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

Posts Tagged ‘Ethics’

‘Part and parcel of the modern game’

Posted by John Beech on January 29, 2013

To develop an old media dictum, a ball boy kicking a footballer, now that would be news.  The Eden Hazard incident (1) was always going to have legs as a story because of its ‘shock horror’ value.  Its inherent symbolism, a Goliath kicking a David, would guarantee that.  As has emerged, there were nuances of the particular incident, which have only added to media interest, which will swell up again when Hazard’s case is heard by the FA.

Not only was it a case of a footballer (at this stage, allegedly) kicking a ball boy, it was a case of a highly, highly paid footballer allegedly kicking a partisan volunteer.  To me this was the true shock horror element.  It epitomised the incongruity of the modern game.  On the one hand there are, in the Premier League, players on enormous salaries, whilst, on the other, vital contributors to the flow of the game, unpaid underage volunteers.  Quite how underage was, of course, an element which added to the story.  The ball ‘boy’ turned out not to be 11 as originally reported, but in fact 17.

Where else but in the modern game would you find a physical confrontation between two people with, to use the language of organisational behaviour, such a phenomenal power distance between them?  Power distance in football, at least as measured by salary, is a real oddity – participants exist on a greatly extended scale, ranging from players, through managers (where else would a manager earn less than his subordinates?), then a considerable distance along the spectrum match officials, all the way to unpaid volunteers.  It is a mixture that is explosive, and it is surprising that it has rarely exploded.

Chelsea’s initial reaction was, not surprisingly, to defend Hazard (2).  I say ‘not surprisingly’, because I am mindful that this was the club that managed to smooth over an incident in which a fire arm was discharged, albeit accidentally, in the workplace injuring an intern (3).

Among the many differing reactions was a condemnation of the ball boy for his attempt to waste time.  This is arguably misplaced, as time-wasting is undoubtedly ‘part and parcel of the modern game’.  It has of course been officially sanctioned since the 1967-68 season by the process of tactical substation.  Out of curiosity I looked at the substitutions that had taken place the previous weekend in the Premier League.

Minutes

No.

0-9

1

10-19

0

20-29

0

30-39

1

40-49

1

50-59

4

60-69

17

70-79

12

80-89

14

90+

2

Even a cursory glance shows a wild skew towards the later stages of a match.  Substitutions because of injury would tend to happen far more evenly, and it is obvious that tactical substitutions are ‘part and parcel of the modern game’.  That particular weekend, all twenty clubs made two substitutions, and twelve of them made a third.

My gripes with this aspect of the modern game are twofold.  Firstly it generates an immense irritation for the fans of one of the two teams, and indeed the players, as the Hazard incident demonstrates well.  In short, it lowers the entertainment value of a match, and tends to enhance the feeling of ‘we wuz robbed’.  Which is my second gripe.  Time-wasting is, in my eyes, unethical from a sporting perspective.  Tactical substitution is all about trying to cement a current score by allowing the opposition less opportunity to compete on the pitch.  It simply doesn’t make sense from the perspectives of sport as sport or of sport as entertainment.  It doesn’t even make sense from the perspective of sport as business to irritate and frustrate half the people who generate the revenues.

It s surely time we moved on from meekly accepting what is ‘part and parcel of the modern game’, started to look at the modern game critically, and call for change to ensure that ‘sport as sport’ is the dominant perspective.  Time in fact for a major and effective review of football governance.  Oh, I forgot… (4)

The time for redefining the modern game is surely badly overdue.  Who though is holding their breath?  Well, for once, I’m just a tiny bit optimistic!

Posted in Ethics, Governance, Organisational culture | Tagged: , , | 1 Comment »

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 »

A not quite 24 carat golden age of football ethics?

Posted by John Beech on November 16, 2011

Received wisdom seems to be that, once the baton of running FIFA was passed on from safe and reliable English hands, there was a rapid descent into a quagmire of unethical goings on.  Even Uncle Sepp himself now admits that FIFA “has had a rough time of late” and concedes that there is now “the need for change and the urgent need for sweeping reforms” (1).  He concludes “FIFA remains committed to walking the walk and won’t get stuck in solely talking the talk. By December, this will become clear for all to see. Until then, I invite everybody to bear with us so that we can clean house and come back to the public with facts that allow FIFA to enter a new decade of doing business. And never again revert to doing “business as usual”.”  Whether he himself decides to ‘walk the walk’ is anybody’s guess.

I’m just back from a work trip and have been reading en route Sir Stanley Rous’s autobiography Football Worlds, published in 1978, a couple of years after he had been replaced as FIFA’s President by João Havelange.  A couple of passages particularly caught my eye as they reveal that back then all was not 100% squeaky clean.  Consider this first quote:

In Nasser’s day I was once present to watch a game there when the Sudan played Egypt in the final of a competition.  My host was General Mostafa, later Vice-President of FIFA, and an enthusiastic crowd of 110,000 worked themselves to a pitch of excitement when the winner had to be drawn by lot after the game had ended with the scores level.  The referee was blindfolded before making the draw, and a great roar of cheers greeted his pulling out the slip with Egypt on it.

When the General returned from the field I congratulated him on the luck of the draw.  He replied that there was no luck involved as, by agreement, both pieces of paper had Egypt written on them.  He may have been joking, but the Sudanese officials showed no sign of disappointment and the result made the day for Nasser and the spectators.

This, for some reason, brought to mind a different recent occasion when, rather than two identical slips of paper, a voting card had only one choice on it.

Sir Stanley was not averse to telling a story against himself.  He writes this from his days refereeing, concerning a game between Millwall and Charlton:

At a crucial point in the game I saw a defender’s hand fist the ball away in a goalmouth melee.  As I blew the whistle for a penalty the players untangled themselves and looked at me in surprise.  It was then that I realised that it was the goalkeeper, not a full-back, who had punched the ball.  So I walked past the penalty spot, past the goalposts, to the edge of the crowd and called at the top of my voice: ‘If the man with the whistle blows it again I will have him removed.’  Then I restarted the game by dropping the ball and the mistake was retrieved without disaster.

A more innocent age perhaps, or perhaps not, than the kind of confessions that can appear in autobiographies today (2) – a reference to Matt Le Tissier, to save you clicking through.

Overall, one would have to conclude that, compared to today’s ills, it was generally a much more ethical football scene, but not some Halcyon era of perfect ethics.

Posted in Ethics, FIFA, Governance, History | Tagged: , , , | 5 Comments »

“Completely vindicated”? Well, not quite completely

Posted by John Beech on September 29, 2011

The press have been quick to quote Peter Ridsale as saying that he had been “completely vindicated” following the dropping of charges fraud brought against him by Cardiff Training Standards Department (see BBC and This is Plymouth for example).

In my book, in this case that fine arbiter of plain English, the Oxford Advanced Learner’s Dictionary, the primary definition of ‘vindicate’ is “clear of blame or suspicion“.

Undoubtedly he has been “completely vindicated” of ‘blame’ as the charges have been withdrawn, and he continues to be able to be a director of a football club.  He can continue to weave his own brand of magic, honed at Leeds United, Barnsley and Cardiff City.

Whether he has been cleared of ‘suspicion’ is, in my opinion, not quite so clear-cut however.  Further down in the press reports the reason the charges were dropped is revealed.  A council spokesman is quoted thus: “On paper, there was a case to answer, however, the council has recently obtained further evidence from prosecution witnesses and taken the advice of a leading counsel.  After a thorough analysis of this new evidence, and due to the reluctance of those supporters who raised concerns to provide witness statements, the council considered that a conviction after trial was unlikely.  Consequently, the council has decided to discontinue the prosecution.”  In these circumstances it would seem likely that there will those who still harbour a suspicion, possibly including some at Cardiff Trading Standards Department, and so ‘complete vindication’ is an interesting use of the language.

To remove both ‘blame’ and ‘suspicion’ it can be argued that the case would have had to have gone to trial, and ‘not guilty verdicts’ returned for all three charges.  Ridsdale had previously said “I will be vigorously rebutting the charges” (1).  He must surely be ruing the fact that the charges were dropped, and he was denied his opportunity to have his cases heard and to be ‘completely vindicated’.

Posted in Ethics, Fit and Proper Person tests | Tagged: , | 3 Comments »

Just a quickie…

Posted by John Beech on July 24, 2011

… before I head off for two weeks holiday.

It’s hard to know what to make of the life-time ban that FIFA’s Ethics Committee have handed out to Mohammed Bin Hammam (1).  To my mind, it’s a bit like the PG Tips Chimps Etiquette Committee handing out a life-long ban for bad table manners.  Unlike Jack Warner’s threatened tsunami, I suspect this will have legs, with a likely visit to CAS (2).

I’m heading off, sans laptop, so will not be blogging or moderating comments for two weeks.  I’d hoped to have a couple of postings – one on how fans were viewed in the context of fan ownership in the sixties, and one on a non-league club and its long-running saga of financial issues – but I’m afraid these will have to wait.  Meanwhile, best wishes to all readers, especially those who are also starting a fortnight’s holiday.

Posted in Ethics, FIFA | Tagged: , | Leave a Comment »

Substitutes and ‘cheating’

Posted by John Beech on July 21, 2011

The Football League has announced that its member clubs have voted “voted to reduce the number of substitutes that can be named on the teamsheet for matches in the npower Football League from 7 to 5” (1).  As a rationale for this change, it was stated that “This was felt to be a sensible and prudent step given the financial challenges facing many football clubs and the commitment made earlier this summer to adopt UEFA’s Financial Fair Play framework“, or, to put it another way, it’s ultimately a good way of cutting costs by employing a marginally smaller squad.

I for one would like to see a change in the rules regarding the actual substitutions allowed.  Nothing imposes such a feeling of anti-climax at the end of a tense game is the tactical (and essentially unnecessary) substitution of players as the final whistle approaches.  It has far more to do with the ‘gamesmanship’ of Stephen Potter than the gamesmanship of what used to be the Beautiful Game.

Musing on this, I turned out an early report by the Football League (but actually published in the FA Yearbook 1966-67, and hence not available online I’m afraid) called “Substitutes: An Experiment Justified“.

It begins “When the Football League introduced its Substitute Rule at the beginning of the 1965-66 season, it was received with misgivings from many people inside and outside the game.  Many of those who were against it chose to ignore the fact that substitution of players for injury has been permitted by the Laws of the Game for a good number of years”.  The second sentence came as a surprise to me.  Did substitution actually take place before 1965?  Surely in that era the culture was for a player to battle on, hiding injury in spite of the danger of exacerbating it causing permanent injury.  Think Bert Trautman.

The report continues: “There were many forecasts of the amount of cheating [sic] and misuse which would follow.  In point of fact, there has been no instance of the Substitute by a manager in order to gain a tactical advantage over his team’s opponents.”  Would that the same could be said today.

Data in the report broadly backs up the claim.  It records that 772 substitutions had been made in 2,028 League games.  These occurred during games thus:

Period of game

Substitutions

Up to 10 minutes

26

11 to 19 minutes

31

20 to 29 minutes

55

30 to 45 minutes

141

Total, first half

253

46 to 59 minutes

182

60 to 69 minutes

100

70 to 79 minutes

110

80 to 85 minutes

106

86 to 90 minutes

21

Total, second half

519

The number of substitutions in those days was limited to one, and, as the report says “If substitution is raised to two, this would increase the danger of substitutes being used tactically, which is really what everyone wants to avoid“.  Substitution was, in any case, only permitted then for injury.

Subsequently ‘everyone’ apparently stopped wanting to avoid the use of tactical substitution, and we have seen the number permitted on the bench grow to 5 in 1996 and then the about-to-be abandoned level of 7 in 2008.  Memory fails me on when tactical, i.e. for reasons other than injury, substitution was first allowed (any offers?).

Do I detect in all of this the idea that the Football League cares less about the game and its enjoyment by fans today than it did in 1965, and cares more about the costs of its member clubs?

Perhaps I’m being a little harsh.  Substitution for injury is a principle I would strongly defend, on the grounds of players’ well-being, and I wouldn’t want a return to pre-1965 practices.  It’s just that it seems to me we have gone too far with tactical substitution, something which I still want to avoid, to use the League’s phrase.

Posted in Costs, Ethics, Football League, Health & Safety, Human Resource Management, Organisational culture, Players' careers | Tagged: , , , , , , | 2 Comments »

Sepp Blatter’s already legendary Jim Callaghan impersonation

Posted by John Beech on May 31, 2011

Blatter’s demeanour at last night’s press conference was clearly one of defiance – it seems he really is blind to the mess the world governing body is in.  Mind you, if you watch again withe sound turned down (1), his body language is less self-confident – the ceaseless paper shuffling, and constantly tweaking the pair of microphones in front to him as if a pair of nipples had suddenly been thrust at him in some seedy nightclub.

The chances then of some serious reform of FIFA on his about-to-be-extended-unopposed watch are as remote as ever.  He is only vulnerable to pressure from outside stakeholders such as broadcasters and sponsors.  Broadcasters are unlikely to bother too much – the World Cup will be watched as eagerly by fans whether he or Caligula’s horse is in charge of FIFA.  Sponsors may yet prove more difficult to accommodate however, and there are already mumblings (2).  Sponsoring is not merely a questioning of gaining exposure for your brand – it only works effectively if there are shared brand values.  Interestingly, Coca Cola list their shared company values as ‘Leadership, Passion, Integrity, Accountability, Collaboration, Innovation, and Quality‘ (3).  It’s hard to see that the present circumstances are helping Coca Cola present their values of leadership, integrity and accountability much.  Adidas too will not be particularly happy bunnies this morning – they state on their webpage for Vision and Governance: “But leadership is not only about results, it is also about how success is achieved. We are accountable for the way we do business… We are committed to good governance“.  Not a great deal of brand synergy going on there at the moment either.

The one thing that can be said of Blatter is that he is a survivor.  Allegations that he acted corruptly date back at least to 2002.  As Nick Harris reported in The Independent nine years ago: “Sepp Blatter was yesterday accused by 11 senior Fifa colleagues of trying to buy votes to secure his re-election as president of football’s world governing body. The dramatic move could end the 66-year-old’s long career in the game.  In an unprecedented move in Fifa’s 98-year history, Blatter became the subject of a formal legal complaint filed in the Swiss courts by five Fifa vice-presidents and six other Fifa executive committee members.” (4)  Maybe we can’t expect too much in the way of sponsorship withdrawal as these allegation haven’t stopped them.

Blatter does have an Achilles heel nonetheless.  FIFA remains under investigation by Swiss federal authorities (5), as revealed by Matt Scott of The Guardian.  The Swiss may be more fussy than Adidas and Coca Cola when it comes to seeing their national ‘brand’ under threat.  Exemption from anti-corruption legislation for FIFA may well be lifted, especially as it applies to ‘not for profit’ organisations, an increasingly badly-fitting description for a body with reserves of almost three-quarters of a billion pounds (6).

One way or another, we shouldn’t expect a swift cleaning of the Augean stables, especially as Blatter is no Hercules.

Posted in Corruption, Ethics, FIFA, Governance, Public relations, Sponsorship | Tagged: , , , , , | 3 Comments »

The Spinmeister in a spin too far?

Posted by John Beech on May 15, 2011

Peter Ridsdale faces charges of two offences under the Consumer Protection from Unfair Trading Regulations 2008 and another under the Fraud Act 2006, brought against him by Cardiff Council’s Trading Standards department (1).  These are:

  • Being knowingly or recklessly engaged in a commercial practice which contravenes the requirements of professional diligence under Regulation 33a of the Consumer Protection from Unfair Trading Regulations 2008. Materially distorted or was likely to materially distort the economic behaviour of the average consumer with regard to a product, namely season tickets, contrary to Regulation 8 and 13 of the Consumer Protection from Unfair Trading Regulations 2008
  • Being a trade engaged in a commercial practice which by omission was misleading under Regulation 6 of the Consumer Protection from Unfair Trading Regulations 2008 in that its factual context omitted material information, namely that they were subject to an embargo imposed by the Football Association on the registration of new players at the said Football Club and as a result caused or was likely to cause the average consumer to take a transactional decision he would not have taken otherwise, contrary to Regulation 10 and 13 of the Consumer Protection from Unfair Trading Regulations 2008
  • Committed fraud in that you dishonestly made a false representation, namely the sale of season tickets intending to make a gain, namely using revenue to purchase new players, contrary to Sections 1 and 2 of the Fraud Act 2006.

Ridsdale told the Plymouth Herald, “I will totally and vigorously refute all the charges and will go back in July to vehemently rebuff them.

The case is of course sub judice, and it would be improper of me to make any comment on it.  While ‘Comments’ remain open, please be aware that I will be mindful of this when deciding whether to publish them or not.

Ridsdale is not of course alone in the world of football management in facing legal proceedings.  Harry Redknapp, Milan Mandric and Peter Storrie are all currently facing court proceedings relating to matters which occured when they were at Portsmouth.  So far as I am aware, all but Storrie are carrying on in football as their innocence is to be presumed.

The four cases are individual, and the seriousness of the charge(s) varies with its relevance to their current work.  What does strike me however as being in marked contrast to practice in many other sectors is that there does not appear to have been serious consideration given to the possibility, and some might argue the appropriateness, of ‘going on gardening leave’ until their names are cleared.  Not that I’m surprised – football in general is not a sector which has placed a great deal of stress on ethics.

Posted in Ethics | Tagged: | 3 Comments »

The points deduction lottery

Posted by John Beech on May 13, 2011

As we move towards the end of the season and the state of ‘ups’ and ‘downs’ begins to harden, I am, as usual (here are my earlier findings on this topic), looking more closely at how the deduction of points impacts on the particular clubs who are promoted or, more typically, relegated.

The impact (or lack of it) can be five-fold:

  • No impact even to a club at the top of the table.  A classic example is that of Arsenal who were still Champions of the old Division 1 in 1990 in spite of having three points deducted.
  • Points deduction results in a club failing to be promoted, as happened to Leeds United in 2008, when a 15 points deduction moved from a guaranteed promotion spot into the play-offs (where they failed to gain promotion).
  • The position of the club is so ‘mid-table’ that the deduction of points is irrelevant other than to their final position.
  • A club is forced into relegation because of the points deduction.
  • The deduction of points is irrelevant because the club was going to be relegated anyway, as was the case when Portsmouth were ‘punished’ with a ten points deduction last year.

You can see where I’m going with the reference to ‘lottery’.

It’s too early yet for a systematic survey, but some examples are all too apparent already.  Plymouth Argyle have been relegated because of their ten points deduction (1), and St Albans have been relegated anyway (2), although by a narrow margin.  Their fans must look enviously north of the border to Dundee, where, in spite of a massive 25 points deduction (3), the club has managed to escape relegation.  Their fans may not necessarily see this as ‘a lucky escape’ however, as, without the deduction, Dundee would have finished a single point behind champions (and automatically promoted) Dunfermline.

The most interesting case is one in which no points have been deducted – that of QPR.  A disgracefully slow investigation finally concluded with a massive fine but no points deducted for 7 alledged breaches of FA financial regulations (4), five of which were found ‘not proven’.  As QPR finished the season as Champions, and 8 points clear of the play-off places, any points deduction would have proved highly contentious to whichever set of fans affected.  The saga may yet continue, as Swansea, who would have been automatically promoted had QPR been deducted nine or more points, are, at the time of writing, undecided as to whether to mount a legal challenge (5), preferring to wait until the full judgement is published.

The use of points deduction as a sanction is unarguably dysfunctional.  The real question is whether it is the ‘least bad’ alternative.  Certainly alternatives need to be explored, and thought given to whether it is possible to distinguish between offences that affect performance on the pitch and more technical financial or administrative offences which have no impact on sporting performance.

Posted in Ethics, Governance, Points deduction, Sanctions | Tagged: , , , | 6 Comments »

Open season on interns?

Posted by John Beech on March 10, 2011

Yes, it’s the Gunfight at the Cobham Coral saga.

For those of you not up-to-date with the jargon of Higher Education, an intern is someone who, in Old Speak, was on an industrial placement from a sandwich course.  Typically this would be the third year of a four year undergraduate degree programme.  The thinking is that such a placement, or internship, gives a broader education and enhances the student’s employment prospects once he or she has graduated.

Reports that no charges are likely to be brought, and that the police investigation was so thorough that, it is reported, they didn’t even include speaking to either Ashley Cole or the shot intern, Tom Cowan, (1) simply beggar belief.

Chelsea are really sorting this one out though – Cole might be fined up to two weeks’ pay (2) and Ancelotti’s reaction is reported as “I am angry, obviously, but to read that [the training ground at] Cobham is out of control is totally wrong. I’ve been a manager for 20 years and one of the most important things is discipline. Players have to observe the rules.  Ashley made a mistake. When he said sorry he was really disappointed [with himself]. But what do we have to do now? Kill him?” (3)  Ancelotti ‘angry’?  Cole ‘disappointed with himself’?  For God’s sake get real guys – someone was shot in the workplace!

Imagine for one moment that the situation had been reversed – that Cowan had brought the air rifle to work and accidentally shot Cole.  Would everyone have been quite so laid back about it?  I would suggest they wouldn’t.

The incident, or more specifically its aftermath, bring shame on the club.  The silence so far (at least so far as I’ve been able to trace) of the Premier League and the Football Association speak volumes about the power of the club and the indifference of the governing bodies to such an incident.  What would it take to get them to condemn Chelsea – the death of an intern?

I find it staggering that the club hasn’t even bothered to make public more detail of what precisely happened, or what their internal investigation has shown.  After all, this incident took place two and a half weeks ago.  In the Ancelotti world of chronic understatement, I’m ‘disappointed with Chelsea’.

UPDATE – 12 March 2011

The police have said that they will not be taking any action (A).  There are two impediments – the incident took place on private property (in which case, the law is an ass; this is, in my opinion, utterly absurd – the incident happened in a place of employment, and employees should be legally protected), and Tom Cowan has declined to file a criminal complaint.  Make of the latter what you will.

The same report suggests that the club can fine Cole up to £250,000 (two weeks salary).  Have they?  The silence from the club remains deafening.

UPDATE – 29 March 2011

Latest ‘jolly jape’ involves a dart and a youth player (see here).  What sort of injury is it going to take before clubs take this kind of behaviour seriously?

Posted in Ethics, Football Association, Governance, Health & Safety, Human Resource Management, Organisational culture, Premier League, Public relations | Tagged: , , , , , , , | Leave a Comment »

The scarf your mum knitted and competitive balance

Posted by John Beech on February 22, 2011

I haven’t been enjoying lunch lately.  Nothing to do with the food in the university canteen; it’s my daily read of The Guardian I blame.  That Matt Scott in particular had me choking today (1) over my vegetarian shepherds pie, although the oxymoron itself hadn’t put me in the best of moods.  I was so bothered that I’ve created a new tag (‘financial doping’) as a result, and will apply it retrospectively as time permits.

To be fair, Matt is an excellent writer, and its was the implications of what he wrote that vexed me, rather than the content per se.  His lead story was about a new Sport+Markt report on European Football Merchandising (2), a snip, I would imagine at 5,831 euros (no, I kid you not, such is the price of valuable market research in the football sector these days).

Matt reported:

The key finding of the European Football Merchandising Report, a survey of 182 clubs and 10,000 fans, was that United’s global revenues (excluding television income) have fallen by 10% in 12 months. The report’s author, Dr Peter Rohlmann, told Digger this was attributable to the “green-and-gold” campaign against the club’s owners.

“Our data show the club has lost retail revenue from the year 2009 to 2010 by around 10%,” Rohlmann said. “This is due to the fact that all the circumstances about the ownership and the behaviour of the Glazer family were not positive in the minds of Manchester United fans. This has had a direct impact on their merchandising spend.”

Rohlmann did not disclose the figures relating to United’s merchandising income because all disclosures made to Sport+Markt by clubs are on a confidential basis. However, he stated that the report analyses all of United’s self-generated merchandising revenues, along with those of their licensing partners such as Nike.

As United reportedly seek a 50% improvement on their £302.9m, 13-year Nike shirt deal, which expires in 2015, the demonstration of a decline in revenues comes at a bad time for the club. The Premier League leaders’ share of the merchandising market, which is worth €1.2bn for the 10 highest-earning clubs across Europe, has also slipped. They are now ranked sixth, down one place from 2008.

A spokesman for the club disputed Sport+Markt’s findings, saying royalties from the profit-share arrangement with Nike had risen in each of the past four years.

Now let’s just stop and put that into its real perspective.  That’s €1.2bn, or a smidgen over £1bn, or a £100m per club, that the fans of just ten clubs have spent in one year on merchandising.  Rather a far cry from the days when you got your mum to knit you a scarf in your club’s colours, and perhaps splashed out on a rosette on Cup day.

As I said, it’s the implications of this that bother.  Such enormous sums spent on the merchandising of a few clubs results in ensuring that the rich and strong clubs just get richer and stronger.  In other words, it distorts the competitive balance in the respective leagues.  It’s not a million miles from financial doping – the attempt to buy success by distorting the balance of competition.  This is normally in the form of ‘benefactors’ pouring money into clubs à la Manchester City or Chelsea, or, at a different level, Crawley Town.  What’s particularly insidious here is that it’s the fans who are being drawn in to pay for the club’s habit.

There is at least one up-side to this though – the Green and Gold campaign is having the desired impact.  As for me, I’ll stick to wearing my favourite footie T-shirt (available from WSC – who still won’t reciprocate a link on their links page, incidentally).

As this was The Digger column that was provoking this reaction, I should have guessed there would be more to incense me.  Matt also reported:

Any defence whose last line consists of Sébastien Squillaci and Manuel Almunia is vulnerable to the attentions of a journeyman striker picked up from the French fourth division. And Jonathan Téhoué, left, proved it in the FA Cup fifth round against Arsenal. Now Digger can reveal just how valuable the Frenchman’s equaliser is expected to be for Leyton Orient. Arsenal turn over £3m for every home game and under the terms of the FA Cup revenue-sharing agreement Orient will be due 42.5% of the net gate receipts that the Emirates Stadium replay generates.

Although the Gunners have yet to announce ticket prices for the 2 March match, the profit is expected to be in the region of £1.6m, raising £700,000 for the League One club. If the match is televised, it will make close to £1m for Barry Hearn’s club – not bad for one game, considering Orient’s total turnover of £3.3m in the 2008-9 season.

Here there is at least an income to the club related to their performance on the pitch.  Orient certainly deserve some good news after their shabby treatment by the Premier League.  My gripe is not with Orient but rather with the fact that in general the distribution of broadcasting rights has the same result – making the rich clubs even richer and distorting the balance of competition.  And who’s feeding the habit?  It’s the fans again.

Have we really lost all sense of the sporting ethic?  Sadly I think I know the answer to that one.

Posted in Benefactors, Broadcasting rights, Ethics, Financial doping, Merchandising, Revenues | Tagged: , , , , , | 1 Comment »

‘Good Rangers’ v. ‘Evil Rovers’?

Posted by John Beech on December 21, 2010

The top of the Conference table intrigues me.  The top seven clubs come from right across the spectrum of football business models, from clubs whose fans can be rightly proud, through those that have been abused by boards past and/or present, through to clubs that engage in blatant financial doping and whose fans have seen the club become identified with a ‘benefactor’ rather than with a local community.

As I write, the top seven, in order, are

  • Wimbledon
    The exemplar of how fans can run a club successfully.  Their story is so well known it doesn’t need repeating.
  • Crawley Town
    Southern League champions in 2004, and since then they have managed to stay up in spite of several sets of points deductions.  Their recent history off the pitch has been one that you would reluctant to wish upon you deadliest rivals.  A brace of Administrations (in 1999 and 2006), being pursued in court by HMRC as recently as last July (1), and a string of owners.
    The most recent is Bruce Winfield, together with Susan Carter, who has produced a ‘war chest’ for the purchase of new players.  Manager Steve Evans was happily spending money throughout the summer transfer window on a scale virtually unprecedented at the Conference level.  One failed attempt to buy success was a cheeky knocked-back try at purchasing Wimbledon’s captain, Danny Kedwell (2).
    All in all a somewhat colourful history off the pitch.  The mystery surrounding the war chest, and who the investors are, to me puts a measure of uncertainty over the sustainability of their current business model.
  • Luton
    A club much abused by its previous owners.  The new ownership team inherited the massive points deduction, but things seem to have finally bottomed out, and it looks as if it will not be too long before it is back in the Football League.  Its home gates would not be out of place in League 2; in fact, they would be the second best!
  • Newport County
    Not the original club, which disappeared in 1989 thanks to the shenanigans of one Jerry Sherman.  The resurrection club has had to claw its way back up the pyramid, including a period in significant exile and an attempt to have them kicked out of the English pyramid.  The club is now roughly 20% owned by the Supporters Trust.
  • Fleetwood Town
    A club with a very chequered background, and many football fans will still be wondering ‘who?’.  The club is owned by Andy Pilley, also the owner of Commercial Power, who sponsor the club’s shirts.  Commercial Power has some interesting approaches to the conduct of its business – see (3) and (4).
    The club went full-time last summer and a £4m stadium redevelopment is under way. With home gates at just under an average of 1700 this season in spite of the club’s success on the pitch, I fear that, for fans, there may be tears before bedtime.  The financial doping may prove unsustainable.
  • Kidderminster Harriers
    A club in meltdown.  It was reported last month as having debts of £250,000 and has been in and out of court at HMRC’s behest for much of this year.  Although they had a winding-up petition dismissed earlier this month (5), its other debts are only sustainable through handouts from the owners (6), and there seems to be a shortage of those willing to pick up what has become a poisoned chalice (7).  Short of a new local millionaire suddenly riding to the club’s rescue, Administration is looking increasingly likely.
  • Wrexham
    A club which famously had to take its own Chairman to court to regain ownership of its ground.  Even today there are concerns over its future (8).
    There has been talk of the Supporters Trust taking over the club (9), but relations between owners and fans have not always been good.

By the end of the season we will of course have one club as champion and automatically promoted, and four into the playoffs.  The battle to be promoted will be fascinating to follow with its business model overtones, especially if these remain the seven clubs in contention.  Will ‘good’ triumph’ over ‘evil’?  That is of course oversimplifying, but I will find it difficult to remove considerations of their business models from deciding who I want to be promoted.

Posted in Benefactors, Ethics, History, Ownership, Trusts | Tagged: , , , , | 1 Comment »

Groundhog Day for the Trotters?

Posted by John Beech on November 12, 2010

Reading through my Bolton file certainly makes for consistent reading, although ‘consistently inconsistent’ might be more accurate.

We have to balance the books” he told us as far back as 2003 (1), adding “We can’t afford to spend any money we haven’t got. We’re not going to go down that route.”  A fan of Mr Micawber then.  Unfortunately, less than a fortnight later it emerged that Burden Leisure, the parent company of Bolton Wanderers, had debts of about £38m and the wage bill had risen from £5.2m to £21.7m during the previous financial year (2).

Later that month the Bolton financial model became clear – put your faith in a benefactor (3), but not some ‘johnny foreigner’, a thoroughly pukka British benefactor, Eddie Davies, a life-long Bolton fan, who lives in, erm, the Isle of Man.  As Gartside put it, “Without Ed’s support we would be watching a very different standard of football…  We can now sit down with the banks and have serious talks about restructuring our debts.

These themes – living within your means and depending on a good old British benefactor – constitute the consistency in that regularly recur in the years since.

This week we have seen the latest Burden Leisure figures published (4) – turnover from football operations was £54.0million, which was £2.2million higher than the 2009 total of £51.8million; the retained loss for the year was £35.4million; and the cost of retaining existing players resulted in the cost of wages increasing by 14% in the year to a total of £46.4 million from the 2009 total of £40.9million.

No wonder then that one of Gartside’s favourite themes of late has been the need for a salaries cap in the Premier League.  Bolton have certainly been one of the better behaved clubs in this respect, managing to keep wages/revenues at under 60% from 2004/05 to 2008/09 (see table here), an achievement shared only by Manchester United, Tottenham, Arsenal and Liverpool.

So ‘where is the inconsistency?’ you ask.  The calls for restraint on wages and keeping within ones income are fine and deserve to be more widely supported.  The living on debt mountain sustained by a rich benefactor are not – they are forms of financial doping, attempting to disrupt competitive balance by the use of unearned money.  The inconsistency is beautifully expressed by Gartside himself, suggesting that UEFA’s Financial Fair Play protocol is not quite what is wanted: “There are ways of tweaking it that would suit the English game better.  Owners should be allowed to invest in equity.  So if you, as an owner, want to buy a striker for 10 million (pounds) that shouldn’t be a problem. But what you then can’t do is pay him extortionate wages that take you out of the breakeven situation.”  His logic is one that escapes me.

Posted in Costs, Debts, Ethics, UEFA, Wages | Tagged: , , , , | 2 Comments »

The Portsmouth Soap: Episode 94

Posted by John Beech on August 29, 2010

In what seems to be now a tradition, my being abroad for a week coincided with yet again a bizarre development at Fratton Park.  On Tuesday The Sun revealed that “Lever’s Pomped up for buyout. PORTSMOUTH are wanted by whizkid tycoon Thomas Lever. The 21-year-old Lamborghini-driving son of a wealthy Manchester businessman and local councillor is in advanced talks to buy the Championship crisis club” (1).

On Thursday The Knutsford Guardian had a slightly different spin on the story: “THE son of a bankrupt former Knutsford councillor has put together a £25m takeover bid for Portsmouth Football Club…  His father David was made bankrupt on July 5 at Manchester County Court” (2).  It would not appear that father David is necessarily down to his last bawby though.  According to a report of 14 July in the same newspaper, the bankruptcy arose as a result of a dispute over payment for the framing of 100 pieces of memorabilia by an international art services company (3).  David Lever had paid the company £10,000, but had not subsequently paid a further £3,500 although ordered to do so by a County Court judge in March, prompting the art services company to raise bankruptcy proceedings.

I don’t know why, but I get just a hint of déjà-vu about this in the Pompey context.  Presumably David Lever is free to leave Knutsford without fear of arrest on gun-running charges though.

The pressure is no doubt on Administrator Andrew Andronikou to find a buyer.  His CVA is based on a business model that presumes Portsmouth will stay in the Championship for the next five years, but the thread-bare squad have faced a dismall start to the season, with the club lying joint bottom of the Championship (with, by coincidence, Milan Mandric’s Leicester) after four games.  But will this lead to an ‘any port in a storm’ approach?  In my opinion, having the 21-year-old Lamborghini-driving son of a wealthy (but legally bankrupt) businessman as the club’s new owner would be (let’s be polite) a sub-optimal outcome.  But the actions of previous owners have led the club into this present position, where simply selling to the one potential purchaser is the only option for an Administrator.

There is of course the new toughened-up Owners & Directors test, which replaced the old Fit & Proper Person test, that would have to be passed.  This case would certainly show whether or not the new test has any more teeth than the old one.  It would be interesting to know the thoughts of David Lampitt on the proposal – he is of course Portsmouth’s recently installed Chief Executive, but was formerly the FA’s Head of Financial Regulation.

Surely a time for new script writers of this particular soap, and a re-think of the plot.  The club does not need a re-run of a previous story line, especially one which led to the shambles the club now finds itself in.  Mind you, I’m not holding my breath.


PORTSMOUTH UPDATE - 11 September

Portsmouth did not get their golden share from the Football League yesterday because of incomplete paperwork (A).  David Lampitt explained that the end of the transfer window had made this problematic.  He expects this to be done within the next week.

The delay may have implications – it gives Tom Lever extra time to put his bid for the club together.


PORTSMOUTH UPDATE - 13 September

Thomas Lever is reported as falling out with Chris Dailly of Jumbo Bridging with whom he had been in talks about funding (B).  ‘Soap’ is definitely the right word for the Pompey saga.

Posted in Benefactors, Ethics, Fit and Proper Person tests, Football League, Governance, Insolvency, Ownership | Tagged: , , , , , , | 4 Comments »

The Woking way: Trumping at the Cards

Posted by John Beech on August 24, 2010

Some news from Woking that made even a jaded old observer such as myself sit up in his chair.  It wasn’t the fact that Chairman Shahid Azeem had quit (1) among concerns over the Cards’ losses (reported as £200,000 for last season), or that ‘benefactor’ Chris Ingram had stepped in again (2) to save the club.  These, after all, are not entirely unfamiliar stories at far too many clubs.  But first, a little background.

Woking joined the Conference in 1992, after a little floating around the divisions of the Isthmian League.  This led to a fine series of seasons on the Nineties, with regular appearances in the FA Trophy, which they won three times.

Their first appearance on my radar screen came in February 2002, when they faced a serious financial crisis (3).  Debts were reported thus “Woking’s trading company showed a deficit of £230,000 up to July 31 last year, added to a £325,000 loss already visible on the balance sheet. More crippling losses totalling £204,00 are understood to have been made so far in the current financial year.”  The club issued 1,000 shares for £255,000, Ingram acquiring 510 of them.  Ingram, a life-long fan, had recently sold his company Tempus for more than £400million.  He commented at the time “As I got closer I realised the club needed more business nous. There is a shortage of that at this level, not just here.  I’m going to try to make it a sustainable business so if I’m not here it can still work as that and resist pressure that supporters sometimes put on you to just spend, spend.   There will be much tighter purse strings. The authority to spend money will be narrowed down hugely.”  Again, not a particularly uncommon state of affairs, except perhaps the scale of his personal fortune.

In November that year the club went full-time, the ninth Conference club to do so (4).

In September 2007 the club got the go-ahead for the redevelopment of their stadium.  Ingram promised he would “provide a stadium worthy of our fans, community and town” (5).  In November the same year there was a structural re-organisation – Ingram  stepped back a bit, becoming Chairman of Woking Football Club (Holdings) Limited, while David Taylor became Chairman of the club (6).

Taylor adopted a hard line, sacking manager Frank Gray and his assistant Gerry Murphy (7), and announcing that “nothing will stop me being the chairman that takes this club into the football league” (8).  Furthermore he declared “I place on record, if the next man doesn’t deliver I will go as well” (9).

The following month Kim Grant was appointed manager (10), with Taylor upping the ante thus: “I will go if we do not get promoted in three seasons”.  Grant found himself sacked in September after seven games of the new season (11) after a disappointing start.  Taylor at this point offered to resign, a move rejected by the board (12).

Shortly afterwards Ingram really started to try and distance himself.  He was reported to be underwriting the club to the tune of £350,000 per season, but said that he intended to stop carrying on with his support from May 2009 (13).  Property developers, banks and the recession were to blame for the lack of progress with the stadium redevelopment.

In November, new Commercial Manager Geoff Chapple ‘rubbished plans’ for the club to revert to a part-time employment basis (14).  A share offer was placed via the Supporters Trust (15).  The following month spoke out in favour of regionalisation at the Conference level, commenting that (16).

January saw a slight change in financial strategy.  In an interview Taylor said “The decision we’ve taken is not to go fully part-time but, instead, to focus on getting the best set of players we can within the playing budget, regardless of whether they are full-time or part-time” (17).

By March last year there was talk of local businessman Shahid Azeem becoming involved in the club in some as yet unspecified way (18), although it would probably be at board level.  Shortly afterwards Taylor turned his attention back to the footballing side, sacking the latest manager, Phil Gilchrist (19).  He explained “The team weren’t even sweating [at half time].  That’s not what I want from a club, players who play for Woking will play with pride and give everything.  I got my fellow directors together and asked them their opinion, and as a board we made the decision at the end of the game”.  Ah, the old sweat factor as the determinant of whether to sack someone else.

Less than a fortnight later Taylor announced his intention of sacking himself, as soon as the club’s long-term future was clarified at the end of the season: “It was always my intention at some stage to stand down once the Kim decision happened.  I’ll stay on until something firm is place for this club.” (20).  It had always been his intention to resign after sacking Kim Grant apparently.  He offered three reasons for his decision: “One is that I made a mistake, I have to pay for that mistake and I have paid for that mistake every moment of every day for the whole of the season if anyone is in any doubt about that.  Secondly I can sit and complain or I can actually get up and do something and I am now making sure the future of this club is a lot brighter than it has been for the last 12 years.  I’ve been involved overseas and in this country speaking to potential purchasers and other shareholders.  The third reason is I do have to have some sanity back. I cannot wait to be either just a director or just going back on the terraces.”  The club meantime was moving towards relegation.

Ingram then announced that he was ‘giving the club back to the fans’ (21), a simple matter of him relinquishing his shares and fans buying them.  A current major shareholder, Peter Jordan, who had also helped bankroll the club in the past, offered an interesting insight into how ‘benefactors’ see themselves – “I do it as a hobby. I don’t drink, I don’t smoke, this is how I spend my money. There are lots of people out there who want to put money into the club”.

In June 2009, Taylor finally did stand down, and Shahid Azeem was appointed Chairman (22).

Ingram appears to have carried out his threat of withdrawing funding, as in August it was reported that striker  Craig Watkins had to pay his own transfer fee when joining the club (23).

A year on, and once again the club is in deep financial difficulty.  This year’s loss is reported to be around £200,000, which Ingram has had to step in and underwrite (24).  Azeem, who had put his own money into the club during the past season, had however lost the faith of the board and has gone (25).  He defends himself nonetheless, saying the club is now in a better financial position than when he came in (26).

Perhaps Woking is in no particular way untypical of football clubs.  It certainly shows characteristics that are far from unknown:

  • a ‘sugar-daddy’ whose commitment varies over time;
  • a Chairman who prevaricates over the right choice of manager, but seemingly does know eventually who doesn’t want;
  • a club losing money.

What then prompted me to sit in my chair.  Well, it was a matter-of-fact statement by Azeem in defending himself.  Tucked way in his comments was the following “The club has not made a profit since 1991”.  Let me just run that past you again, with some melodramatic emphasis: “The   club   has   not   made   a   profit   since   1991”, 1991 being a year before promotion to the Conference.

My access to football clubs at Woking’s level is patchy, and certainly doesn’t go back twenty years.  Is Woking, I wonder, unique in its inability to break even, or is it some kind of unfortunate record breaker?  It certainly is addicted to financial doping.  Not in a Pete Docherty wild excess kind of way; more in the way of someone who has become addicted to soft drugs over time and just can’t stop.

Is there any vestige of ‘financial fair play’ when a situation like this just rolls on and on and on?  How can the decision to remain full-time be reasonable if any sense of fair competitive balance is to be maintained?  How much longer can we hear that mantra that ambition leads to promotion, which in turn leads to prosperity?  Why does nobody seem to be too bothered with this situation?

Posted in Benefactors, Ethics, Insolvency, Ownership, Pyramid movement | Tagged: , , , , | 2 Comments »

 
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