Football Management

Commentary on the management of over 160 English football clubs by Dr John Beech, winner of the FSF Writer of the Year Award 2009/10 Twitter: @JohnBeech Curator of Scoop.it! Football Finance

Archive for the ‘Globetrotterisation’ Category

That feeling of déjà vu at Pompey, all over again

Posted by John Beech on February 17, 2012

Portsmouth’s return to Administration today (1) for the second time in a smidgen under two years speaks volumes, especially coming in the week that Rangers, a rather more iconic club, suffered the ignominy of Administration too (2).  High profile those these events are, the phenomenon of financial problems is not confined to te top clubs.  This season so far we have also seen Darlington go into Administration, as have Rothwell Town way down the pyramid.  Prescot Cables have returned to amateur status mid-season, and poor Croydon Athletic have disappeared, at least for the moment.  (A full listing of English football clubs’ insolvency events in the modern era is available here; a warning, it does not make pleasant reading)

It would be easy to dismiss the case of Portsmouth as a special case (especially bad, that is).  The ‘club as company‘ has a long and shameful tradition.  It was formed in 1898 to replace the previous club, Royal Artillery, who were disbanded because of that delightful euphemism ‘financial irregularities’ – payments to players which were blatantly undermining their supposed amateur status.  Funny how history can return to haunt you.

By 1912 the owners were already in deep financial trouble, and the company was voluntarily wound up and promptly reformed, thus wiping out its debts (3), a procedure which is no longer legal, but was far from rare in those days.  The mind boggles at how football clubs today would behave if it were still a legal option like this open to them.  To use a ‘Partridgeism’, the club ‘bounced back’, entering the Football League in 1920, winning the FA Cup in 1939, and the old First Division title in 1949 and 1950.

The road was only downhill after that, obviously excepting the recent relatively spell in the Premier League and FA Cup win.  Sporting decline was followed by financial decline.  A series of owner/benefactors who failed in various degrees is a familiar mantra to Pompey fans – since 1973 the list reads John Deacon, Jim Gregory, Terry Venables, Martin Gregory, Milan Mandric, Sacha Gaydamak, Sulaiman Al Fahim, Ali Al Faraj, Balram Chainrai, and Vladimir Antonov.  Whatever criticisms can be made about them individually, the lack of any continuity has hardly been good for the club.  And there will doubtless be further criticism to come as the unravelling enquiries of both this period of Administration, and the previous one, tease more and more uncomfortable detail out of the wood work.

Of the 200+ files I have on English football clubs, Portsmouth’s is the biggest.  It would be convenient to say that this is because I am Pompey fan.  That would not  though be honest.  It’s because they have a spectacularly aberrant history of ownership and mismanagement.  ‘Spectacularly aberrant’ from normal business, that is.  Merely ‘worse than most’ with respect to other football clubs.

The themes which have dogged Portsmouth occur throughout my files, and all over this blog:

  • Owners who did not have deep enough pockets, and yet push clubs further into unsustainable financial positions
  • Owners unlikely to win ‘Ethical Businessman of the Year’ competitions
  • Owners who have clearly not read the dictum of Mr Micawber in David Copperfield (Charles Dickens was born in Portsmouth, so the reference is particularly appropriate)
  • Repeated failure to pay HMRC on time

Portsmouth’s latest ‘misadventure’ should provide a wake-up call.  But then so so should their one two years ago.  Will the governing bodies just hit ‘snooze’ again?  I like to think not, but, would you believe it, I’m not optimistic.

I can’t argue that the imposition of the Financial Fair Play protocol, or effective club licensing ,or an effective Fit and Proper Person Test would necessarily have avoided Pompey’s current discomfort.  Without them though, another round of insolvency events is inevitable.  It doesn’t have to be that way and nor should it be.

Surely the football world must finally wake up to sorting out, as its highest priority, its financial messes, by attacking the causes rather than the symptoms  rather than stressing over the number of English clubs left in European competition or who the next England manager should be.

Posted in Benefactors, Ethics, Financial doping, Fit and Proper Person tests, Globetrotterisation, Governance, History, Insolvency, Ownership | Tagged: , , , , , , , , | 4 Comments »

Manchester United and the Monkees

Posted by John Beech on October 3, 2011

A comparison that doesn’t fully stand up to scrutiny, I promptly concede, but the ‘soulless’ way Manchester United is run as a business must trouble many a fan of what was once ‘the beautiful game’, and has often in the past been referred to as ‘the people’s game’.

An article in the Financial Times really caught my eye (1) – an interview with Richard Arnold, United’s Commercial Director by the redoubtable Roger Blitz.

It wasn’t the business plan that Richard Arnold was setting forth was other than a sensible one in business terms, but here was someone who has ‘sold his football soul’, if, that is, he had had one.

It was the calculating and almost cynical way he viewed his ‘customer base’, and the language he used.  Here was someone who made no distinction between running a sports business and running any other kind of business – a distinction which I believe to be vital (and bear in mind that I have been teaching and researching sport management, working in a university Business School, forponsored over fifteen years).  Yes, there is much common ground, but sport businesses are a distinct variety of business, not least because their customers see themselves as having psychological ownership of the product.

God help the present and future fans of Manchester United who are to be milked like a cash cow, even when incurring charges on their club-s credit card.  And just how comfortable does Sir Alex Ferguson (see my previous posting) feel working for them.  I caught sight of him, appearing, rather incongruously, in a video shown last week at the annual Labour Party conference.  He has long been a Labour Party supporter, and, for the benefit of overseas readers of this blog, the Labour Party for many, many years played Left Half in British politics.

Another football supremo also caught my eye since my last posting- the peerless Peter Ridsdale.  He was claiming that “he yearns for a life out of the public eye” (3).  Had this claim appeared in the form of a press release by fax from some rural hideaway out of the public spotlight?  No, in fact he was sitting “sipping coffee in Cardiff’s Mercure Holland House hotel” giving a press interview.  How torn the Spinmeister must be in deciding whether to follow his yearning.

Posted in Globetrotterisation, Marketing | Tagged: , | 2 Comments »

The ins and outs of the transfer window

Posted by John Beech on September 3, 2011

So, the transfer window finally slammed shut, to use the mandatory cliché, amid the predictable hype.  In one respect this was hardly surprising – of the 289 August deals reported by the BBC (1), no fewer than 93, or 32%, had taken place on the final day.  In total 141 (49%) had taken place in the final week.  One was almost left wondering whether a whole month was needed.

A noticeable feature of the BBC data is that of the 289 deals, 69 involved players described as unattached, 110 were loans, and 10 were free transfers, leaving only 100 (35%) that were full-blown fee-paying transfers.  Given the main reason for having a transfer window – to prevent clubs buying in extra talent in a burst to achieve promotion or a Champions League place – the question must surely arise as to whether it is necessary to apply any transfer window at all to non-fee-paying transfers, now the clear majority.  After all, no club is going to loan another club a player willingly if it feels that will upset competitive balance and/or give the receiving club a somehow unfair advantage.

It’s difficult to analyse the spending by individual clubs – the BBC data records the figure for a mere 17 deals:

Samir Nasri Arsenal – Man City £25m
Juan Mata Valencia – Chelsea £23.5m
Bryan Ruiz Twente – Fulham £10.6m
Mikel Arteta Everton – Arsenal £10m
Peter Crouch Tottenham – Stoke £10m
Andre Santos Fenerbahce – Arsenal £6.2m
Scott Parker West Ham – Tottenham £5m
Oriol Romeu Barcelona – Chelsea £4.35m
Jermaine Beckford Everton – Leicester £3m
Emmanuel Eboue Arsenal – Galatasaray £3m
Ishmael Miller West Brom – Nottingham Forest £1.2m
Leroy Lita Middlesbrough – Swansea £1.75m
Shaun Maloney Celtic – Wigan £1m
James McClean Derry City – Sunderland £350,000
Darnel Situ Lens – Swansea £250,000
Shaun MacDonald Swansea – Bournemouth £80,000
Chris Lines Bristol Rovers – Sheffield Wednesday £50,000

There seems to be a consensus that spending has peaked again following a couple of years decline.  Which is bad news in my book.  I would have hoped that Financial Fair Play and capped squad sizes would have reined in the crazy levels of spending.  It may be that they have outside the Big 5, but that in itself is dysfunctional – these are the five clubs most likely to qualify for Europe and therefore find themselves under scrutiny from UEFA.

It’s also clear from the limited data available that there is no sign of the vertical disparity in terms of spending power  up and down the football pyramid declining.  Again, I can only greet this with disappointment.  When will they ever learn?

Posted in Costs, Globetrotterisation, Premier League, Transfers, Uncategorized | Tagged: , , , | Leave a Comment »

Manchester City’s aspirations of global hegemony?

Posted by John Beech on December 14, 2010

Manchester City are the latest addition to a strategic alliance of football clubs across the world which Atlético Madrid have been building.

Atlético’s international agreements go back as far as November 2009, when they started to collaborate with Shanghai Shenhua of China (1).  Collaboration was essentially sporting, with the use of player loans to gain playing experience.

The pace at which Atlético is developing strategic alliances has stepped up a gear of late: recently Atlético has signed up Muangthong United of Thailand (29 Oct; 2), Al Ain of UAE (12 Nov; 3), Raja Casablanca of Morroco (30 Nov; 4), Club América of Mexico (unknown date), and now Manchester City (8 Dec; 5).  Targets for further expansion are reported to include Brazil (Atlético Paranaense , Palmeiras and Internacional), USA (Red Bull New York, San Jose and Chivas USA) and Japan (Yokohama Marinos and FC Tokyo).

Not surprisingly the emphasis within this alliance is no longer so clearly sporting (6).  To quote David Redshaw of A Different League:

The pioneering scheme aims to seek sponsorship and expand each club’s image to all continents while sharing information on players through a wide scouting network. It also comes at a good time for Atlético as they need investors to help finance the construction of their new 73,000-capacity stadium, La Peineta, which will cost around £175m. The club hope to move in for the 2012/13 season and there are also plans to build a state-of-the-art sports city in the Alcorcón area of Madrid.

He also reports that Atlético have asked La Liga if they can play home games at 12:00.  This would allow their games to be shown live at peak times in the Far and Middle East.  Amazingly, Atlético “received a favourable response from their own supporters clubs who have agreed the change of hour is the way forward“!  There’s more: “a pre-season tournament involving all ten is already being lined up before the start of next season“.

It’s the now increasingly familiar sound of the ‘untapped markets’ argument.  What seems to be being forgotten is the tapped market – loyal local fans.  Sport and business are troublesome bed fellows at the best of times, but surely it doesn’t make sense to kick one of them out of bed.  In any case, the need to boost revenues is rather less significant to Manchester City than to Atlético.  Manchester City have probably the most free-spending benefactor ever to grace the director’s box of an English football club.

But wait…  What’s that on the horizon?  Oh dear, it’s UEFA’s Financial Fair Play protocol.  To keep on spending at the rate Manchester City is becoming used to (see an earlier posting Manchester City following in Pompey’s footsteps), they are going to have to do something about boosting their revenues if they want to carry on being a Viv Nicolson (click here if she was before your time!).

Ironically, a measure designed to reign in spending unearned money may well result in a situation that leaves loyal fans fuming at how to raise the money for global air fares and having to reschedule their Saturdays during the main season to accommodate kick-off times, all for the benefit of new fans in the Far East.  Yet another example of what can only be described as the Harlem Globetrotterisation of English football.

How long before the Premier League is reduced to the ten teams with the richest benefactors endlessly touring the world playing exhibition matches in front of currently ‘untapped’ fans, and to hell with the real fans?

Posted in Fans, Globetrotterisation | Tagged: , | 2 Comments »

 
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