Olympic bid - the inside story

[Fiona]

London 2012’s victorious Olympic bid FD Neil Wood tells Lesley Bolton how two years’ work culminated in an emotional rollercoaster on 6 July

It was straight back to business for Neil Wood, finance director of London’s triumphant Olympic bid team, on their return from Singapore to base camp at Canary Wharf on 11 July. No time for basking in glory, but straight into meetings on debt finance and lease arrangements.

Surveying the city’s Olympic kingdom from the supreme vantage point of the top floor of 1 Canada Square, the dapper 40-year-old, who was seconded from his role as a Deloitte partner at the end of 2003, recalls the momentous events of Wednesday 6 July. Standing four rows back from the Beckhams and Bobby Charlton, Wood recalls holding hands with Olympic sporting hero Alan Pascoe, and one of the children flown to Singapore as part of London’s delegation, as the Olympic anthem was sung.

‘I turned to the young girl next to me. She was shaking very badly. I told her not to worry, that maybe Paris had won, but it didn’t matter because we’d had a fantastic time. And she turned to me and said, 'it’s not me who’s shaking, it’s you!' She let go of my hand and it was me who was shaking.’

Wood continues: ‘When Jacques Rogge [the Belgian president of the International Olympic Committee] opened the envelope and went through his speech, we were all taken by surprise because we were expecting pauses for effect. And he didn’t, he just said “the games of the 30th Olympiad go to the city of London”. So there was a micro second of just shock, and then absolute elation from the whole London delegation.

‘I don’t think anyone who was there in that room had gone through such a rollercoaster of emotion before in their lives. It was just phenomenal.’

In transition

The bid company spent a budget of £30m to secure the games. The budget for the organisation of the games is £1.5bn in today’s money, says Wood. He is presiding over the finances of the London Organising Committee of the Olympic Games (LOCOG) in its transitionary phase. ‘The transition time is not set in stone,’ says Wood, ‘but there’s a feeling at the moment that it will be about six months or so.’

He adds: ‘We had to have a transition from being an election campaign, if you like, to being a committee that’s actually got to run an Olympic games. Some of those roles transfer across quite easily, some don’t. Once a new chief executive is appointed, it’s really up to him or her to look at the constitution of the board and the management team.’

And will Wood be applying for what must be the FD role of a lifetime? He replies coyly: ‘I think it’s too early to say. I’m absolutely committed to working on the transition period. We’ll just see how things pan out after that.’

Financial hurdles

The first financial challenge ahead for LOCOG will be to put in place an appropriate structure to deliver sponsorship income. ‘We have to raise something in the order of $1bn (£570m) of sponsorship income,’ says Wood. The FD himself won’t be involved with the marketing, but will be closely involved with the financial aspects of any deals being done.

‘One of the ways you can go out of control in an eight-year project,’ warns Wood, ‘is to let expenditure get out of control in the early years. You’ve got to spend what you’ve got to spend during the period immediately adjacent to the games, over 2001-2012, when you’re having to put services in place. But one of the dangers is to build up a level of infrastructure you don’t need too quickly and then spend six years bearing an overhead that doesn’t actually deliver anything. So again it’s keeping those costs under control.’

As far as the skills required by the FD are concerned, Wood says it’s like running any project that has a start date and an end date, and putting in place the financial controls and procedures necessary. However, he says that if there is a uniqueness about it, it lies in the fact that the organisation is finite. In a similar way to the bid company, which worked towards the 6 July, LOCOG has to deliver the games in the summer of 2012.

It also has to cope with a growth spurt that would far exceed the most successful of entrepreneurial companies. ‘LOCOG goes from having an expenditure in the next 12 months of some £20m to something in the order of £1bn in its last year, in terms of annual expenditure,’ says Wood.

‘There aren’t many organisations that grow at that rate.’ Staff numbers will also rise from about 50 initially to something in the order of 3,500 plus 75,000 volunteers at games time.

Employees of the bid company finish on 31 July and those transferring to LOCOG take up their employment on 1 August. The first transitional board meeting is on 27 July.

Sweet moment

For Wood, his involvement with the Olympic campaign has been ‘one of the most exciting and exhilarating things I’ve ever been involved with. I’ve never worked on anything before where you’ve worked for two years, where it’s a single thing you’re aiming to achieve, against the toughest competition out there, the whole of the British public getting behind you and then doing it against all the odds, against all the expectation. That was very powerful.’

In conclusion, he says, winning on the day was ‘a very sweet moment’.

This article first appeared in accountancy magazine