are the intangible rewards resulting from the sense of satisfaction of attaining a worthwhile cause. In Dan's case it is being his own boss and doing something that he loves to do.

Management

This is important to understand when trying to predict the future of SCOSB. I feel that for this reason, SCOSB will be around as long as Dan Gibson is. In the times of an unstable, and unpredictable job market, Dan has, in his mind, the best job of all. SCOSB provides Dan a job that he loves doing for as long as he wants it. What sports-crazed family man would pass up this opportunity? Not Dan Gibson. His ability to change and adapt is another reason that we will see SCOSB in the future. Adding the grill exemplifies this. It also shows that the organization is dynamic in the sense that the owner has his head up and is not impetuous or inflexible to change as is necessary

External Conditions

I say that SCOSB will be around as long as Dan Gibson is, but maybe more correctly stated, for as long as SCOSB can stay in business. The prospects look good. A main reason I see continued success is because Columbia is a college town. The university itself has been around for 200 years and will be there for 200 more. Another major university is located nearby in a growing town. These two resources provide a very large and convenient potential customer base. This along with the fact that the students are the ideal age (old enough to drink, young enough to drink a lot) and are constantly being recycled benefits SCOSB.

Competition, though, may be the only restrictive factor regarding SCOSB's longevity. Since SCOSB's emergence, some local bars and restaurants now have satellites for sports purposes that may tap into SCOSB's market. On the other hand, the sports bar will soon have an operational grill that may tap into their market. The fact that that SCOSB is specialized, and focused on showing comprehensive sports broadcast programming still separates it from the rest. SCOSB shows not just some, but all of the games. SCOSB had created a unique niche that will not be displaced by novice competitors.

People will always have different favorite teams. They will always want to watch their favorite teams. Teams will always watch sports. People will always drink. I think SCOSB will be a Columbia icon for a long time to come.