The world’s attention will be focused on the 2012 Olympic Games in London in late July as 10.8 million ticket holders, 15,000 athletes and 21,000 media pros gather in the U.K.’s capital. But for Neil Wood, CFO for the committee organizing the London Games, the months ahead represent the culmination of almost a decade’s hard work. Wood’s journey to the 2012 Games started nine years ago, when he worked at Deloitte as an audit partner. “Back in 2003, when it was decided that the bid would go forward, the London Development Authority (LDA) put in £10 million for a part-financed bid and said it wanted to nominate someone as the CFO,” says Wood. “The LDA invited the big accounting firms to put forward a candidate for the role. I was looking for something big and interesting to do, and I was put forward by Deloitte.”
It turned out to be a complicated process, but Wood was appointed CFO of the London 2012 bid, and when the bid was successful in July 2005, Deloitte agreed to extend his temporary posting to the organizing committee, enabling him to stay on as CFO.
LOCOG’s budget of £2 billion ($3.2 billion) comes from three main sources: local sponsorship, ticketing and a £600 million ($950.6 million) contribution from the International Olympic Committee (IOC) funded by the IOC’s international sponsors and broadcasting rights. LOCOG met its local sponsorship target of £700 million ($1.1 billion) last year, and ticketing is projected to bring in around £600 million. Smaller revenue sources include sponsorships, licensing from the organization’s retail program, asset disposal and interest income.
Raising funds was always going to be a challenge, but that was exacerbated by the economic turbulence of recent years, particularly since LOCOG’s revenue targets were set before the beginning of the financial crisis.
Working for an organization with a limited lifespan also presented some unique challenges. For one thing, Wood started out with a blank slate.
“We had no systems, no IT infrastructure, no protocols, no processes,” he recalls. “So one of the first challenges was to put in the IT infrastructure, put in a complex ERP system and build the processes around that. Governance arrangements had to be built, which I largely did with our general counsel, so we established all the delegated authorities and all the processes that we would go through so that there was crystal clarity in the organization as to how things are authorized. Putting that in early has served us very well.”