Football Club Management: Insights from the Field 2017032506, 9781138697751, 9781315519173

Citation preview

‘I met Ian many months ago on the eve of a Fulham FC game away to Sunderland, and at that time the role of the director of football (DoF) was still relatively uncommon in the clubs hierarchy. Thankfully Ian has dedicated his time to articulate what many other authors have failed to achieve, producing a brilliant insight into how elite clubs operate and a “behind-the-scenes” look at the balance between football and business operations. I am sure this book will help to enlighten both football fans and academics and advance the role of the DoF in the modern game.’ Mike Rigg, former Technical Director at Manchester City FC and former Head of Talent Management at the Football Association ‘Ian’s book presents a clear and analytical review of the football landscape from both a management and business perspective. It provides the reader with a valuable and detailed insight into how professional football clubs are organised.’ Mark Wotte, former Performance Director at the Scottish Football Association ‘Having read through Ian’s book I am greatly impressed with what is a comprehensive academic study and essential reading for those looking to either break into football in a strategic capacity or those already in the game looking to learn of alternative approaches.’ Ben Marlow, Head of Football: 21st Club

Football Club Management

The rapid global growth of the sport industry has prompted the need for a more commercial approach to the management of sport clubs. This book is the first study of its kind to focus on the management of professional football clubs, providing a real-world insight into management principles and their practical application. The international commercialisation of football has led to a fundamental transformation of the industry’s management practices, given the financial rewards of success and the high price of failure. This book presents a critical examination of this transformation, questioning why clubs are increasingly adopting management strategies from other industries. Each chapter analyses the role played by a key leadership figure within a club, such as the owner, chief executive officer (CEO), chief financial officer (CFO), chief operating officer (COO), director of football (DoF), and head coach. Full of exclusive interviews, case studies and examples of best practice, this book sheds new light on the challenges of working in this extraordinarily highpressure environment. Football Club Management: Insights from the Field is fascinating reading for all those working in or studying the management, marketing or administration of football. Ian Lawrence is a Senior Lecturer in Sports Management at Teesside University, UK, where he runs the BA Hons Sports Management and Marketing degree programme. He has strong links to elite-level football both in the UK and the US. Currently, he leads on a number of research projects that explore the challenges faced by senior leaders and executives within the professional game. He is an Associate Member of the Centre for the Study of Football at Manchester Metropolitan University, UK, and serves on the Editorial Board for the Journal of Research Initiatives.

Routledge Research in Football

1

Elite Soccer Referees Officiating in the Premier League, La Liga and Serie A Tom Webb

2

The English Premier League A socio-cultural analysis Edited by Richard Elliott

3

Football Biomechanics Edited by Hiroyuki Nunome, Ewald Hennig, and Neal Smith

4

Football Club Management Insights from the Field Ian Lawrence

Football Club Management

Insights from the Field

Ian Lawrence

First published 2018 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 711 Third Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2018 Ian Lawrence The right of Ian Lawrence to be identified as author of this work has been asserted by him in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice : Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Names: Lawrence, Ian, author. Title: Football club management : insights from the field / Ian Lawrence. Description: Abingdon, Oxon ; New York : Routledge, [2018] | Series: Routledge research in football ; 4 | Includes bibliographical references and index. Identifiers: LCCN 2017032506 | ISBN 9781138697751 (hbk) | ISBN 9781315519173 (ebk) Subjects: LCSH: Soccer—Management. | Soccer managers. | Soccer teams. Classification: LCC GV943.3 .L39 2018 | DDC 796.334—dc23 LC record available at https://lccn.loc.gov/2017032506 ISBN: 978-1-138-69775-1 (hbk) ISBN: 978-1-315-51917-3 (ebk) Typeset in Sabon by Apex CoVantage, LLC

Contents

List of figures List of tables Preface Acknowledgements 1 The English professional football industry

viii ix x xiv 1

2 The owner(s)

15

3 The chief executive officer (CEO)

29

4 The chief financial officer (CFO)

42

5 The chief operating officer (COO)

57

6 The director of football (DoF)

71

7 The first-team manager/head coach

84

8 The academy manager (AM)

103

9 Career development

120

10 Conclusions: future industry business directions Appendix: job descriptions Glossary Index

130 139 155 159

Figures

1.1 The English professional football ‘pyramid’ 1.2 A typical club senior management structure 2.1 The number of foreign owners of EPL clubs, 2004/5–2016/17 3.1 Chief executive officer (CEO): organisational structure and line management responsibilities 3.2 The virtuous financial cycle of club revenue generation 4.1 Operating profit/(loss) and profit/(loss) before tax of Premier League clubs, 1998/99–2015/16 5.1 Chief operating officer (COO): organisational structure and line management responsibilities 8.1 Player pathway (holistic development) to the first team 9.1 Coach education: professional development pathway

2 11 17 30 39 43 63 113 123

Tables

1.1 1.2 3.1 6.1 6.2 7.1 7.2

The highest-revenue-generating professional sports leagues in the world Assessment of the accounts of EPL clubs and their ‘financial health’, 2015/16 Average durations of managerial spells, 2010/11–2015/16 Director of football (DoF): roles and responsibilities DoFs in the EPL, 2016/17 Traditional roles and responsibilities of a football club manager Traits and skills of leadership

3 7 34 74 76 86 90

Preface

The inspiration for researching and writing this book comes from being first and foremost a fan of the game and more precisely a Liverpool FC fan. Coming from a family of ‘Scousers’ who took their dedication to and support of the team to fanatical levels of devotion, I was fortunate to grow up in an era of unprecedented success for the team. The 1970s and 1980s were decades in which Liverpool fans became accustomed to winning and their players and coaches became mythologised in various autobiographical and biographical memoirs. However, the vast majority of those often soporific and romanticised accounts missed an intellectual opportunity to explore deeper questions of ‘why’ and ‘how’ they achieved success rather than simply describing the ‘what’, ‘where’ and ‘when’ of their behaviours. The motivation for this book is therefore to attempt to answer the fundamental core questions of why some individuals are more successful than others and how they achieve consistent and repeated success. The book aims to provide the reader with insight into the complex and dynamic work that takes place ‘behind closed doors’. As an industry ‘outsider’, I was granted privileged access to the complexities of elite club management, innovation and change within a dynamic industry.

Research approach A relatively small number of academics have managed to gain ‘face-to-face’ access to club executives and coaching staff for the purpose of objective and insightful research (Magee & Sugden, 2002). This appears to be due to a pervasive sense of scepticism by professional football towards engaging with industry ‘outsiders’ (Nestler et al., 2008; Parker, 1996, 2000). As such, elite football presents itself as ‘closed’ and distrustful of outsiders and therefore unlikely to consent to the majority of research requests. The historical reluctance to engage in research with individuals outside of its network may be in part due to concerns regarding the confidentiality of club operations, sensitivity regarding data and concerns regarding

Preface

xi

how access to staff and resources will be used and potentially ‘exploited’ by anyone from outside of their professional network. Such scepticism and uncertainty is exacerbated when two or more clubs participate in the same research (Relvas et al., 2010). In order to reassure external contacts of the motives underpinning the research it was considered in the best interests of all parties that both anonymity and confidentiality was assured from the start. This assurance was formally underpinned by adherence to the ethical approval guidelines required of such a project i.e. relating to primary data collection and presentation of findings. As a result, the process of nurturing and establishing a trusting relationship was long and problematic, but key to being afforded the opportunity to obtain rich and nuanced insight into the ‘what’, ‘where’, ‘when’, ‘how’, ‘which’ and ‘why’ of decision making. Trust in a research setting can be arguably accelerated if the researcher has the status of ‘quasi-insider’ (Wacquant, 1992). As a former semiprofessional football player, Roderick (2006) believes that he was afforded the status of ‘insider’ and afforded a level of legitimacy and trust in the eyes of the players he interviewed for his excellent book on the career and working culture of professional football players. This was not a status or legitimacy that this author could claim or use to leverage access to undertake detailed research interviews. An alternative participant recruitment strategy was therefore considered. Speculative requests for interviews, via social media and professional networks such as LinkedIn, were mostly unsuccessful – unsurprisingly so, given the industry reluctance to engage with outsiders. The majority of interviewees for this book came from professional contacts via industry ‘gatekeepers’. A gatekeeper in research terms is someone who provides access to his/her professional contacts and by doing so helps to reassure his/her colleagues of the integrity of both the researcher and the outputs of any collaboration. As mentioned above, the author did not have the status of quasi-insider and so referrals from high-profile industry gatekeepers were crucial in facilitating an introduction and potential access to club personnel. Most notable amongst the gatekeepers was Rick Parry. As a former Chief Executive of Liverpool and the Premier League Executive, Rick’s reputation and standing within professional football were essential in identifying potential contacts and establishing the credibility of the author via a mutual association. In addition, Rick was ideally placed to offer a number of recommendations regarding who, in his view, had industry insight i.e. the occupational experience, record of achievement and qualifications to facilitate the required research insight necessary for the book. Personnel interviewed were then asked to recommend colleagues who had both the professional credentials and a willingness to become potentially involved in the research. As a result, the sample of intended interviewees ‘snowballed’ from an initially small pool of contacts to an extensive network of mutual associations (Rubin & Rubin, 1995).

xii

Preface

In total, 16 senior club executives were interviewed from five different English Premier League (EPL) clubs. Interviews were undertaken by the author over a period of 15 months, between October 2010 and May 2017, and followed a semi-structured format with an ‘interview guide’ that utilised pre-defined topic areas to guide the discussion (Relvas et al., 2010). Broadly, the interviews began with an initial ‘introduction and background’ discussion of the rationale for the book, its anticipated structure and the ethical protocols associated with the interviewees’ participation. Second, the interviews probed the subjects’ professional background in order to contextualise and frame their career trajectory. Third, participants were asked to discuss their current roles and responsibilities within the club and to provide insight into its operational structures and working practices. Finally, interviewees were asked to critically reflect upon their own professional development and provide recommendations of how this could be further enhanced. Commitment to a series of in-depth, semi-structured interviews was challenging on the behalf of the interviewees, given the demands that such high-profile individuals have upon their time and availability. Inevitably, this meant that several subjects eventually withdrew from the research process due to the demands of their role and the inflexibility that this created. A commitment to detailed and inevitably time-consuming meetings was crucial if the book was to go beyond superficial observations and provide genuine insight. By allowing the subjects to identify and raise issues relevant to their own circumstances, the author ensured that the interview responses that followed were particularly candid regarding their career experiences (Andrews et al., 2005; Rubin & Rubin, 1995). Each interview was underpinned by sensitivity or ‘research empathy’ in order to help to minimise the ‘distance’ between researcher and respondent (Collinson, 1992; Oakley, 1990; Roderick, 2006). This was in part facilitated by maintaining a structure to each interview that was flexible, iterative and continuous. As a result, the research themes, identified in each chapter, were adapted in terms of how they were introduced into each interview according to the personality, interests and knowledge of the interviewee (Andrews et al., 2005; Daley, 2010). Reassurance of anonymity, I believe, was crucial in helping to put the interviewees at ease regarding whether their comments would be traceable, with concerns of how peers would evaluate their comments. This crucial feature of research preparation was obtained through pre-requisite ethical research formalities (required by both the researcher and interviewees). Each interview was then audio-recorded to allow for accuracy of recall and the data obtained analysed using a ‘thematic’ approach. Subsequent interpretation was then discussed with the interviewee to ensure that discussion points and conclusions accurately reflected the content of each interview. While the interviews within each chapter provide a number of specific implications for theory and practice, it is important to recognise the

Preface

xiii

study’s inevitable constraints. Beyond generalisability issues, interviewee comments and therefore data veracity may have been restricted by interactional effects such as poor recall, hindsight bias and self-preservation bias (Nestler et al., 2008).

References Andrews, D.L., Mason, D.S. & Silk, M.L. (2005). Qualitative Methods in Sports Studies. Berg. Collinson, D.L. (1992). Managing the Shopfloor: Subjectivity, Masculinity and Workplace Culture. Walter de Gruyter. Daley, C. (2010). Perceptions of Trust in Football Contexts: A Multi-Methodological Approach. PhD thesis, Northumbria University. http://nrl.northumbria.ac.uk/753/ 1/daley.cherrie_phd.pdf. Magee, J. & Sugden, J. (2002). ‘The world at their feet’: professional football and international labour migration. Journal of Sport and Social Issues, 26(4), pp. 421–437. Nestler, S., Blank, H. & von Collani, G. (2008). Hindsight bias and causal attribution. Social Psychology, 39, pp. 182–188. Oakley, A. (1990). Housewife. Penguin. Parker, A. (1996). Chasing the Big Time: Football Apprenticeship in the 1990s. Unpublished PhD thesis, University of Warwick. Parker, A. (2000). Training for glory, schooling for ‘failure’? English professional football, traineeship and educational provision. Journal of Education and Work, 13(1), pp. 61–76. Relvas, H., Littlewood, M., Nesti, M., Gilbourne, D. & Richardson, D. (2010). Organizational structures and working practices in elite European professional football clubs: understanding the relationship between youth and professional domains. European Sport Management Quarterly, 10(2), pp. 165–187. Roderick, M. (2006). The Work of Professional Football: A Labour of Love? Routledge. Rubin, H. & Rubin, I. (1995). Qualitative Interviewing: The Art of Hearing Data. Sage. Wacquant, L.J.D. (1992). The social logic of boxing in black Chicago: towards a sociology of pugilism. Sociology of Sport Journal, 7(3), pp. 221–254.

Acknowledgements

I would like to sincerely thank all of the contributors (interviewees) to this book. I would also like to thank all of the club personnel who gave up their valuable time to be interviewed for the book. The insight gained from the book is due to their enthusiasm, patience and support. In particular, I would like to extend my gratitude to Rick Parry for most generously providing his time and encouragement in writing this book. Last, but not least, I need to thank Becky, Grace and Charlie, without whose support this book would not have been possible.

Chapter 1

The English professional football industry

Introduction This chapter is intended to provide an overview of the English professional football club industry and in doing so highlight the complex business environment in which domestic elite clubs operate. The author aims to facilitate an appreciation of the multifaceted strategies and processes that underpin successful club operations, but the chapter does not serve as a detailed history of the global development of the game or delve into the political or sociological issues associated with its expansion and global popularity. Readers in search of such information are better served by reviewing the excellent research of Goldblatt (2008), Szymanski and Zimbalist (2006) and Murray (1994). It should be stated that the term used throughout this book is ‘football’. It is critical to differentiate the sport from others that are also commonly referred to as football, such as rugby union, rugby league, Australian Rules football and American ‘gridiron’ football. The rationale for using the specific term ‘football’ is set by historical precedent and the codification of rules and procedures of the modern game by the Football Association (FA), the first national football federation, founded in 1863, and the first professional football league in the world (the Football League), founded in England in 1888 (Szymanski & Zimbalist, 2006). The competition was established by its 12 founder clubs (Accrington Stanley FC, Aston Villa FC, Blackburn Rovers FC, Bolton Wanderers FC, Burnley FC, Derby County FC, Everton FC, Notts County FC, Preston North End FC, Stoke City FC, West Bromwich Albion FC and Wolverhampton Wanderers FC). A second division was added in 1892, and expansion to four divisions with 88 clubs in total came in 1923 (Mason, 1980). The growing popularity of the club game resulted in the organisational structure being further expanded to the current 92 club ‘pyramid’ and its spread over four divisions (Figure 1.1). The English Premier League (EPL) is regulated by the FA and governed separately from the remaining three lower divisions comprising the Football League (FL). The EPL and the top division of the FL are linked by the traditional system of end-of-season promotion and relegation, whereby the bottom three EPL

2 The English professional football industry

Figure 1.1 The English professional football ‘pyramid’

clubs are demoted and replaced by three FL clubs (Carmichael et al., 2010). The end-of-season and final EPL positions are determined by accumulated match points over regular season fixtures (three points for a win, one point for a draw, and no points for a loss), with any teams equal on total points ranked according to their aggregate goal difference. While the team topping the EPL is crowned as champions and qualifies for the following season’s UEFA Champions League competition, a number of other highly placed clubs also qualify for European competitions, along with the winners of two domestic knock-out cup tournaments played alongside EPL fixtures. Although all EPL clubs theoretically start the season as equals, their end-of-season objectives are inevitably different, reflective of their ownership, finances and revenue streams. While a small number of clubs are perennial contenders for competitive honours and qualification for lucrative European competition, many are peripheral, with the majority of clubs interpreting their continuing survival in the EPL as their priority. Averting relegation, and its potentially dire financial consequences, is a critical consideration for all teams (ibid.). The most significant contemporary organisational development in England took place in 1992, when the most successful club teams instigated a ‘break-away’ from their fellow league counterparts to create a rebranded and constituted new top tier, identified as the English Premier League (EPL). The motivation for the move was to enable the elite clubs to escape from the majority control of the ‘smaller’ teams and control the negotiation and sale of broadcast rights and distributed revenues. The result was that fledgling satellite broadcaster BSkyB won a substantial package of live rights for £191

The English professional football industry

3

million for the period of 1992–7 (BBC, 2015). BSkyB had self-evidently identified broadcasting elite club football as a key element of its strategy to dominate satellite television in the UK. By winning the contract to broadcast live games, they now controlled the supply of live football and therefore the success of the EPL ‘product’ both domestically and internationally in term of audience growth and market penetration for its commercial partners. Now broadcast via TV and the internet to a global audience estimated at three billion spread across 212 different territories, the EPL is statistically the most watched professional sports league in the world (PL, 2015). A highly marketable ‘on-field’ product has led to considerable ‘off-field’ revenue for the EPL. Currently, Sky and BT Sport (new entrants into the football broadcast market) have paid a record £5.136 billion for live EPL TV rights for three seasons from 2016/17 (BBC, 2015) (Table 1.1). This figure represents a 70 per cent increase on the previous £3 billion deal. The specific global appeal of the EPL can arguably be traced to a number of factors: primarily, the perceived quality of player performance on the field and the cosmopolitan melting pot it represents for individual clubs’ diverse multinational squads. For example, 25 per cent of the 552 players who went to the Euro 2016 tournament were contracted to a team within one of the four English football leagues. This figure is more than double the number from the German leagues and nearly four times as many as from La Liga in Spain (LMA, 2016; UEFA, 2016). The most successful teams, managers and players in the EPL have now become recognisable global brands with fan bases that are commercially nurtured by the individual clubs, domestic leagues and player agents to transcend national, cultural and linguistic boundaries. Historically, fans of football teams have identified with their team in large part due to an association with their place of birth, family connection, and community affiliation – an association that has been reinforced via the ‘live’ experience of watching their team in person. However, clubs are increasingly responding to demand for their football ‘product’ by creating ‘virtual communities’ or ‘imagined communities’

Table 1.1 The highest-revenue-generating professional sports leagues in the world Competition

Annual cost of broadcasting rights

Total cost of broadcasting rights

Duration of broadcasting deal

NFL (American football)

£3.24bn ($4.95bn)

£25.95bn ($39.6bn)

2014–22

NBA (basketball)

£1.7bn ($2.6bn)

£15.73bn ($24bn)

2016–25

MLB (baseball)

£1.02bn ($1.55bn)

£8.13bn ($12.4bn)

2014–21

English Premier League

£1.7bn

£5.14bn

2016–19

Sources: BBC (2015), Deloitte (2016), Forbes (2017), Statista (2017)

4 The English professional football industry

via their social media channels. Anderson (1991) considers an ‘imagined community’ to be one in which no face-to-face or live association is necessary to become identified or associated with a larger community. The inevitable consequence of the EPL being ‘consumed’ within a larger commercial global culture is that high-profile players and their managers sacrifice a level of intimacy and engagement with their audience, the fans. The contemporary sports star is the ‘hero of the consumer culture’ (Lines, 2001, p. 285). As Connell acknowledges (1992, p. 78), such stars function as privileged members of society and are the subject of public and press interest, and yet ‘there is more than a hint in all such stories and asides that the personalities are unworthy of the privilege they enjoy’. Tabloid newspapers in the UK, in particular, have a voracious appetite for the ‘darker side’ of sportsmen’s behaviour, where social media has exposed issues of moral impropriety (both on and off the field) to a global audience (McNamee et al., 2007; Mutz, 2015). From an economic standpoint, the organisational structure of competition within English club football has some marked differences to its US sporting counterparts (Szymanski, 2016). In US professional sports, the league teams work collaboratively in terms of the distribution of talent or the player ‘labour market’ (for example, salary caps and restraints on player mobility) and the ‘product market’ (sharing revenues from TV broadcast contracts). In professional football, such economic restraints are limited. Players are largely free to move within the club market and mobility is high. Typically, there is a degree of sharing of broadcast revenues, though this is seldom on the basis of strictly equal shares adopted in the US (ibid.). Within the English professional pyramid, respective club revenues fall significantly as one moves from higher to lower tiers. For example, the clubs in the EPL currently generate about seven times as much revenue as clubs in the Football League Championship, the next tier down (Deloitte, 2016). This reflects both lower revenues from broadcasting and sponsorship, where the money tends to be focused on the highest tier, as well as lower attendances and spending by fans, who are less attracted to lower-division competition (Szymanski, 2016).

Football finance: how do clubs make money? The financial ‘health’ of a football club can be gleaned from a variety of reputable sources, including commercial advisory service providers (for example, Deloitte, EY (formerly Ernst & Young) and KPMG), academic perspectives (for example, researchers like Stefan Szymanski and the website Swiss Ramble) and the clubs themselves, via the data declared and published via their annual reports at Companies House (a government agency with which UK companies have to file their annual reports). A review of the annual financial statements provided by clubs reveals that revenue is typically presented within three categories: ‘matchday’ sources, ‘broadcast’ sources and ‘commercial’ sources. However, it is worth noting that for a detailed analysis of revenue streams

The English professional football industry

5

between clubs, it would be necessary to obtain information not otherwise publicly available (Deloitte, 2014). For example, some differences between clubs, or over time, may arise due to different commercial arrangements and how the transactions are recorded in their respective financial statements. This may be due to different financial reporting parameters with respect of a club, and/or different ways in which accounting practice is applied to their transactions (ibid.). However, allowing for the above caveats with regard to accounting procedures, matchday revenue can be broadly categorised as income that is largely derived from gate receipts (including ticket and corporate hospitality sales). Meanwhile, broadcast revenue includes income from distributions from participation in domestic leagues, cups and European club competitions, while commercial revenue typically includes sponsorship, merchandising and revenue from other commercial operations. In the past, the bulk of a football club’s revenue came from gate receipts and fans buying food and drink inside the stadium (Bridgewater, 2010). Manchester United FC, for example, collected £108 million in ‘matchday’ revenue in the 2014/15 season (Deloitte, 2015). However, a growing proportion of an EPL club’s main income is now derived from other sources, such as TV broadcasting rights. In 2016, BT Sport and Sky Sports agreed a £5.136 billion venture to show live games from 2016 until 2019; this figure is a 70 per cent increase on the previous deal and equates to £81 million a season to each EPL club. Clubs also generate revenue from lucrative sponsorship deals, the most prominent being on the front of the players’ shirts: for instance, Standard Chartered agreed a £90 million three-year shirt sponsorship deal with Liverpool FC in 2015 (Deloitte, 2017). Clubs also generate income by selling shirts to fans, along with other club-branded merchandise. Sponsorship deals extend to banner adverts inside the stadium and in some cases naming rights for the stadium itself. In 2004, Emirates paid Arsenal FC £100 million for the naming rights of their new stadium for 15 years, along with an eight-year shirt sponsorship deal. However, the highest-profile manner in which clubs generate revenue is via their player transfer activity and the sale of players. For example, Tottenham Hotspur FC signed Gareth Bale in 2007 for £7 million, but sold him in 2013 to Real Madrid for a then record transfer fee of £85.3 million, making a profit of £78.3 million (BBC, 2013). Arguably, the definitive guide to contemporary football finance is produced by Deloitte, a professional services firm that specialises in providing commercial, financial and regulatory business advice to its clients. Now in its twentieth edition, the Deloitte Football Money League profiles the highest-earning clubs in Europe and their relative financial performances. The ever-changing financial landscape of football over the past two decades has been both extraordinary and fascinating in equal measure. When the Deloitte Football Money League was first published covering the 1996/97 season, Manchester United FC topped the table with revenue of £88 million. In the most recent 2017 survey, the club has regained top spot,

6 The English professional football industry

with revenue nearly six times greater than in 1997. In the 20 editions of the Money League to date, 42 different teams from 11 different leagues around the world have taken a place in the top 20, with only ten teams managing to remain ever-present in the top 20. While clubs from outside the ‘big five’ European leagues have made occasional appearances in the top 20, the dominance of clubs from England, France, Germany, Italy and Spain has become more apparent, particularly in the most recent editions. This dominance reflects the growing trend of ‘polarisation’, common not only in the Money League but also across much of the football world. The revenue ratio between the top-earning club and the bottom-earning club in the top 20 in 1997 was 3.2:1. It is 4:1 in the 2015/16 edition. The polarisation between the top and bottom clubs is arguably accelerating. Promotion can also increase the level of expectation and create pressure to retain a position in the world’s richest league. A club can get overexcited and the board can sanction acquisitions that fall outside a reasonable budget and seriously threaten the short- and even long-term financial future of the club. This recalls the experience of Queens Park Rangers, who accumulated losses of £143 million despite generating about £250 million in revenue during their stay in the EPL. QPR managed to spend a startling £285 million on wages and £114 million on player purchases, while their level of debt surged to a peak of £194 million. The financial accounts of EPL clubs in 2015/16 show nine clubs reporting profit before tax, which has reduced from 11 in the prior year. To illustrate how the EPL clubs’ finances have evolved, Table 1.2 sets out some key measures of the 20 member clubs in each of the seasons for the previous two broadcasting cycles. The table illustrates an increasing gap between clubs’ revenue and their staff costs, reflecting the decrease in wages as a percentage of revenue from 70.3 per cent in 2010/11 to 60 per cent in 2013/14 before a gradual increase to 62.3 per cent in 2015/16. EPL clubs’ operating profits remain relatively stable, but they have recorded pre-tax losses of £111 million, after two consecutive seasons of pre-tax profits. The season saw EPL clubs grow revenues by almost 10 per cent to over £3 billion, with the two Manchester clubs alone responsible for the majority of the increase. Manchester United’s participation in the 2015/16 UEFA Champions League, coupled with continued strong commercial revenue growth, resulted in a 30 per cent increase in revenue to £515 million. This saw them top the 2017 Deloitte Football Money League for the first time since the 2003/04 season, as the world’s highest-revenue-generating club. Increased distributions to clubs competing in Europe (under the new UEFA broadcast rights cycle) – notably Manchester City FC, who reached the semi-finals of the UEFA Champions League – also contributed to EPL clubs’ revenue growth. Their revenues increased to a new record of £3.6 billion in 2015/16, according to Deloitte. Wage costs increased by 12 per cent to £2.131 billion, resulting in combined operating profits (excluding player trading, net interest charges and the ‘amortisation’ of player contracts) of £0.5 billion (2014/15: £0.5 billion).

The English professional football industry

7

Table 1.2 Assessment of the accounts of EPL clubs and their ‘financial health’, 2015/16 2010–13 broadcasting cycle

2013–16 broadcasting cycle

2010/11

2011/12

2012/13

2013/14

2014/15

2015/16

Number of clubs reporting profit before tax

7

7

6

14

11

9

Aggregate net profit/(loss) before tax (£m)

(382)

(241)

(268)

201

50

(111)

Aggregate operating profit/ (loss) (£m)

(452)

(368)

(344)

(50)

(172)

(309)

Total revenue (£m)

2,104

2,253

2,422

3,078

3,234

3,420

Total wages & salaries (£m)

1,478

1,578

1,688

1,846

1,990

2,131

Wages to revenue (%)

70.3

70.1

69.7

60.0

61.5

62.3

Total net assets (£m)

1,387

1,601

1,745

2,169

2,725

2,520

Total external debt (excluding owner debt) (£m)

1,186

1,095

1,018

1,010

1,035

1,187

Note: Data from the 20 member clubs of the subsequent season was not yet available and so the results of the three promoted clubs playing in the Championship are included. Source: PL (2015)

A combination of increased wage costs, increased amortisation charges arising from EPL clubs’ then record transfer expenditure in the summer 2015 transfer window, and £110 million of exceptional costs, resulted in an aggregate pre-tax loss of £111 million in 2015/16 – the first combined pre-tax loss since the 2012/13 season. Analysis of Table 1.2 reveals a return to pretax losses, following two consecutive years of pre-tax profits; however, it is worth noting that the EPL’s new three-year broadcast rights deal will most likely see a return to record levels of profitability in the 2016/17 season.

The structure and organisation of a football club The working structure of a professional football club is the subject of much conjecture due to the paucity of empirical research surrounding the topic, and in recent years little has changed to alter that perspective (Gammelsæter, 2006; Relvas et al., 2010). Indeed, it is unclear how a football club’s

8 The English professional football industry

structure and organisation should even be defined. Gammelsæter’s consideration of Mintzberg’s model outlined in The Structuring of Organizations (1979) with regards to professional football clubs reveals that stability and effectiveness are based on notions of order, coherence and consistency. Such mechanisms appear to align with managerial practices, such as total quality management (TQM). The tenets of TQM are similar to the aims of a professional club in attempting to increase organisational success through the participation, satisfaction and commitment of all stakeholders (De Knop et al., 2004). Similarly, the Baldrige National Quality Program’s (2009) performance excellence framework embodies seven categories of good management practice that could underpin analysis of club structure: 1 2 3 4 5 6 7

leadership strategic planning customer and market focus measurement, analysis and knowledge management HR focus process management results. (Frick & Simmons, 2007)

Within an organisation, decision-making structures, such as the board of directors within a football club, are regarded as the executives held responsible for the organisation’s goals, priorities and reporting mechanisms (Kikulis et al., 1995). Moreover, executive personnel need to encourage and guarantee stakeholders’ full commitment in order to establish and maintain the effectiveness of the organisation. Indeed, the shared values and goals of the organisation must be clear and accepted by all stakeholders (Slack & Parent, 2006). In order to guarantee that all stakeholders know the values and goals of the organisation (Ferkins et al., 2005), and what is expected of them in terms of contributions towards the aims of the organisation (Woodman & Hardy, 2001), the decision-making structure must develop a sound, robust and clear communication system. Woodman and Hardy emphasised the need for such a policy as they maintained that the main workplace stressors include communication failures, ambiguity regarding the aims of the organisation, lack of awareness of people’s roles, lack of role structure, and the difficulty in fulfilling two (or duplicate) roles. Moreover, role ambiguity, role conflict, role overload and lack of knowledge and responsibility seem to play an important part in the development of staff satisfaction and effectiveness in the discharge of their responsibilities (Seegers & van Elderen, 1996). A higher level of decision making and more written procedures have been positively linked to a better and clearer communication process (Wilkesmann & Blutner, 2002) and, consequently, to an increase in the organisation’s effectiveness (Kimberly & Rottman, 1987).

The English professional football industry

9

The FA does not prescribe or specify the required organisational format of any football club, other than a condition to establish what legal entity the club is and how it intends to be recognised for tax purposes (FA, 2015). The organisational flexibility permitted by the FA allows each club to decide on which structure to adopt depending on its overall purpose. As a consequence, football clubs can take one of several different legal structures, depending upon the purpose for which it is formed. The most common of these structures are: 1 2

3

‘unincorporated association’ (the most common structure for an amateur club); ‘private company limited by guarantee’ (the most common structure for a club formed primarily for participation purposes rather than personal profit); ‘private company limited by shares’ (the most common structure for English professional clubs that are formed with a view to profit).

In the latter legal structure, the shareholders of a club are the members either via subscribing for shares from the club or by buying shares from an existing shareholder (typically based on the value of the club at the time of acquisition). The company is owned by shareholders, who elect the ‘directors’, who have a duty to promote the success of the company, to act in its best interests and to comply with its ‘Articles of Association’ (i.e. the company’s constitution). Shareholders typically have the right to receive a dividend (if declared, out of the club’s distributable profits); and therefore this legal structure is particularly attractive to owners or investors who wish to invest in the club as a potentially profit-making operation, as they can benefit from the payment of dividends and an increase in the value of their shares (which can be sold, subject to the incorporated club’s governing document, the Articles of Association). The advantages of this legal structure for the club is that, first, it has a ‘separate legal identity’; in other words, if it becomes insolvent, then the members (i.e. the shareholders) will not be liable for the company’s debts other than to the extent that they have not fully paid the company for the shares that they hold. In addition, shares in the company can be bought and sold, subject to any restrictions in the Articles of Association. Third, if anyone – either individually or in conjunction with other shareholders – holds over 50 per cent of the issued shares, then he/she can control the appointment and removal of the board of directors; if anyone holds 75 per cent or more of the issued shares, then he/she is, among other things, able to change its Articles of Association. This feature creates considerable pressure upon shareholders to consider who will sit on their board of directors or club committee. The implications of this have far-reaching implications for the general governance structure of the club. Clubs are therefore ‘free’ to determine how they wish to be managed; however, in practice, the simplest

10 The English professional football industry

approach appears to be to leave all decisions to the board of directors to determine on a majority vote basis. In the case of ‘deadlock’ (i.e. a 50/50 split of votes in favour and against), the chair is only entitled to a second or casting vote if the Articles of Association expressly allowed this. It may be practicable and/or desirable to delegate certain powers to management committees or other sub-committees, or to allow members to participate in certain decision-making processes in general meetings (FA, 2015).

The board People have been gathering together for centuries to delegate authority and ensure the workings of society from food and education provision to defence of their communities (Gevurtz, 2004). In contemporary society, elite football clubs have evolved from their social and community roots to become businesses for profit. In doing so, they have evolved into businesses that compete for talent and a place within the market. As a consequence, clubs now have a need for a group of leaders who are held responsible for overseeing clubs’ short-term performances and long-term strategic operations (Figure 1.2). Collectively, board members are responsible for strategic planning and reviewing resources, driving transformation and creating a competitive advantage for their club. In terms of structure and governance, the chairman of the club is held responsible for directing the board and the chief executive officer (CEO) runs the club business (Michie & Oughton, 2005). To avoid the concentration of power in the hands of the full-time salaried heads or ‘executive directors’ of a club, the conventions of good business practice are that no less than one third of the board of directors should comprise ‘non-executive’ directors (ibid.). These are experienced individuals who are principally employed as part-time consultants by the CEO (Johnson et al., 2008). The overall aim is that non-executive directors can act as ‘critical friends’ in offering a more external or objective view of club strategy. However, there are legitimate concerns regarding the objectivity and independence of non-executive directors’ views given that such appointments are normally made by the CEO personally, and from within his/her own professional networks (ibid.). The role of the CEO is examined in detail in Chapter 3; however, given the strategic importance of leadership provided by the CEO, it follows that board members’ most important job is to hire and fire the CEO. The board should oversee the performance evaluation and measurement of the CEO on a daily basis. Although stakeholders are not privy to the dynamics of how boards interact, research by Price and Toye (2017) provides some macro business health indicators that indicate whether a board is accelerating i.e. dynamic in helping to drive company performance forwards. This research reveals that the boards of highly successful companies (‘superaccelerators’, in Price and Toye’s terms) tend to be smaller (on average, 11 members versus 13 board members for companies that have plateaued). The conclusion is that a smaller board membership facilitates clear, efficient and effective lines

The English professional football industry

11

Figure 1.2 A typical club senior management structure

of communication and accountability for the owner. In addition, highly successful companies tend to have board members who are ‘industry insiders’ i.e. experts with professional insight and a track record of having successfully implemented business transformation (an average of 47 per cent coming from outside of their specific industry domain). Familiarity with specific industry norms and expectations means that new board members are fully cognisant of the need to be totally committed to a role in which shareholder and stakeholder activism has helped to ensure that the demands placed on directors to achieve progress, both on and off the field, remain constant. Directors have a wide range of potential roles and responsibilities within a club board, depending on the needs of the organisation and their terms of employment. However, each director – regardless of his/her specific role – has a ‘fiduciary’ or legal and ethical responsibility to act in the best interests of the club’s stakeholders as set out in the Companies Act 2006 (FA, 2015). In evaluating potential new board members, it is important to consider whether they ‘add value’ across the broader board discussion by being able to contribute to a variety of committees (Heidrick & Struggles, 2016). Depending on the club structure and board membership, this might extend to monthly meetings to discuss a variety of club-related topics such as finance, operational management, governance, corporate social responsibility, legal issues, marketing, etc. However, there is now arguably an increasing need to specifically recruit digitally astute directors (ibid.). With more than three billion people now online globally (Davidson, 2015), how clubs conduct their business and how fans experience clubs’ products and services have changed profoundly. Moreover, the digital age is rapidly transforming how fans interact with one another, and how they develop online communities. In the UK, about one-third of internet users access the web primarily via smartphone (Hern, 2015), and in Europe, one in seven retail transactions is now completed through contactless payments (Dakers, 2016). The responsibility of the board is to decide which skills and competencies are needed within their executive and how best to recruit those directors. While no one has a crystal ball, the above digital commerce trends suggest that club boards need digitally astute directors to bolster more traditional skill sets in areas such as strategy, law, finance, sales and governance.

12 The English professional football industry

As a result, the ownership of any club must critically review and manage the composition of their board. Traditionally, the chairman of the board is the most senior person on the company’s board of directors, which is the group that legally has the final word on what the company does. The chairman is elected by the other members of the board, and usually is neither an employee of the company nor works full-time on company business. The board as a whole (but not the chairman individually) is responsible for the company’s overall strategy and major strategic decisions, as well as hiring (and firing) the CEO. The chairman of the board will typically serve ex-officio on all board committees (including the executive committee), run all board meetings and consult frequently with the CEO. While the chairman’s vote has the same weight as that of any other director, there is often an implied seniority and gravitas to the chairman’s role. The one exception to this structure is in the case of an executive chairman, who works in a full-time, compensated, operating employee role and directly manages the CEO (although, depending on the particular company and people involved, both might instead report directly to the board). Because all power in a company ultimately stems from the board of directors, which represents the interests of all shareholders, the board determines just how much power it delegates to the chairman and the CEO. Thus, for a chairman to ‘get more power’, he/she needs to have sway over the other members of the board, either technically (because the chairman has the right to appoint them) or unofficially (because the other members will take the side of the chairman in the case of conflicts with the CEO). In any ‘ordinary’ organisation, philosophical and strategic alignment between all senior executives is a key factor in success (21st Club, 2017). If the workers on the shop floor endorse the vision of the organisation, then head office has a greater chance of fulfilling that vision. But football clubs are not conventional organisations (ibid.). Stakeholders are often focused upon what could be described as short-termism or a demand for instant gratification. Success and what defines it are contextualised in relation to fans’ expectations, the board and, most crucially, the club ‘owner’ (the focus of the next chapter).

References 21st Club. (2017). Changing the Conversation: A Collection of Insights for Football Club Boardrooms. Amazon. Anderson, B. (1991). Imagined Communities: Reflections on the Origin and Spread of Nationalism. Verso. BBC. (2013, 1 September). Gareth Bale joins Real Madrid from Spurs in £85m world record deal. www.bbc.co.uk/sport/football/23538218. BBC. (2015, 10 February). Premier League TV rights: Sky and BT pay £5.1bn for live games. www.bbc.co.uk/sport/football/31357409. Bridgewater, S. (2010). Football Management. Palgrave Macmillan.

The English professional football industry

13

Carmichael, F., McHale, I. & Thomas, D. (2010). Maintaining market positioning: team performance, revenue and wage expenditure in the English Premier League. Bulletin of Economic Research, 63(4), pp. 1–34. Connell, I. (1992). Personalities in the popular media. In Dalgren, P. & Sparks, C. (eds). Journalism and Popular Culture. Sage, pp. 65–83. Dakers, D. (2016, 26 January). Contactless cards now used for one in seven sales. Telegraph. www.telegraph.co.uk/finance/newsbysector/banksandfinance/12120370/ Contactless-cards-now-used-for-one-in-seven-sales.html. Davidson, D. (2015, 26 May). Here’s how many internet users there are. Time. http://time.com/money/3896219/internet-users-worldwide. De Knop, P., Van Hoecke, J. & De Bosscher, V. (2004). Quality management in sports clubs. Sport Management Review, 7, pp. 57–77. Deloitte. (2014). The Football Money League 2014: All to Play For. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/global/Documents/ Audit/gx-deloitte-football-money-league-2014.pdf. Deloitte. (2015). The CFO Journey: Opportunities and Uncertainties Facing the Finance Leader. https://www2.deloitte.com/content/dam/Deloitte/br/Documents/ finance/cfo/TheCFOJourney_.pdf. Deloitte. (2016). Deloitte’s sports industry starting lineup: trends expected to disrupt and dominate 2017. https://www2.deloitte.com/us/en/pages/consumer-business/ articles/sports-business-trends-disruption.html. Deloitte. (2017). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf. FA. (2015). Club Structures: A Guide to Club Structures for National League System and Other Football Clubs. www.northamptonshirefa.com/~/media/countysites/ northamptonshirefa/documents/football-Club-structures_2015.ashx. Ferkins, L., Shilbury, D. & McDonald, G. (2005). The role of the board in building strategic capability: towards an integrated model of sport governance research. Sport Management Review, 8, pp. 195–225. Forbes. (2017, 19 January). Manchester United now biggest sports team in the world. www.forbes.com/sites/mikeozanian/2017/01/19/manchester-united-now-biggestsports-team-in-the-world/#19c0b4c123d4. Frick, B. & Simmons, R. (2007). The Impact of Managerial Quality on Organizational Performance: Evidence from German Soccer. Lancaster University Management School Working Paper. Gammelsæter, H. (2006, September). In search of the structure of the professional football club. Paper presented at the 14th European Association of Sport Management Congress, Nicosia, Cyprus. Gevurtz, F.A. (2004). The historical and political origins of the corporate board of directors. https://ssrn.com/abstract=546296. Goldblatt, D. (2008). The Ball Is Round: A Global History of Soccer. Penguin. Heidrick & Struggles. (2016). Inside the Digital Boardroom. www.heidrick.com/~/ media/Publications%20and%20Reports/Inside_the_digital_boardroom.pdf. Hern, A. (2015, 6 August). Smartphone now most popular way to browse internet. Guardian. www.theguardian.com/technology/2015/aug/06/smartphones-mostpopular-way-to-browse-internet-ofcom.

14 The English professional football industry Johnson, G., Scholes, K. & Whittington, R. (eds). (2008). Exploring Corporate Strategy (8th ed.). Prentice Hall. Kikulis, L., Slack, T. & Hinings, C. (1995). Sector-specific patterns of organizational design change. Journal of Management Studies, 32(1), pp. 67–100. Kimberley, J. & Rottman, D. (1987). Environment, organization and effectiveness: a biographical approach. Journal of Management Studies, 24(6), pp. 595–622. La Liga. (2015). Professional Football Financial Report. http://files.laliga.es/ 201604/15171007memoria-economica-2015_eng_webv15042016.pdf. League Managers Association (LMA). (2016, September). Kicking off. The Manager (preview), 29, p. 7. Lines, G. (2001). Villains, fools or heroes? Sports stars as role models for young people. Leisure Studies, 20(4), pp. 285–303. Mason, T. (1980). Association Football and English Society, 1863–1915. Branch Line. McNamee, M., Jones, C., Cooper, S.M., Bingham, J., North, J. & Finley, V. (2007). British spectators’ perceptions of the values and norms in selected professional sports: a comparative ethical survey. Leisure Studies, 26(1), pp. 23–45. Michie, J. & Oughton, M. (2005). The corporate governance of professional football clubs in England. Corporate Governance: An International Review, 13(4), pp. 517–531. Mintzberg, H. (1979). The Structuring of Organizations. Prentice Hall. Murray, W. (1994). Football: A History of the World Game. Scolar Press. Mutz, M. (2015). Transnational public attention in European club football: current trends and driving forces. European Societies, 17(5), pp. 724–746. Premier League (PL). (2015). Barclays Premier League Season Review 2014–15. http://pulse-static-files.s3.amazonaws.com/premierleague/document/2016/07/02/ 8c512768-05db-4be9-9a10-7295d3fc82d7/2014-15-premier-league-seasonreview.pdf. Price, C. & Toye, S. (2017). Accelerating Performance: How Organizations Can Mobilize, Execute and Transform with Agility. Wiley. Relvas, H., Littlewood, M., Nesti, M., Gilbourne, D. & Richardson, D. (2010). Organizational structures and working practices in elite European professional football clubs: understanding the relationship between youth and professional domains. European Sport Management Quarterly, 10(2), pp. 165–187. Seegers, G. & van Elderen, T. (1996). Examining the model of stress reactions of bank directors. European Journal of Psychological Assessment, 12(3), pp. 212–223. Slack, T. & Parent, M. (2006). Understanding Sport Organizations: The Application of Organization Theory (2nd ed.). Human Kinetics. Statista. (2017). The Statistics Portal. www.statista.com/search/?q=professional+sport. Szymanski, S. (2016). Professional Asian football leagues and the global market. Asian Economic Policy Review, 11(1), pp. 16–38. Szymanski, S. & Zimbalist, A. (2006). National Pastime: How Americans Play Baseball and the Rest of the World Plays Soccer. Brookings Institution Press. UEFA. (2016, 3 June). Where do the 552 Euro players come from? www.uefa.com/ uefaeuro/news/newsid=2371017.html. Wilkesmann, U. & Blutner, D. (2002). Going public: the organizational restructuring of German football clubs. Soccer & Society, 3(2), pp. 19–37. Woodman, T. & Hardy, L. (2001). A case study of organizational stress in elite sport. Journal of Applied Sport Psychology, 13(2), pp. 207–238.

Chapter 2

The owner(s)

Introduction Historically, the first owners of professional football clubs in nineteenthcentury England were mostly wealthy local businessmen who had a passion for their town and its inhabitants. This passion translated into the investment of a proportion of their wealth, time and energy in establishing and then patronising their local team. Much of this initial benefaction could be argued to be a form of philanthropy, corporate social responsibility or an attempt to ‘give something back’ to the local community for social and sporting reasons and not for commercial gain. Football at this formative stage of its existence was a game played mostly by males who were attracted by its simplicity of rules, organisation and ‘cheapness’ (Walvin, 1986, p. 1). The catalyst for further growth and the potential for commercial gain during the nineteenth century was wider societal and economic improvements for the inhabitants of England’s town and cities (Carter, 2006). Most notably, legislative changes such as the Factory Act in 1850 brought in by the government of the day reduced the number of working hours that could be demanded by employers. This created an opportunity for factory workers to take part in leisure and entertainment on a Saturday afternoon and thereby a window of opportunity to exploit the demand for football. However, it was not until much later in the nineteenth century that owners responded to growing matchday attendances and began to expand and develop their facilities. During this period, aggregate attendances at professional football matches rose from approximately 600,000 during the first season of the Football League in 1888 to over 8.5 million in 1913 (Mason, 1980). Owners now increasingly recognised the entrepreneurial opportunities that were emerging as the popularity of the club game soared. The increased revenue from gate receipts, refreshment sales, marketing and advertising led to further expansion of stadiums to accommodate an increased number of spectators. The commercial potential of the game was now apparent for all owners to recognise, and with it the need to compensate its players in heralding a new era of professionalism (Carter, 2006).

16 The owner(s)

In contemporary society, professional club football structures bear little resemblance to their historical roots and have changed dramatically in response to a variety of social, economic, political and technological factors. However, the key factor that has accelerated change is the commercial attractiveness of teams within the EPL to reach a global audience of three billion viewers in 212 territories around the world. The pervasive reach of the EPL brand and the capacity of its clubs to engage an international audience is fundamental in offering appeal and value to prospective owners and investors. The attraction appears to be quite simply that EPL clubs offer superior revenues and growth rates compared to the majority of their European club counterparts. A review of European club finance by Deloitte (2017) reveals that EPL clubs’ combined revenues for the 2015/16 season rose to a record £3.6 billion, which is 9 per cent up from 2014/15. Growth in club revenue typically comes from two major sources: broadcast and commercial income fees shared by the Premier League (£2.4 billion shared among 20 teams depending on their finishing position, ranging from £150 million for Chelsea FC as champions to £93 million for Sunderland AFC in 20th position (PL, 2017)) and the rewards for taking part in international club competitions such as the UEFA Champions League. According to Szymanski (2007, p. 204), ‘there is no doubt that the big clubs view success in the Champions League as their primary objective’. Although it is now ten years old, this research is still valid in 2017, particularly following the continued growth in popularity of Europe’s most prestigious club competition within global markets. First, there are significant financial incentives for qualification to take part: a total of more than €1.3 billion was shared among the clubs competing in the 2016/17 UEFA Champions League (UEFA, 2016). Second, clubs can now use the global exposure obtained via progression within the competition to generate indirect revenues via an expanded audience and greater appeal for sponsors (Pawlowski et al., 2010; Rohde & Breuer, 2016a). Given the seismic shift in the commercial landscape of English elite club football, it is not surprising, therefore, that there have been significant changes in terms of club ownership, the most noteworthy of which has been the influx of private and foreign investors into Europe’s elite clubs (Rohde & Breuer, 2016a; Scelles et al., 2014) (Figure 2.1). The new generation of billionaire owners and investors tend to have superior financial resources at their disposal, which are strategically deployed to purchase high-calibre players and secure the services of managerial talent in the pursuit of success both domestically and on an international stage. As such, the financial investment in ‘on-field’ performance may be indicative of a new strategy of owners focusing on ‘profit maximising’ (Franck, 2010; Kuper & Szymanski, 2009; Wilson et al., 2013). The first question to ask when analysing the role of the owner is: what makes a ‘good’ owner? Is it ensuring financial stability and self-sustainability? Is it

The owner(s)

17

20 18 16 14 12 10 8 6 4 2 0 5

4/

0 20

6

5/

0 20

7

6/

0 20

8

7/

0 20

9

8/

0 20

10

9/

0 20

11

0/

1 20

12

/ 11 20

13

2/

1 20

14

3/

1 20

15

4/

1 20

16

5/

1 20

17

6/

1 20

Figure 2.1 The number of foreign owners of EPL clubs, 2004/5–2016/17

strong investment and a willingness to propel the football club to greatness, no matter what the cost? Or is it a desire to centre the club on communitybased principles and make sure that ticket prices are affordable? Many fans would argue that a good owner should have all of those characteristics. Owners are held responsible for safeguarding the future of the club. Since the explosion in popularity of the EPL, foreign investors and companies have looked with curiosity at the top division in this country and, as the years have gone on, at lower-league teams as well. They have looked at clubs as either an opportunity or an investment depending on the vision of the specific individual. Some have bought clubs and sought to exploit the commercialisation of the league in order to boost the clubs’ global standing and institute a ‘brand’ makeover. Historically, fans have been regarded as the ‘lifeblood’ of football clubs through their role in providing gate money and buying merchandise (House of Commons Culture, Media and Sport Committee, 2011). As such, the power of fans to influence and act as catalysts for change should not be underestimated. Typically, fans’ concerns centre upon the financial motives of some club owners as they seek to maximise what supporters perceive as short-term profit at the expense of long-term stability. Concerns regarding the level of due diligence undertaken by clubs regarding prospective ownership changes led to football licensing authorities such as the Premier League reviewing the applications of individuals to become club owners. The legislation that followed required applicants to be reviewed against the Premier League’s (2009) criteria for the selection of ‘fit and proper’ owners and directors of football clubs, later superseded

18 The owner(s)

by the Owners’ and Directors’ Test (2012). Test criteria specify that owners and directors: • • • • • •

must not be involved directly or indirectly with another club; must not have a significant interest in another club; must not be prohibited by law to be a director; must not have committed any of a list of criminal offences; must not have been made bankrupt or taken voluntary bankruptcy; must not have been a director of a club that has suffered two separate events of insolvency.

In addition, a new ‘disqualifying events’ category has been incorporated by the Premier League in 2017 to further test the financial qualifications and conduct of any applicant. For the first time, the Premier League’s rules now allow it to block a prospective new owner or director if he or she has engaged in conduct outside the UK that would constitute an offence according to UK law.

Multi-club ownership (MCO) The above development reflects the increasingly cosmopolitan nature of the EPL and its attraction to foreign investors and new ownership structures. One such structure is known as ‘multi-club’ model of ownership (KPMG, 2017). The ambition of club owners to expand their business interests from a share in one club to several around the globe has become increasingly commonplace in the last decade (Dimitropoulos & Tsagkanos, 2012; Rohde & Breuer, 2016b, 2017). The motives for clubs to extend their ownership portfolio is fuelled by a commercial desire to leverage their intellectual property rights and in doing so both expand the ‘global footprint’ and drive ‘operational synergies’ (i.e. the ‘pipeline’ of player recruitment, development and sales; ‘economies of scale’ i.e. sharing of business ‘best practices’, etc.) between the ‘parent’ club and any partner. However, any potential partnership opens up questions regarding ‘conflict of interest’ and challenges to the integrity of any competition in which owners have a majority shareholding in a competitor. This concern is addressed by UEFA within Article 5 of their competition regulations, which prohibits any company or private individual having control or influence over more than one club in the same European competition (i.e. Champions League or Europa League) (UEFA, 2015). However, such European restrictions have not prevented clubs from being creative and expanding their ownership portfolio to those teams that either do not compete in UEFA-sanctioned competitions or compete outside of the confederation (KPMG, 2017). Within the EPL, the most prominent multi-club owners are Manchester City FC, who currently also own New

The owner(s)

19

York City (USA), Melbourne City (Australia), Club Atlético Torque (Uruguay), Girona (Spain) and Yokohama F. Marinos (Japan). Business strategy involves seeking competitive advantage – something that makes a club more successful than its rivals (Szymanski & Kuypers, 1999). For successful leadership in a highly competitive league, there is inevitable imitation and replication of tried-and-tested ideas. A club owner must therefore not only have the prerequisite business acumen but also the capability to optimise the ‘strategic assets’ of the club e.g. a star player, manager, location or club reputation (perhaps embodied in a brand and the narrative surrounding its history) that attracts fans and employees (players and staff) to the club. The owner therefore needs to try to establish a competitive advantage for the club which is sustainable, while mindful of the structural macro-environmental constraints in which the league operates. The business imperative for the Premier League is to maintain and grow the appeal of the league for as diverse an audience as is feasible. Attraction to the league’s ‘product’ is predicated upon competitive balance and the uncertainty of each game outcome. Therefore, any interference from individual clubs that aims to upset competitive balance is likely to encounter restrictions imposed by the Premier League. Domination of a league by the richest club owners who can afford to buy the most expensive players is therefore counterproductive to competitive balance. Ultimately, a league in which only a small number of clubs have a chance of winning is held to be less appealing to an extended audience than one in which any one of a large number of teams could win (ibid.). Hence, UEFA have attempted to encourage club teams and their national leagues to adopt forms of selfregulation that reduce financial disparities between clubs with the intention of boosting sporting competitiveness as a consequence. In the UK, and in the European Union more generally, the legal status of regulations relating to transfer systems, restrictions on ownership, redistribution mechanisms and the collective (rather than individual) negotiation of TV rights has increasingly been challenged as competition law has strengthened. There is a case for a return to greater regulation, if necessary to be provided by a government-appointed regulator along the lines of those running the formerly nationalised industries (Hamil et al., 2004). Despite the inherent structural concerns within football governance, and the challenges that lie ahead, the professional game remains attractive to investors and wider commercial entities.

Case study: interview with an owner I became the owner of the club because first and foremost I’m a fan. It certainly wasn’t because I thought I was going to make any money out of my involvement. At the same time, you cannot allow your heart to rule what

20 The owner(s)

should be objective evidence-based business decisions. Buying a football club is unlikely to yield much of a return, and if that’s your motive, then you are probably making the wrong decision to become involved in the first place. Probably heart ruling the mind in those instances. I think it’s possible to balance your responsibility to both the fans and the community while behaving in a financially responsible manner; but that means sometimes disappointing fans and making financial decisions that aren’t always very popular, such as the sale of high-profile players. I don’t think that the average fan fully appreciates that, despite the revenue that we as a club make from the Premier League broadcast deal and our other commercial revenue streams, the majority of teams in the league struggle to ‘break even’. This is ironic, given that the goal of creating the Premier League was to try and stabilise club finances. The league during my time has made collective operating losses of between £450 million and £300 million per season, which means that, despite the impressive broadcast deals and popularity of the game globally, only half of the teams in the league can expect to make a profit before tax. I know that last season [2016/17] in the Championship [the second tier of football in England], only two or three clubs made an operating profit and only four or five made a net profit once player trades were taken into account. Clubs unfortunately chase success and in many cases compromise the long-term sustainability of the club. There is no real reason why a club cannot break even and aim to make a profit. Half of the clubs in the Premier League do currently, so it’s not unachievable. It takes good planning, though, and financial discipline. I personally disagree with what happened at Manchester United FC. The Glazer family bought the club not because they were fans but because they recognised the value of its global brand. The cost of buying the club was then loaded onto the club itself, with the revenues it generates used to pay down the debt and interest that the Glazers undertook to buy the club, ultimately leaving them with a multi-billion-pound asset. It’s a very risky strategy that is predicated upon United retaining their status as one of the best teams in Europe. Success on the field translates to commercial success off it in terms of sponsorship, etc. But this means that they have to succeed on the pitch both domestically and internationally if they are to manage the debt and grow the asset value of the club. The main reason why the majority of clubs fail to make profits, though, is due to the growth in player wages. Last season, the average ratio of wage bill to turnover was 70 per cent. Since the inception of the Premier League more than 20 years ago, 80 per cent of the increase in revenues has flowed into wages [Yueh, 2014]. If as a club you are able to exercise control over wage costs, then you have the key to financial stability. By controlling costs, you are heading towards making your club profitable. The situation is worse if you look at the Championship, though, where

The owner(s)

21

the average ratio of wage bill to turnover was around 90 per cent. The reason for it is they are chasing promotion into the Premier League and the revenue that comes along with it. The gap in funding makes promotion from the Championship to the Premier League a huge financial deal and owners lose sight of the implications of the gamble not paying off. By surviving [in the Premier League] for one season, you are going to receive £90 million plus, which was the case for Sunderland AFC this year, and so the financial carrot is enormous. Buying a club is not for the faint hearted, that’s for sure. People commit to the football club like no other industry I’m familiar with. By that, I’m not just talking about the fans in the stadium. I’m also describing the employees at the club. Football drives that connection, which makes it a special industry to be involved in. I can understand why we have so many foreign interests in the Premier League given the quality of the game and the passion of the support. I guess that 50 per cent of the teams both in the Premier League and the Championship are owned by foreign businessmen. Clearly, these individuals don’t have a sentimental, emotional or family connection to the club, but they invest their fortunes all the same. Roman Abramovich [the Russian owner of Chelsea FC] has probably invested and written off over £1 billion since he bought the club, as will have Sheikh Mansour at Manchester City FC. I respect their investment, but appreciate that for them their football clubs represent a way of expanding their brand – whether it be national image, airlines or petrochemicals – to a global audience. The football club in this instance becomes part of a bigger portfolio of business interests, co-branding and reach to a different audience potentially. If you are successful with your football team, you enter into markets that conventional marketing can’t access. My concern is when the club game becomes a pawn for nation states to exercise some form of image building or soft power. Owning a football club is like no other business venture. Yes, I agree in principle with the observation, but every business owner says the same thing. I think that’s just human nature. When you travel and do as much business as I do, you soon recognise that everything is underpinned by human logic, even if sometimes it’s difficult to identify. Each business has a context, a market that fluctuates in response to supply and demand, competition that changes both domestically and overseas – all of which you need to constantly scan and appraise, be agile. Not that different to what your players are doing constantly on their stage. In business, you need to find your competitive advantage, especially when you are competing with market leaders and clubs who are twice as big as you are. You can learn from your competition, maybe even copy some of their ideas that have worked to ensure your growth: for instance, the marketing of Manchester United FC and the investment in their youth academy structures. In a hyper-connected world, we are only a tweet or a Facebook post

22 The owner(s)

away from communicating and building relationships, but it all fails with the wrong product. It’s really a question of picking out the fundamentals and applying them to your context. What is your vision for the business? How will you achieve that vision over the next five to ten years? The vision is dictated by how deep your pockets are financially and how much you are prepared to pay for your talent. Our aim is to maintain our Premier League status. In Germany, Spain, Italy, etc., there are usually two or three teams that dominate and win their top league. Outside of that, there are 17 or 18 other teams that compete within a lower stratum of the same division. We compete in a league within a league and need to be skilful in how we manage our budget and avoid repeating the mistakes of clubs such as Leeds United FC. ‘You cannot spend beyond your means’ is the clear message. In my other businesses, it’s essential that if you wish to hold on to your top talent, you need to create an enjoyable and supportive work environment – that’s clear. However, you also need to pay what the market demands. Professional football players are our talent and so are our support staff, and by that I mean that everyone from the first-team coach to the medical team, etc. is key in allowing the players to play to their full potential. I think this is borne out within wider employment research and certainly correlates within professional club football. Those teams that pay the highest salaries usually finish in the best table positions. My job is to ensure that we operate on a sound financial basis but are cognisant of needing to generate sufficient revenues to pay the required salaries. There is an expectation both from the board and our fans that each season we improve, which means having the best talent available to us within our budget constraints. The dream for every fan, and I’m one of them, is to have a team of ‘galácticos’ or superstars, but we have to operate responsibly. We are not in the same position as Florentino Perez to invest €250 million in new players at Real Madrid. As a result, I think we are innovative in terms of how we recruit and develop our talent. You have to look hard in every business to find out where the opportunities are, where you can innovate and place a new weighting or interpretation on the data you have and then be brave enough to try them out. Who our competitors are is relatively straightforward. You can identify them via their league position. But what can we learn from them? How did they maximise all of their income streams? There are three main sources of revenue for a football club. Broadly speaking, they are matchday income, commercial and broadcasting. Broadcasting is the main income stream for us, as for most clubs. The income from matchdays has increased significantly over the time we have been in charge. When we refurbished our stadium, we used the opportunity to consider how best to address the current and predicted future demand we had from all of our fans, whether they be season ticket holders, corporate hospitality or VIP boxes, etc. We aim to fill our stadium for each game, but

The owner(s)

23

be mindful of who our market is. To build an 80,000-seater stadium at this stage in the club’s development would not make financial sense. We need to be pragmatic in forecasting the demand for attending our games, plus making sure that we have the best atmosphere possible. Having empty seats does not help in that process. This means that to get near capacity each week requires our ticket pricing to be among the lowest in the league and to offer good value. Results are the key factor. Winning creates a momentum, which leads to demand, both on and off the field. The greatest potential for growth and expanding our turnover is within the commercial or marketing department of our club. By maximising our sponsorship, pre- and postseason tours and merchandising, we can add significant growth. However, our appeal as a club to commercial partners is very much dependent upon our Premier League status. If we can maintain and consolidate our position, we become much more attractive as an investment, both domestically and overseas. In wider business, you need to define your unique selling point. You can also see that in professional football, with the brand of football that is played by Barcelona or Real Madrid, for example. Winning is at the core of it, though. You need to win first and foremost – that should be our brand. Brands cannot be built upon business criteria; they need to be built on emotions and our fan values, and that means winning. I’m convinced that our fans will tolerate winning ugly if we win. At this stage in our club’s strategic journey, we need to be regarded as winners. This is our product upon which we can evolve over time. We cannot expect the revenue we [as clubs] obtain from television broadcasting deals to keep on growing. At some stage, revenue from that source will plateau and eventually fall. Markets grow and expand. My responsibility, along with my fellow directors, is to anticipate that change and make the necessary provisions. The industry has experienced similar disruptions with the impact of Bosman and next is Brexit. In essence, the supply and demand for your product will inevitably change. We as a club need to make sure that we are financially resilient enough to cope with any changes. The club means a great deal to me, as you can imagine. I’m the owner, but also the custodian of something that means so much to so many people in our region. I appreciate this because my family grew up supporting the team and going to every home game. I’m a fan and have been ever since I can remember. I think this personal connection has helped me in appreciating how much the club and its success means to our supporters. Our market is regional; I’m not sure that expanding in search of an international audience is necessarily a good fit for us currently. The club is a big part of our fans’ everyday lives and we fully appreciate that. With that understanding comes a great deal of responsibility, something we take very seriously. As custodians, we need to remember that we are accountable to our supporters and need to do everything we can to make sure that we are moving forwards,

24 The owner(s)

but at the same time we can’t jeopardise our long-term survival by compromising ourselves financially because we are fans. As fans, it’s even more important that we are aware of any perceptual bias and blind spots that fans can be victim of. As the owner, I need to facilitate the best decisions in the best interests of the club. I understand the frustrations of fans, not just at our club but also at others, when they see incredible transfer fees and wages being paid to certain players. The reality, however, is that our club cannot operate according to those metrics. In a nutshell, each owner and CEO is trying to manage fan expectations for their respective team. We as a board are optimists, but also need to be pragmatic in terms of setting conservative targets; how we communicate this is important, but difficult. Survival [i.e. avoiding relegation] is the immediate priority for any newly promoted team. Consolidation of position is the second-year plan and progress each year up the table is the medium- to long-term ambition for the majority of clubs. Supporters have ambitions for their club, which we respect, but the club need to communicate realistic and achievable targets and plan how best to exceed those targets. The ambition has always been to use our academy as the focus of developing players and bringing them into the first team; it’s a form of continuity that the fans expect from us. I think we have an excellent track record of nurturing talent from our region. I’m proud of what our academy has achieved and this will always be our preferred method of supporting the first-team manager. I’m acutely aware that fans become frustrated with club owners, managers and players when the team is experiencing problems on the field, but it’s my responsibility to make sure that we plan for the long term and do not have a knee-jerk reaction to setbacks. The ‘behind-the-scenes’ work is my focus, which inevitably is the least glamorous aspect of football, but incredibly important in providing the platform for our team to go out and do their best. At a board level, we are responsible for putting in place the structures that will help us to win, both on and off the field. It’s unfashionable to talk of business metrics within professional football, but football is a business. Failure to recognise this will lead to a club going bankrupt, and we’ve all watched owners and executives who have compromised the future of their teams by spending more than they earn in pursuit of success. I don’t believe that we have the right to gamble with something as important as the longevity of a football club. It’s too important for that. The idea that football clubs should be run as a business is anathema to many fans, but it’s a strategy for the long term that is sustainable and that we won’t compromise. I recognise that football is unlike any business I have encountered. There aren’t too many businesses that have the visibility and media exposure that professional football has. Millions of people viewing and reviewing your performance on the pitch, social media continuing the review with analysis from every angle and misconceptions

The owner(s)

25

reinforced and perpetuated all leads to a frenzy of interest. However, it does increase the pressure on everyone, both on and off the field, to maintain a coherent long-term philosophy and strategy. My role is to ensure that I support club staff in delivering progress in a calm, objective and considered manner. For example, a run of defeats does not necessarily mean that we should intuitively lose faith in our manager. If we have undertaken the appropriate robust due diligence when it comes to appointments, we must be prepared to be calm, patient and trust in our appointments. This means providing our employees with a clear set of responsibilities for which they are accountable and against which they are ultimately judged. We try to avoid creating overly complex job descriptions with far-ranging responsibilities; in my experience, this leads to dilution of efforts and inefficiencies. We all have limited bandwidths; it’s easy to become distracted, especially with our addictions to smartphones. As a board, we meet regularly to focus on relevant issues, but mostly to ensure that we step back from our daily tasks and the associated ‘noise’ and reflect on the long-term club planning. This kind of step-back allows us to take collective responsibility for our strategic decisions and not become distracted by any short-term demands or blind spots. Organisational stability is a reflection of such long-term planning and I believe a hallmark of anyone or anything aspiring to achieve long-term success. Better-informed decisions at a board level will logically increase our chances of success. You only have to review what happened at Manchester United FC and the fall-out from Sir Alex’s retirement as manager. The same kind of organisational stability has potential benefits for each of our respective departments at the club. I work closely with the CEO when discussing senior appointments. We like to be proactive rather than reactive when making executive appointments. What I mean by this is that if you haven’t undertaken appropriate research and don’t have contingency plans in place, then you are potentially exposed. We have, in the past, had our senior staff ‘headhunted’ by other clubs, which has caused significant disruption. In business, there are a variety of tools and methods used to ‘scan’ and review the credentials of potential new staff. The key is to spend as much time as possible in analysis. You can see the disruption that clubs such as Southampton FC have experienced in the last five to ten years, both in managers being headhunted and players being sold. Testament to the efficiency and rigour of their data analysis and scanning of potential talent is that they appear to have contingency plans for the majority of talent succession scenarios that they are likely to be faced with. The challenge is not to allow individuals to become complacent. If we have recruited the ‘right’ people, they have the mindset of challenging, thinking innovatively and pushing boundaries. A great deal of what constitutes an innovative or enquiring mind is now termed ‘disruption’. I tend to regard

26 The owner(s)

such management speak as ‘old wine in new bottles’, but I do challenge our staff to avoid being complacent – and that means being creative and testing received wisdom. I think those are key ingredients for any organisation and my role is to nurture that kind of philosophy via our appointments, staff training and excellent links with sporting and commercial partners. Remember, I’m a fan, but we have a civic responsibility to make sure that the club is run appropriately and that means making difficult decisions, not all of which we will get right. What we will not shy away from doing is falling into any form of ‘sunk cost bias’ or becoming paralysed by embarrassment regarding errors. This means that if we have made a mistake, we will not continue investing time, energy and resources in that area. You need to trust your appointments and the due diligence that is undertaken during recruitment. However, the reality is that even with the most diligent and scientific recruitment process, mistakes can be made. An individual who has achieved success at one club may not be able to transfer the same success to a new club. It’s a challenge for every club, and one that’s amplified by being the owner who is held accountable by the fans. I think a number of fans and indeed the board can be seduced by charismatic ‘special ones’ or ‘super leaders’. First and foremost, they are high achievers and have a great track record of success, but they seem to empower the fans, players and staff around the club with their smile, sense of humour, engaging personality, etc. I’ve worked with quite a few people who fit the bill as charismatic, highly successful leaders, but I’ve also see that charisma turn sour when results don’t go their way and that energy and smile become unravelled and ultimately toxic. It’s at that stage that we are forced to make a change. Professional football operates within the wider entertainment industry. As such, we face competition for attention and from the cinema, other sports, leisure activities, etc. The advantage we have within football is the emotional attachment that our fans forge with their club over time. It’s something that is passed down through our families and friends, but we cannot take this commitment for granted. We can’t win every week, but we can certainly make sure that our players commit every week. It’s very important that we don’t lose sight of what our fans expect.

References Carter, N. (2006). The Football Manager: A History. Routledge. Deloitte. (2017). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf.

The owner(s)

27

Dimitropoulos, P.E. & Tsagkanos, A. (2012). Financial performance and corporate governance in the European football industry. International Journal of Sport Finance, 7(4), pp. 280–308. Franck, E. (2010). Warum deutsche Fussballklubs in der Champions League den Kürzeren ziehen. CRSA Working Paper, 36, pp. 1–13. http://repec.business.uzh. ch/RePEc/iso/ISU_WPS/124_ISU_full.pdf. Hamil, S., Holt, M., Michie, J., Oughton, C. & Shailer, S. (2004). The corporate governance of professional football clubs. Corporate Governance: The International Journal of Business in Society, 4(2), pp. 44–51. House of Commons Culture, Media and Sport Committee. (2011). Football Governance: Written Evidence at 28 March 2011. www.publications.parliament.uk/pa/ cm201011/cmselect/cmcumeds/writev/792/792we.pdf. KPMG. (2017, 21 April). Multi-club ownership: a diversified portfolio strategy. www.footballbenchmark.com/multi_Club_ownership. Kuper, S. & Szymanski, S. (2009). Soccernomics. HarperSport. Mason, T. (1980). Association Football and English Society, 1863–1915. Branch Line. Pawlowski, T. & Anders, C. (2012). Stadium attendance in German professional football: the (un)importance of uncertainty of outcome reconsidered. Applied Economic Letters, 19(16), pp. 1553–1556. Pawlowski, T., Breuer, C. & Hovemann, A. (2010). Top clubs’ performance and the competitive situation in European domestic football competitions. Journal of Sports Economics, 11(2), pp. 186–202. Premier League (PL). (2017, 1 June). Premier League value of central payments to clubs. www.premierleague.com/news/405400. Rohde, M. & Breuer, C. (2016a). Europe’s elite football: financial growth, sporting success, transfer investment, and private majority investors. International Journal of Financial Studies, 4(2), pp. 12–23. Rohde, M. & Breuer, C. (2016b). The financial impact of (foreign) private investors on team investments and profits in professional football: empirical evidence from the Premier League. Applied Economics and Finance, 3(2), pp. 243–255. Rohde, M. & Breuer, C. (2017). The market for football club investors: a review of theory and empirical evidence from professional European football. European Sport Management Quarterly, 17(3), pp. 265–289. Scelles, N., Helleu, B., Durand, C. & Bonnal, L. (2014). Professional sports firm values: bringing new determinants to the foreground? A study of European soccer, 2005–2013. Journal of Sports Economics, 17(7), pp. 688–715. Szymanski, S. (2007). The future of football in Europe. In Rodriguez, P., Kesenne, S. & Garcia, J. (eds). Sports Economics after Fifty Years: Essays in Honour of Simon Rottenberg. University of Oviedo Press, pp. 191–210. Szymanski, S. & Kuypers, T. (1999). Winners and Losers: The Business Strategy of Football. Viking. UEFA. (2015). Regulations of the UEFA Europa League 2015–18 Cycle. www.uefa. com/MultimediaFiles/Download/Regulations/uefaorg/Regulations/02/35/92/45/ 2359245_DOWNLOAD.pdf. UEFA. (2016, 25 August). 2016/17 Champions League revenue distribution. www. uefa.com/uefachampionsleague/news/newsid=2398575.html.

28 The owner(s) Walvin, J. (1986). Football and the Decline of Britain. Palgrave Macmillan. Wilson, R., Plumley, D. & Ramchandani, G. (2013). The relationship between ownership structure and club performance in the English Premier League. Sport Business Management International Journal, 3(1), pp. 19–36. Yueh, L. (2014, 27 February). Why on earth buy a football club? www.bbc.co.uk/news/ business-26365955.

Chapter 3

The chief executive officer (CEO)

Introduction In virtually every organisation, no leader is more influential than the chief executive officer (CEO) (Finkelstein et al., 2009). In elite club football, the CEO can now be regarded as an executive leader of a transnational corporation (TNC). Football clubs, like their global business counterparts, now possess global corporate supply chains that manufacture, distribute and market their branded products. In the case of football, this extends beyond the broadcast distribution of games to a wide range of branded merchandise such as team kit, leisure wear and associated paraphernalia (Giulianotti, 2002, 2007; Giulianotti & Robertson, 2004). Strategic decisions made by a CEO and his/her fellow directors, therefore, now have global ramifications for how the club is consumed by both their domestic and now global communities of supporters. As such, the club CEO is required to have the leadership and managerial skills to focus the diverse systems and business initiatives that exist within his/her organisation upon how best to develop and maintain its competitive advantage (Odgers Berndston, 2017; Porter, 1985). The CEO’s ability to act as the focus, the ‘glue’ and the inspiration that binds together the collective strategic thinking of a culturally diverse workforce within any club is pivotal in developing and maintaining any competitive edge. Within club football, therefore, the role of CEO is typically one of high pressure and one where the individual is held fully accountable by the board and its shareholders for achieving strategic differentiation and competitive advantage. Ultimately, the ability to engage and inspire stakeholders at all levels across the business, from board members to fans and the media, is crucial to the longevity of the CEO’s tenure. Accountable in most cases for the day-to-day running of the club, the CEO works closely with the chairman to set and manage a budget that ensures that the club operates in a sound and sustainable way. Depending on the nuances of how each individual club decides to operationalise its structure, the CEO may

30 The chief executive officer (CEO)

potentially have oversight of club matters both on and off the field of play or, conversely, focus upon one or the other. Ultimately, the CEO is the senior strategic member of the board and reports directly to the owner(s) and the club’s board of directors.

The typical responsibilities and profile of a CEO A review of job descriptions and responsibilities for advertised roles reveals that football club CEOs have a wide range of potential responsibilities, ranging from commercial and matchday to first-team recruitment activities. More broadly, CEOs are held responsible for achieving results, but responsibility for performance across the club is delegated to various heads of department (Figure 3.1). In essence, the CEO must aim to create a culture and context for decision making that is embedded throughout the organisation. The pivotal role that the CEO plays within any club is reflected by his/her salary. Remuneration figures for the CEOs working within the EPL range from £100,000 to £1 million per year according to publicly listed club accounts at Companies House. Heidrick & Struggles’ most recent demographic study of global chief executives (2017) established that CEOs are typically male, and this is also reflected in sport. Professional sport brings with it many traditions and is sometimes an anchor to the past, which challenges sports governing bodies and clubs to adapt to more inclusive and diverse ways of operating. Research documented within the Gender Balance in Global Sport Report (Women on Boards, 2016) identifies that there has been no real progress with regard to the number of women on sports boards at governing body level. In England, the FA’s recent proposal to reserve three places for women on its council board from 2018 still has to be approved by its 122-person council – an overwhelming male body historically resistant to reform (Women on Boards, 2016). Of the 20 teams competing in the 2016/17 EPL season, only Everton FC, Leicester City FC, Tottenham Hotspur FC and West Ham United FC had women identified as directors within their clubs. However, no club within the league had a woman listed as CEO.

Figure 3.1 Chief executive officer (CEO): organisational structure and line management responsibilities

The chief executive officer (CEO)

31

CEOs are not surprisingly highly educated, with a range of undergraduate and postgraduate qualifications that span accountancy, economics, law and business. However, the typical background appears to be an educational and industry experience in finance. Expertise in finance may be in part due to the continued scrutiny of earnings, regulatory concerns and audit committee requirements with which clubs are required to comply. As a result, high-level industry expertise and a track record of success within business make this background vital for any professional football club. There is a growing need for executives to complement a business background with experience within broader consumer-facing industries. Football fans, however, are commonly regarded as being ‘exceptional’ with respect to ‘traditional’ consumers due to their heightened levels of emotional attachment, affiliation and brand loyalty to their club (Samara & Woss, 2014). It is this understanding and appreciation of relationship marketing that allow commercial departments within clubs, and specifically CEOs, to add value to their clubs’ revenue streams. An appreciation of the complex ways in which fans identify, attach and make decisions is therefore an important requirement for any CEO and his/her marketing communications team. The CEO is clearly the person entrusted by the owner with creating a high-performance organisational culture and context for decision making, but it appears that there is a lack of understanding as to how effective working culture is established and sustained (Cruickshank et al., 2013). The mechanics of how this culture is facilitated is opaque and difficult to establish, given the insular world of professional football. Whether such changes are most effectively brought about subtly and covertly by leadership stealth or overtly by high-profile changes in staffing is open to conjecture (Bell et al., 2013a). However, what is transparent is that despite the EPL’s collective profitability, only nine of the EPL clubs managed to make a pre-tax profit in 2015/16. As discussed earlier, this is in large part due to the failure of clubs to control their costs. The outlays on player registrations (transfers), player wages and stadium development are the principal causes of this, and are the responsibility of the CEO. Another significant cost for professional football clubs and for their CEOs is the ‘hiring and firing’ of staff. Acquiring the ‘right’ manager is integral to a club’s onfield success. Conversely, the appointment and subsequent dismissal of the wrong manager can be extremely costly, as managers are entitled to compensation if their contracts are terminated early (Brady et al., 2008). The role of the CEO therefore involves analysing the risks associated with his/her strategic decision making. The finances and emotional attachments that are associated with club football mean that the risk of making the wrong decision places enormous pressure on CEOs and their boards of directors to make the best decisions in the best interests of all stakeholders. The implications of the task are brought sharply into focus once a consideration of the anxiety-elevating nature of change is accounted for within

32 The chief executive officer (CEO)

clubs i.e. the multiple and varied motivations in professional team settings, and the power ‘flux’ between team management and the staff, players and superiors (Thaler & Sunstein, 2003).

The role of trust and risk In football, the first-team manager or head coach possesses a great deal of control over crucial factors that can impact on outcomes on the field of play: for example, player selection, formation, tactics, etc. In essence, trust is placed in the team to produce the desired outcome. Trust is also a key feature of any decision-making process regarding the appointment or termination of any employee’s contract by the CEO. Underpinning any appointment is the calculation of risk. Risk itself may be considered to be the level of uncertainty and vulnerability inherent within any situation; the latter may be based upon the level of reliance and the importance of the outcome. For a CEO, there is a clear need to be trusted by his/her superior (the owner), and to have trust in his/her own decision making and his/her appointments. Therefore, if the CEO is to be a transformer and consolidator of club culture, he/she will need to build and develop the levels of trust necessary to shape a shared vision and a common set of priorities across the club and its partnerships. Butler (1991) has proposed that the foundation of trustworthiness in any decision-making process is a characteristic of the trustee. He set out what he termed ‘conditions’ of trust; these were essentially ten characteristics of the trustee that could elicit trust from a ‘trustor’. The ten factors were: availability, competence, consistency, discreteness, fairness, integrity, loyalty, openness, promise fulfilment and receptivity. In retrospect, Butler’s list could be conceived as ten markers used by trustors to gauge ‘trustworthiness’; as such, the ten present an interesting starting point for discussions on the factors employed in trust appraisals (Daley, 2010). According to this view, trustors may make specific appraisals of the personal characteristics of trustees before awarding trust. For a CEO, this is typically focused upon previous achievements, reputation and character within professional football and (potentially) prior previous personal interaction with prospective candidates. While a variety of definitions and conceptualisations of trust exist, it is important to note that at the centre of these definitions is ‘risk’ or something to lose (ibid.). In the context of professional football, outcomes are heavily reliant upon the actions, and indeed interactions, of other group members (directors, managers and players). Individuals cannot precisely predict the actions of others, and so the risk that an individual will not act in the predicted and hoped-for way is always present. This aspect of the working environment contributes to the situational ‘uncertainty’ and, in turn, the perception of risk and vulnerability within football organisations. Vulnerability or reliance may exist to a greater or lesser extent in almost every scenario of human interaction, but is

The chief executive officer (CEO)

33

exacerbated when responsibility for a desired outcome is placed on a single individual (ibid.). In the case of club football, that reliance, vulnerability and risk is focused upon the head coach. The dilemma for the CEO is that, given his/her expertise in a business context (with multiple objectives), he/she has to clearly and transparently communicate the long-term vision and business strategy to the head coach (whose prime responsibility is the performance of the team in the short to medium term). The differences in priorities and the lack of transparency in communication within clubs has inevitable consequences for employee careers. The highest-profile and most controversial decisions that CEOs are likely to make lie within the process of appointing first-team managers or head coaches – decisions that are likely to have implications that extend beyond the football stadium to the stock exchange. Research conducted by Bell et al. (2013b) reveals that, on average, a managerial sacking results in a share price rise of 0.3 per cent, while a resignation leads to a drop in share price of 1 per cent, cumulating in a negative abnormal return of over 8 per cent from a trading day before the event. The implications of this are that sacking a poorly performing manager may be interpreted by the markets as a possible route to better future match performance, whereas losing a capable manager through resignation will result in a drop in a club’s share price (ibid.). From a legal perspective, the CEO must proceed cautiously when considering which manager or head coach to appoint. Under the Employment Rights Act 1996, managers have the same rights as any other UK employee in any other industry (Santy, 2012). Poor performance is a potentially fair reason to dismiss an employee, but any club needs to follow a ‘fair procedure’ before carrying out such a dismissal, and this will involve giving the employee time to improve and offering support. A ‘reasonable’ employer might be expected to allow an underperforming employee several months to turn things around but, in professional football, timescales can be very short; managers can find themselves dismissed having lost only a small number of games (ibid.). According to the League Managers Association, the body that represents current and former professional football managers, the average duration of a managerial spell in the EPL is currently 1.93 years, and across all four professional divisions 1.29 years (LMA, 2016) (Table 3.1). The CEO has a key role in the research, due diligence and appointment of the best managerial candidate. Given the noticeable ‘churn’ or turnover of managers that is identified within Table 3.1, legitimate concerns can be raised about those executives who are responsible for their club appointments. Currently, there appears to be a lack of formal leadership training and recruitment experience within football clubs. As a result, many club boards and CEOs employ ‘executive search’ or headhunting agencies or consultancies to help inform, screen (assess and evaluate) candidates and direct the

34 The chief executive officer (CEO) Table 3.1 Average durations of managerial spells, 2010/11–2015/16 Season

Premier League

Championship

League 1

League 2

Overall average

2015/16

1.93 years

1.13 years

0.97 years

1.26 years

1.29 years

2014/15

1.80

0.86

1.41

1.44

1.23

2013/14

1.22

1.93

1.48

1.08

1.44

2012/13

2.81

1.04

1.37

2.57

1.84

2011/12

2.65

1.96

1.39

1.46

1.70

2010/11

2.09

0.89

1.67

1.33

1.45

Source: LMA (2016)

recruitment search; high-profile industry recruiters include Nolan Partners, Sports Recruitment International and the Executives in Sport Group. The challenge for club owners when deciding which external agency to commission is in trying to establish whether the agency understand the club’s culture and whether it will ultimately be worth the investment. The consequences of appointing the ‘wrong’ candidate can be costly to the club and lead to organisational instability. Traditionally, the focus is laid upon the first-team manager as the pivotal appointment in any club’s success; however, the risks faced by organisations and shareholders when a CEO departs are significant. Yet most clubs appear to adequately plan for this. The imperative for any owner and board is to ensure that there is in place an effective and reliable CEO succession strategy (Wowak et al., 2014). This means that owners have to identify those individuals – both internally and externally – with the skills to fulfil the organisation’s ambitions and mitigate the risks and the implications of any transitions. Although confidence plays a significant role in the normal employee– employer relationship, it is particularly important within football (Santy, 2012). A successful manager who has the ‘confidence’ of the club and its fans can be a ‘talisman’, drawing the best performances out of players and creating the virtuous circle of self-belief translated into results. Legally, an employee who has been employed for two years can bring a claim of unfair dismissal in the employment tribunal if submitted within three months of his/her dismissal. This is a statutory claim under the Employment Rights Act 1996 and any compensatory award is capped in most cases (currently at a maximum of £72,300) (ibid.). This means that pursuing such claims is not really worthwhile for higher earners such as senior executives or managers within professional football. Such high earners can recover uncapped damages for wrongful dismissal (breach of contract) in the ordinary courts (ibid.). Sacking football managers

The chief executive officer (CEO)

35

can therefore be an expensive and reputationally damaging business for CEOs, clubs and managers.

Case study: interview with a CEO If you ask any one of my colleagues how they became a CEO, they will usually be quite self-effacing and tell you that it was due to hard work, long hours and a bit of luck. But what they probably won’t reveal for the sake of appearing arrogant is that each of us is ambitious, we have a proven set of business skills, have delivered results and are good networkers. Networking is important in any walk of life, but especially so in business. Most CEOs are more likely to be promoted internally rather than headhunted by external recruitment agencies. This makes good sense to me, as the owner or chairman knows you and has seen whether you are a good ‘fit’ for the organisation. It’s like an extended interview, I suppose, in which owners have the opportunity to go beyond your CV and see what actually makes you tick and where you can add value to the company. For those people who have come into the football industry via other channels, again that’s usually via an extended business network. For instance, my background was in corporate finance and I worked for a company that did some business for the previous owner of the club. Our paths didn’t cross directly, but the club saw first-hand what I could deliver on and approached me to consider the role of CEO. As CEO, I have control over the club strategy, and that is to achieve progress both on and off the field. But, importantly, this responsibility is ultimately overseen by the owner, balanced by the board members and delegated to our various departmental heads. I’m trusted by the owner to act in the best interests of the club at all times, but also given discretion to initiate change within the club. The owner is charismatic, but understated in how he conducts himself. Professional football and the attention to it creates high-profile figures very quickly, but our owner has deliberately cultivated a low profile in the media. To the fans, some owners become heroes, but our owner would rather let others take the limelight. What everyone recognises is that he has a clear vision for the club, which we all share in. The vision is important: it’s the thing that drives and empowers the staff. I was attracted to working here based on the club’s values and identity. In my past experience, the effectiveness of any leader is in terms of how they are able to articulate what they want to achieve. It’s something that we buy into. We are a big part of the region and the community, and as a focal point we have a responsibility to do our best, not just for ourselves but for everyone in the community. We strive for excellence in all that we do – both on and off the pitch – to continually develop and sustain a successful football club. On the pitch, we will always try to play exciting and attacking football. A key part of that aim is to build and enhance our academy to

36 The chief executive officer (CEO)

enable a flow of talented young players. Off the pitch, we aim to develop our role at the very heart of the local community, recognising that the club exists for its fans and all stakeholders. By delivering excellence across fan engagement, commercial and business matters, the club aims to grow its fan base and create a successful legacy for the next generation of supporters. I think that with a charismatic leader such as our owner, we are able to articulate ‘strategic visions’ for the changes that are necessary. In my experience, leaders of that character are able to change the status quo very quickly. They do this via the quality of their relationships. At this club, we try to nurture a great working culture. Typically, this means being highly sensitive to staff needs and communicating clearly and with passion. This, I believe, is our core strength as an organisation i.e. we establish trust and commitment from everyone very quickly. It’s crucial that staff and players buy into a joint or shared vision. I look for staff who put others first, who show commitment and who are not interested in merely maintaining the status quo. You can change behaviours very quickly if you empower people. If staff and players believe that the vision of the leader is also their vision, then a sense of shared interests is created. We are not going to pursue or invest in ideas or people that don’t fit within the philosophy of the club. Something that was made quite clear to me during my first meetings with the club owner was that he wanted me to help reduce the impact of ‘founder’s syndrome’. It wasn’t something I was familiar with at the time, but the owner explained that the syndrome occurs when the club operates according to the personality of someone in the organisation (usually the owner or founder) rather than according to the mission of the organisation. My express role was to make sure I prevented the club from being dominated by any single person, regardless of whether they were my boss! Having said that, I have never detected any sense of that syndrome at the club. If I did, I would need to challenge it. It may sound clichéd, but we are reminded every day of what the club means to our supporters and we are not prepared to compromise that. That doesn’t mean that we aren’t ambitious and progressive, but we are a club first and foremost that serves our community and provides opportunities for the region. My overall role, therefore, is to help deliver that vision and be dynamic in pursuing opportunities for us as a club. I think one of my qualities is my intellectual curiosity. By that, I mean I encourage and support our staff to be innovative and embrace novelty. By challenging the status quo and norms of club working practices, we can gain an advantage or at least review potential strategic advantages. In my previous life as a corporate financier, I was responsible for adding value to what we did: in simplistic terms, improving our return on investment. I did this by reviewing the business lines of communication to try to optimise how colleagues communicated. It was the first thing that I did when I started here at the club. My daily task is to make sure that we have simple,

The chief executive officer (CEO)

37

efficient lines of communication between all employees. Bureaucracy and poor organisation exists in every business if you allow it to. Simplicity is best in business. By that, I make sure every employee at the club has clear lines of responsibility and accountability. You are more likely to get decisions right if you have negotiated and agreed clear terms of employment i.e. scope of authority and the boundaries. Again, in my experience, staff need to be careful what they wish for in terms of the scope and responsibilities of their role. Expanding a role can be great for someone’s ego and potentially their salary, but it usually leads to a reduction in their efficiency. It’s something that was a key element of my first steps here at the club: the appointment of key roles such as chief operating officer, chief financial officer, academy manager and, last but not least, first-team head coach. The distinction for us of head coach versus manager is important for the club. We have, in the past, appointed a football manager for the first team, but I think it’s a role that is so potentially broad in scope that it’s no longer feasible. Our preference is now to appoint head coaches. The coach is responsible for all first-team matters i.e. he selects the team (both players and support staff), coordinates training, organises how we play and advises upon recruitment, but, most importantly, he does not become involved in negotiation with agents or players’ contracts. That falls within my remit as CEO. I know that in some clubs they have moved to a more formal demarcation of on- and off-field responsibilities by appointing a director of football (DoF). I don’t think we currently require that role here at the club, but I can see how it’s working well at other clubs where the CEO is unable or unprepared to work with the head coach on first-team-related matters. In my experience, a DoF is old wine in new bottles. By that, I mean most clubs have used one of the directors or the CEO in the hybrid role of DoF. It was part of their internal set of responsibilities, and possibly shared by two or three directors, but not shared or broadcast externally to the media and fans. In terms of player transfers, we have a simple approach. There is no need to overcomplicate the process. The board have a budget for player transactions and I operate within it. I’m accountable to the board, but have flexibility in terms of how that money is spent. If I wish to go above that figure, I need to speak to the chairman regarding whether there is scope to extend. There is an ongoing dialogue between the head coach, the head of recruitment and myself regarding potential targets. It’s not something that happens a week before the transfer window opens. During the course of the season, the list ebbs and flows and player names are removed and added on a weekly basis depending on positional priorities, injuries, form and player contract statuses. The transfer budget basically relates to net transfer spend and our wage bill. For example, if we have a £20 million budget for the summer window, we could be buy four players at £5 million each or one player who costs £20 million. The time spent on negotiation with agents can be excessively drawn out. Plus, the cut and thrust of negotiations is not always

38 The chief executive officer (CEO)

pleasant. The club has a reputation within the industry of upholding the highest of ethical principles and it’s important that we maintain those values and do not compromise them. We pay a fair price for our new players, but we will not be forced into compromising the financial stability of the overall club to meet what we think are excessive demands. As a result, we are well known for being prepared to walk away from deals. On a couple of occasions, I’ve asked the head coach to be a witness to a player negotiation with an agent in order for them to appreciate the broader business environment for the club. One thing you need to avoid is wanting to buy more than the other wants to sell; otherwise, you run the risk of doing sub-optimal deals. That’s when you see some of the extortionate prices that some teams pay, when the negotiating logic becomes subordinate to the emotional logic or the emotional drive. You always want good value, good deals for the club. That’s what this is all about. You can look back on deals and think you could have done something differently. It’s like if you buy a house: you would look back and think ‘I paid £500 for those curtains and I didn’t need to’, or you ask for the carpets to be thrown in because it will save hundreds of pounds but then you get in and you don’t like them anyway. It’s good value that you want in any negotiation. The driving ambition for each team is to maintain their Premier League status. Once you’ve achieved that, you consolidate and try to move higher up the league. Each place that you climb is rewarded by around £1.9 million. Success breeds success commercially. It’s a type of ‘virtuous cycle’ [Figure 3.2] that impacts on each of our key revenue streams of matchday, commercial and broadcasting. In simplistic terms, if we are in the Premier League, we become more attractive to fans both locally and further afield. We are then able to sell more tickets, more shirts, and commercially we become more attractive to a variety of partners. Most notably, how much we can sell shirt sponsorship for increases with each new contract negotiation. The increased revenue allows us to buy more expensive players, which results in better performance, results and further progress on the field of play. Better results by the first team increase our attractiveness to fans and sponsors, and so on. If we are relegated, then we are faced with a different revenue scenario. Even though this year each of the three relegated clubs will receive parachute payments of £47 million, it will require them to try to bounce back into the Premier League as soon as possible. Delays will only compromise how you finance your club moving forwards. So, membership of, and your eventual finishing position in, the league have a highly material impact on the revenue streams and cash generation of the club. Since I began my role here as CEO a thousand years ago [laughs], I’ve worked on average about 70 hours a week, sometimes more. In most other jobs, your enthusiasm would wane if you committed more than 50. The great thing about this role, compared to any of my previous, is that you are part of something much bigger than spreadsheets and bottom-line appraisals. The

The chief executive officer (CEO)

39

Club revenue: Matchday Commercial Broadcasting

Increased revenue leads to purchase of highercalibre/more expensive players and staff and payment of higher wages

Off-field success i.e attractiveness of the club to sponsors, commercial partnerships, higher-value shirt sponsorship contract

Purchase of new players and staff and/or development of players via the club academy and/or sale of players

On-field success i.e. progress defined by cup success, improved finishing position in the league, promotion/ avoidance of relegation

Figure 3.2 The virtuous financial cycle of club revenue generation

fact that we have such a privileged role to play in the life of our community makes this job different. I think the fact that my role as CEO is so diverse creates potential issues with who replaces me. In other words, will the successor have the skills and experience to take over? I know that in studies from other disciplines, CEO succession rates are accelerating and I’d be surprised if that wasn’t also reflected in club football. I think a PwC study identified that CEO turnover rates climbed from 10 per cent in 2010 to around 17 per cent in 2015. And more startlingly, most of those companies had no plan for their CEO succession. A colleague of mine reminded me of the story about Julius Caesar regarding succession planning. When Julius Caesar was assassinated in 44 BC, he designated as his successor a relatively unknown and frail youngster, Octavian. This created such consternation that the Roman Empire was then thrown into a civil war. The moral of the story is that you need a clear process to ensure a smooth transition. It cannot be a secret, which is only revealed on a piece of paper after you’ve left. Voilà, you’re done! In conversations that I’ve had with the owner, the dilemma is not so much identifying internal or external potential leaders as it is to

40 The chief executive officer (CEO)

develop them for the CEO role. Our current club strategy is to review, on an ongoing basis, what our next CEO should look like. We don’t necessarily want the next person to be a carbon copy of me (as nice as that may be for my ego). As the popularity of our club expands beyond our traditional fanbase, we may need our next CEO to have different skillsets or capabilities. We’ve tried to anticipate this by asking every board member to list the top five challenges they feel the next CEO will have to tackle, and by offering their own thoughts on the leadership qualities the next CEO will require. This has now become an agenda item every quarter for our board meetings. Candidates that we have identified as having high potential are invited to spend time with the board, and to work on certain projects. In this way, we can see how they perform on a range of tasks, review and advise on their performance. I read of a classic case of CEO succession done right by the America utilities company General Electric in the 1980s. Jack Welch, as the company CEO, prepared his own succession plan by listing the essential qualities that the ‘ideal’ candidate should possess, and sharing those with the board. He then interviewed the top 500 or so leaders across the company, and submitted a shortlist to the board. The same person, I think, is still there today.

References Bell, A.R., Brooks, C. & Markham, T. (2013a). The performance of football club managers: skill or luck? Economics & Finance Research, 1(1), pp. 19–30. Bell, A., Brooks, C. & Markham, T. (2013b). Does managerial turnover affect football club share prices? The IEB International Journal of Finance, 7, pp. 2–21. Brady, C., Bolchover, D. & Sturgess, B. (2008). Managing in the talent economy: the football model for business. California Management Review, 50(4), pp. 54–73. Butler, J.K. (1991). Toward understanding and measuring conditions of trust: evolution of a conditions of trust inventory. Journal of Management, 17(3), pp. 643–663. Cruickshank, A., Collins, D. & Minten, S. (2013). Culture change in a professional sports team: shaping environmental contexts and regulating power. International Journal of Sports Science & Coaching, 8(2), pp. 271–290. Daley, C. (2010). Perceptions of Trust in Football Contexts: A MultiMethodological Approach. PhD thesis, Northumbria University. http://nrl.north umbria.ac.uk/753/1/daley.cherrie_phd.pdf. Finkelstein S., Hambrick D.C. & Cannella, A.A. (2009). Strategic Leadership: Theory and Research on Executives, Top Management Teams, and Boards. Oxford University Press. Giulianotti, R. (2002). Supporters, followers, fans, and flâneurs. Journal of Sport and Social Issues, 26(1), pp. 25–46. Giulianotti, R. (2007). Football: A Sociology of the Global Game. Polity. Giulianotti, R. & Robertson, R. (2004). The globalization of football: a study in the glocalization of the ‘serious life’. The British Journal of Sociology, 55(4), pp. 545–568.

The chief executive officer (CEO)

41

Heidrick & Struggles. (2017). CEO and Board Practice: Route to the Top 2017. www.heidrick.com/~/media/Publications%20and%20Reports/Route_to_the_ Top_2017.pdf. League Managers Association (LMA). (2016). End of Season Manager Statistics. www.leaguemanagers.com/documents/44/LMA_End_of_Season_Report_and_ Statistics_2015–16.pdf. Odgers Berndston (2017). CEO: the success of an organisation is increasingly defined by the CEO. www.odgersberndtson.com/en-gb/roles/ceo. Porter, M.E. (1985). Competitive Advantage: Creating and Sustaining Superior Performance. Free Press. Samara, B. & Woss, A. (2014). Consumer in sports: fan typology analysis. Journal of Intercultural Management, 6(4), pp. 263–288. Santy, R. (2012, 17 February). Poor performance and confidence: traps for football clubs and their managers. Shoosmiths. www.shoosmiths.co.uk/client-resources/ legal-updates/Poor-performance-and-confidence-traps-for-football-Clubs-andtheir-managers-1602.aspx. Thaler, R.H. & Sunstein, C. (2003). Libertarian paternalism. The American Economic Review, 93(2), pp. 175–179. Women on Boards. (2016). Gender Balance in Global Sport Report. www.women onboards.net/womenonboards-AU/media/AU-Reports/2016-Gender-Balance-InGlobal-Sport-Report.pdf. Wowak, A.J., Mannor, M.J. Arrfelt, M. & McNamara, G. (2014). Earthquake or glacier? How CEO charisma manifests in firm strategy over time. Strategic Management Journal, 37(3), pp. 586–603.

Chapter 4

The chief financial officer (CFO)

Introduction In any large business, the chief financial officer (CFO) occupies a critical position in his/her organisation. Within club football, the CFO has traditionally been focused upon acting as both a ‘steward’ (preserving the assets of the club by minimising risk and presenting accurate financial information) and an ‘operator’ (running an efficient and effective finance operation). Club finance departments have therefore been structured, almost exclusively, to generate financial information, but not necessarily intended for macro decision making. The traditional function of a CFO could thus be argued as being to ensure compliance with external foci such as HMRC, football governing bodies and associated stakeholders. This focus is reflected by the FA (2015), who regard the prime role of CFOs as being to ensure that clubs’ financial accounting records are appropriate and have the necessary level of detail regarding their fiscal status. At an operational level, the conventional role of a CFO is to present timely financial information, reports, evaluations and end-of-financial-year accounts to the club board (Simons, 2002). Under UK company law (the Companies Act 2006), business directors must not approve the financial statements for their company unless they are satisfied that they give a ‘true and fair’ view of the organisation’s finances for that period.

Managing club finances Insight into the financial health of clubs in the EPL is obtained by reviewing their financial accounts, which are made available to the general public via Companies House. Analysis of individual club accounts by Deloitte (2017a) has identified that despite teams in the EPL posting combined revenues of £3.6 billion, they made collective pre-tax losses of £110 million; as a result, only nine of the 20 clubs managed to convert their revenue into a profit in 2015/16.

The chief financial officer (CFO)

43

700m 600m 500m 400m 300m 200m 100m 0 -100m -200m -300m -400m 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16

Operating profit/(loss)

Profit/(loss) before tax

Figure 4.1 Operating profit/(loss) and profit/(loss) before tax for Premier League clubs, 1998/99–2015/16 Source: data taken from Deloitte (2010, 2011, 2012a, 2013, 2014, 2015a, 2016, 2017a)

In fact, as Figure 4.1 illustrates, from a low point of around £400 million in losses in 2009/10 and 2010/11, profit climbed to around £200 million in 2013/14, before falling to £100 million in 2015/16 and on to its current level of a £110 million loss. What may be of greater concern for the industry is the level of debt that CFOs and their boards are prepared to tolerate and that, as a consequence, CFOs are charged with managing. Concerns regarding the level of indebtedness across clubs in Europe can be traced back to UEFA’s European Club Licensing Benchmarking Report in 2011, which noted that the deficit of clubs with a UEFA License increased from €0.6 billion in 2007 to a peak of €1.7 billion in 2011 (UEFA, 2011). The financial mismanagement displayed by elite clubs was held to be due, in large part, to their irresponsible spending on player transactions and wages. Consequently, UEFA introduced the Financial Fair Play (FFP) regulations in 2011, to try to introduce more discipline and rationality in club finances, to encourage teams to operate on the basis of their own revenues and to protect the long-term viability and sustainability of European club football (UEFA, 2015). UEFA’s primary tool to achieve FFP is the ‘break-even’ requirement imposed on teams that have qualified for a UEFA club competition. Accordingly, clubs must demonstrate that their expenditure does not exceed their revenue; failure to comply with this standard can result in fines and additional punishments, which can extend to exclusion from UEFA competitions (van Maren, 2017). The most recent report compiled by UEFA has identified some success that may be attributed to the FFP regulations. UEFA’s research suggests that aggregate losses have dropped by 81 per cent since the full introduction of FFP, from €1.7 billion in 2011 to just over €300 million in 2015, and that ‘net debt’ as a percentage of revenue has fallen from 65 per cent in 2009 to 40 per cent in 2015 (UEFA, 2017).

44 The chief financial officer (CFO)

While the risk of club bankruptcy is relatively low within the EPL, it is self-evidently crucial for CFOs to retain full oversight of their financial assets and liabilities and be proactive in advising their club boards regarding any signs of ‘financial distress’ (Begbies Traynor, 2017). The CFO must therefore carefully monitor all sources of club revenue, while being mindful that all income streams and associated costs are dependent on the performance of the first team and its appeal to supporters and commercial partners alike. As a result, the CFO is a key element of any club’s corporate governance in communicating to the board any ‘real’ or ‘perceived’ risks associated with changes in cash flow, debt, business costs and projected revenue. All companies, including football clubs, must manage a variety of risks, and their appetite for risk will vary according to the financial support of the owner and the potential commercial revenue that a team generates. The most significant risk is the lack of control and uncertainty that clubs have over their results on the field of play. Nonetheless, CFOs are required to review financial risks that are tangible, club-specific and addressable, rather than focusing upon those financial risks that are beyond the company’s control. The CFO’s report should therefore discuss risks, actions taken and mitigating factors in clear, concise, easy-to-understand language for the board members who are not familiar with the terminology and calculations associated with accountancy reporting. Risks that are specific to the company, as opposed to those that apply to the industry as a whole, should be differentiated and new risks clearly identified. The continual appraisal and reappraisal of financial risk that could have a material impact on the club’s long-term financial performance is now accepted as a key part of corporate governance (Hamil et al., 2004). Depending on the size of the club’s finance department (i.e. the number of finance employees and their respective roles), the CFO may require colleagues to ‘model’ the consequences of different club performance outcomes (i.e. league finishing position, relegation, promotion, retention of league status, cup success, player transactions, etc.), and then decide if he/ she wants to insure against risks arising from the uncertainty by modelling a number of hypothetical financial scenarios with which to guide the club’s financial response and ensure that the club’s value is maintained. The techniques used to measure the value of football organisations are the same ones employed in valuing any company. However, football clubs, and professional sports teams in general, tend to display a peculiarity that firms from other industries do not: they pursue what economists call ‘utility maximisation’ (i.e. on-field success) rather than ‘profitability maximisation’ (KPMG, 2016). In other words, sporting success generally has a higher priority than off-field financial results. Although UEFA club licensing and FFP regulations have forced major football clubs to maintain a certain degree of financial sustainability, clubs traditionally aim to gain prestige and success rather than to make a financial profit. The need to obtain on-field success is strongly driven by short-term pressure placed by fans, sponsors and

The chief financial officer (CFO)

45

media. Football clubs that are successful on the field are capable of engaging fans, media and sponsors. This in turn generates revenues, which can be invested in improving the squad in order to increase chances of further sporting success. Another peculiarity of football clubs, in comparison to companies operating in other industries, is the lower correlation between direct investment in the club (i.e. input) and sporting success (i.e. output). Leicester City FC becoming EPL champions in 2015/16 is an excellent example of this and proof that sporting success cannot always be bought. In order for a CFO to consider the profitability dimension of a football club, he/she would need to potentially consider a range of data. Most prominently, the ratio of staff costs to revenue would be taken into consideration. The wages of players, technical and other staff make up by far the largest part of all expenditures, and therefore a high ratio indicates a lower capability to generate bottomline profits (ibid.). Stadium ownership and usage is a further consideration when valuing a football club. Beside players’ registrations, the stadium is one of the most relevant assets of a football team. A club-owned stadium generally means more opportunity to generate revenues. Therefore, ownership of the home ground is also considered in any formula for valuation (ibid.). Undoubtedly, there is a strong correlation between on-field success and social media engagement expressed (among other metrics) by the number of Instagram, Twitter and Facebook followers that a club has. Therefore, in any club valuation formula the number of social media followers of a team is deemed to be a good indicator of market reach, popularity and fan engagement. The dilemma for any club and commercial department is then how to translate that interest into financial income or to ‘monetise’ that involvement.

Technological change It is now becoming clear that technological change represents the most creative and potentially destructive force across all financial ecosystems today (PwC, 2016). The impact of cloud-based software, ‘robotic accounting’, automated software and artificial intelligence (AI) can increasingly be seen across all successful business operations. The potential for technology to provide ‘real-time’ access to results at the press of a button is highly attractive to financial directors. The pace of technological change is also felt within professional sport, in which club CFOs and their colleagues are now tasked, as part of their expanded strategic role, with seeking better ways to access and understand the sources of data. Innovations within business finance IT, such as cloud-based software to deliver customer relationship management (CRM), HR and financial accounting have now migrated over into the professional sports industry and should allow club CFOs to spend more time analysing results rather than simply

46 The chief financial officer (CFO)

preparing financial reports. The challenge for the CFO is how best to quickly and accurately consolidate financial data into reports that provide insight for effective decision making. Selection of the ‘right’ metrics to evaluate financial data is a complex task, given the variety of financial touchpoints could be considered within any club. The CFO can potentially address these challenges up to a certain level with IT solutions: analysis tools to consolidate large amounts of data can provide insights up to transaction level. Research by Deloitte (2015b) reveals that the majority of businesses still rely upon analysis provided by conventional tools and dashboards such as Microsoft Excel. However, it is important for the CFO to realise that the results are only as good as the quality of the data and that speed of financial decision making is heavily dependent on the quality of the business processes within any club. It is therefore vital for club CFOs to consider how best to streamline and standardise data and processes prior to switching to automated reports (PwC, 2016). Organisational change in response to technological disruption is inevitable for all businesses, and clubs need their executives to have the necessary level of expertise to optimise financial processes. Roles within finance that involve strict rules and standardised data to generate standardised reports are particularly vulnerable to disruption. This threat has long been acknowledged, and the CFO has therefore arguably evolved from an administrative to an advisory role less focused on accounting but more on directing the overall business on making effective business decisions (Deloitte, 2015b). This clearly places more pressure on CFOs and their fellow financial teams to be innovative and to consider what proportion of their current activities could be carried out just as easily by computers (Simons, 2002). The automation of processes is particularly appealing to the CFOs of any business if the technological efficiencies free up their colleagues’ time to address more challenging issues and help the company to generate accurate, easy-to-consolidate data that can be grouped and analysed for further strategic decision making. The ongoing review that CFOs must therefore undertake is to balance where clubs are financially with where they are going. In terms of their approach towards innovations in IT, this means supporting both core ‘keep-the-lights-on’ functions and potential large financial transformation initiatives (PwC, 2016). Each club will respond to these trends and priorities in its own way, largely dependent on its unique position in the market, desired path forwards, brand positioning, regulatory circumstances and organisational capabilities (ibid.). Football clubs, in common with other businesses, have a financial legacy and have grown via changes in ownership and layers of financial reporting structures and methods and associated technology. Typically, clubs’ financial operating models have not been nimble enough to react to an industry in which technological disruption is already a reality (ibid.).

The chief financial officer (CFO)

47

The priority for sports leagues and their teams to be secure has traditionally focused on protecting the safety and wellbeing of physical assets: supporters, players and stadiums. However, the industry’s increasing adoption of digital technology, analytics and an online presence has exposed a new class of assets and vulnerabilities that extend well beyond the physical realm into cyberspace (Deloitte, 2017b). Recent cyber incidents made public by US professional sports leagues and teams have given credence to the theory that malicious actors can be successful in attacking or ‘hacking’ using the same approaches that have been seen in other industries. For example, one US sport franchise reported the leak of sensitive financial player information via an email phishing scam, while another breach involved an attack by the scouting director of one team, who used stolen credentials to hack into another team’s database, accessing the club’s player notes to gain competitive advantage (NCA, 2017). As a consequence, the CEO and the CFO have an increasing responsibility to ensure that all matters of confidentiality and financial sensitivity are secured (Bruton et al., 2000). Professional football clubs represent highly attractive and potential easy targets for hackers, given the interconnected technology used by leagues and teams to optimise the fan experience, the advanced analytic intellectual property used to measure performance and even the availability of technology aiding players and teams with in-game strategy execution. Therefore, while advances in technology have brought efficiencies and insight, there is a clear need for directors to remain vigilant regarding their ability to protect the value of their strategic and evolving assets. Over the past few decades, the science of decision making – behavioural economics – has uncovered many human frailties that can contribute to bad decision making (Kahneman, 2011). Drawing on insights from neurology, psychology, economics and beyond, behavioural economists paint a humbling picture that individuals do not always act rationally and often base their decisions on assumptions or ‘heuristics’ (Deloitte, 2012b). Given the deluge of data generated by social media and cloud technologies, making the decisions that matter may now have become even more complicated than ever. Improving the quality of decisions, therefore, should begin with an understanding of the process and potential biases inherent in individual and group decision making. The role of the CFO in providing rigorous, evidencebased data is therefore crucial in any business. In summary, the role of the CFO can be viewed as that of a financial pragmatist. However, he/she must work closely with his/her colleagues across the club board to improve company performance through his/her finance-driven suggestions. By posing data-driven questions and formulating solutions around them, the CFO can help their club to address critical constraints, uncertainties and performance issues through tangible and realistic actions to move the company forwards (PwC, 2016). Others on the team can push forwards new products, product differentiation or market

48 The chief financial officer (CFO)

strategies, but the CFO must ensure the economic returns and viability of different positioning strategies, while creating value in the immediate context (Goldratt, 1992).

Case study: interview with a CFO I joined the board over five years ago, having first crossed paths with the owner in my previous role as the financial director of a small engineering company. The business was set up by myself and a couple of colleagues over 15 years ago. In business, you meet people all the time, at functions, events, etc. and you rub shoulders with people from a wide range of organisations and industries. I think it was at business conference held in London that I first met the CEO of the club. Over the course of the next few years, we kept on bumping into each other at various functions and he mentioned that the club was looking for someone who could potentially take over the financial reins [from the current club director who was due to retire in 12 months]. Knowing what I do now of the CEO, I’m not sure how many of those meetings were accidental. I’m sure he was carrying out some research on whether I was the kind of person he could work with and make a difference to the club. My first question to the CEO was: how do the owner and the board plan to grow? In my previous role, the standard answer is by driving new or existing products to new or existing markets. In football, the product is the first team and the passion surrounding their performance on the field, and so the most straightforward question involves knowing the club’s strategy to improve on-field performance. Any CFO’s role, then, is to make sure that capital is available at the right cost for these choices to be profitable, and that the company has processes and decision-making rules for capital allocation to support that growth. As a chartered accountant, I’m clearly familiar with all fields of business finance, including taxation and general management, but was clearly unfamiliar with the football industry. It was this unfamiliarity that made me initially reticent about joining the club. Something that I made very clear to the CEO was my need to fully understand the club’s business model, the owner’s expectations, its operating environment and associated risks before I could commit to the role of CFO. What followed was a number of meetings with the current incumbent and a period of shadowing his role. During this time (approximately three months), I stepped back from my role with the engineering business and took a form of sabbatical. It was a big gamble on my behalf, but something that I was prepared to do. I’ve always been a football fan and so the potential to work for one of the most prestigious clubs in the country was an opportunity that I wasn’t going to turn down without having fully researched it. During those first few months, I soon realised that we would need to prioritise how we could optimise the current

The chief financial officer (CFO)

49

in-house reporting methods with emerging technologies. My initial review concluded that the club at that stage did not have the necessary financial reporting mechanisms or infrastructure to best support club colleagues. Next, I conducted an internal audit of the club’s finances; in my previous business, we refer to it as a ‘management review of controls’. In effect, you are reviewing whether the organisation’s risk management, governance and internal control processes are operating effectively. I firmly recommended to the CEO and the owner a ground-up redesign of financial capabilities and functionality. At that stage, I was surprised to learn that of the 20 leading tools you can use as an accountant to monitor an organisation’s financial performance, only one (the CIMA Strategic Scorecard©) was in use. At that stage, we had not conducted a review or appraisal of cost-benefit analysis at the club. I was particularly interested in understanding the club’s financial information, principally its income streams, costs, pre-tax profits, wage expenditure relative to revenue, etc. Information is contextual and in accounting you rely upon financial data that has three main key characteristics. Firstly, it has to be ‘time related’ i.e. using information from both the past and present to give you some predictive insights regarding the future. Secondly, information usually operates within ‘organisational boundaries’. This needs to be recognised, but avoided. I use financial information that is drawn from inside and outside the club, including data from business partnerships, suppliers, markets and our fans. Thirdly, we use information that is both quantitative (both financial and non-financial, including environmental and social issues) and qualitative. In my experience, a number of CFOs don’t have or fully appreciate the usefulness of qualitative financial data in their decision-making process. From what I’ve observed over the last few years, I think club CFOs are changing. Traditionally, they are expected to play the role of ‘steward’ and get the books right. But now I think clubs expect their finance directors to be ‘strategists’ also, in helping to shape the club’s overall direction. It’s something that attracted me to the club. I want to try to help the other parts of the club business perform better and explore business improvement initiatives such as enterprise cost reduction, procurement and process improvements that add value to the business. These varied roles make my job more complex, but more satisfying at the same time. Management accounting, regardless of the business or the context you work within, begins and ends with conversations. The club wanted me to help improve their decision making by communicating insightful financial information at all stages of their strategic decision making. I think one of my skills is as a communicator. Good communication of critical information allows the board to cut across any silos that may exist in the various departments and encourage integrated thinking. By discussing the needs of the board and the decision makers within it, you can help identify and

50 The chief financial officer (CFO)

analyse the most relevant information. Mostly, I’m providing financial recommendations that are tailored to the decision being considered, to those making the decision (or other audiences). I also sometimes have to take the unpopular position of saying that we don’t have the resources to take on certain important projects. A pragmatic approach is needed if you are to be effective in your role, but that doesn’t mean that you can’t also be empathetic to their perspectives. If you lose your empathy, you will probably be excluded ultimately from future bigger-picture decisions. In a high-profile business such as football, there will always be ups and downs. When things are going particularly well, I don’t over celebrate; I stay calm and keep my eye on the ball [laughs] – excuse the pun. Many directors look to the CFO to get a feel for how the club is doing, so it’s important that my actions instil confidence in the team. As a chartered accountant, I’m aware that sometimes it’s easy to start using financial jargon. The board are not shy in asking me to speak in lay terms and reduce any complexity and accountancy terms. The precise nature of what data and financial reports I communicate depends on the audience. It has to be tailored to the level of the audience’s financial knowledge and presented in a way that is easy for them to understand, but must be underpinned by robust and evidence-based financial information. My view is straightforward: I prefer plain English over jargon in terms of reporting pertinent financial details to the board. I need to present information clearly with both brevity and honesty. The best reports tell the club’s financial story. They establish clear links between the vision and mission and its strategy, while explaining the organisation’s values and how they connect to its success. The company’s narrative is clearly linked to the report’s financial details, and the primary strategic messages echo throughout the document. Finally, the best reports offer context about the future, explaining how the company is positioning itself for the year to come. Key performance indicators (KPIs) help flesh out the story. KPIs are most credible when they are on point, reflect the already enumerated strategy and relate directly to longterm success and value creation. They should be reliable, be consistently calculated year on year, offer historical context (at least five years), be clearly defined and linked to incentive arrangements and provide a fair and balanced view of all aspects that drive company performance. They should be capable of reflecting all significant developments, positive or negative. The key is that my reports provide an insightful and transparent breakdown of what can be quite complex documents. The owner made it clear when I first started shadowing the previous CFO that he and the CEO need to have the right information at the right time if they are to be able to make the best decisions. Discussions about financial strategy happen all the time at the club and involve all staff. I think this is one of my major contributions so far. I think previously there existed a tendency to work in silos. Conversations would take place only

The chief financial officer (CFO)

51

at a board level among five or six directors. I’m the CFO, but at the same time I do not have the monopoly on the right answers. By encouraging my small team of commercial executives to discuss and debate, we reduce any ‘siloed thinking’. Although the finance function of the club is led by me and I give final approval to the figures, it is very important to remember that everyone within an organisation is responsible, directly or indirectly, for the generation of data and information that will influence final decisions internally. This means that we are very careful to recruit those employees who can fit in within our club culture and are financially literate with a good ‘finance eye’. From a professional skills standpoint, I look for people who have accounting, financial modelling and data analytics experience, and so on. My aim is to make an impact and the race is certainly on among clubs and more broadly financial institutions to gain a competitive edge through the application of digital technology. We as a club needed to overcome our legacy business models, systems and processes and to hire the best digital talent. This is no simple feat. People who are equally fluent in business, finance and technology are in short supply, and the competition for them is fierce. In fact, you can see this in other finance sectors also; I think some people refer to it is as the ‘talent paradox’. Despite high unemployment rates in many countries, CFOs can’t find the talent they need. In a Deloitte survey [2017b] I looked at recently, one out of three CFOs surveyed said they were having trouble filling open positions, and the majority were taking steps to ‘lock in’ top performers. This is not dissimilar to what our CEO attempts to do with the first-team staff. At the same time, high-calibre finance talent is on the move, mostly being poached by competition within the league. I’m aware that employees, especially good ones, are hard to hold onto for any business. They move on for a number of reasons, such as pay, career progress, etc. We as a club cannot afford to pay the highest salaries, compared to other clubs, but we believe that we are a good organisation to work for. I have regular meetings with all members of the finance department. I use them as ‘check points’ to find out about how they are doing. For example, last week we discussed the drivers of club costs, plans and targets. I think employees want leadership that inspires trust. I have to earn that trust by being straightforward and honest. I meet with each one of the finance team individually and in groups to try to demonstrate a personal and professional commitment to their welfare. Simply put, having good interpersonal skills is a key factor for a CFO at this club. In my previous role, the directors of the company referred to interpersonal skills as some form of ‘business chemistry’. We brought in a team of leadership consultants to advise us on how to understand our employees. They used a series of behavioural questions to try to help us identify the dominant personality types within our teams. I’ll be honest: I don’t think we achieved anything as a result. I think people are a lot more complex than simply organising them into neat

52 The chief financial officer (CFO)

categories of personality and character. The motto we have here at the club is a simple one: treat others as you wish to be treated and, if possible, treat others as they wish to be treated. It will come as no surprise that I am very analytically minded and use data analytics a lot in my decision-making process. I also recognise that data analytics provides one part of the narrative and culture, personal instinct, etc. can also contribute to the decision-making process, particularly in a business like football. The thing that is great for our club and many other businesses is that data analytics can help the company to gain a deep understanding of what our fans like and what our advertising partners need, which can lead to a more informed view of priorities in a complex landscape. The club is a ‘limited company’ in legal terms. By that, I mean ownership of the club resides with the shareholders. The owner is the majority shareholder. He is the catalyst for a large number of the decisions that are made throughout the club. In one of our first meetings, he asked what my own financial biases or blind spots are. I didn’t quite understand what he meant, but he was asking whether I was potentially overconfident in my own objectivity and analytical abilities or take shortcuts. For example, do I overlook what I don’t understand and could I live with the cost of a few bad decisions? It was this kind of bias covered by behavioural economists, such as Daniel Kahneman in his book Thinking Fast and Slow [2011], that he was getting at. In particular, he was asking whether I had a tendency to search for and find confirming evidence for a belief while overlooking counterexamples, something Kahneman defined as ‘confirmation bias’. The owner asked that all financial evaluations that I present to the board were underpinned by exhaustive and reliable sources of evidence – and not underpinned by overconfidence, ego or a good story. However, unlike any other industry (that I’m familiar with), as the majority shareholder he is not motivated by profit and I don’t think he’s the only one. If you look at the pre-tax profits for all teams in the EPL, you have around 12 making a profit and eight reporting consistent losses. The growth in the industry and increases in revenue (primarily from the domestic and global popularity of the EPL) has not translated into higher profitability for clubs. The surprising thing (when I first started to appreciate how clubs operate) was how many clubs run perpetually at an economic loss. If these businesses were fundamentally ‘profit maximisers’, then they would have been closed down by their owners. If you look at the people who are identified on the ‘shareholder lists’, you’ll note that they were largely born and now live within 50 miles of the ground. This means that they are all from the region and in most cases were probably fans of the club growing up as kids, so any profit motive that they may have is tempered by the overriding desire to win on the field rather than make a return on their investment. You would have to speak to each individual shareholder personally to find out what

The chief financial officer (CFO)

53

their views are, but I’d be surprised if, as supporters themselves, they view ownership of the club as a purely financial proposition. Clearly, the personality of this club and its shareholders is not one that you will see across the other 19 teams in the EPL. I think we are probably the exception to the rule. I think the first teams to be listed on the stock exchange in the UK were Spurs [Tottenham Hotspur FC] and Man United [Manchester United FC] in the 1980s and early 1990s. This was probably born out of the increases in broadcasting revenue that clubs were able to use and ultimately the creation of the Premier League in 1992. Most club owners and their shareholders will inevitably be motivated by profit. In my experience, what distinguishes a ‘private limited company’ from a ‘public limited company’ (i.e. floated on the stock exchange) is that in the latter case the profit motive is likely to be stronger. I think when you list your company on the stock exchange, you are deliberately introducing the club to a different category of investors with little or no interest in the business other than for the returns that it can generate, either through the payment of dividends or the appreciation of the share price. Insurance companies and pension funds tend to fall into this category, but so do some football teams. I think my major contribution is in helping the club to understand how it can move towards profitability, for no other reason than to maintain its status in the league. Our owner has, throughout his time at the club, used a considerable amount of his personal wealth on supporting the club. We all appreciate that this approach is unsustainable in the long term moving forwards. The challenge for our fans and shareholders is to appreciate how we move towards profitability without (a) gambling on improving performance by paying inflated fees for players and (b) becoming overly reliant upon the current broadcast deal. Clubs, like all businesses, improve their performance by recruiting the best talent. In all industries, the best talent is acutely aware of what their market value is and they are usually very good negotiators. In the case of football, that’s usually left to their agents, whose main role is contract negotiation. If you want the best, you probably need to pay the highest and outspend your rivals. In my view, player wages are the most concerning aspect of how a club moves forwards. Assuming that sporting success impacts upon business success, you have a business model in which your capacity to pay higher salaries is directly proportional to your results. In my previous roles and in most ‘well-managed’ businesses, salaries should account for no more than 50 per cent of revenue. This is more broadly recognised as the ‘magic ratio’. In professional football, they should be between 50 and 65 per cent of revenue. In the Premier League, it hovers somewhere between 60 and 70 per cent. The salary-to-revenue ratio is broadly regarded as an accepted indicator of the financial health and prudent fiscal management of a club. The reality is that only the richest clubs (in terms of revenue) can potentially pay the highest player salaries

54 The chief financial officer (CFO)

and attempt to operate close to the magic ratio. Clubs, therefore, need to be financially capable of affording to pay the highest salaries if they are to retain and attract the best players. In my experience, the top six teams invest heavily in player contracts to maintain their league position, whereas the majority of the other clubs seem to trade in player contracts to sustain their financial viability. This, unfortunately, may come at a cost of either being relegated or staying in a lower league. In accountants’ ‘speak’, when a player is purchased, the cost to the club is ‘amortised’ – in layman’s terms, written down or spread over the length of the player’s contract. For example, if a player is purchased for £20 million on a five-year contract, the fee is amortised by the club in its accounts to the value of £4 million per season. Player wages are then agreed at £5 million per year. When the player is sold two years later, the cumulative amortisation is £8 million, leaving a value of £12 million in the club accounts. If the agreed sale price to the purchasing club is £20 million, the selling club will report a £12 million profit on the sale plus additional savings made by the removal of the player’s wages and the £4 million annual amortisation payments. I do not become involved in salary decisions or who we purchase, but I am responsible for providing accurate and timely financial data based on which decisions are made by the CEO and the owner. Even during my time here, I have noticed an evolution in terms of how financial information is used. It has now moved on from information generation, control and quality to all layers of the club, and I think that’s essential. All businesses have a lot on their plate, and that includes clubs. As in other industries, we have shifting demographics in terms of our supporter base and their expectations, and we have emerging competitors and changing regulations. This means that as a CFO you need to remain energetic and focused, regardless of the daily challenges you may face. I think that it’s important for people to view senior members of the executive as being in control and decisive, and I try my best to live up to that expectation.

References Begbies Traynor. (2017). Red Flag Alert Football Distress Report: English Football League, April 2017. www.begbies-traynorgroup.com/assets/uploads/pdfs/1970_ ENGLAND%20Football%20Report%202.pdf. Bruton, G., Fried, V.H. & Hisrich, R.D. (2000). CEO dismissal in venture capital backed firms: further evidence from an agency perspective. Entrepreneurship Theory and Practice, 24, pp. 69–78. Deloitte. (2010). Annual Review of Football Finance 2010: Highlights. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/sportsbusiness-group/uk-sbg-arff-2010-highlights.pdf.

The chief financial officer (CFO)

55

Deloitte. (2011). Annual Review of Football Finance 2011: Highlights. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/uk-sbg-arff11-highlights.pdf. Deloitte. (2012a). Annual Review of Football Finance 2012: Highlights. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/uk-sbg-annual-football-finance-review-2012-highlights.pdf. Deloitte. (2012b). CFO Insights: Making Decisions that Matter. http://deloitteblog. co.za.www102.cpt1.host-h.net/wp-content/uploads/2012/11/Making-decisionsthat-matter.pdf. Deloitte. (2013). Annual Review of Football Finances 2013: Highlights. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sbg-arff-2013-highlights-download.pdf. Deloitte. (2014). Annual Review of Football Finance 2014: A Premium Blend. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-annual-review-football-finance.pdf. Deloitte. (2015a). Annual Review of Football Finance 2015: Revolution. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-arff-2015-highlights.pdf. Deloitte. (2015b). The CFO Journey: Opportunities and Uncertainties Facing the Finance Leader. https://www2.deloitte.com/content/dam/Deloitte/br/Documents/ finance/cfo/TheCFOJourney_.pdf. Deloitte. (2016). Annual Review of Football Finance 2016: Reboot. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-annual-review-of-football-finance-2016.pdf. Deloitte. (2017a). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf. Deloitte. (2017b). Football industry reports. https://www2.deloitte.com/global/en/ misc/search.html#qr=football%20industry%20reports. Football Association (FA). (2015). Club Structures: A Guide to Club Structures for National League System and Other Football Clubs. www.northumber landfa.com/~/media/countysites/ntfa/documents/football-club-structures_2015. ashx?&session-id=de6df997fc11a41353432470fd68f47b. Goldratt, E. (1992). See the Goal: A Process of Ongoing Improvement. North River Press. Hamil, S., Holt, M., Michie, J., Oughton, C. & Shailer, S. (2004). The corporate governance of professional football clubs. Corporate Governance: The International Journal of Business in Society, 4(2), pp. 44–51. Kahneman, D. (2011). Thinking Fast and Slow. Turtleback Books. KPMG. (2016). Football Clubs’ Valuation: The European Elite 2016. https://assets. kpmg.com/content/dam/kpmg/pdf/2016/05/the-european-elite-2016.pdf. National Crime Agency (NCA). (2017). The Cyber Threat to UK Business: 2016/2017 Report. www.nationalcrimeagency.gov.uk/publications/785-thecyber-threat-to-uk-business/file. PricewaterhouseCoopers (PwC). (2016). Financial Services Technology 2020 and Beyond: Embracing Disruption. www.pwc.com/gx/en/financial-services/assets/ pdf/technology2020-and-beyond.pdf.

56 The chief financial officer (CFO) Simons, T. (2002). Behavioral integrity: the perceived alignment between managers’ words and deeds. Organization Science, 13(1), pp. 18–35. UEFA. (2011). European Club Licensing Benchmarking Report: Financial Year 2011. www.uefa.org/MultimediaFiles/Download/Tech/uefaorg/General/01/91/61/ 84/1916184_DOWNLOAD.pdf. UEFA. (2015). UEFA Club Licensing and Financial Fair Play Regulation. www.uefa. org/MultimediaFiles/Download/Tech/uefaorg/General/02/26/77/91/2267791_ DOWNLOAD.pdf. UEFA. (2017, 12 January). European club football’s financial turnaround. www. uefa.org/protecting-the-game/Club-licensing-and-financial-fair-play/news/ newsid=2435355.html. van Maren, O. (2017). How to bail out your local club: the application of the state aid rules to professional football clubs in financial difficulty. The International Sports Law Journal, 16(3–4), pp. 155–176.

Chapter 5

The chief operating officer (COO)

Introduction The role of a chief operating officer (COO) is one with which many football fans may be potentially unfamiliar; indeed, many fans may be unable to name who their club COO was or currently is. Typically, the individual occupying the position is not exposed to external scrutiny from the media, club supporters or indeed organisational scholars, and as a result goes mostly unnoticed. This is somewhat surprising, given that the role encompasses a variety of strategic club responsibilities, which lead to it being identified as one of the most crucial and challenging leadership positions in any business operational context (Bennett & Miles, 2006a; Gerrard, 2005; Marcel, 2009). For many, the position of COO is second only to the CEO in terms of executing business plans developed by the owner and board and may represent a form of ‘co-leadership’ (Heenan & Bennis, 1999). However, little is still currently known or appreciated regarding the diverse range of responsibilities that this executive leadership position involves. The lack of scientific research may be in part due to the complex nature of the COO role and the deeply contextualised and club-specific work that COOs undertake (Bennett & Miles, 2006a; Hambrick & Cannella, 2004). As a result, it is neither realistic nor appropriate for this chapter to provide a ‘one-size-fits-all’ typology that applies to each and every football club COO.

Working within a challenging business context The most challenging strategic issues facing business executives today include corporate performance, corporate governance and enterprise risk management (Ramamoorti et al., 2011). The contribution made by the COO and his/her fellow club executives is vital in keeping their organisations out of the media headlines (reputation risk), driving profits amid increasing domestic and European competition (superior business performance and results), navigating continuously evolving compliance imperatives (regulatory risk)

58 The chief operating officer (COO)

and improving the overall efficiency of their business operations (operational risk) (ibid.). Professional football clubs at the highest level are now highly automated operations that receive and process large volumes of information to support and manage their global enterprise. In search of greater efficiencies for their operations, many clubs have taken advantage of e-commerce possibilities and now increasingly outsource their business transactions to external information technology providers. The aim of doing this is to both preserve and add value to the club. However, a reliance upon automation derived from external customer relationship providers and technology agencies to facilitate a higher volume of business transactions opens up concerns regarding the ownership of club data, the introduction of errors and the potential for fraud and information integrity risk. Complex and dynamic information flows are inherently susceptible to, and frequently characterised by, the presence of information errors (FERF, 2011). Information errors, even if inadvertent, result in increasing costs, reputational and compliance risks, and operational inefficiencies. In addition, they may adversely impact an organisation’s ability to operate competitively. Where there are questions about behavioural and integrity risks (i.e. people risks), there is also the risk of fraud through asset misappropriation, corruption or fraudulent financial reporting (ibid.). In light of the challenges posed by technological disruption and an accelerated pace of change, there is a clear rationale for any business to prioritise the operational efficiency, health and sustainability of its organisation. The oversight and monitoring of the operational health of an organisation is therefore a complex and challenging responsibility and may be distributed across a range of departments or focused within one executive’s remit (that of the COO). By continuously monitoring their business operations, clubs limit their exposure to operational and compliance risk, especially in an environment susceptible to technological disruption. Businesses instinctively understand that better monitoring means fewer surprises (ISACA, 2010). The appointment of an individual who has oversight of the club’s operational efficiency (i.e. ways of running business operations that are not only cheaper but also faster, easier, more flexible and less risky) is key. Within club football, the need for an individual who has a broad experience and understanding of organisational processes and systems, business process improvement and people management is essential to balance the demands placed on a club CEO. Today, elite football clubs have global operations and aggressively pursue talent to fill business needs both on and off the field. CEOs, along with first-team managers or head coaches, are typically required to be public, outward-facing figures of the business, communicating with many constituencies while campaigning internally for any changes they hope to make. Any COO must therefore have the skills and attributes to complement his/her CEO’s skill set and scope of responsibilities and in effect work as the internal, inward-facing CEO for the club. Some theorists

The chief operating officer (COO)

59

speculate that delegating responsibility in this fashion can enable the CEO to better cope with the overwhelming complexities of leading a large organisation (Bass & Stogdill, 1990; Marcel, 2009). Practical observers, however, have been more sceptical. These critics suggest that the presence of a COO can create accountability problems for the CEO (Abelson, 1999), can burden shareholders with an expensive but unnecessary executive (Murray, 2000) and may promote the hiring of inexperienced CEOs (Charan & Colvin, 1999).

Succession planning The significance of the COO in terms of operational decision making creates a potential succession-planning issue for every club. Recruitment of a successor externally or promoting someone from within the club is problematic given the broad range of skills and experience required for a COO. Depending on the individual club and the division of responsibilities, the role could involve oversight and line management of colleagues within research, sales and marketing, stadium operations, IT and HR. In addition, the COO may be tasked with the management of office systems and processes and the monitoring of operational risk. Given the complex range of responsibilities that a COO may have, it would not be surprising if boards were not open to their current COO being considered for the outward-facing role of CEO at some point in the future. An examination of club board structures reveals that there are almost no constants in terms of the composition of club leadership. People with very different backgrounds ascend to the role and succeed in it (Bennett & Miles, 2006a). This variability makes the role problematic to research; it is difficult to establish whether the external observer is making accurate and insightful inferences when comparing one club COO with another. Salespeople or marketers who have developed the tools of their trade in one company can usually apply them to good advantage in another, even in a dramatically different industry such as professional football. Financial and HR executives likewise are schooled and practised in standard ways of doing things. But it is harder to discern whether a COO who has succeeded at one company has what is required to be a successful COO at a different company or in a different business context; the skill set is neither generic nor very portable. Even within a single industry, the appropriate qualifications for the COO role can shift. Research undertaken for this book has identified significant variation in COO roles and responsibilities, which manifestly implies that there is no standard set of ‘optimum COO’ attributes. This makes finding suitable candidates problematic for executive recruiters. More importantly, it confuses owners and executive boards regarding prospective candidates. The existence of a variety of different roles suggests a range of attributes on top of the basic – and infinitely

60 The chief operating officer (COO)

variable – equirement that there exists a personal chemistry between the COO and the current CEO (Marcel, 2009).

The COO role There is no single agreed-upon description of what the COO role entails (Bennett & Miles, 2006a). The various responsibilities held by a COO are club specific and are designed to complement the outward-facing role of the CEO. The most basic review of club COO job descriptions reveals large disparities in terms of club reporting structures, line management and accountability. A small minority of elite clubs allocate COOs responsibility for all off-field activities. This role excludes first-team and academy operations but includes oversight of HR, facility management, matchday operations and commercial operations; in simplistic terms, it means being the ‘internal CEO’ for the football club. At other clubs, the role is focused on a specific business need or project. For example, several clubs expect their COO to use his/her previous marketing or commercial experience to lead their effort to grow the off-field commercial dimensions of their business. The focus of a COO’s responsibilities must crucially complement and align with the needs of the CEO. As a result, the COO role can be defined structurally and strategically, by the relationship he/she has with his/her CEO and the fundamental motives for his/her appointment (Bennett & Miles, 2006a; Kotter, 2008). Such roles are not mutually exclusive, but are dynamic and are shaped by performance and the evolving needs of the club and the CEO. In a leading article in the Harvard Business Review, Bennett and Miles (2006b) outlined their research of the COO role in industry generally and concluded that the differences among COO roles arise from the different motives behind the owner’s and board’s decision to create the position in the first place. From their research, they identified seven basic reasons that companies decided to hire a COO, and these reasons yielded seven roles that the COO can play vis-à-vis his/her CEO. The roles are not mutually exclusive but in their view usually no more than two or three dominated. Taking some licence to relate to a football club structure (and sympathetically relate to the role of the CEO and fellow board members), they identified: 1 2 3 4 5

the executor, whose job is to lead the execution of strategies developed by the club board; the change agent, the true driver of change, not just the executor of tasks handed down by the board; the mentor, to the CEO/executive/board/heads of department; the other half, whose prime role is to complement the skills and knowledge of the CEO; the partner, who serves as a co-leader at the club alongside the CEO;

The chief operating officer (COO)

6 7

61

the heir apparent, whose role is to be groomed to take over from the CEO; the MVP, a job given so as not to lose a critical person in the company.

Research conducted via a series of semi-structured interviews with four COOs currently working within the EPL (for the purpose of this book) reveals that four of the above seven roles predominantly underpin the appointment of a club COO. The most significant role is that of executor of strategies developed by the owner, CEO and club board. Within professional football, this may be simply a concession to the complexity and scope of the CEO’s job, with its numerous external commitments. Managing large, often global clubs was recognised as requiring ‘two sets of hands’; in such cases, the COO typically takes responsibility for reviewing and delivering operational efficiencies on a day-to-day basis. This is why the COO position is nearly ubiquitous in businesses that are operationally intensive, such as the airline and automotive industries, as well as in organisations that operate in hypercompetitive and dynamic marketplaces, such as high-tech firms (Forbes & Milliken, 2005). By bringing in a COO to lead and oversee the day-to-day operations, clubs enable their CEOs to focus on the strategic, longer-term challenges that the club will face. CEOs were identified as requiring a ‘head-up’ approach to understand success in the future, whereas the COO has his/her ‘head down’, focused on the operational details necessary for success in the immediate and short to medium term. Second, clubs reviewed a COO appointment in terms of his/her ability to impact upon delivering strategic change. Typical examples cited included the oversight of facility expansion or investment in new technology. Candidates considered for such a position were reviewed according to their track record of delivering success in project management tasks, problem solving and facilitating strategic change. Within this role, executives stressed the importance of being able to think critically and creatively in their problemsolving approach. Third, club COOs regarded their prior experience as a mentor or partner as crucial in their appointment. Some clubs appointed a COO to mentor a young or inexperienced CEO (in some cases, a relative of the owner). The clear need was for an industry ‘veteran’ with extensive experience and a rich network of football industry contacts who could develop or act as a ‘foil’ to both the CEO and the club owner. This can lead to what has been called a ‘two-in-a-box’ model (Bennett & Miles, 2006a) and is similar to what Heenan and Bennis (1999) have termed ‘co-leadership’. Indeed, Heenan and Bennis contend that more companies should create and cultivate co-leadership arrangements and are more effective when the CEO and the COO are paired. One could logically hypothesise that as the CEO develops in stature, the COO might potentially lose influence, have his/her role redefined or be removed.

62 The chief operating officer (COO)

Fourth, several COOs recognised that their current status and responsibilities were reflective of being the ‘heir apparent’ to the incumbent CEO. Owners and their fellow board members had selected a current employee as having high potential and wished to both support and challenge his/her career development at the club. While no guarantees of promotion were provided to current COOs, the policy was reflective of succession planning, commitment and the value attached to the individual by the business owner (Bennett & Miles, 2006a). While the various roles noted above are not mutually exclusive, it may be problematic for a single executive to wear several of these hats at once. Understanding the roles distinctly, however, and considering their differences reveals a few things clearly. Even though the role of COO is contingent upon the needs of the CEO and the club more generally, there appear to be a number of success factors that consistently appear within executive business research findings. The single element most critical to the success of a CEO–COO pairing appears to be the level of trust between the two individuals (Currall & Judge, 1995). To speak of trust is almost a cliché, but the vehemence with which research participants stressed it suggests that they consider it more crucial here than in any other business relationship (Levinson et al., 1993). The decision to appoint a COO clearly has the potential to improve overall club performance, but the likelihood of any improvements may ultimately depend on the COO’s relationship with the CEO and more broadly with the club board. Trust, therefore, has to be absolute between the COO and the CEO. Thus, it would not be surprising, given the potential for insecurities regarding power and status to emerge, if the majority of CEOs and COOs are either former colleagues or even friends. Levinson et al.’s excellent appraisal of the COO–CEO relationship explores the dysfunctions that can arise in such situations: unhealthy rivalries, defensiveness, over-control, misconceptions and doubt. How can a pair of executives get past such perils and develop an extraordinary level of trust? Again, consistent themes in research interviews for the book suggest the answer. The CEO must feel certain that the COO shares the club’s overarching vision and can deliver on his/her contingent responsibilities. The ‘bridge of confidence’ between two people operating together with separate yet united agendas is essential for this relationship to work.

Case study: interview with a COO I came in to my current role as COO at the club over ten years ago, having previously worked as a COO in the banking and financial services sector. In the banking industry, the COO is rarely regarded as a ‘CEO in waiting’. I know that in other sectors they sometimes are (such as football), and as a result the selection process for a COO is usually focused upon identifying candidates with the kind of football business background or complementary

Figure 5.1 Chief operating officer (COO): organisational structure and line management responsibilities

64 The chief operating officer (COO)

skills that would allow them to potentially replace the CEO. In banking, the COO is not usually appointed as the future CEO, but is rather someone whose skill set and experiences complement and support those of the CEO. The banking COO’s priority is to relieve the CEO of the burden of responsibility for internal management, regulation, change and so on. This allows the CEO to focus his/her efforts on strategy, investor relationships, revenue creation and any aspects that directly impact the business’s ability to secure or retain clients, develop new products, create revenue and drive the business forwards. The COO partners this effort by ensuring the business is compliant, controlled and efficient. They [the COO] will seek ways to drive down costs and deliver value to the ‘bottom line’, while the CEO focuses on the ‘top line’ and shareholder value. In football, yes, we also have shareholders and so experience in delivering organisational efficiency and effectiveness of the ‘bottom line’ is valuable. In football, I’ve seen several COOs who clearly view their role as a springboard for career advancement; those passing through it emerge better equipped to be the future CEO. I’m a little bit biased, but given the level of scrutiny and regulation that the financial services sector is subjected to, I believe that banking executives are probably better prepared and more rounded than COOs in other sectors. It’s of no surprise to me that executives who have a proven record of success in the financial sector are attractive candidates for COO positions within club football. What constitutes the ‘right’ qualifications for the role of COO very much depends on the industry and the lines of responsibility you have in relation to the CEO. To add another layer of complexity for good measure . . . all of that is dynamic and can shift according to the needs of the business at any particular point. The majority of my role, currently, is dedicated to driving operational efficiencies for the club. This efficiency change agenda is defined by working closely with the CEO and the CFO to review our costs and regulations such as UEFA’s Financial Fair Play. The arrival of the new CFO at the club has been significant to the scope of what I do. My role has probably become more inward looking and operationally focused than it was when I first started here. Banking COOs are typically not employed to build a new business or to strategically take the business on a new journey, but rather to execute the vision and strategy of the principal business leaders. Having worked across the financial services sector, this is pretty consistent from one banking COO to another, particularly within financial markets. The common challenges for banking revolve around falling revenues, cost-ratio implications and the burden of the regulatory agenda, all of which create common market-wide challenges. While there exist core shared aims and challenges, the broader parameters of responsibility and influence can vary greatly from bank to bank, supporting the idea that the most cursory survey of COO job designs shows real disparity in spans of control, decision rights, reporting structures and the like.

The chief operating officer (COO)

65

In football, I’ve been surprised by how much the COO’s role is defined in relation to the CEO as an individual, and by that I mean the different thought processes behind creating the position in the first place. The owner is crucial in how leadership is formalised within any club structure. The owner creates a reporting hierarchy that may be peculiar to his/her own experiences and may have no resemblance to other sectors. Our owner has interests in a number of different business sectors and so has created (somewhat inevitably) a rather unconventional and eclectic reporting structure. The only common denominator, across all of his various businesses, is the COO. In each of his various companies, the COO is required to make sure that the business operates in a controlled, compliant and cost-effective way. The club owner once referred to me as both the glue and the oil of the business. I’ll take that as a compliment. The club is a series of interconnected partnerships. My partnership with the CEO is the most important one on a day-to-day basis. In management speak, I tend to lead on the execution of strategies developed by the club board. It’s simply a consequence of the scope of the CEO’s job today, with its numerous external commitments, that someone like me is needed. The club is a large, global enterprise and management of it requires two sets of hands. I will typically take responsibility for delivering results on a day-to-day, quarter-to-quarter basis. By bringing me in as COO, the club have oversight and leadership on all day-to-day operations. Within our club, I have a broad operations remit, which covers everything ‘outside’ of the first team and the academy. Our CEO looks after all activities that are first-team staff and players related. On a typical day, I arrive at the office around 7am. I think it’s important to get a head start before the phone starts ringing and emails start flooding in. Typically, most of my detailed planning, organisational and management ideas will take place outside of a conventional working day and this means early starts and late finishes. It’s something that I have maintained throughout my career. I think it’s important to lead by example and that means commitment, long hours, multitasking and a professional work ethic. My job description probably covers the design and implementation of business strategies, plans and procedures. A key component of that is to establish comprehensive goals for performance and growth. In simplistic terms, on a day-to-day basis, I oversee the operations of the company and the work of executives within IT, marketing, sales, finance etc. My functional role requires me to lead on everything connected with the stadium, including matchdays, health and safety, security, hospitality, cleaning, food and beverage procurement, operational efficiencies, etc. Outside of the activities associated with matchdays, I’m tasked with exploring how best we can optimise current and prospective commercial revenue streams. My previous career outside of professional football overlaps in terms of the core skills and experiences you require to effectively deliver financial and operational efficiencies on a variety of projects such as

66 The chief operating officer (COO)

facility management, IT and organisational development. My background extends to being responsible for meeting sales targets, launching products and implementing campaigns, so I felt comfortable in being able to adapt my skill set to the needs of the club. The club’s on-field performance has a direct correlation with the demand for our stadium and associated services. If we are able to consolidate our position in the Premier League, the demand for everything from season tickets to corporate hospitality significantly uplifts. Unfortunately, I can’t influence how the team perform on the pitch, but their performance certainly impacts on the revenue and operational demands of my team. ‘Benchmarking’, in my previous roles, was a key skill for any COO to have. Each and every business needs to benchmark and I was curious how this was undertaken within a football club. One of the best ways for any business to succeed is by learning from what others do and this means the competition. Professionally, there is a great deal of inter-club collaboration. We all speak to each other, attend the same conferences and work with a small range of external agencies. As a result, we have a good working knowledge of what other clubs do in terms of their operations. If you can learn from other clubs regarding what has worked and what hasn’t (in terms of making savings and increasing revenue), then you should. This, most simplistically, is the essence of benchmarking: comparing your performance against that of others. How many season tickets are sold and why, how many corporate hospitality boxes are sold and why, how many pies are sold, etc. ‘Reinventing the wheel’ is not necessary at all . . . plus it’s expensive and time consuming for any business to consider. We use our club data and compare it to that circulated by the industry to analyse what is already known and then guide any follow-up actions. Traditionally, organisations have undertaken audits laboriously and manually. This moved on to inspections via computers or ‘after-the-fact’ data analyses to monitor their business operations. These approaches are, in my opinion, not only costly and time consuming, but also provide very little value in learning about or anticipating financial risks. I’ve been using variations on the Balanced Scorecard (BSC) since it was invented in the early 1990s. Financial indicators alone are not enough for the management of any company, and the inventors of BSC [Kaplan & Norton, 1992] recognised that when you work within a dynamic and competitive market, you need tools that provide up-to-date and ideally real-time information. BSC is still the best model, in my view, for helping to consider club financial processes, customer processes, internal processes, and learning and growth potential. BSC allows the club to have a visual representation of how we are doing in relation to our targets. Clubs now use continuous monitoring (CM) technologies within a BSC model. Technology has revolutionised how fast we can access data. Automated technology allows us to continuously audit our business operations. It’s an approach that is embedded within the financial

The chief operating officer (COO)

67

services sector and it’s something I’ve introduced here [at the football club]. The idea is that the technology allows management to continually review business processes for adherence to and deviations from their intended levels of performance and effectiveness. With CM, controls are built into everyday operations. One of the reasons why I was asked to join the club was my experience in technology and what benefits it can bring to a business. But I’m also proud of my ability to help nurture and develop the skills and competencies of employees. Part of that development requires everyone to have explicit responsibilities and reasonable lines of accountability. This demarcation has to be established at the start of the COO’s relationship with club employees. I’m confident that if I can help to develop the ‘human capital’ at the club, I will have delivered on my role; by that, I mean whether I have developed an employee’s level of knowledge, skills and performance. I think the best leaders do that. The creation of the COO position represents a new role at some clubs and adds a layer of management. For the position to be successful, the COO needs to be given the time to develop mutual trust with the management/ executive team and especially the CEO. The COO needs to understand that they are not going to be the one in the spotlight; it is a shared spotlight. The COO’s job is to help the club run as efficiently as possible. The COO doesn’t need to be, and should not be, a headline hog! When first hiring a new COO, it is natural for club directors to feel a potential loss of control regarding the internal running of the club. Directors may also feel a little anxious regarding the employment of a ‘non-football man’. I certainly fall into that bracket given my previous work in banking. I’d be surprised if they didn’t have some initial concerns regarding my appointment. For instance, ‘How can he possibly understand this business [football]’? It’s an inevitable and fair question to pose. It’s the fact that I can see the business from a different perspective that I believe adds criticality and objectivity to my analysis. Success, however, will only come if we collectively are able to display some critical thinking. I will challenge colleagues to consider new and alternative ways of working. If we stand still, nothing will be achieved. The owner needs to ensure that any ‘loss-of-control syndrome’, if it exists, is addressed early in the COO’s tenure and doesn’t hinder their ability to add value. Trust has to be absolute in any relationship, whether that be with family and friends or at work. Inevitably, there will be those outside of the club and some occasionally within [laughs] who are always seeking to drive wedges if they can. We, as COO and CEO, need to be supportive of one another and empathise with what the other requires. Inevitably, we will not agree on every decision, but we must mutually respect one another if the relationship is to be effective and be of benefit for the club. I believe the advantage we have is the fact that we have known each other professionally for a long time. Going back in time, I was the boss of the club CEO in

68 The chief operating officer (COO)

a previous business and didn’t necessarily anticipate working either within professional football or as his COO at any point. So you could say that our respective roles have now reversed. I was invited by the CEO to join him at a stage in my career when I was happily retired. I regarded his approach as a significant compliment and the challenge is one that I’ve enthusiastically embraced. After all, I could have been retired and content with cutting the grass at home [laughs]. I think that the CEO understands what I bring to the table and fully appreciates what I can deliver on, otherwise he wouldn’t have invited me to join the club. There are no egos, petty rivalries or concerns regarding power and status between us. Accountability and lines of responsibility are clear, which I think is crucial if you are to be efficient and effective in managing a business. The CEO trusts me to deliver on strategic operational goals. Colleagues and internal operations staff who previously had direct access to the CEO now have an intermediary – me – to consult with. One of my first challenges was to develop relationships that established protocols of how I like to work and discourage anyone from seeking ‘backdoor’ access to the CEO. At the same time, I depend on the CEO to politely block efforts by those who might want to circumvent my position. It’s not an ego thing, more of an operational necessity. We are all busy people and so if we can streamline the hierarchy or levels of red tape, then every decision that is made should also become more efficient and hopefully more effective. This is not to say that restricting access to the CEO is the goal, but the lines of responsibility must be respected. Within department structures, it’s easier for me to delineate boundaries when two individuals clearly have complementary competencies and each naturally gravitates to different areas of expertise. The greater the overlap in competencies, the greater the likelihood that employees might feel (perhaps accurately) that I’m micromanaging and second-guessing their decisions. Such behaviour on my part communicates to the employee a lack of trust that is likely to engender friction in the relationship. I normally negotiate, agree and establish such lines of accountability through discussions and trial and error at a very early stage in the relationship. Ultimately, my job is to help contribute to the club growing and becoming more successful off the pitch. If I’m effective in my role, then the CEO becomes more successful. I don’t need the spotlight and never have in my career. The club CEO encourages me to use my voice in board meetings and operating reviews, but my main passion is for how best I can develop and coach my staff to develop further – in particular, how best to develop their problem-solving skills. As a financial analyst, I have always been reliant on the insight that good data can provide and I’ve carried that philosophy over into football. I expect my staff to have an evidence base when considering how to problem solve. I’m interested in how colleagues approach a problem step by step, from identifying and analysing the issue to comparing

The chief operating officer (COO)

69

alternatives and choosing the most effective solution. I try to encourage staff to provide innovative, fresh solutions. Most complex situations that arise in operations require a team effort, and a big part of my influence is establishing a culture where people show initiative and feel comfortable in asking for help. I suppose my business mantra is summed up by the expression ‘You cannot manage what you cannot measure and you cannot measure what you cannot describe’. Within any company, it’s crucial to have a clear (and agreed) vision and strategy. The same approach is required in professional football. If I can assist the club in working towards embedding a culture of performance that is quantifiable, measured and controlled, I’ll have played my part.

References Abelson, R. (1999, 10 October). A leader’s-eye view of leadership. New York Times, D1. Bass, B. & Stogdill, R. (1990). Bass & Stogdill’s Handbook of Leadership. Free Press. Bennett, N. & Miles, S. (2006a). Riding Shotgun: The Role of the COO. Stanford University Press. Bennett, N. & Miles, S. (2006b, May). Second in command: the misunderstood role of the chief operating officer. Harvard Business Review. https://hbr.org/2006/05/ second-in-command-the-misunderstood-role-of-the-chief-operating-officer. Charan, R. & Colvin, G. (1999, 21 June). Why CEOs fail. Business Week, pp. 68–78. Currall, S.C. & Judge, T.A. (1995). Measuring trust between organizational boundary role persons. Organizational Behavior and Human Decision Processes, 64(2), pp. 151–170. Financial Executives Research Foundation (FERF). (2011). Executive Report: The Benefits of Continuous Monitoring. https://pdfs.semanticscholar.org/6d7e/51085f 55081b34ef9eae69450cfdaa326884.pdf. Forbes, D. & Milliken, F.J. (2005). How boards of directors interact as decision making groups. In Duval-Hamel, J. & Bournois, F. (eds). Encyclopedia of Executive Governance. Les Editions Economica. Gerrard, B. (2005). A resource-utilization model of organizational efficiency in professional sports teams. Journal of Sport Management, 19(2), pp. 143–169. Hambrick, D. & Cannella, A. (2004). CEOs who have COOs: contingency analysis of an unexplored structural form. Strategic Management Journal, 25(10), pp. 959–979. Heenan, D.A. & Bennis, W. (1999). Co-Leaders: The Power of Great Partnerships. John Wiley & Sons. Information Systems Audit and Control Association (ISACA). (2010). Monitoring Internal Control Systems and IT. Rolling Meadows. Kaplan, R.S. & Norton, D.P. (1992, January–February). The Balanced Scorecard: measures that drive performance. Harvard Business Review, 70(1), pp. 71–79. Kotter, J.P. (2008). A Sense of Urgency. Harvard Business Press. Levinson, H., Humphrey, J., Evans, D. & Berry, J.K. (1993). The Academy of Management Executive (1993–2005), 7(2), pp. 71–83.

70 The chief operating officer (COO) Marcel, J.J. (2009). Why top management team characteristics matter when employing a chief operating officer: a strategic contingency perspective. Strategic Management Journal, 30(6), pp. 647–658. Murray, M. (2000, 24 February). Investors like backup, but does every CEO really need a sidekick? Wall Street Journal, 1. Ramamoorti, S., Cangemi, M.P. & Sinnett, W.M. (2011). The Benefits of Continuous Monitoring. Financial Executives Research Foundation. http://canco.us/ wp-content/uploads/2012/01/The_Benefits_of_Continuous_Monitoring-editedfinal-8-11.pdf.

Chapter 6

The director of football (DoF)

Introduction For many years, economists have recognised the importance of the manager in the production process (Audas et al., 1997, 2002; Forbes & Milliken, 2005; Relvas et al., 2010), but rarely have they considered how this translates to the context of team sports. In this chapter, I consider the emerging role of director of football (DoF) and the challenges that this presents to the traditional club management hierarchical structure. It is the contention of this chapter that the effectiveness of the modern-day head coach is undermined and compromised by the divergent range of skills that the role requires. As such, the predominant model needs to be critically reviewed.

The value of success and how to achieve it At the end of each English Premier League (EPL) season, the bottom three teams are relegated to the division below (the Championship). The financial ramifications for how clubs generate their revenue are considerable. Estimates for the most recent 2016/17 season reveal that all club revenue streams (broadcast, matchday and commercial) are negatively impacted by being demoted to the division below. In 2016/17, the club finishing last, Sunderland AFC, are predicted by Deloitte’s Sports Business Group to lose at least £55 million to £65 million due to relegation (Smith, 2017). The damage to the brand can be seen in terms of shareholder and market value, and potentially impacts upon its attractiveness to external investment (Szymanski, 2016). The financial damage inflicted on a club’s health is partially mitigated by the ‘parachute payments’ given to each relegated club by the PL. In their first year out of the EPL, Sunderland can expect to receive 55 per cent (approximately £46 million) of the equal share of broadcast revenue paid to EPL clubs, plus a further 45 per cent (approximately £38 million) in 2018/19 and 20 per cent (approximately £17 million) in 2019/20 (if they have not returned to the EPL by that point). However, a review of EPL records identifies that since the league’s formation in 1992/93 through to the

72 The director of football (DoF)

end of the 2016/17 season, only 21 out of 73 teams that have been relegated from the EPL have gained promotion the following season (29 per cent of teams). The implication for club owners and their boards is that fewer than one in three clubs ‘bounce back’ into the EPL the following season. Therefore, it is imperative for every club owner and his/her executive board to establish an efficient and effective club structure that facilitates EPL survival. Given the implications of relegation, the question is why some clubs are more successful than others and what differentiates a ‘successful’ organisation from those that ‘fail’. The various factors that underpin success are complex and the subject of considerable academic investigation. Inevitably, the goal of research, within this context, is to identify, support and invest in the key factors (on and off the field) that correlate to success (Chadwick, 2009; Oberstone, 2009; Plumley et al., 2017). One thesis, made popular by author Michael Lewis in his 2003 baseball book titled Moneyball: The Art of Winning an Unfair Game, is simple. By using statistical analysis, ‘smallmarket’ teams can compete against wealthier opponents by buying players who are undervalued by other teams and selling players who are overvalued by others. The impact of the best-selling book was to encourage executives (regardless of their sport) to be less insular in their management practices and consider alternative and more creative approaches to conducting their business. By identifying potential ‘inefficiencies’ within their working practices, club boards were able to consider alternative staffing and recruitment structures and ways of optimising the overall effectiveness of their club.

Management education and training in football Managers in all industries operate in a context in which results are the ultimate determinant of their ongoing employment (Agergaard & Ryba, 2014). In professional football, unlike in corporate business, results are published instantaneously via the internet and disseminated for analysis and public debate. The very nature of professional football effectively renders the manager’s domain public and highly visible (Perry, 2000). However, perhaps the most significant incongruence that exists between corporate and football managers is the level of preparedness for the rigours associated with the position (Agergaard & Ryba, 2014). The level of education frequently preceding appointment to corporate management is generally extensive, especially when compared to that of football managers (Perry, 2000). The same holds true in terms of functional experience, albeit to a lesser extent (Brady et al., 2008). In football, a player may end his playing career and enter into the management sphere relatively easily, depending on the significance of his playing career (Hughes et al., 2010). Functional experience may be gained by managing lower-division clubs, but this is not common practice. By contrast, the route to corporate management is generally convoluted and sees the individual gain functional experience in a variety of corporate settings prior to appointment (Perry, 2000). Similarly, the paucity of formalised

The director of football (DoF)

73

training for football management is underlined by the prevalence of such training within the corporate context (Brady et al., 2008). When it is considered that the football model of management not only reproduces the tribulations experienced by corporate managers but in some contexts intensifies them, the lack of formal preparation becomes profound (Kelly, 2008). First, the duties of a contemporary football manager have multiplied as football has become increasingly commercialised (Crust & Lawrence, 2006; Soriano, 2012) If even the most successful and therefore competent (at least in the short term) manager is incapable of sustaining the performance of these duties, then they must be minimised (Brady et al., 2008). This could be by adopting the DoF model implemented frequently in continental Europe. With such a model, the division of responsibilities would reduce the manager’s workload. Such delegation would allow for a more efficient concentration of resources and focus (Hughes et al., 2010). As a profession, football management is supported by minimal training when compared to corporate management. Kelly’s (2008) findings highlight the lack of formal management training and the widespread assumption within football that previous playing experience is sufficient preparation for entry into management. While many aspects of the management of football clubs have involved increasing professionalisation and bureaucratisation, the role of the manager has proven remarkably resistant to these processes. Although technical (football-related) development is provided by national football associations, this is insufficient given that the contemporary football manager must now operate within the commercial and political spheres as well as the sporting sphere (Crust & Lawrence, 2006). Thus, there is a need for training and development targeted at preparing potential managers for media relations, as well as for issues relating to economics, marketing, finance and communications (Agergaard & Ryba, 2014). By increasing the level of preparedness, the capacity for managers to cope with, and consequently succeed at, professional football management is also increased.

The DoF role The DoF role is sometimes compared to that of a general manager in a North American professional sports organisation, and often referred to as ‘sporting director’ or some equivalent in continental Europe (Soriano, 2012). In a structure with a designated DoF, the position of manager may be officially renamed or identified as ‘head coach’ or ‘head of first-team affairs’ in order to more clearly define and differentiate the remit of the traditional ‘manager’ as opposed to the DoF. The general consensus regarding the role, according to those who have filled the position, is that the DoF acts as a ‘buffer’ between the executive board/owners and the manager. In principle, the DoF is answerable to the board of directors but is also there to assist the head coach. The precise responsibilities of a DoF are subject to the complexities and idiosyncrasies of each club and its vision for the role. Alternate terms such as ‘sporting director’ and ‘general manager’ are often used interchangeably;

74 The director of football (DoF)

however, the level of power and influence held by a DoF in the day-to-day and transfer operations of a club may vary considerably. DoFs are typically held accountable by the owner and club board for establishing the long-term vision for the football club. Integral to that process is the importance placed upon the strategy applied to the buying and selling of players. Club transfer policies are usually set by such individuals and buying low and selling high is crucial to a DoF’s longevity. When scouting players and dealing with transfers, directors are expected to have a clear understanding of the fees, worth and cost of the various players who may be involved. Such delegation of duties is apparent at Real Madrid, where transfer dealings are the responsibility of club president Florentino Peréz and his sporting director. As a result of the above refinement of roles, lines of reporting and accountability, the modern-day manager of a club with a DoF typically takes full responsibility for on-field playing matters only. The extent of the manager’s influence over player transfers and contract negotiations appears to vary considerably from club to club. Even within the remit of playing affairs, the manager is likely to delegate duties among a team of subordinate coaches and assistants, responsible for first-team and academy affairs, as well as specialised positions such as goalkeeping coach. The role of the DoF in coordinating such complexities is crucial, but appears in the British media to be viewed cynically as being intrusive and as undermining the authority of the manager. Self-evidently, there is a need to clearly establish the delineation of roles, particularly those of manager and DoF, and their boundaries of strategic influence for the benefit of all stakeholders within a football club. The responsibilities of the DoF role identified in Table 6.1 place responsibility upon the board of directors to appoint an individual who can be a Table 6.1 Director of football (DoF): roles and responsibilities

Core responsibilities

Manager

Director of football (DoF)

First-team selection

Not responsible for first-team selection (NB has no direct coaching responsibilities) Answerable to the board, but is also required to support/assist/liaise with the manager/head coachAssists the board in explaining/articulating ‘football’ mattersActs as a buffer or intermediary between the board and the manager/head coachAppoints manager/head coachAccountable for creating and articulating the vision, strategy and environment for on-field club success

Style of play

Not responsible for the style of play, but recruits coaching staff who agree to work within the club’s playing philosophy (i.e. playing style, tactics, formation, etc.)

Prime tasks

Contributory tasks

Manager

Director of football (DoF)

Assembly and maintenance of the playing squad

Allocates resources to the coaching teamManages the process of building and retaining playing talent at all age groups (in liaison with the manager/head coach)

Club coaching policy

Oversees football staff recruitment and budget (including first-team coaching staff) Advises the board regarding first-team and academy coaching staff recruitment

Player discipline, fitness, preparation and well-being

Oversees academy youth development issues (the academy manager (AM) reports to the DoF)

Player development

Oversees all aspects of sports science at the club, including fitness/rehabilitation/ medical (in liaison with the heads of department)

Appointment of assistant staff

Oversees football assistant staff recruitment and budget (in liaison with the manager/head coach and the AM)

Attendance at board meetings

Attendance and reporting to the board as an executive director

Media duties (pre- and post-match)

Media liaison

Salaries/contracts of players

Oversees contract negotiations with players and their representatives

Club scouting policy

Oversees player research and recruitment (in liaison with the head of scouting), including player identification, acquisitions, sales and retention (including contract negotiations with player representatives)—including player identification, acquisitions, sales and retention

Club youth policy

Oversees the club’s football training facilities, taking primary responsibility for reviewing and implementing improvements to the training ground environment and infrastructure

General public relations/sponsorship dealings

Communication with both internal and external stakeholders regarding the strategic vision of the club

Match programme literature

As and when required

Source: adapted from Perry (1980)

76 The director of football (DoF)

provider of intellectual capital and individual capital (human, social and cultural) and link these to the functioning of the board. The DoF is then intended to form a link between board effectiveness and organisational performance (Soriano, 2012). Forbes and Milliken (1999) have devoted significant analysis to board processes and defined effort norms, cognitive conflict and the use of knowledge and skills. They have recognised the potential trade-off between cohesion (often stated as a desirable board feature) and cognitive conflict or the ability to challenge. It is apparent, however, that DoF models are heavily board centred, with the DoF having a much greater role in the key strategic and decision-making processes. Effective corporate governance provides the structure through which the objectives of the club are set and the means of attaining those objectives and monitoring performance are determined. At its broadest, the integration of a DoF within this structure enables the manager to comprehend the framework of rules, relationships, systems and processes within and by which authority is exercised and controlled in corporations. It includes the practices by which the authority of the head coach is contextualised. Within the EPL, there appears to be a growing enthusiasm for embracing the benefits of the model. In 2016/17, 13 out of the 20 teams had an appointment in place (Table 6.2).

Table 6.2 DoFs in the EPL, 2016/17 Club

DoF

Arsenal FC

Dick Law (appointed September 2009)

Bournemouth FC

Richard Hughes (appointed May 2014)

Chelsea FC

Michael Emenalo (appointed July 2011)

Everton FC

Steve Walsh (appointed July 2016)

Leicester City FC

Jon Rudkin (appointed December 2014)

Liverpool FC

Michael Edwards (appointed November 2016)

Manchester City FC

Txiki Begiristain (appointed October 2012)

Southampton FC

Les Reed (appointed July 2011)

Stoke City FC

Mark Cartwright (appointed December 2012)

Sunderland AFC

Simon Wilson (appointed November 2016)

Swansea City FC

David Leadbeater (appointed June 2010)

Watford FC

Filippo Giraldi (appointed June 2012)

West Bromwich Albion FC

Nick Hammond (appointed April 2016)

Note: No identified DoF: Burnley FC, Crystal Palace FC, Hull City FC, Manchester United FC, Middlesbrough FC, Tottenham Hotspur FC, West Ham United FC.

The director of football (DoF)

77

Case study: interview with a DoF My route to becoming a DoF is a little unusual. As a kid growing up, I was a talented footballer and had a number of professional clubs back home approach my parents with offers of contracts to play in their academy teams. My parents were always very pragmatic and asked that I made sure that I gave as much time to my studies at school as I did to kicking a football. My parents’ occupations moved them around the world and so I picked up languages fairly quickly. At that point, I had no idea what direction my career would take me. As a kid, I was simply trying to make friends at my new school (laughs). The tipping point for me was when I reached the age of around 14 or 15 and I started training with guys who played in my position and went on to play for the national team, I appreciated that maybe I wasn’t cut out to get to the top. My parents’ earlier advice was pragmatic, but ultimately intuitive. I went to law school, while starting my coaching licence education. I love football and wanted to still be involved, even if I wasn’t going to make the grade at the very top as a player. After graduating from law school, I had a stint as a youth coach at my hometown club and met some people who have subsequently been incredibly influential in my career. I suppose you could regard them as mentors. I must have made a good impression in terms of my coaching ability and scouting reports because I was asked to help the manager when he left the club to join a new team. This led to work as a scout and my first experiences of what is now regarded as a DoF. I was in a great position to help the club because I was a coach, could speak several languages and had a law degree. I think the combination of skills put me in a unique position for the club in terms of the support I could offer both the head coach and the club ownership (initially, this revolved around scouting, player contracts and other club business-related matters). In most businesses, you need to be a good communicator, but I think in football you need to have more than that. The DoFs I respect for have great organisational ability and they understand the world of the coach. They are empathetic and have typically worked up through the various coaching licences to achieve a high level of technical understanding. All of the successful DoFs I know are either UEFA or equivalent A or Pro Licence holders. It’s this coaching background that establishes a level of mutual understanding, empathy and trust when you work with a head coach. They (the head coach) look at your credentials and afford you a level of professional respect if you have walked in their shoes, so to speak. At the same time, your professional licence and status establishes the potential for the head coach to feel vulnerable. The DoF should make it clear to the head coach that their (DoF) role is to support them in achieving success with the first team, not be a shadowy figure in the background waiting for them to slip up so that they can be replaced by the DoF. The role of DoF is not a new one for professional football clubs. I know of colleagues who have been through the Italian training school [Director

78 The director of football (DoF)

Sportivi], which has an excellent reputation. The perception is that it’s a new thing in club structures and that it’s just landed on the UK’s shores. It’s not. It’s been around since the 1960s in Italy via their professional training centre and from the 1960s in England. At clubs such as Liverpool FC, they’ve had an early version of DoFs where Bob Paisley (became manager of Liverpool in 1974) had some of the administrative duties previously undertaken by Bill Shankly (his predecessor) given to Peter Robinson (Liverpool FC club secretary). I’m positive that he (Bob) didn’t deal with players’ contracts. In the past, I have met with Lawrie McMenemy (best known for being manager at Southampton FC between 1973 and 1985) and he told me of the time in the 1990s when the club asked him to take on the kind of role that we now recognise as a DoF. More recently, you could easily argue that many club CEOs have operated as quasi-DoFs. For example, Rick Parry (Liverpool FC CEO from 1998 to 2009) and David Gill (Manchester United FC CEO from 2003 to 2013) took on many of what are regarded as the perceived roles and responsibilities of a DoF. The reality is that football managers in the vast majority of club structures do not undertake or direct salary negotiation. There is a clear separation of responsibility and accountability for delivering upon those responsibilities. In my experience, the first-team manager is not employed to be in charge of the club academy, nor is he responsible for the hiring or firing of academy staff. However, alignment and a productive working relationship is needed between the first-team manager and the academy manager (if it is to work as the intended ‘pipeline’ for the first team). The role of the DoF in facilitating clear lines of communication and expectations is essential if the relationship is to be effective. The reality is that if the first-team manager is successful (in terms of on-field first-team success) he will have higher status within the club and potentially more influence regarding what happens within the academy. Given the results-oriented nature and demands of the first-team club environment, it may mean that there is the potential for the first-team manager and the academy manager to have conflicting objectives: for example, the first-team manager may be focused on immediate success and the academy manager on long-term club development of youth talent. Part of the responsibility of anyone undertaking the role of DoF is therefore to manage that relationship and ensure that the terms and conditions of employment are unambiguous i.e. there are precise boundaries and clear lines of accountability. This may help in reducing any perceptions of power and human issues such as jealousies regarding the pecking order at each club. Such short, simple lines of accountability are essential and increase the likelihood of the club getting things right. However, sometimes we get our appointments wrong and we need to make a staffing change. Many people, at some point in their professional career, will encounter a colleague or leader who erodes the organisational productivity, results and ultimately the reputation of the business. The same

The director of football (DoF)

79

is true in football clubs. Part of my role is to build a decision-making bridge between the board and the first-team staff. In theory, I’m best placed to do this given my business and coaching background. I’m the conduit for information to be translated from the board room to the training field. On occasions, I have to carefully filter and manage that process. At the same time, you cannot tolerate a head coach who consistently saps the energy of the business. I’ve heard people in other industries talk of ‘toxic leaders’ in their company. They are difficult to spot and often arrive with impressive credentials and results and are clearly high performing, but for whatever reason they become someone prone to being abusive, malicious, petty and in some cases bullying of staff or players. When you have an employee who increasingly becomes described in those terms, the club needs to act. If this person falls within my remit of ‘football staff’ (first-team staff and players or academy staff and players) that I line manage, then I’m required to report my concerns to the CEO and potentially the board. In the past, I’ve seen football staff who appear to be on an emotional rollercoaster i.e. rather than making a stable environment for their team, they tend to be the ones whose behaviour is unpredictable. You can never be sure what the toxic leader will say or do next. They also tend to be overly emotionally sensitive (usually in response to criticism following a run of defeats) and are notoriously moody. I guess ultimately they display what our first-team psychologist would identify as poor emotional control i.e. they shout and sulk, often without any apparent sense of embarrassment. It goes without saying that toxic leaders are bad for their group and bad for the organisation as a whole. There is an acceptance within professional football that the industry is one that is driven by results. A lot of club owners will tolerate minor personality clashes and difficulties in communication as long as the team is winning. Failure to achieve your performance targets in any business will lead to your exit. It becomes accelerated if you fall into the ‘toxic leadership’ bracket. DoFs are arguably much more needed now due to the complex infrastructures that have evolved over time within elite football. Currently, I think there are only two EPL teams who have majority UK owners: the last time I looked, I think West Ham United FC and Stoke City FC. The other 18 teams are foreign controlled and with that cosmopolitanism comes significant differences in how they (the owners) would like their club structures to work. My role as DoF is to advise the club board regarding how best to comply with UEFA’s Financial Fair Play requirements, and harness the efficiencies of collaboration in sports science, big data, etc. The most effective reporting structure (given the nature of the interdisciplinary collaboration that takes place within clubs) is to have short lines of communication and accountability. Managing a big, successful business requires staff who have expertise in finance, governance, marketing and law. In the football industry, that

80 The director of football (DoF)

extends to needing experts in sports science, nutrition, medicine, etc. Manchester United FC have a reported annual income of around £500 million. Wage bills for players are astronomical and hover around 60 per cent of a club’s total income. Given the extraordinary demands on managing a business of this scale, you need experts. It would be therefore nonsensical to expect one employee to be simultaneously an expert in coaching, finance and employment law. For example, how could a first-team head coach ever have the prerequisite financial and legal background to dictate the budget allocated to talent acquisition and then negotiate complex image rights and agent fees? There is a misconception that the football manager (as they are typically referred to in the UK) has a Svengali-type control over complex business decisions such as player transfers. In reality, CEOs are authorised (by the owner and the board) to work within a financial budget regarding player transfers; anything above that agreed amount needs approval. In most cases, the DoF is then tasked by the CEO to work with the head coach and their talent scouts to identify the ‘right players’ at the ‘right price’ for the club. In business, it is standard procedure for complex purchasing decisions to require a variety of views, perspectives, checks and balances. I think that it’s helpful for managers to understand the cut and thrust of negotiations and potentially be present as a witness for their own understanding of what underpins a player transfer. Employee talent is the capital that most businesses are founded upon and you can see this clearly in club football. Clubs operate in a highly competitive market where there is a scarcity of talent. In other words, talent is high in demand, but short in supply. This is acutely recognised by both the players and their representatives. A significant part of my role is liaising between the CEO, the head coach and the players’ agents in finding the ‘right people’. Previously, clubs relied upon recommendations based on subjective intuition and behavioural intangibles provided by their head coaches and scouts. In my experience, that perspective, although respected, is now challenged by big data and what science can reveal as to our decisions. For a large number of people, the first they heard of statistics being used to underpin player recruitment was in the 2011 Moneyball film with Brad Pitt. One of the classic lines from the head scout of the baseball team depicted was ‘You don’t put a team together with a computer . . . Baseball isn’t just numbers. It’s not science.’ I don’t know why there is such a high level of mistrust of using technology to help inform your decisions. Maybe it’s because those people who don’t understand what data can do fear being exposed? However, regardless, the use of data analytics in football is here and I don’t envision it going away. Increasingly, my role is to make sure that not only am I aware of its (data technology and analytics) potential, but can translate that in layman’s terms to my other colleagues. As a business, we need to focus upon the constant pursuit of a competitive edge. This may mean everything from how we make our players fitter and optimise post-match recovery to how we can

The director of football (DoF)

81

best optimise our commercial revenue streams and build relationships with our supporters. I think that one of my strengths is my intellectual curiosity. It always has been, and as soon as I stop exploring problem-solving strategies from a variety of perspectives, I’ll stop working at the club. The challenging aspect of the role is that there are a multitude of explanations and sources of research that you can consider when decision making. I try to combine the science of the quantitative methods (such as data analytics) with the holistic merits of interpretive studies. We, as a club, need to demonstrate robust decision making. In terms of player transfers (in and out of the club), I’m held accountable by the CEO and ultimately the owner. The head coach is in constant dialogue with me regarding players. This is not a process that starts a week before the transfer window opens, but is ongoing and shifts according to positional requirements, form and player injury within the current squad. Prices are too high and the market is crazy, especially within the EPL and selling clubs hoping to have a slice of the broadcast revenues that English clubs can access. Selling clubs will monitor what similar players (age, experience, injury history, etc.) have been bought for and will base or model their own valuation upon current or previous precedents. This in effect is their ‘reservation price’, one that they are unprepared to go below. Ultimately, what you pay for any player is determined by the motivation to sell and your motivation to buy. We (at the club) build a statistical profile based on any number of KPIs of a hypothetical transfer target. The quantitative analysis then allows us to filter potential players against these benchmarks. It is at this point (once a shortlist of players who match the profile has been drawn up) that we ask our scouts or coaches to use their intuition and subjective insight to test the rigour of our data. The reverse can also happen, where we identify a player ‘in the flesh’ who is then compared against the KPIs on our database. The majority of professional football players that fall within our desired KPI profile for the first team are aged between 18 and 28 years old. Regarding education, unfortunately the majority (over 70 per cent) will not have completed any education beyond high school. The big misunderstanding relates to the monthly salaries that many players receive. Across Europe, it’s not uncommon for a player to earn less than £4,000 net per month and many make less than that. So you can potentially purchase a new player relatively inexpensively if you have the appropriate structure in place. Money is not necessarily the key performance driver among all players once they arrive at their new club. Job satisfaction and the level of support that players receive while at the club are very important. Salary incentives and performance bonuses can be used to attract players, but you hold onto the same players if you provide a high level of organisational support: for example, help with integration of the entire family into a network of similar people, career support for the family and especially the children, and private problem support when they encounter a difficulty in

82 The director of football (DoF)

their private life. All these things have an influence and help to strengthen commitment from the player when they experience a dip in form or are approached by other teams.

References Agergaard, S. & Ryba, T.V. (2014). Migration and career transitions in professional sports: transnational athletic careers in a psychological and sociological perspective. Sociology of Sport Journal, 31(2), pp. 228–247. Audas, R., Dobson, S. & Goddard, J. (1997). Team performance and managerial change in the English football league. Economic Affairs, 17(3), pp. 30–36. Audas, R., Dobson, S. & Goddard, J. (2002). The impact of managerial change on team performance in professional sports. Journal of Economics and Business, 54(6), pp. 633–650. Brady, C., Bolchover, D. & Sturgess, B. (2008). Managing in the talent economy: the football model for business. California Management Review, 50(4), pp. 54–73. Chadwick, S. (2009). From outside lane to inside track: sport management research in the twenty-first century. Management Decision, 47(1), pp. 191–203. Crust, L. & Lawrence, I. (2006). A review of leadership in sport: implications for football management. Athletic Insight: The Online Journal of Sport Psychology, 8(4). www.athleticinsight.com/Vol8Iss4/FootballManager.htm. Forbes, D. & Milliken, F.J. (2005). How boards of directors interact as decision making groups. In Duval-Hamel, J. & Bournois, F. (eds). Encyclopedia of Executive Governance. Les Editions Economica. Hughes, M., Hughes, P., Mellahi, K. & Guermat, C. (2010). Short-term versus longterm impact of managers: evidence from the football industry. British Journal of Management, 21(2), pp. 571–589. Kelly, S. (2008). Understanding the role of the football manager in Britain and Ireland: a Weberian approach. European Sport Management Quarterly, 8(4), pp. 399–419. Lewis, M. (2003). Moneyball: The Art of Winning an Unfair Game. W.W. Norton & Company. Oberstone, J. (2009). Differentiating the top English Premier League football clubs from the rest of the pack: identifying the keys to success. Journal of Quantitative Analysis in Sports, 5(3), Article 10. Perry, B. (2000). The boss? The contemporary role of the football manager. In Murphy, P. (ed.). Singer & Friedlander’s Review, 1999–2000 Season. Singer & Friedlander in association with the University of Leicester, pp. 59–62. Plumley, D.J., Wilson, R. & Ramchandani, G. (2017). Towards a model for measuring holistic performance of professional football clubs. Soccer & Society, 18(1), pp. 16–29. Relvas, H., Littlewood, M., Nesti, M., Gilbourne, D. & Richardson, D. (2010). Organizational structures and working practices in elite European professional football clubs: understanding the relationship between youth and professional domains. European Sport Management Quarterly, 10(2), pp. 165–187. Smith, P. (2017, 15 May). What is the cost of Premier League relegation for Sunderland, Middlesbrough and Hull City? Skysports.com. www.skysports.com/

The director of football (DoF)

83

football/news/11095/10879090/what-is-the-cost-of-premier-league-relegationfor-sunderland-middlesbrough-and-hull-city. Soriano, F. (2012). Goal: The Ball Doesn’t Go In by Chance. Management Ideas from the World of Football. Palgrave Macmillan. Szymanski, S. (2016). Professional Asian football leagues and the global market. Asian Economic Policy Review, 11(1), pp. 16–38.

Chapter 7

The first-team manager/head coach

A team is not simply the addition of 1 plus 1 plus 1 all the way to 11. It’s a multiplication. T (1 2 3 4 5 6 7 8 9 10 11) to the power of N. N is the influence of the manager. (Paul Frantz, French football manager)

Introduction The 2016/17 football season heralded 11 managerial changes among the 20 clubs that compete in the EPL. The changes began when Swansea City FC sacked Francesco Guidolin on 10 October 2016 and continued shortly after the final game of the season with the termination of Claude Puel’s contract at Southampton FC on 14 June 2017. The average tenure of managers leaving their respective clubs in the EPL was a mere 391 days. A similar pattern can be identified across the lower professional divisions in England, where in the 2016/17 season 44 of the 72 clubs also changed their manager. What emerges from such statistics is that the tenure of a professional football club manager is often precarious and volatile (Flint et al., 2014). One potential conclusion to be drawn is that the high attrition rate of leaders within club football, or employee ‘churn’, is reflective of poor recruitment practices on the behalf of club boards, a chronic focus on the immediacy of results, or both (LMA, 2015).

The roles of the football manager The historical role of football club manager and its evolution in English society has been elegantly considered in a wide range of academic studies (Carter, 2006; Hopcraft, 1968; Wagg, 1984; Walvin, 1986). What can be concluded is that the management of football clubs changed as a consequence of professionalism in 1885 (the legalisation of player payments by the FA) and a need for individuals who had expertise. From the mid-nineteenth century, horse racing, cricket and athletics had become commercialised spectacles, drawing large crowds, and in essence provided football with a template of

The first-team manager/head coach

85

how to run a sports business (Vamplew, 2004). The challenge for football clubs, which had initially been established for social and sporting reasons, was how to evolve from their amateur values and approaches into professional, commercially focused organisations. As noted in Chapter 1, early club committees functioned like ‘quasi-democracies’, in which club secretaries ran the club on a day-to-day basis, directors selected the team and a trainer looked after the players (Carter, 2006). In effect, club directors ‘made football management up as they went along’ (ibid., p. 4). However, pressure upon directors to commit more time to their clubs and the commercial opportunities that flowed from a rise in the game’s popularity accelerated clubs’ transition towards professionalism and the need for a football specialist. The management style and approach adopted by many of the early football leaders was determined by the fact that they received little or no formal preparation. Early football managers inevitably deferred to the communication styles and management philosophies underpinned by their own formative experiences and background. As a consequence, the impact of authoritarian and powerful role models such as school teachers, military leaders and police officers was crucial in helping to inform and mould the manner in which early football managers worked. A key watershed figure in the evolution of football management in England was Herbert Chapman in the 1930s. He helped to establish Arsenal FC as the most successful club of the era and was arguably the first to consider how managers might ‘organize victory’ via a tactical masterplan (Carter, 2006, p. 8). However, Chapman was much more than simply an astute tactician. Success was underpinned by placing importance on the various factors that holistically contributed to on-field performance. These included the value of ‘hands-on’ coaching, player recruitment, control of team selection and playing style (free from interference) and the status of ‘football boss’. The template provided by Chapman was one to become reluctantly adopted by many clubs in return for on-field success. Directors now increasingly conceded power and status regarding who was viewed as the most important person at the club. The mystique surrounding the title of ‘manager’ is therefore totemic in British football and is synonymous with a leader who possesses both charisma and tactical genius. The expectations and responsibility placed upon the first-team leader are inevitably unrealistic and ultimately unsustainable. However, the ‘cult of the manager’ is still pervasive, at least in the eyes of supporters and more worryingly in the recruitment strategies undertaken by many club owners. Whether management in modern-day football is indeed a profession is a contentious issue (Crust & Lawrence, 2006). The implication is that managers should demonstrate a high level of education and training enforced by a governing body (Larson, 1977). By definition, therefore, the professional status of football managers in the UK is a relatively new phenomenon, heralded by the creation of the UEFA Pro Licence in 1997, with the

86 The first-team manager/head coach

first graduates following in 1998. The process of managing people, whether in sport or business, is a complex task and requires a sympathetic appreciation of the multidimensional roles required (Crust & Lawrence, 2006). Traditionally, a coach has a prescribed number of roles, which typically includes overseeing a planned, coordinated and integrated programme of athlete preparation (Baker et al., 2003; Lyle, 2002; Pyke, 1992; Sabock, 1985; Woodman, 1993). By contrast, the modern football manager must acknowledge the importance of his role from a business or financial perspective and defer responsibility to ‘experts’ within the club. Some theorists have attempted to distinguish the difference between a manager and a leader by emphasising the organisational role of the manager and the vision and direction provided by leaders (Weinberg & Gould, 2003). According to Beech (2002), the consensus is that management implies leadership, but that leaders need not necessarily be managers. The traditional role of the football manager clearly encompasses elements of both management and leadership. However, the traditional role is arguably now contracting in the modern era to focus upon ‘core responsibilities’. From an applied perspective, those individuals (owners, boards and potentially DoFs) who are responsible for appointing managers would be well advised to consider the extant literature, theories and research concerning leadership, which is the focus of this chapter. The degree to which a manager offers ‘human capital’ to a club (the level of previous success and experience) may be crucial in determining which managers are appointed by clubs to new positions (Audas et al., 1997, 2002), but this might not always

Table 7.1 Traditional roles and responsibilities of a football club manager Core responsibilities

Prime tasks

Contributory tasks

Source: adapted from Perry (1980)

1. 2. 3. 1. 2. 3. 4. 5. 6. 1. 2. 3. 4. 5.

First-team selection Style of play Assembly and maintenance of the playing squad Club coaching policy Player discipline, fitness, preparation and well-being Player development Appointment of assistant staff Attendance at board meetings Media duties (pre- and post-match) Salaries/contracts of players Club scouting policy Club youth policy General public relations/sponsorship dealings Match programme literature

The first-team manager/head coach

87

be the best selection procedure if managers have a dominant style that is incongruent with players’ preferences and situational factors. It appears that effective management behaviour necessarily varies across specific contexts as the characteristics of the players and the environment change (Chelladurai, 1978). Those individuals who are already, or who are aspiring to be, in managerial positions within football may be encouraged, via psychological support, to reflect on their own characteristics, behaviours and interactions with other club staff, and where necessary seek to change in order to enable greater productivity. What is of particular concern is how prospective club managers’ eligibility for a role is considered by boards (Crust & Lawrence, 2006). As discussed within the Preface to this book, football clubs are organisations in which ‘insider networks’ dominate and strongly influence their decision-making process. As a result, staff are often recruited on the basis of ‘who you know’, rather than ‘what you know’. Such an approach inhibits a more thorough exploration of who could ‘add value’ to the leadership of the club. This type of ‘corporate myopia’ is reflected in the lack of opportunities that exist for individuals who are from Black and Minority Ethnic (BAME) backgrounds. It is now over 100 years since the first black footballer (Arthur Wharton) signed a professional contract to play for Rotherham Town FC (Vasili, 2000). However, despite the clear growth in BAME player ‘visibility’, there are continuing concerns regarding the number of BAME leaders within the professional game who are of strategic influence within their club (i.e. first-team managers, coaches, academy directors, etc.). Research conducted by Bradbury (2013, 2014) has previously identified that approximately one quarter of all registered professionals are of BAME; however, surprisingly only 3 per cent of the 522 senior coaching positions within clubs were held by individuals of BAME (Bradbury, 2014). Self-evidently, while ethnic minorities have visibility, they do not hold positions of authority or strategic influence (Kandola, 2016). The issue of BAME representation was further compounded in June 2017, following the resignation of Dame Heather Rabbatts from the FA’s board. Dame Rabbatts was the first black female director to be appointed to the board. Upon resigning from her position, she warned that English football was ‘in danger of losing, yet again, another generation of ex-players and other BAME individuals who want to play a role and have relevant skills yet increasingly feel excluded’ (Rumsby, 2017). Admittedly, club football is not alone with regard to concerns regarding inadequate BAME representation in senior roles. Research conducted by SpencerStuart (2016) found that just 1.6 per cent of directors in the 150 top FTSE companies were BAME. The societal issue of discrimination and overt racism is one that transcends employment industries. However, if football is indeed the national sport, there is considerable work to be undertaken by its strategic stakeholders if it is to reflect the diverse make-up of those currently playing the game at the highest level.

88 The first-team manager/head coach

Defining leadership Barrow (1977, p. 232) defined leadership as ‘the behavioral process of influencing individuals and groups towards set goals’. This definition is important because it places emphasis on the vision of a leader (i.e. goals, objectives) while also highlighting the necessary interaction between the leader and group members. Effective leadership will encompass an understanding of motivation and is likely to minimise any loss of productivity through the development of both task and group cohesion, allowing a group to operate at, or close to, its potential (Crust & Lawrence, 2006). Indeed, Carron and Chelladurai (1981) found that cohesion was dependent upon player and coach relationships. Loehr (2005, p. 155) stressed that the common theme of effective leadership is the ‘positive impact that individuals can have on group dynamics relative to a team objective’. The act of leadership attempts to influence and convert others into ‘followers’ (Tannenbaum et al., 1961) and may be achieved through a variety of mechanisms such as coercion, persuasion and manipulation. Leadership requires an understanding or respect for the power dynamic between the influencer and the follower. The relationship recognises that every act between the two parties is a ‘political act’ with the potential for coercion (Miller, 1985). Researchers have suggested that the interpersonal dynamics at play between player and coach are complex (Bloom et al., 1998, 1999; Martens, 1987, 1990) and this complexity is also likely to extend to player– manager relations. Managers unable to communicate effectively with their players may inadvertently exacerbate problems due to a lack of understanding of their perspective. The perception and interpretation of information conveyed by the manager may have its origins in the formative stage of an individual’s development (Seligman, 1991). To improve the intellectual exchange between player and manager, it may be necessary to integrate specialist sports psychology consultants into the coaching team to facilitate reflection from both parties. To understand leadership, it is important to transcend the superficial and lay perspective, which tends to define success in terms of winning. For some football clubs with limited resources, success might be defined in terms of maintaining their status (i.e. avoiding relegation to a lower division). According to Weinberg and Gould (2003), leaders typically have two functions: 1 2

to ensure that the demands of the organisation (the club) are satisfied by the group effectively meeting its targets; and to ensure that the needs of group members are satisfied.

Clearly, those individuals who are responsible for appointing leaders/managers need to ensure that the visions and targets of both the club and the

The first-team manager/head coach

89

potential leader are compatible and that the qualities of the leader and group members (players) are also congruent (Crust & Lawrence, 2006). The early research into leadership effectiveness was conducted outside of sports settings (usually business, military or education contexts) and tended to use one of two approaches (Horn, 2002). The trait approach assumed that effective leadership was founded on innate personality dispositions rather than being a function of learning and explicitly supposed that great leaders were born and not made. By contrast, the behavioural approach posited that effective leadership was a function of a leader’s dominant behaviours (Fiedler, 1967). The assumption was that an individual could learn to be an effective leader by adopting behaviours that other successful leaders used (i.e. leaders were made and not born). Both the trait and behavioural approaches to studying leadership rested upon the premise that a set of universal traits or behaviours could be identified that would reliably discriminate between successful and unsuccessful leaders. Eventually, such research began to permeate sports (ibid.). For example, Penman et al. (1974) tested the degree of correlation between coaching success (male, interscholastic football and basketball head coaches) and authoritarianism. They found that more successful coaches, in comparison to less successful coaches, exhibited more authoritarianism. Research that followed took similar approaches to investigate the relationship between effective leadership and traits or behaviours such as decision-making style and creativity (Lenk, 1977; Pratt & Eitzen, 1989). Some theorists even proposed coaching profiles that were supposed to be characteristic of successful coaches (Ogilvie & Tutko, 1966, 1970). Although Ogilvie and Tutko considered traits such as authoritarianism, tough-mindedness, independent thinking, emotional maturity and realism as important characteristics, it is apparent that these theorists produced no evidence to support their profile (Weinberg & Gould, 2003). In hindsight both the trait approach and the behavioural approach were oversimplified positions and it was too optimistic to expect a single set of traits or behaviours to be able to discriminate between successful and unsuccessful leaders. While these approaches failed in their main objectives (no single set of traits or behaviours have been consistently found to characterise effective leaders), the research that tested these conceptual models undoubtedly advanced the knowledge base and led to more complex theoretical models and research designs (Crust & Lawrence, 2006). Stogdill (1974) summarised the contribution of trait approaches to the study of leadership by listing those traits and skills that have been found more frequently in related research (Table 7.2). These traits and skills are not specific to sport and should not be considered as essential prerequisites but rather as potentially useful leadership characteristics. It is important to note that the absence of such traits does not necessarily preclude an individual from being a successful leader.

90 The first-team manager/head coach Table 7.2 Traits and skills of leadership Traits

Skills

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.

14. 15. 16. 17. 18. 19. 20. 21. 22.

Adaptable to situations Alertness to social environment Ambition (achievement oriented) Assertiveness Cooperation Decisiveness Dependability Dominance Energy Persistence Self-confidence Stress tolerance Willingness to take responsibility

Intelligent Conceptually skilled Creative Diplomatic Fluent speaker Knowledgeable about group Organized Persuasive Socially skilled

Source: Stogdill (1974)

Contemporary research: the multidimensional model of leadership While research and theories from non-sports settings provide useful frameworks for understanding leadership (Horn, 2002), specific approaches that reflected the unique demands of sports settings were required. In response to this need, Chelladurai (1978, 1990, 1993) developed the multidimensional model of leadership to provide a conceptual framework that allowed leadership effectiveness to be studied in the sports domain. Chelladurai proposed that effective leadership is dynamic and is based on a complex series of interactions between the leader, group members and situational constraints. The model suggests that positive outcomes (performance and satisfaction) will occur when there is congruence between the leader’s actual behaviour (e.g. either organising practices or providing positive feedback), the group members’ preferred leadership behaviour (e.g. a preference for a highly organised, supportive leader) and the behaviour that is required in relation to the situation. In addition, behaviour does not occur in a vacuum, and antecedent factors such as leader and member characteristics will influence both the actual behaviour of the leader and group preferences for leadership behaviours (Crust & Lawrence, 2006). The challenge for football managers is to show flexibility in adapting their dominant leadership style to suit specific leadership situations and, with large squads of highly paid players, to keep everyone satisfied (ibid.). In essence, Chelladurai’s (1978, 1990, 1993) model stresses the importance of

The first-team manager/head coach

91

‘fit’ or ‘alignment’, with high levels of satisfaction (a multifaceted construct that includes satisfaction with individual performance, team performance, type of leadership, etc.) and performance predicted when there is congruence between actual, required and preferred behaviours. Therefore, when discrepancies occur, it would seem that leaders are faced with an important dilemma: to carry on without making significant changes and to expect (or encourage) others to be more accommodating; to remove barriers (e.g. problem players or other coaching staff who are creating disharmony); or to be more flexible (which may prove decidedly difficult for controlling, authoritarian managers). It is interesting to note that some football managers appear to be ‘recycled’ following previous failures and eventually succeed in certain types of situation (e.g. in relegation battles) but are less effective or less able to adapt their style to more positive situations (and vice versa) (Crust & Lawrence, 2006). Weinberg and Gould (2003) make a similar observation when referring to NBA coach Doug Collins, whose autocratic and emotional style appeared to be most effective in providing direction for young, unpredictable teams. However, when Collins failed to adapt his style as the teams matured, this autocratic approach was seen as a liability and in two similar situations Collins was fired after initially making a positive impact. Clearly, such anecdotal observations do little to advance knowledge of leadership, but it is evident that further research in this area is warranted given the potential applied importance of knowing which types of leaders suit particular situations and why (Crust & Lawrence, 2006).

Hardiness and mental toughness In light of the high levels of stress that are associated with football management, it is interesting that a number of the traits listed by Stogdill (1974) (Table 7.2) appear to be associated with the concepts of hardiness and mental toughness (i.e. ambition (achievement oriented), persistence, self-confidence, stress tolerance, etc.). The work of existential psychologists led to greater understanding of the stress–illness relationship, and the cognitive mechanisms that allow individuals to function efficiently and tolerate highly stressful situations without becoming ill (Kobasa, 1979; Kobasa et al., 1982). Kobasa (1979) found that executives who were exposed to highly stressful environments but remained healthy (as opposed to those who became ill) were characterised by a set of distinct cognitive attributes, which has been described as the hardy personality. The three dimensions of hardiness as highlighted by Kobasa (1979) are: 1 2

commitment (as opposed to alienation), which reflects individuals’ ability to feel deeply involved or committed to the activities in their lives; control (as opposed to powerlessness), which involves both decisional control, or the ability to autonomously choose between various coping

92 The first-team manager/head coach

3

strategies in order to deal with stress, and cognitive control, the ability to appraise stressful events as being part of an on-going life plan, thus deactivating their jarring effects; and challenge (as opposed to security), which is the anticipation of change rather than stability as the norm, and the interpretation of change as a challenge or a chance to grow, rather than as a threat.

These three dimensions appear to act as a buffer to stress (Kobasa, 1979; Kobasa et al., 1982). Maddi (2004) suggested that hardiness represents an operationalisation of existential courage; that is, without courage, individuals may revert to habitual past choices and behaviours, holding onto what is already known and familiar rather than actively seeking out new, and perhaps more relevant, alternatives. This concept can easily be transferred to football management, where a cursory glance at professional managers in England quickly reveals a distinction between those who have applied scientific principles to training and embraced new developments in sports science and those who have more rigid, set ideas about how things should be done, which are usually rooted in past traditions. The ability to function effectively – not just in terms of remaining healthy but also in terms of decision making and remaining clear and logical in thought when experiencing adversity – is intuitively an important characteristic of a football manager (Crust & Lawrence, 2006). That includes keeping players focused on what is important and connecting with team members’ core values (Loehr, 2005). Research has shown that mental toughness is positively correlated with the performance of endurance tasks (Crust & Clough, 2005); negatively correlated with perceptions of exertion in conditions of high-intensity exercise; and predicts those individuals who are more likely to be able to bounce back (i.e. show resilience) after negative feedback (Clough et al., 2002). Although research into mental toughness is still at a relatively early stage and has mostly focused on the sports performer, extending such research to incorporate football managers would clearly enhance knowledge of what some researchers have described as arguably one of the most important psychological attributes in achieving excellence (Borrie & Knowles, 2003; Jones et al., 2002; Williams, 1998). Interestingly, research has shown that hardiness can be learned, and that hardiness training with managers can lead to increased job satisfaction and lower levels of stress, strain, anxiety, disgust and blood pressure (Maddi, 1987, 2004; Maddi et al., 1998). These researchers developed a training programme that involved business managers learning how to: • •

cope effectively with stressful circumstances; give and get assistance and encouragement in social interactions;

The first-team manager/head coach

• •

93

engage in the self-care that supports effective coping and social support; and use the feedback from these activities to deepen their hardiness attitudes.

Extending hardiness and mental toughness research to incorporate football managers should be encouraged since it is apparent that some managers thrive on the pressures of the job while others succumb to the stress and appear ill at ease (Crust & Lawrence, 2006).

The coach–athlete relationship Although there is a lack of scientific studies specifically examining the relationship between football managers and players, recent research has developed a clearer understanding of important features of successful coach–athlete relationships. Jowett and colleagues (Jowett, 2001, 2003; Jowett & Cockerill, 2002; Jowett & Ntounamis, 2004) have explored the reciprocal nature of such relationships, giving particular emphasis to affective, behavioural and cognitive factors. This research has focused on how coaches and athletes influence each other and the interdependency that is evident. Jowett and others have previously highlighted the importance of the three Cs of closeness, commitment and complementarity to coach–athlete relations (Jowett et al., 2005). Closeness refers to feelings and perceptions that appear to be a function of interpersonal factors such as liking, trust and respect. Open channels of communication, voicing of needs, effective problem solving, acceptance and appreciation characterise closeness. Importantly, such qualities as trust and respect have been associated with successful coaching (Janssen & Dale, 2002), while their absence is linked to less harmony and less support (Douge, 1999). Commitment reflects oneness of thought between coach and athlete, and is defined as an intention to maintain and optimise relations (Jowett et al., 2005). When performances fall below expectations, commitment can guard against retaliation by promoting accommodation, and this is characterised by flexibility when change is necessary. A lack of commitment has been shown to be linked to criticism, communication breakdown and a lack of common goals (Jowett, 2003). Complementarity, the third C, reflects a positive working environment where coach and athlete work together to attempt to improve performance. Jowett et al. (2005) suggest that complementarity has been found to relate to both high levels of performance and greater satisfaction with the relationship. Recently, Jowett et al. (2005) proposed a fourth factor, co-orientation, which still requires further investigation, but reflects coach and athlete perceptions of how the other perceives them. Extending this research to incorporate manager–player relationships would certainly help to extend knowledge of interpersonal relations within football. Although proposing mental toughness and courage as two important components might be regarded as premature given the limited research attention,

94 The first-team manager/head coach

it is likely that the abilities to tolerate stress, to rebound from adversity and to seek out new practices rather than remaining rooted in the past will be important factors. From a behavioural perspective, it is evident that building rapport with players and providing clear goals are important foundations in optimising player performance. According to Chelladurai and Carron (1978), if a manager adapts his/her behaviour to comply with the players’ preferred behaviour, the players may be more readily inclined to repay the manager through an elevated performance (Lin et al., 2005). Furthermore, the manager’s ability to cultivate a shared mental model among players and coaching staff is likely to be important with regard to team coordination processes and performance. Despite a focus upon theory and research, it is clear that variables outside of the manager’s direct control such as finance, injury and refereeing decisions will inevitably impact upon the degree of success that he/she experiences. Also, it is recognised that there will be some football managers (by way of traits, behaviours or interactions) who do not conform to the proposed composite view but who are nevertheless effective. In conclusion, there will be instances where the unique skills and/or knowledge of a manager will allow him/her to function in ways that appear contrary to research evidence, but still be successful.

Case study: interview with a first-team manager/head coach My background was as a semi-professional football player outside of the UK. Football was everything to me. I literally played every day of my childhood. I played for the school team, my town and eventually the city club. I was good, but no superstar. I remember hearing or reading something from Johan Cruyff [former Netherlands international, FC Barcelona player and coach] who said that football is a game of mistakes, so try to reduce the number of mistakes you make if you want to win. Simplistic but very true, and it underpins what I think I’m good at doing and always have been. As a child, I would ask my father to video record me playing in the games. After the game, I would analyse my performance and see what I could do better. If I could not identify any room for improvement, I would ask my coach, my father or my neighbour – basically, anyone I respected. I think that was probably the first sign that maybe my strengths, or my talent, were in analysis and planning and not necessarily dreaming of playing for Barcelona. I followed a predictable pattern in my coaching career. I went to university and studied sports science while taking my coaching licences and coaching part-time with my local town club. I firmly believe that practice and repeated practice of technique is the foundation to skill. I think being in the position where I could experiment with various coaching ideas, sports science, nutrition, etc. was vital and I did this without the pressure of needing

The first-team manager/head coach

95

to win. In my early 20s, I was either an assistant or junior coach. We wanted to win, but the club were always supportive of trying to identify new innovative methods of getting the most out of the team. We, of course, could not simply write a cheque to another team and buy their best player; those days were in the future [laughs]. The focus was on how to develop the players we had already at the club. I can remember attending a coaching licence course around 2000 when one of the presenters mentioned that the cost i.e. training, medical support, etc. of taking a player from the youth team to the first team was around €2 million per kid. I nearly fell off my chair. It’s clearly a big investment on the behalf of professional clubs and you need to make sure that you have talented staff who can try to reduce the number of mistakes any club makes regarding how you identify, recruit and develop talent. Something that is difficult to measure is commitment. It’s a conversation that I like to have with my staff. Commitment is contagious in my view, both from staff and the players. If we have it and maintain it, it grows. I ask my staff to find out little things such as what time the players arrive for training, and how long they stay after training has officially stopped. If you recruit players and staff with a high level of commitment or professionalism, you have the foundations of a good club culture. Once that commitment or dedication starts to drop, my staff need to firstly spot it and try to correct it. If the changes in behaviour become long term, you have a problem because it becomes the norm and standards drop in lots of different areas. For example, players look at the role models within their dressing room and copy their behaviour. In some cases, they even buy the same cars and dress the same way outside of the club. It’s natural, I suppose. But, for any club manager, you need players to reinforce the positive aspects of how a team should work i.e. work hard, good attitude, listen to the coach, be unselfish, etc. ‘Cultural architects’ are needed in every workplace. These are the role models who demonstrate the behaviours every day to their team mates that need to be reinforced. I call them my ‘generals’, and usually the captain of the team is the most prominent general. You have a problem if your general no longer wants to perform or allows his own personal and professional standards to fall. This reflects on you directly and quick, decisive action is required. If you look at the best managers throughout world football, they are decisive in removing negative influences from around the team. This could mean replacing a star player, captain or even staff if they are no longer able to give you 100 per cent commitment or loyalty. The term ‘manager’ is one that you typically only find in English football. When I think of the title, I ask the question: what is it that I am managing? I think the media become a little too obsessed with what you do or do not do in your role at a club. I will always have an opinion – ask my family [laughs] – and my friends say that is a reflection of my curiosity. I take that as a compliment, but I also know the limits of my understanding. I have a degree yes, I have professional qualifications yes and I also have extensive experience.

96 The first-team manager/head coach

But I am not a financial, legal or marketing expert, nor do I try to be. This means that, although I take an interest in what the club is doing and how I feel that impacts upon me and my staff, I do not try to manage them. It would be inappropriate for me to do so. I have responsibility for overseeing everything connected with the players and academy. Inevitably, this means the sports science, nutrition, medical and education teams. Balance is needed in every team. If everyone understands their role and the part they play for the overall benefit of the team, then good. You see it in the way Barcelona press their opponents. Everyone has a defensive role and an attacking role. Everyone in the team buys into the approach and structure. When I was first asked to work in England, my agent asked whether I felt comfortable in the role of ‘manager’ as he understood it to be in the EPL. My reply was: how can any individual possibly be expected to juggle contract negotiations, deal with agents, meet with the commercial team, liaise with sponsors, the media, facility management, etc. and concentrate on winning the next game? I do not have the skills, patience or understanding to wear all of those ‘hats’ of responsibility. So my reply to my agent was: please find out if I’m likely to be asked to manage all of those various departments. The answer was no and I have yet to meet any ‘manager’ who does. I think in most people’s view the manager or head coach is the leader of the club. I don’t think that is necessarily accurate and respectful of what goes on inside a club. But certainly he normally represents the most obvious sign of club leadership. The teachers that I remember most fondly from school were those who had an ‘X factor’ about them, which was the reason why they were good at their job and the reason why I listened. I guess you could describe it as charisma. What is charismatic to one person is not to another, so I suppose it’s subjective and open to interpretation, but the teachers and coaches I responded to best were those charismatic people. They were the people who didn’t just make you technically better at your job, but a better man by challenging your values. My parents always described me as being good at influencing people also. I’m not sure that they had a lot of evidence to prove that, but I saw early on in my career that people do things for their own reasons, not yours. You need to firstly understand their motives and what makes them tick. Once you have done that, you have gained some valuable insight which can be used for your own plans and ideas. I think I was an amateur psychiatrist in a previous life (laughs) and have always loved reading around the subjects of social psychology and leadership. If you combine that natural interest with a passion for football, it becomes inevitable that you do something like teach or coach. If I had not become a manager, I would have probably have gone into teaching, most likely as a PE teacher. I enjoy, even to this day, being out on the field and helping the players to develop. That passion and enthusiasm hasn’t gone yet. Once that spark goes, I’ll know it’s time to do something new.

The first-team manager/head coach

97

I think the whole debate regarding whether a head coach prefers to be called the ‘manager’ is an ego thing. ‘Manager’ sounds more important (laughs). I have a healthy ego, but I also do not need a job title to impress other people. I currently work with a DoF. He was the person who met with my agent during initial talks and negotiations. Following those meetings, I then met with the DoF to discuss the club’s offer to me. At each stage, the club’s ambitions were made clear, as was how they saw me contributing to that plan. I think it’s very important to clarify your role and expectations from the start and remove any ambiguity. The DoF, if he is good at his job, is a vital part of any success. He is the link between the board and me. I meet with him formally each week and informally whenever we feel the need. On some occasions, because we are both based at the club training ground, that can be over breakfast, lunch and sometimes after training. We both have an open-door policy and can feel relaxed about bringing up any issue that will help the team. His background is in finance, but he’s also a coach and has the necessary level of football understanding to appreciate my ideas. I place a great deal of trust in my support staff. I have known them for over ten years in some cases and, whenever possible, I try to bring them to whichever club I am at. I was recently asked to provide a presentation to some colleagues regarding how to optimise training and developing a team and I immediately thought of my coaching staff. I think we have clearly been through a few different stages in terms of our professional relationship. If you look at the research of, say, Bob Tuckman [American psychologist], you start to recognise that teams, whether they be staff or players, go through a series of steps in their growth. Upon reflection, I noted that my staff and I have been though a similar process. The first stage is ‘forming’. You assemble a group of people, but they are not yet a working team as such. Usually, they are friends, professional acquaintances and mostly people you know or familiar names, but they are still a collection of individuals. The next stage is ‘storming’, in which everyone’s strengths and weaknesses are identified. In my experience, this is when the honeymoon ends and some members leave because they don’t like their status, role or contribution. I usually try to formalise what we need from colleagues in writing. We discuss individually and also as a team and then we agree it. My role at this stage is crucial in establishing balance and perspective, but any conflicts need to be resolved quickly. I have noted in the past that this stage requires patience and maturity. If your staff do not respond to this approach, then they need to leave. Thirdly, the team enters a ‘normalising’ phase. At this stage, each group member should have adapted their behaviour to fit in with the needs of the team. The issue with normalising or formalising roles is that you remove the spark of creativity or innovation. People feel the need to fit in with their role and are reluctant to offer ideas outside of how the group see them. Ideas become replaced by group thinking or simply agreeing just to avoid conflict. The balance is how

98 The first-team manager/head coach

to deliver on the ‘normal’ day-to-day projects and requirements and whether that inhibits more creative thinking. I spend a lot of time drinking coffee and having informal chats regarding ideas that my staff have that are outside of their day-to-day focus. It’s important that my staff feel able to brainstorm and be creative. The best time for this, personally, is in the summer when we have an opportunity to change our focus from the next game. The final stage of team evolution is ‘performing’. I think it is very brave for a leader or manager to want to constantly go through the other stages at each new workplace. It can be exhausting and it does not always work out in the way you had hoped. You may never arrive at this final stage in which your team is a genuine unit. I can honestly say that each member of my staff has mutual respect for each other member’s skills, knowledge and personality. On occasions, I have noticed that we slip back a stage (especially when a new member of staff joins or someone leaves), but we normally get back to ‘performing’ if we have retained the majority of the core members of staff. Successful teams are, in my opinion, those who can learn new skills, who are flexible enough to change old ways when change is needed, who can accept constructive criticism and who can critically evaluate themselves. I value the unique abilities of everyone in my team. Ultimately, if I have recruited the right people, I then need to focus on how to integrate them into a coordinated and efficient group. This is part of the reason why I think it is dangerous to place too much attention on one person within the organisation. Players need to think for me on the field of play. They are not my puppets. I think my role ultimately is in trying to harness the cumulative knowledge and skill of all those staff and players. By requiring people to take on leadership roles, you are distributing your leadership and hopefully challenging individuals to take on responsibility for their actions and do their best and win. Management is all about winning. It can be broken down into the various skills and practices that underpin a winning team, but you need to win. Managers are held responsible for carrying the hopes and dreams of the fans, the owners and indeed the players; without the support of all parties, you are compromised. Winning sustains belief from all parties that you are the ‘right’ person to lead. Winning instils confidence and creates momentum that is difficult to resist, even for your biggest critics. If you go into any job not appreciating that your career is directly proportional to results, then you’re a little deluded I’m afraid. Longevity and success as a manager is therefore contingent upon winning games. Being able to balance and manipulate a complex range of responsibilities is all that is within your sphere of influence. Outside of that, you will inevitably be exposed to criticism from fans who may not appreciate your tactical decisions, owners who are unprepared to sanction your player recruitment requests and players who don’t respond to your man-management or communication style.

The first-team manager/head coach

99

However, having said that, working at a top club is the best job you can have and despite my expression on the sideline (caught by the television cameras), it can be fun, but it’s also tough. The best comparison I can think of is comparing it to a plate spinner in a circus. Sometimes I feel as though I’m in the middle of a circus ring spinning 50 plates at once, which means that I’m running all over the place trying to make sure none of the plates drop. I’ve been fortunate enough to work within the game for over 30 years, but you need to keep those plates spinning [laughs]. Inevitably, one or two of the plates will crash. The key is keeping the majority in the air.

References Audas, R., Dobson, S. & Goddard, J. (1997). Team performance and managerial change in the English football league. Economic Affairs, 17(3), pp. 30–36. Audas, R., Dobson, S. & Goddard, J. (2002). The impact of managerial change on team performance in professional sports. Journal of Economics and Business, 54(6), pp. 633–650. Baker, J., Horton, S., Robertson-Wilson, J. & Wall, M. (2003). Nurturing sport expertise: factors influencing the development of the elite athlete. Journal of Sports Science & Medicine, 2(1), pp. 1–9. Barrow, J. (1977). The variables of leadership: a review and conceptual framework Academy of Management Review, 2(2), pp. 231–251. Beech, M. (2002). Leaders or managers: the drive for effective leadership. Nursing Standard, 16(30), pp. 35–36. Bloom, G.A., Crumpton, R. & Anderson, J.E. (1999). A systematic observation study of the teaching behaviors of an expert basketball coach. The Sport Psychologist, 13(2), pp. 157–170. Bloom, G.A., Schinke, R.J. & Salmela, J.H. (1998). Assessing the development of perceived communication skills by elite basketball coaches and athletes. Coaching and Sport Science Journal, 2(3), pp. 3–10. Borrie, A. & Knowles, Z. (2003). Coaching science and soccer. In Reilly, T. & Williams, A.M. (eds). Science and Soccer (2nd ed.). Routledge, pp. 187–195. Bradbury, S. (2013). Institutional racism, whiteness and the under-representation of minorities in leadership positions in football in Europe. Soccer & Society, 14(3), pp. 296–314. Bradbury, S. (2014). Ethnic Minorities and Coaching in Elite-Level Football in England: A Call to Action. A Report and Recommendations from the Sports People’s Think Tank in Association with the FARE Network and the University of Loughborough. www.farenet.org/wp-content/uploads/2014/11/We-speak-withone-voice.pdf. Carron, A.V. & Chelladurai, P. (1981). Cohesion as a factor in sport performance. International Review of Sport Sociology, 16(2), pp. 21–41. Carter, N. (2006). The Football Manager: A History. Routledge. Chelladurai, P. (1978). A Contingency Model of Leadership in Athletics. Unpublished PhD thesis, University of Waterloo.

100 The first-team manager/head coach Chelladurai, P. (1990). Leadership in sports: a review. International Journal of Sport Psychology, 21(4), pp. 328–354. Chelladurai, P. (1993). Leadership. In Singer, R.N., Murphey, M. & Tennant, L.K. (eds). Handbook of Research on Sport Psychology. Macmillan, pp. 647–671. Chelladurai, P. & Carron, A.V. (1978). Leadership. CAPHER, Sociology of Sport Monograph Series A, University of Calgary. Clough, P.J., Earle, K. & Sewell, D. (2002). Mental toughness: the concept and its measurement. In Cockerill, I. (ed.). Solutions in Sport Psychology. Thomson Learning, pp. 32–43. Crust, L. & Clough, P.G. (2005). Relationship between mental toughness and physical endurance. Perceptual and Motor Skills, 100(1), pp. 192–194. Crust, L. & Lawrence, I. (2006). A review of leadership in sport: implications for football management. Athletic Insight: The Online Journal of Sport Psychology, 8(4). www.athleticinsight.com/Vol8Iss4/FootballManager.htm. Douge, B. (1999). Coaching adolescents: to develop mutual respect. Sports Coach, pp. 6–7. Fiedler, F. (1967). A Theory of Leadership Effectiveness. McGraw-Hill. Flint, S.W., Plumley, D.J. & Wilson, R.J. (2014). You don’t know what you’re doing! The impact of managerial change on club performance in the English Premier League. Managing Leisure, 19(6), pp. 390–399. Hopcraft, A. (1968). The Football Man. Simon & Schuster. Horn, T. (2002). Coaching effectiveness in the sport domain. In Horn, T. (ed.). Advances in Sport Psychology (2nd ed.). Human Kinetics, pp. 309–354. Janssen, J. & Dale, G. (2002). The Seven Secrets of Successful Coaches. The Mental Game. Jones, G., Hanton, S. & Connaughton, D. (2002). What is this thing called mental toughness? An investigation of elite sport performers. Journal of Applied Sport Psychology, 14(3), pp. 205–218. Jowett, S. (2001). The Psychology of Interpersonal Relationships in Sport: The Coach–Athlete Relationship. Unpublished PhD thesis, University of Exeter. Jowett, S. (2003). When the honeymoon is over: a case study of a coach–athlete dyad in crisis. The Sport Psychologist, 17(4), pp. 444–460. Jowett, S. & Cockerill, L. (2002). Incompatibility in the coach–athlete relationship. In Cockerill, I. (ed.). Solutions in Sport Psychology. Thomson Learning, pp. 16–31. Jowett, S. & Ntoumanis, N. (2004). The Coach–Athlete Relationship Questionnaire (CART-Q): development and initial validation. Scandinavian Journal of Medicine & Science in Sports, 14(4), pp. 245–257. Jowett, S., Paull, G., Pensgaard, A., Hoegmo, P. & Riise, H. (2005). Coach–athlete relationship. In Taylor, J. & Wilson, G. (eds). Applying Sport Psychology. Human Kinetics, pp. 153–170. Kandola, B. (2016). Goals, penalties and markers: the evolving nature of racism as seen in football. Conference presentation, British Psychological Society Division of Occupational Psychology (BPS DOP), Nottingham, 7 January. Kobasa, S.C. (1979). Stressful life events, personality and health: an inquiry into hardiness. Journal of Personality and Social Psychology, 37(1), pp. 1–11. Kobasa, S.C., Maddi, S.R. & Khan, S. (1982). Hardiness and health: a prospective study. Journal of Personality and Social Psychology, 42(1), pp. 884–890.

The first-team manager/head coach

101

Larson, M. (1977). The Rise of Professionalism: A Sociological Analysis. Harper & Row. League Managers Association. (LMA). (2015). End of Season Review and Manager Statistics. www.leaguemanagers.com/documents/37/LMA_End_of_Season_report_ and_statistics_2014_-_15.pdf. Lenk, H. (1977). Team Dynamics. Human Kinetics. Lin, Z.P., Jui-Chia, C. & Esposito, E.N. (2005). Successful leadership behavior in sport. The Sport Journal Supplement, 13(1). www.thesportjournal.org/sport-supplement/ vol13no1/05 successfulleadership.asp. Loehr, J. (2005). Leadership: full engagement for success. In Murphy, S.M. (ed.). The Sport Psych Handbook. Human Kinetics, pp. 155–170. Lyle, J. (2002). Sports Coaching Concepts: A Framework for Coaches’ Behaviour. Routledge. Maddi, S.R. (1987). Hardiness training at Illinois Bell Telephone. In Opatz, J. (ed.). Health Promotion Evaluation. National Wellness Institute, pp. 101–115. Maddi, S.R. (2004). Hardiness: an operationalization of existential courage. Journal of Humanistic Psychology, 44(3), pp. 279–298. Maddi, S.R., Khan, S. & Maddi, K.L. (1998). The effectiveness of hardiness training. Consulting Psychology Journal, 50, pp. 78–86. Martens, R. (1987). Science, knowledge and sport psychology. The Sport Psychologist, 1(1), pp. 29–55. Martens, R. (1990). Successful Coaching. Leisure Press. Miller, E.J. (1985). The politics of involvement. In Colman, A.D. & Geller, M.H. (eds). Group Relations Reader 2. A.K. Rice Institute, pp. 383–398. Ogilvie, B.C. & Tutko, T.A. (1966). Problem Athletes and How to Handle Them. Palham Books. Ogilvie, B.C. & Tutko, T.A. (1970). Self-perceptions as compared with measured personality of selected male physical educators. In Kenyon, G.S. (ed.). Contemporary Psychology of Sport. Athletic Institute, pp. 73–78. Penman, K., Hastad, D. & Cords, W. (1974). Success of the authoritarian coach. Journal of Social Psychology, 92(1), pp. 155–156. Perry, B. (2000). The boss? The contemporary role of the football manager. In Murphy, P. (ed.). Singer & Friedlander’s Review, 1999–2000 Season. Singer & Friedlander in association with the University of Leicester, pp. 59–62. Pratt, S. & Eitzen, D.S. (1989). Contrasting leadership styles and organizational effectiveness: the case of athletic teams. Social Science Quarterly, 70(2), pp. 311–322. Pyke, F. (1992). The expanding role of the modern coach. The Pinnacle, 9(3), pp. 15–21. Rumsby, B. (2017, 14 June). FA’s first black female director quits over ‘lack of progress’ for ethnic minority coaches. Telegraph. www.telegraph.co.uk/football/2017/06/14/ fas-first-black-female-director-quits-lack-progress-ethnic-minority. Sabock, R.J. (1985). The Coach. Human Kinetics. Seligman, M.E.P. (1991). Learned Optimism: How to Change Your Mind and Life. Pocket Books. SpencerStuart. (2016). 2016 UK Board Index. www.spencerstuart.com/~/media/ pdf%20files/research%20and%20insight%20pdfs/ukbi_2016_final.pdf?la=en. Stogdill, R. (1974). Handbook of Leadership. Free Press.

102 The first-team manager/head coach Tannenbaum, R., Weschler, I.R. & Massarik, F. (1961). Leadership and Organization: A Behavioral Science Approach. McGraw-Hill. Vamplew, W. (2004). Pay Up and Play the Game: Professional Sport in Britain, 1875–1914. Cambridge University Press. Vasili, P. (2000). Colouring Over the White Line: The History of Black Footballers in Britain. Mainstream. Wagg, S. (1984). The Football World: A Contemporary Social History. Harvester. Walvin, J. (1986). Football and the Decline of Britain. Palgrave Macmillan. Weinberg, R.S. & Gould, D. (2003). Foundations of Sport and Exercise Psychology (3rd ed.). Human Kinetics. Williams, J.M. (ed.) (1998). Applied Sport Psychology: Personal Growth to Peak Performance (3rd ed.). Mayfield. Woodman, L. (1993). Coaching: a science, an art, an emerging profession. Sport Science Review, 2(2), pp. 1–13.

Chapter 8

The academy manager (AM)

Introduction This chapter is not intended to provide the reader with a systematic review of the literature associated with talent identification, but instead to provide an introduction to the work that takes place within a professional football club academy. The first point to note is that professional football clubs, despite any romantic notions to the contrary, are in essence service enterprises engaged in the business of outperforming their opponents (Bourke, 2003). Like other service enterprises, football clubs engage in ‘utility maximisation’ subject to financial constraints (Audas et al., 1997; Bourke, 2003; Gerrard, 2005). The so-called ‘grow-your-own’ policies put in place by professional football clubs for aspiring professionals (via the nursery system or club academy) reflect a contemporary shift from a traditional, proactive ‘in-house’ solution to reliance upon an externally sourced (market-sensitive) and reactive solution (ECA, 2012; Magee & Sugden, 2002; McGovern, 1999). Ultimately, professional clubs want to win competitions, earn revenues and entertain spectators (North et al., 2014). For this, they need highquality players developed internally via their own academies or acquired from elsewhere via the payment of transfer fees.

The modernisation of youth development and the Elite Player Performance Plan (EPPP) In January 2010, the potential to modernise youth development within English professional club football was discussed by a meeting of the Premier League (PL) academy managers (AMs). The momentum for such a seminar had arguably been building in large part due to the abject failure of the senior England men’s team to achieve success on an international stage (since last winning the FIFA World Cup in 1966). The national team’s failure was primarily attributed to a paucity of domestic ‘home-grown’ youth talent emerging from the 92 professional clubs and nearly 12,000 youth players in the academy system. (The PL’s definition of a ‘home-grown’ player is one

104 The academy manager (AM)

who, irrespective of his/her nationality or age, has been registered with any club affiliated to the FA or the FAW for a period, continuous or not, of three seasons or 36 months prior to his/her 21st birthday (PL, 2016).) Technically and tactically, English players were regarded as inferior in quality to their foreign counterparts – a belief reinforced by statistics identifying a growing trend for club managers to employ foreign talent in preference to their English counterparts and by a UEFA report that states that the EPL has the highest percentage (69.2 per cent) of foreign players of any European league (UEFA, 2015). The proposed solution was to modernise and ultimately regulate what appeared to be fragmented domestic youth development structures. What followed was the first fully comprehensive appraisal of youth football in England since the Charter for Quality was introduced in 1998 (Wilkinson & FA, 1997). This appraisal was an extensive multidisciplinary review of high-profile ‘successful’ club academies around the world in an attempt to establish the common denominators of best practice relating to the development of staff, players and environment. The clear mission of the strategy was to produce more and better home-grown players. The analysis and subsequent consultation with clubs and stakeholders (the FA and the Football League) resulted in what became formalised by the PL as the Elite Player Performance Plan (EPPP) in 2012 (PL, 2011). The EPPP document sets out in detail the criteria and processes necessary to ensure that professional football clubs in England are empowered to create a world-leading youth structure. As a result, the 92 professional clubs have been provided with a new classification system ranging from Category 1 (optimum development model) through Category 2 (development model) and Category 3 (entry-level development model) to Category 4 (late development model). In essence, the strategic document provides the blueprint for how AMs and their staff are independently audited and benchmarked according to the key outputs of their youth structure. The six ‘critical success factors’ identified within the EPPP document that apply to all categories of academy are as follows: 1

2 3 4 5 6

Increase the number and quality of home-grown players gaining professional contracts at the clubs and playing first-team football at the highest level. Create more time for players to play and be coached. Improve coaching provision. Implement a system of effective measurement and quality assurance. Positively influence strategic investment into the academy system, demonstrating value for money. Seek to implement significant gains in every aspect of player development.

At present, there are 24 Category 1 academies operating in England, each of which is allowed to recruit talented players from the age of 9 for up to

The academy manager (AM)

105

three hours a week of professional coaching. Once players reach the age of 16, they can be offered a full-time three-year scholarship by the academy. The clear intention is that talented youngsters can access talent development programmes that mirror the current best practices for gifted musicians, artists and outstanding athletes in other sports. Arguably, this philosophy is reflective of the belief that ‘if involvement in organised sport is not begun by age 7, an athlete will sufficiently lag in skill execution such that future performance accomplishment is unlikely’ (Wiersma, 2000, p. 14). The philosophy of the professional clubs is that immersion within an elite soccer culture can optimise physical talent development and facilitate appropriate socio-psychological athletic development. The academy structure has as its core the premise that it develops more intelligent players who possess not only advanced technical skills but also greater self-awareness and positive lifestyle management (Stratton et al., 2004). However, not all research supports the notion of early specialisation and its perceived benefits to the individual (Baker et al., 2003; Wiersma, 2000). Specifically, some studies suggest that elite participation during adolescence can impede the formation of a mature and balanced self-identity. Given the high attrition or ‘failure’ rate of academy prospects to graduate to a professional career, it is somewhat surprising that there is still a paucity of empirical research regarding ‘athletic identity’ in professional football (Anderson & Miller, 2011; Mitchell et al., 2014). The importance of understanding athletes’ psychological wellbeing within professional sport has been well documented (Mitchell et al., 2014). Although an academy proposes to develop more intelligent players, there is clear potential for the development of athletic identity and with it concerns for players if and most likely when they are deselected. This places a great burden upon the academy in which a player and his/her family place their trust and, ultimately, the hope of a professional career. Academy staff therefore have a crucial applied role in helping support both parents and their children in managing their well-being as part of their career journey (Mitchell et al., 2014).

The value of academies It is a cliché to say that football belongs to the youth, but few clichés ring as true as this one. As a result, football clubs have appreciated the importance of implementing their own youth development structures in order to identify and ‘grow’ their own players. Competition has always existed among clubs to unearth and develop the best players for their first teams, but that competition for talent has accelerated as a result of two major changes. The first of these has to do with the implementation of UEFA’s Financial Fair Play (FFP) rules, which require all clubs to live within their means. An efficient and productive youth development structure or academy is now a financial necessity if clubs are to become less reliant upon their owners and

106 The academy manager (AM)

shareholders to finance their business activities. The second change is squad size limits. Such limits are already in place in European club competitions, and more and more leagues have introduced or are considering implementing a limit of 25 players, with unlimited players under the age of 21. In the current economic climate, and with FFP becoming increasingly important, clubs need to consider how they can improve their own academies. This trend can be observed across the major European domestic leagues and their respective club academies, according to the European Club Association (ECA) (2012) survey of 96 clubs from 41 different national associations. For example, the objective of Ajax FC’s academy is to have three players from the academy make it into the first team every two seasons, while FC Lens are more ambitious in aiming for eight players from the youth academy to progress into the first team each year. The EPL was represented in the survey by Arsenal FC, who declared that the focus of their €3-million-per-year facility is upon player ‘quality’ (rather than a predefined target number), as exemplified by talent, intelligence and motivation (ibid., p. 27). Regardless of the target numbers or ambitions of specific clubs, what is clear from the report is the level of detail and infrastructure that underpins academy work. A snapshot of Arsenal FC’s academy reveals that they work with approximately 176 players each season; of these, 131 players are in the 9–16 age bracket, 25 are in the 17–18 age bracket and 20 are in the 19–21 age bracket, with the vast majority of players living within one hour’s drive of the club’s two training centres in London. Staffing, facility and player contract costs make up the bulk of the expenses associated with operating a club academy structure. The median (a measure of central tendency, often considered more useful than the mean because it is less affected by ‘outliers’ of minimum and maximum values) used within the ECA report identified that two thirds of elite academies spend more than €3 million per year (approximately 6 per cent of the club’s budget), with those figures predicted to increase significantly over the next five years. FC Barcelona can be considered an outlier in this respect, given that they have 250 players within their La Masia academy, which has running costs estimated at €20 million per year (ECA, 2012, p. 33). Given the growing investment made by clubs into their academies, it is becoming increasingly important to be able to assess whether the academy is contributing value to the wider club i.e. delivering a return on investment (Deloitte, 2017a). It is commonly accepted that transfer and loan fees generated by academy products are one measure of this, but analysis rarely stretches beyond comparing these with overall academy expenditure (ibid.). It is also pertinent to consider, as some clubs do, the net cost of academy players once they make the first team; this comparison is benchmarked by analysis of the net cost of players recruited from elsewhere. As well as transfer and loan fees paid/received, this approach can also incorporate the wage costs of academy players compared with those of players recruited from

The academy manager (AM)

107

elsewhere, and, in doing so, provides a potentially more accurate assessment of the financial value of an academy (ECA, 2012). The analysis can be extended to incorporate the overall running costs of the academy, such that they are effectively spread across the small number of academy products who ultimately reach the first team (Deloitte, 2017a).

Talent identification and recruitment Talent identification and recruitment is a global business. Researchers in all domains, from professional sports teams to industry, have endeavoured to find a way to predict, identify and employ the best potential performers in their respective fields. The rewards for those clubs that can forecast accurately and efficiently who to work with and conversely who to reject are significant in a highly competitive market for talent. First, such clubs are able to maintain and nurture their identities or brands, and second, they benefit financially. Clubs that can accurately predict those individuals who have the potential to compete at the highest level are those that save themselves considerable sums of money. The financial outlay from professional football clubs in England over recent seasons underlines the potential savings that can be made by establishing an efficient pipeline of talent to the first team. The 2016/17 season saw £1 billion invested in new players by the clubs in the EPL and the Championship (BBC, 2017) – an amount comparable to the GDP of some countries. Despite the global nature of English football and the media focus upon high-profile foreign signings, domestic clubs still tend to conduct the majority of their business within the UK. Over the last ten years, approximately 45 per cent of signings in the EPL came from other English clubs, with that figure rising to 75 per cent in the Championship. The trend is even more marked regarding sales, with 86 per cent and 95 per cent of outgoing players moving domestically in the EPL and the Championship respectively (LMA, 2016). What is clear is that clubs are searching for financial value in terms of their player recruitment. As well as generally favouring domestic recruits, clubs are frequently using loans and free signings in order to conduct transfer business on a tight budget. Of the 965 EPL and Championship player transactions in the 2016/17 season, 54 per cent were loans and 27 per cent were free transfers. With only 19 per cent of transactions seeing money change hands, the data indicates that clubs are exercising a certain amount of caution with regard to their spending. EPL clubs may have registered a net spend of £1 billion in 2016/17, but there are signs that clubs are being more conservative in their spending than in previous years. Given that Manchester United FC (£173 million) and Manchester City FC (£97 million) together accounted for over 50 per cent of EPL operating profits (Deloitte, 2017b), it becomes clear that others are having to be more frugal in their recruitment. One possible explanation for this focus on domestic players outside the very

108 The academy manager (AM)

wealthiest clubs is the introduction of the EPPP. Designed to encourage the development of home-grown players and improve the standards of academies, the EPPP is arguably both a form of regulation and an incentive for clubs to invest in youth and add domestic players to their squads. Despite the financial and regulatory imperatives to identify and develop domestic youth talent, finding the most effective and efficient method to do so is an inherently complex task (Reilly, 1979; Williams & Franks, 1998; Williams & Reilly, 2000). The determinants of what talent looks like within the U9 age group and how best to facilitate a player’s potential are the subject of intense academic debate. The complexity of devising a youth talent model that applies to the game of football is identified by Williams (2000, p. 737): Players are confronted with a complex and rapidly changing environment. Players must pick up information from the ball, team-mates and opponents before making an appropriate response based upon current objectives (e.g. strategy, tactics) and action constraints (e.g. technical ability, physical capacity). Such decisions are often made under pressure, with opponents trying to restrict ‘time’ and ‘space’ available to perform. (Nagano et al., 2004; Williams 2000) There is now a burgeoning interest worldwide in spotting talented young players among the myriad of youngsters participating in football games that has led to a systematic search for potential. Nearly 20 years ago, Williams and Reilly (2000) pointed out that professional football clubs rely on the assessments of scouts or coaches supported by a ‘shopping list’ of key criteria. What can be concluded is that scouts’ recommendations are often subjective and based on the complex interplay between years of experience, knowledge and reflection (Nash & Collins, 2006). The ability of scouts to identify talent is a highly sought-after quality that ensures that clubs do not lose time, money and prestige by investing in the ‘wrong’ players (Christensen, 2009). However, identifying which are the ‘right’ and ‘wrong’ players is problematic. Since the beginning of the 1990s, the amount of research into talent identification in football has increased considerably in both the natural and the social sciences (Williams & Reilly, 2000). Researchers from a variety of disciplines have devoted their attention to a wide range of considerations, such as the early experiences of the athletes, the values of the coaches, environmental and economic opportunities, habits and training traditions, all of which affect the identification and development of talent in sport (Asgar, 1970). In addition, some scientists have claimed to have identified the ‘X factor’ in terms of predicting potential talent. One high-profile example was a study by Manning et al. (2003), who reported a robust relationship between footballing ability and the ratio of second (index finger) to fourth (ring finger) digit length. Their research claimed that a low ratio reflects high prenatal testosterone and low oestrogen, a foetal environment

The academy manager (AM)

109

that results in higher visuospatial ability, speed and overall football ability. Nevertheless, the continual search for a competitive edge inevitably stimulates research that often requires further investigation (North et al., 2014). ‘As football games can never be fully isolated for study in laboratory simulations, this quest for a true understanding of scientific issues is likely to be continued indefinitely’ (Reilly & Gilbourne, 2003, p. 702). What is clear from contemporary research is that while motor abilities underpin skill acquisition, psychological factors appear to be the significant determinants of individuals’ potential within sport (North et al., 2014). Not only will the psychological characteristics and behaviours of youth players determine whether they are able to develop the required skills, but these characteristics and behaviours will also influence whether they are able to stay committed to the necessary training in order to develop successfully and perform at the first-team level. The psychological resilience to cope with the ‘ebb and flow’ of life within a club academy is something that is clearly difficult to predict within young players, but is essential if they are to remain on the road to excellence (MacNamara et al., 2010). The inevitable development of a strong athletic identity that takes place within football academies clearly has the potential to impact psychologically and emotionally upon those players who do not ‘make it’ within their club academy (Brewer et al., 2000; Sparkes, 2000). Those players who attach high value, status and meaning to their self-concept are those most likely to suffer the most if and when that career pathway ends. The deselection of players from an academy due to illness, injury or appraisal of ability has been found to result in players having to rebuild their self-concepts due to a sense of loss and feelings of depression, humiliation, fear and, in some cases, anger (Lavalee et al., 1998). The educational and welfare support that deselected players receive from their respective clubs when making the transition out of professional football is therefore crucial in easing this transition and the loss of camaraderie, adulation and income stream (Brown & Potrac, 2009). In conclusion, talent therefore appears to depend on genetics, environment, opportunity, encouragement and the effect of these variables on physical and psychological traits (Bompa, 1985, 1999; Williams & Reilly, 2000). The question for academies is not whether genetic or environmental factors determine player behaviour, but how these factors interact. The challenge for any club academy and its multidisciplinary team of colleagues is how to provide the optimum environment for player development – namely, one in which the individual is encouraged and supported, and has the opportunity to learn and practise.

The AM role The AM is the senior member of staff held responsible for facilitating the above optimum environment. As such, he/she is the focal point of leadership

110 The academy manager (AM)

for youth development operations within the club and typically reports directly to the CEO. The leadership provided by the AM is critical to the success of the academy. In line with the expectations of the EPPP, the AM is tasked with ensuring that the club’s youth players are provided with the best coaching and support services in order to maximise their potential. The leadership of a youth structure that aims to be both technically excellent and financially viable represents a significant challenge for AMs, given that they are tasked with promoting the development and progression of players who range from 9-year-old children to 21-year-old adults. The structural modernisation required by many AMs to ensure that their organisations comply with the ambitions of the EPPP represents a considerable challenge to their leadership and managerial skills. Arguably, post-EPPP, the role of AM has become a far more complex one, requiring the coordination of an array of specialist resources and services that support the creation of an ‘uncompromising elite environment’ (PL, 2011, p. 16). Ultimately, the overarching priority for every club academy is to develop youth players who are ready to play in the first team. Failure to do so will inevitably draw criticism from the club owner, who has invested in supporting the development of youth players as a pipeline for the first team. The most recent statistics reveal the extent of the challenge that club AMs face in preparing players who are ready to play first-team football. At the start of the 2016/17 season, all 20 teams in the EPL were required to declare their 25-player first-team squads. From a total of 500 players, only 38 (7.6 per cent) were graduates from academies.

Case study: interview with an AM I’m a local lad, but ironically was never a supporter of the club I now work for [laughs]. I supported the team up the road, which led to me getting a bit of stick from some of the parents when I first took the role of AM here. The club and owner take player development very seriously. We recognise the importance of our youth players. They are the DNA of the club and we are proud of what the club has achieved in the past. Fans have a much stronger emotional connection with the players that they’ve grown up with or seen play in the youth teams. I know personally that, as a kid and fan, I had a greater affinity with players who are from the region. We don’t have an official target for how many players need to move up into the first team each year, but the more the better, obviously. In the past, the club has set what I think are unrealistic targets of two or three players per season moving from the academy into the first team. The reality is that every one of the other 19 EPL teams are trying to discover talent and they are pretty much fishing in our pond. As a Category 1 club, any U9 to U11 age group players have to live within a one-hour drive of the academy. This means that most of these kids are from the local area and are probably fans

The academy manager (AM)

111

of the first team, or at least we hope so. Above that age, you are potentially in competition with clubs nationally, and indeed you can recruit nationally from U12 to U16 as long as the player is guaranteed access to a full-time education programme. The academy is divided into three broad age groups. The ‘Foundation’ phase is U9–U11, in which players are trained for around four hours per week and around eight when they reach 11 years old. At 9 years old, we require players and their parents to sign a ‘schoolboy contract’, which is reviewed at the end of each season. If we think that the boy is progressing, we offer to extend his registration with the club. If we have concerns or doubts about his ability to go further, we cancel his registration. The decisions we take every year are the most difficult part of the job. We are acutely aware of the impact we are having, not just on the boy but also on everyone in his family. It’s not something we take lightly and is based on evidence we’ve accumulated throughout the season. I would say that 50–75 per cent of all boys do not have their contract renewed during the period between 9 and 16 years of age. The boys who are released by the club usually go back to their village or grassroots teams. In a small number of cases, they are taken by other club academies and offered a schoolboy contract, which is great news for them. Either way, we are positive that the vast majority of boys will have had a great educational experience. Unfortunately, only a small percentage of those who start at the club will move up through the various phases. That is the reality, I’m afraid. Our job is to be honest and not deceive anyone regarding how hard it is to reach the top. It doesn’t mean, of course, that the players cannot have a good experience at the same time. My job is to make sure that we provide a supportive and enjoyable experience for every player regardless of what the future may hold for them. The next stage is called the ‘Youth Development’ phase, where all boys are aged between 12 and 16 years old. In this phase, the players train for between 10 and 12 hours per week. Again, each season we review individual player progress and undertake a thorough review with the relevant coaches. At 16, we consider whether to offer a ‘scholarship contract’, allowing the player to combine football training with their educational studies. The final group are the ‘Professional Development’ players, who are between 17 and 21 years old. Players in this group are training for 12–14 hours per week depending on their other commitments to school, college and potentially the first team. This is the stage at which players can be paid a salary. The amount depends on how good the player is and what the wage structure is at any particular club. It can be anything from £300 to £1,500 per week. At some of the richer clubs, it can be as high as £30,000 per week if you are earmarked to play for the first team (or already have). Since the PL introduced the EPPP in 2012, clubs across the four English divisions have invested a lot in their youth development. I estimate that EPL clubs spend on average £3 million each year on their academy, which most

112 The academy manager (AM)

probably makes it the second largest expense for most clubs, behind firstteam player costs. Measuring success can be as simple as how many players from the academy end up in the first team, but it can also be how many players we sell on to other clubs or how many players leave the club (with no transfer fee received) but have a career in football. The clear economic value or return on investment by the club relates to the first two measures, but I think we have a moral and ethical responsibility to help produce good people and not simply be a talent production line. Fortunately, the owner agrees with this philosophy and has stated that he will continue to be supportive of the focus on developing good people first and foremost. The playing philosophy of the club is reflective of the qualities we look for from our players: intelligence, motivation and skill. I like the quote that I read from one of my daughter’s books (you see, football coaches do read occasionally!). I think it originally was accredited to Leonardo da Vinci. ‘Simplicity is the ultimate sophistication.’ It must be a good philosophy because Massimiliano Allegri [manager of Juventus] is on record as saying something similar, I think. You have to remember that you are working with mostly children and young adults in a club academy and that means being sensitive to the pressure that they are under to perform. They will make mistakes on and off the field. If you renege upon the influence you have as a role model and educator, you are missing the bigger picture of your role. Outside of football, I try my best to raise my own children with the right values and attitudes. At the club, we have a similar responsibility i.e. to have a team that we are proud of (on and off the pitch). Remember that these players have been in the football system for most of their formative years. We as staff have a responsibility to make sure that the training field is a classroom. During my coaching education and while studying for various licences, I have become aware of a number of different models for talent identification that are being used by high-profile clubs. I know from experience that Ajax use a system called TIPS (Talent, Intelligence, Personality, Speed), and Liverpool did at one stage use TABS (Technique, Attitude, Balance, Speed). In addition, I’ve come across system acronyms such as SUPS (Speed, Understanding, Personality, Skill) and the final one some clubs call PAS (Pace, Attitude, Skill). The thing you hear all the time is ‘He really looks like a player’ from scouts, coaches and parents. It’s great to have an appreciation for the game, but it needs to be supported by the science, in my view. A lot of scouts and coaches use the data to say ‘I told you he was good’ or ‘I told you that the stats would back it up’. The problem is how you subtly explain to your gaffer that they are probably falling into a ‘confirmation bias’ or jumping to conclusions. I love to read and came across the work of Daniel Kahneman, which I found intriguing. The FA have had their ‘four corners’ model in place for a while now. I think it’s helpful in explaining how talent evolves and matures over a long period and we also use it at our academy to monitor how each

The academy manager (AM)

113

dimension (technical, physical, psychological and social) impacts on player development. I’ve seen lots of players who have the physical attributes, but lack the mental toughness or emotional stability to cope with academy football. My staff are always on the look-out for players who are ‘good learners’ i.e. they are open and receptive to coaching feedback and want to improve. In a nutshell, can they be coached? Also, how do they communicate with their teammates? Anyone can dribble around a series of cones, but can they do it in a real game, one that matters? Have they demonstrated mental strength, toughness and determination consistently, not just a flash in the pan? Consistency is key if we are to be assured that a player can repeat that skill, for example in the last minute of a game when they are tired and being challenged by an opponent. Are they brave on the ball? I would argue that skill is really just technique under pressure – both mentally having the composure and physically being able to deliver that technique. Is the player resilient? This is key both on and off the field. How do they react to problems, again on and off the field? I suppose most people would regard our role as analysing the technical or football skills aspect of a player, and yes this is a key aspect, although I would always recommend a player with good personal skills over technical ability. Physical or technical skills are those that are easiest to measure such as passing, heading the ball, speed, etc. These skills are relatively straightforward to generate data on, and we do, but the personal qualities are key for me. In the past, I’ve worked with managers who have clearly identified the particular psychological qualities they are looking for in their players. They place a value on those players who

Figure 8.1 Player pathway (holistic development) to the first team

114 The academy manager (AM)

are prepared to listen to what is being said by the coaching staff. It kind of seems obvious, but not every player has the personality or character to work hard and be dedicated. Over the last two or three decades, I have definitely noticed a dramatic growth in the use of scientific research directly related to football. I think this was initially focused upon how best to optimise the performances of the first team, but you can now see it has also impacted youth football. The staff we employ are from a range of different disciplines. We recruit staff with a wide range of skills and professional backgrounds, from age-specific coaching licence holders to education specialists and physiotherapists. The best thing about our multidisciplinary background is that we are able to take evidence and ideas from one subject area and use it to explore solutions in another. For example, how can we optimise the fitness of our players and their positional demands via a better understanding of individual nutritional requirements? We have a number of knowledge transfer partnerships in place at the club. It’s an opportunity for external partners (typically universities) to offer their expertise in return for data collection opportunities and the potential for collaborative research output. I was fortunate to be able to visit the AC Milan training complex [Milanello in Italy] a few years ago, and was really impressed by the way in which they linked science and football. The aim of their ‘MilanLab’ was to optimise the team’s results by using an impressive range of tools that normally, at least in my opinion, you’d only expect to see in science or technology labs. During their presentation, AC Milan reported a 92 per cent reduction in non-traumatic injuries and a dramatic drop in the need for injections. Their point was at the very top level in sport, the difference between winners and losers is sometimes small details. The key message I took home is to be thoroughly professional in every aspect of what the academy does and to take decisions based on evidence rather than just intuition or personal opinion. Intuition tells me [laughs] that the majority of our academy players are operating at 50 per cent of what they are capable of in terms of potential. I read something written by Rasmus Ankersen, the author of The Gold Mine Effect [2012], who said that footballers in general could train more frequently than they currently do, and, after 25 years of working in academy football, I’m inclined to agree with him. He isn’t just talking about training for fitness but rather all the other components that come together to make the complete player tactically, technically, physically and mentally. For example, how many players actually spend time analysing their performances via video analysis tools? How often do they ask themselves ‘What went well?’? Very few players appear to take ownership of their own development and most leave it up to the coaches within the club. In my experience, not very many coaching staff have ever worked outside of football and/or have done any courses other than FA ones. As a result, the coaching and thought processes around developing players become a

The academy manager (AM)

115

little blinkered and maybe polarised. Few coaches will give you any evidence around how they know their coaching sessions are effective (both in the immediate and long term). I always used to ask the academy coaches I work with three questions: 1 2 3

What is the objective of the session? How do you know if it is effective or not? What happens next?

The amount of time players spend at the academy on a day-to-day basis is extremely short, so we have to make sure that the sessions are high quality. Coaches here are set high standards and need to be planning and reflecting after each session to make the next practice even better, if possible. If I can instil those kinds of professional expectations and that kind of education culture, then great. The internet and various software programs make it relatively easy for our technical staff and recruitment personnel to review players all over the world without having to physically sit in the stands anymore. As a club, we are familiar with the essential tools of the trade (in terms of player performance analytics), with Prozone, Opta and AMISCO the most frequently used. The use of real-time data to improve player performance, team formation and tactics is something that is now very influential within the game. I don’t pretend to understand the data explosion, but I’m sympathetic to its role and make sure we have the staff who translate its potential into what we can do at the club. Player tracking systems such as Prozone are great for collecting physical data such as distance covered, number of sprints and high-intensity distance covered in real time. The information provided allows us to adjust the volume and intensity of training for individual players in real time also. It’s also invaluable for those players returning from injury: benchmark figures based on their pre-injury training performance can be used to determine when they have recovered sufficiently to be considered for selection. The expert sports science staff are key to our analysis and interpretation of results. For the first team, the databases that the recruitment team can scour are endless. Opta cover the majority of world competitions, including the leagues in South America. The data is excellent for someone in a first-team role, but not necessarily data that I need to access for my role. I do, however, use the technical reviews and information from FIFA and UEFA regarding final-third pass completion success rate, chance creators, who is the most prolific dribbler, etc. as a way of benchmarking how the game is evolving. The technology is a guide, though; it doesn’t drive our decisions, but certainly helps to efficiently and sensibly profile our players. For example, if you look at the sports science data regarding players aged between 16 and 18 years old, you will find that elite players are around the same height,

116 The academy manager (AM)

typically between 1.70m and 1.80m, and their weight is between 70kg and 74kg. Depending on the playing philosophy of the first-team coach, you may also be looking for players who can play within a particular system. For example, at Ajax FC, they recruit and select a ‘squad’ of players who play within a 4–3–3 system, half of whom are right-footed and half of whom are left-footed. At Rosenborg FC, they play in a 4–3–3 system and expect their players to learn a play book of attacking moves, and then you have Real Madrid FC, whose youth teams play a 4–3–3 or 4–4–2 system with one holding defensive midfield player. So, depending on who you are working for, you have different recruitment requirements. All clubs need to recruit effectively if they want to do well. If you are a big team with an established EPL pedigree, then players and their families are automatically interested before any approach is made by a club scout. Talented youth players are usually on the radar of a number of scouts. The football world is quite small and so players very quickly acquire a reputation, whether it be from watching school teams play or via their village teams of a weekend. We do not allow any scouting of players that falls outside of the agreed current PL regulations. We certainly don’t want our scouts to have a ‘predator’ reputation for aggressively trying to recruit players. Conversely, we do not want to feel that our players are under threat of being ‘poached’ away from our own club. No scouts are allowed in our club academy. If we do identify any, they are politely asked to leave by security. We have a network of scouts in England and abroad. Most scouts work on a consultancy basis for us and receive a small financial retainer, but the majority of their income will come from whether we actually offer a contract to the player that they have recommended. The reputation of any scout, and ultimately mine also, is based on the calibre of those recommendations. The reputation of the external scout coupled with where the player is from is an important initial part of our decision-making process. We are familiar with the schools and clubs that have a reputation for high-quality coaching and player support. If we receive recommendations from such a school or club, we are more likely to enquire further. The club has a clearly defined philosophy and it’s underpinned by integrity. The owner wants to win, but we have to make sure we do it in the right way. Our players have to share, appreciate and practise our values of honesty and integrity. A great deal of that certainly comes from our significant others and, in case of our youth players, we look to meet and get to know the parents. Typically, they are the most important role models for a young player. By getting to know the parents, we get to know the young man. The majority of players that we recruit cannot simply assume that they will walk straight into the first team. Appreciation of that and support from parents and the player’s family are crucial in providing a foundation for a player’s career. As a club, I’m proud of the history and reputation we have for developing players;

The academy manager (AM)

117

however, the reality is that most players will not make it into the first team, and so the support provided by both the club and their family is crucial.

References Anderson, G. & Miller, R.M. (2011). The Academy System in English Professional Football: Business Value or Following the Herd? University of Liverpool, Management School Research Paper Series. www.liv.ac.uk/managementschool/research/ working%20papers/wp201143.pdf. Ankersen, R. (2012). The Golf Mine Effect: Crack the Secrets of High Performance. Icon Books. Asghar, E. (1970) A Comparative Study of Multidimensional Talent. The Faculty of Sports Science: University of Leipzig. PhD submission. Audas, R., Dobson, S. & Goddard, J. (1997). Team performance and managerial change in the English football league. Economic Affairs, 17(3), pp. 30–36. Baker, J., Horton, S., Robertson-Wilson, J. & Wall, M. (2003). Nurturing sport expertise: factors influencing the development of the elite athlete. Journal of Sport Science & Medicine, 2(1), pp. 1–9. BBC. (2017, 1 February). Transfer deadline day: Premier League clubs net January profit. www.bbc.co.uk/sport/football/38817276. Bompa, T.O. (1985). Talent Identification. Science Periodical on Research and Technology in Sport – Physical Testing GN-1. Coaching Association of Canada. Bompa, T.O. (1999). Periodization: Theory and Methodology of Training. Human Kinetics. Bourke, S. (2003). The dream of being a professional soccer player: insights on career development options of young Irish players. Journal of Sport & Social Issues, 27(4), pp. 399–419. Brewer, B.W., Van Raalte, J.L. & Petitpas, A.J. (2000). Self-identity issues in sport career transitions. In Lavallee, D. & Wylleman, P. (eds). Career Transitions in Sport: International Perspectives. Fitness Information Technology, pp. 29–48. Brown, G. & Potrac, P. (2009). ‘You’ve not made the grade, son’: de-selection and identity disruption in elite-level youth football, Soccer & Society, 10(2), pp. 143–159. Christensen, M.K. (2009). ‘An eye for talent’: talent identification and the ‘practical sense’ of top-level soccer coaches. Sociology of Sport Journal, 26(3), pp. 365–382. Deloitte. (2017a). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf. Deloitte. (2017b). Annual Review of Football Finance: Ahead of the Curve. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-annual-review-of-football-finance-2017.pdf. European Club Association (ECA). (2012). Report on Youth Academies in Europe. www.ecaeurope.com/Research/ECA%20Report%20on%20Youth%20Acad emies/ECA%20Report%20on%20Youth%20Academies.pdf. Gerrard, B. (2005). A resource-utilization model of organizational efficiency in professional sports teams. Journal of Sport Management, 19(2), pp. 143–169.

118 The academy manager (AM) Lavallee, D., Grove, J., Gordon, S. & Ford, I. (1998). The experience of loss in sport. In Harvey, J.H. (ed.). Perspectives on Loss: A Source Book. Taylor & Francis, pp. 241–252. League Managers Association (LMA). (2016, April). Kicking off. The Manager (preview), 27, p. 7. MacNamara, A., Button, A. & Collins, D. (2010). The role of psychological characteristics in facilitating the pathway to elite performance Part 1: identifying mental skills and behaviors. The Sport Psychologist, 24(1), pp. 52–73. Magee, J. & Sugden, J. (2002). ‘The world at their feet’: professional football and international labour migration. Journal of Sport & Social Issues, 26(4), pp. 421–437. Manning, J.T., Bundred, P.E. & Taylor, R. (2003). The ratio of 2nd and 4th digit length: a prenatal correlate of ability in sport. In Reilly, T. & Marfell-Jones, M. (eds). Kinanthropometry VIII. Routledge, pp. 165–174. McGovern, P. (1999). The Irish Brawn Drain: English League Clubs and Irish Footballers 1946–1995. Working Paper No. 28. Centre for Employment Relations and Organisational Performance, Smurfit School of Business. Mitchell, T.O., Nesti, M., Richardson, D., Midgley, A.W., Eubank, M. & Littlewood, M. (2014). Exploring athletic identity in elite-level English youth football: a crosssectional approach. Journal of Sports Sciences, 32(13), pp. 1294–1299. Nagano, T., Kato, T., & Fukuda, T. (2004) Visual search strategies of soccer players in one-on-one defensive situations on the field. Perceptual and Motor Skills, 99(3), pp. 968–974. Nash, C. & Collins, D. (2006). Tacit knowledge in expert coaching: science or art? Quest, 58(4), pp. 465–477. North, J., Lara-Bercial, S., Morgan, G. & Rongen, F. (2014). Project Report: The Identification of Good Practice Principles to Inform Player Development and Coaching in European Youth Football. A Literature Review and Expert Interviews in Belgium, England, France, Germany, Italy, the Netherlands, and Spain in the Performance Pathway. Research Centre for Sport Coaching and Physical Education Institute for Sport, Physical Activity and Leisure, Leeds Beckett University. Premier League (PL). (2011). Elite Player Performance Plan. www.premierleague. com/youth/EPPP. Premier League (PL). (2016, 1 September). Squads for 2016/17 Premier League confirmed. www.premierleague.com/news/84136. Reilly, T. (1979). What Research Tells the Coach about Soccer. AAHPERD. Reilly, T. & Gilbourne, D. (2003). Science and football: a review of applied research in the football codes. Journal of Sports Sciences, 21(9), pp. 693–705. Sparkes, A.C. (2000). Illness, premature career-termination, and the loss of self: a biographical study of an elite athlete. In Jones, R.L. & Armour, K.M. (eds). Sociology of Sport: Theory and Practice. Longman, pp. 13–32. Stratton, G., Reilly, T., Williams, A.M. & Richardson, D. (2004). Youth Soccer: From Science to Performance. Routledge. UEFA. (2015). UEFA Club Licensing and Financial Fair Play Regulation. www.uefa. org/MultimediaFiles/Download/Tech/uefaorg/General/02/26/77/91/2267791_ DOWNLOAD.pdf. Wiersma, L.D. (2000). Risks and benefits of youth sport specialization: perspectives and recommendations. Paediatric Exercise Science, 12(1), pp. 13–22.

The academy manager (AM)

119

Wilkinson, H. & Football Association (FA). (1997). A Charter for Quality: Football Education for Young Players. FA Publications. Williams, A.M. (2000). Perceptual skill in soccer: implications for talent identification and development. Journal of Sport Sciences, 18(9), pp. 737–750. Williams, A.M. & Franks, A. (1998). Talent identification in soccer. Sport Exercise and Injury, 4, pp. 159–165. Williams, A.M. & Reilly, T. (2000). Talent identification and development. Journal of Sport Sciences, 18(9), pp. 657–667.

Chapter 9

Career development

(Note: This chapter is intended to provide a sample of the professional development opportunities that currently exist for players, coaches and business executives within professional football. It is not intended to be an exhaustive directory of career and personal development links, but a summary that serves to highlight the complex landscape that career-minded individuals enter.)

Introduction The draw of working within the potentially highly paid and glamorous industry of professional football is one that can be readily appreciated. The sense of status or social worth that a career in football potentially offers could be interpreted as a ‘life dream’ or ‘labour of love’ for many who pursue it (Adamson et al., 1998; Hopcraft, 1968). However, to perceive any career in football as predictable, linear and secure is misguided, whether that be as an aspiring boardroom executive, a tracksuit-wearing coach or a professional footballer. For those individuals aspiring to become professional footballers, there is a degree of luck that determines the longevity of careers and the level to which players can reach. Players are subject to the vagaries of managerial decisions, loss of form and the threat of career-ending injuries. The harsh reality for most footballers is that their careers are lived out in relative obscurity and are short in duration, insecure and physically demanding (Roderick, 2006). A similar scenario is likely to be experienced by football industry executives, who operate within a culture of uncertainty dictated by dependence on and sensitivity to results. In the face of such volatile circumstances, Roth (1963) has eloquently argued that people make every effort to reduce the uncertainty attached to their positions by psychologically structuring their lives to anticipate potential changes in status and employment. One approach is to strategise career contingency plans and anticipate the required personal and professional skills required in any future roles. In recent years, there has been a significant increase in the quality and provision of educational programmes made available to academy players under

Career development

121

the terms of EPPP regulations. The same focus on education and its importance has been extended to the coaching fraternity by the FA and UEFA. However, there remain a number of conflicting tensions for academy players attempting to balance the pressures and practices associated with undertaking education while committing to the demands of a professional football academy. Examples from within similar sporting contexts have identified that by far the greatest obstacle to players achieving success in their educational studies is their general lack of focus and commitment to educational support (Hickey & Kelly, 2008). Although players may genuinely attempt to engage in educational and external vocational development opportunities, football is given priority. Underpinning this is both their personal desire to establish themselves as professional players and their commitment to the primary goal of winning games of football (Lavallee et al., 1998; Hickey & Kelly, 2008). As such, football players may, by virtue of their commitment to playing football, be examples of ‘trained incapacity’ (Merton, 1957). (This notion is based upon the work of the sociologist Veblen, who observed that decision making that is narrow is inevitably prone to ‘blind spots’ due to its failure to appreciate or react to changes in circumstances (Veblen, 1967).) However, despite such concerns regarding a focus upon the dream of a professional career, the governmental inspectorate of educational provision within academies, Ofsted, has clearly stated that EPL club staff have extremely high expectations of players in terms of their education and provide an exceptionally high-quality learning environment (Ofsted, 2017). This recent report finding is highly positive in terms of the overall picture it paints of clubs’ educational delivery and support of educational outcomes.

Players Talented players are identified by professional clubs in a variety of ways. Traditionally, clubs’ scouts observe first hand the potential of a young player during his/her live school or youth league games. For the U9 to U12 age groups, player recruitment in England is restricted to those clubs that are within a one-hour drive of the academy facility (PL, 2012). At this stage, potential recruits are invited to take part in a trial or screening event, which can take place on one set date or be extended over a period of time, before a decision is made whether to register them at the club. Talent identification at this stage looks to determine whether an individual has the raw materials or potential to develop into a first-team player (ECA, 2012). Players deemed to have potential are offered the opportunity to register with the interested club, demonstrating a commitment by both the child and his/her parents to the club’s academy, and a reciprocal commitment or ‘duty of care’ by the club to the child and his/her family. Those players who are able to progress within a club’s academy have the potential to be offered a ‘professional contract’ from the age of 17.

122

Career development

In 2011, a report published by sportingintelligence.com revealed that Premier League footballers’ average ‘basic’ annual pay (not including win bonuses or signing-on fees) in 2009/10 was approximately £1.16 million. In the intervening seven years, this figure has grown to £2.4 million (2016/17 season), or almost twice as much as the average earned by players taking part in Spain’s La Liga competition (sportingintelligence.com, 2016). Clearly, football at all levels remains extremely rewarding as a potential career, in terms of remuneration, job satisfaction and potential celebrity status (Douge, 1999; Roderick, 2006), but, given that an average football career lasts just eight years and the standard retirement age of a player is just 35, even extravagant levels of wealth are likely to dissolve during ‘retirement’ (Brown & Potrac, 2009; PFA, 2016). Sensitivity towards post-career planning contingencies is a focus of the Professional Footballers’ Association (PFA), the players’ union. The organisation provides guidance for its members regarding the provision of educational and vocational courses. According to the PFA, the key career transition issues for players revolve around how to best plan their post-playing careers by first identifying their own personal strengths and then match them to the most appropriate options. By assisting in planning their post-playing career, the various PFA workshops and courses aim to encourage players to develop effective employer networks and to carefully assess their personal finances and plan accordingly for the future (ibid.).

Coaches In England, the Football Association (FA) is the national governing body for the game and has primary responsibility for the education and development of all coaches. Its 2016–20 strategy aims to grow levels of participation within grassroots football while striving for success with its elite teams (men’s senior, women’s senior, men’s U21s, youth teams). The coaching pathway that facilitates this strategic aim is referred to as the ‘coach education pathway’. This pathway maps the learning journey from the first formal educational course undertaken by a new coach through to the advanced qualifications required to manage at an elite professional level. The first step for any aspirational football coach is to take the FA Level 1 in Coaching Football. This basic course provides participants with an introduction to coaching the game and working with players from under 7 years old to adults. A more in-depth understanding of coaching is provided within the FA Level 2 in Coaching Football. This qualification introduces learners to the core components of England’s ‘DNA’ blueprint for elite player development unveiled in 2014 (FA, 2014). The next stage of development requires coaches to undertake the FA Level 3 (UEFA B) in Coaching Football. This qualification focuses on key aspects related to the role of a football coach working with teams. For coaches aspiring to work within the professional

Career development

123

game, there are an additional two levels. The FA Level 4 (UEFA A) in Coaching Football, once completed, can ultimately lead on to the most advanced coaching qualification available, the FA Level 5 (UEFA Pro) in Coaching Football. The UEFA Pro Licence is the highest-level qualification available for professional coaches and is intended to bridge the role of the coach with that of the first-team manager. The intention behind the award is to shift the focus from coaching-led activities to matters beyond the football field itself, such as business and governance within a professional football club (FA, 2017a). At present, to obtain a management position at the elite level of any European nation’s league system, it is necessary to hold or to be working towards a UEFA Pro Licence (ibid.). Attending elite-level coaching courses

Figure 9.1 Coach education: professional development pathway Source: data from FA (2017b)

124

Career development

can also present professional networking opportunities for participants and facilitate information sharing that can help to raise the profile and broaden the contact base of aspirational coaches (Morrow & Howieson, 2014). In this regard, these courses can increase the knowledge, accreditation and networks of coaches and help them to make the successful transition from playing to coaching in the professional game. Despite the importance attached to educational provision, there remain a number of questions regarding the effectiveness and usefulness of preparing coaches for the demands of the professional game via current coaching awards and licences – in particular, the relevance and applicability of the knowledge, methods and perspectives that are being taught on such courses. While Morrow and Howieson recognise the limitations of their primary research in terms of its generalisability, it does raise legitimate concerns regarding whether the content and pedagogic approach of current licensing awards need to be reconsidered.

First-team managers/head coaches For most professional managers, the pathway to becoming a manager starts as a professional footballer and then a coach (Christensen, 2009; Loy et al., 1979). The impact of various head coaches and managers during the career of a player is inevitably highly influential in helping to formulate and guide career decisions as to ‘what-do-I-do-next’ conundrums. For those interested in considering a career as a head coach or manager, this begins with serving a form of apprenticeship within the academy of a club (normally the club with which the player has the closest personal and professional connection as a coach – most often his current club). This experience then typically leads to ‘learning the ropes’ as the youth-team coach, leading to the role of U18 coach and then potentially a role as assistant manager. Personal and professional relationships with current or former employers appear to be key in allowing players such developmental opportunities. In this way, a player is regarded as a quasi-insider by senior management at a club and this insider status seems to be key in reinforcing the high level of trust that is required to operate within the football industry. During this initial apprenticeship, players are encouraged both by UEFA, the PFA and the League Managers Association (LMA) to continue their professional development via a range of accredited courses. However, the learning curve of professional managers is unnecessarily steep. Ericsson and Smith (1991) and Ericsson et al. (1993) observed that a minimum of 10,000 hours of deliberate practice (approximately ten years of practice: 20 hours for 50 weeks per year) is required before any individual has the foundation upon which expertise is possible. Given the time and commitment required in order to complete such fundamental formative practice, this would need football industry authorities to revisit their continuous professional development (CPD) approach and delay the entry of neophyte professionals into

Career development

125

elite sport management (Cruickshank et al., 2013). The historical failure of football industry governing bodies to address the professional needs and wants of their members is arguably yet to be addressed. Given the high turnover of football managers, the need for training has never been more important to allow coaches and managers the best chance of success.

Executive officers The EPL in 2017 can be viewed as one of the most commercially attractive sports leagues in the world. The brand appeal of the league can be evidenced by its broadcast presence, not only in Europe but also in emerging markets such as Brazil, Russia, India, China and the Middle East. The appeal of EPL teams to a cosmopolitan global audience continues to grow and with it the scope for development of new commercial opportunities in territories far removed from their home stadiums (Deloitte, 2017; KPMG, 2016; PwC, 2011). As sponsors allocate increasing amounts of money to sport, there will be intensifying pressure for club owners and their directors to lead on sophisticated measurement techniques to demonstrate the returns on sponsors’ investment and value for money for all stakeholders. The imperative of recruiting staff with the business acumen to exploit the commercial opportunities available is crucial to any club in the current era. Competition for such high-calibre executives is inevitably intense, given the shortage of supply and the high demand across all business organisations for such staff. Given the broad range of business activities in which clubs are engaged, it may be prudent for prospective employees to consider whether they have the necessary multidisciplinary knowledge and applied business foundations: for example, an in-depth knowledge of legal, political and economic issues (e.g. competition law, litigation prevention, risk management, regulation and media policy). In addition, they need to be focused upon the key current and future challenges faced by professional football clubs (e.g. commercial rights, social media, corporate social responsibility, governance structure, etc.). An expanding range of governing bodies, universities and hybrid club– commercial organisations aim to address the developing market for the specialist training of football industry executives. One high-profile training programme is the Executive Master in European Sport Governance (MESGO), which is delivered (in collaboration with UEFA and various European universities) in the form of nine one-week seminars over a period of 18 months. In addition, FIFA have their own FIFA Master course delivered by the International Centre for Sports Studies (CIES). This one-year postgraduate programme combines taught components and practical case studies supplemented by guest lectures and field visits. The course focuses on the three key and inter-related fields of sport humanities, management and law.

126

Career development

In 2015, UEFA created the UEFA Executive Master for International Players (UEFA MIP). Specifically designed for and restricted to former international professional players, the course is intended to improve professional player employability in a range of sports business-related organisations. During the 20-month course, participants study a wide range of modules covering the roles and skills of the manager, strategic marketing, stadium and operations management, the format and regulation of competitions, etc. over seven sessions. In the UK, there are a number of academic institutions that offer a range of diplomas and undergraduate and postgraduate courses that aim to supply the football industry with ‘work-ready’ employees, one of the first being Southampton Solent University (SSU). In 1999, SSU started delivering their Certificate in Professional Sport Management and Administration (Football), in conjunction with the LMA, to provide training for administrative staff working for the 92 professional football clubs. In 2002, the LMA established a collaborative partnership with Warwick University to deliver a postgraduate diploma course (a relationship that lasted until 2012). The aim of the diploma was to provide aspiring professional football coaches and managers with an opportunity to enhance their various UEFA coaching awards with experience of the broader business demands of the football industry. This professional development opportunity aimed to introduce candidates to a range of industry topics such as leadership, finance, diversity and equality, media training, personal branding, managing upwards and negotiation skills. An updated version of the same course (accredited by the University of Liverpool) is now delivered at the FA’s headquarters (St George’s Park). Arguably the highest-profile football MBA in Europe, and one of the highest ranking, is delivered by the University of Liverpool. The Football Industries MBA (FIMBA) is a 12-month programme that consists of 12 compulsory modules that range from International Football Industry, to Leadership, Management and Organisation to Managerial Economics. The recent growth in commercial sports education providers collaborating with established institutions of higher education can be seen with the creation of a Masters in Sports Directorship by Visionary Sports Investment (VSI) and Manchester Metropolitan University. In addition, VSI have also partnered with the Sports Business Institute Barcelona to deliver a part-time, online Postgraduate Degree in Football Business Management. While in recent years there has been growing evidence of a momentum towards establishing qualifications-based frameworks for employment in professional football, the extent to which this has been implemented beyond youth academy settings remains a moot point (Bradbury, 2013; SPTT & Fare Network, 2014). In this regard, the professional football industry remains heavily reliant on professional networks rather than qualificationsbased methods of employee recruitment. This is especially the case in relation to senior executive appointments. Furthermore, these networks-based

Career development

127

methods of recruitment have tended to result in the appointment of ‘known’ connections from within the dominant social, cultural and associated business networks of the football industry. In many cases, the new business and management recruits have less relevant industry experience than other applicants, including those from more ethnically diverse backgrounds. In this regard, it might be argued that executive recruitment at professional clubs continues to be largely premised on ‘who you know, not what you know’. CPD awards, such as national governing body coaching badges and various affiliated or approved courses, will continue to be a part of the formal educational landscape for the foreseeable future. The various football associations act as gatekeepers to a profession that limits access to the upper echelons of the business via a series of professional career stepping stones. Successful negotiation and completion of each certification hurdle is required at each stage of the professional masterplan. What is clear from the various CPD pathways mentioned is that they are inevitably constrained by having to operate within defined financial limits or boundaries. There is a need for the certification provider to deliver training that is ‘price sensitive’ to the consumer i.e. is affordable and provides value for money, while still delivering the appropriate level of heutagogical support for their customers – in essence, a programme of study that is ‘fit for purpose’. The concern, however, is that despite the best intentions of the various football-affiliated CPD organisations to deliver bespoke programmes of educational training, these programmes are compromised by cost implications (the optimum duration of the course, staffing, facilities, resources, etc.) and sensitivity to the needs and wants of their customers (price sensitivity, short duration, flexibility of dates and location, etc.). As a result, current structures and professional pathways are only accessible to those who have the financial means and flexibility of time. In essence, the system is fundamentally flawed in terms of the range of individuals who can progress through the system to reach their optimum level. The challenge for training providers is to offer a programme of study that both delivers high-quality content and is price sensitive. As a result, increasingly there appears to be a trend for online resources for answers and content for aspirational learners. Social media forums such as LinkedIn, Facebook and the Player Development Project provide a stream of highquality, research-based content and a forum for coaches searching online for answers. Such forums provide learners with communities of like-minded individuals (‘communities of practice’) that help to further stimulate and support ‘informal learning’. This dimension of learning is often neglected within the above formal professional CPD structures and should clearly be an area of focus for national associations and their award pathways. The benefit of such virtual forums is that learning is neither restricted to formal events nor prohibitively expensive, and continues long after the formal course has ended. Such online forums offer flexibility and the opportunity

128

Career development

for a wide range of educators to meet in a virtual world not bounded by time or place. In essence, an inclusive community is established, where everyone (from grassroots football to professional clubs) can learn and challenge existing practices. What is clear from research and the concept of ‘deliberate practice’ is that the online world should complement, and not replace, direct involvement in the sport. The mindset of being humble and willing to challenge one’s own ideas is crucial in any personal development journey. Being prepared to network, ‘knock on doors’, observe, experiment and ask questions of a variety of experts is crucial in extending knowledge beyond formal educational structures. The challenge is to be patient in acquiring a USP of experiences and knowledge that define your contribution to any prospective audience.

References Adamson S.J., Doherty, N. & Viney, C. (1998). The meanings of career revisited: implications for theory and practice. British Journal of Management, 9(4), pp. 251–259. Bradbury, S. (2013). Institutional racism, whiteness and the under-representation of minorities in leadership positions in football in Europe. Soccer & Society, 14(3), pp. 296–314. Brown, G. & Potrac, P. (2009). ‘You’ve not made the grade, son’: de-selection and identity disruption in elite-level youth football, Soccer & Society, 10(2), pp. 143–159. Christensen, M.K. (2009). ‘An eye for talent’: talent identification and the ‘practical sense’ of top-level soccer coaches. Sociology of Sport Journal, 26(3), pp. 365–382. Cruickshank, A., Collins, D. & Minten, S. (2013). Culture change in a professional sports team: shaping environmental contexts and regulating power. International Journal of Sports Science & Coaching, 8(2), pp. 271–290. Deloitte. (2017). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf. Douge, B. (1999). Coaching adolescents: to develop mutual respect. Sports Coach, pp. 6–7. Ericsson, K.A. & Smith, J. (eds). (1991). Toward a General Theory of Expertise: Prospects and Limits. Cambridge University Press. Ericsson, K.A., Krampe, R.Th. & Tesch-Romer, C. (1993). The role of deliberate practice in the acquisition of expert performance. Psychological Review, 100(3), pp. 393–394. European Club Association (ECA). (2012). Report on Youth Academies in Europe. www.ecaeurope.com/Research/ECA%20Report%20on%20Youth%20Acad emies/ECA%20Report%20on%20Youth%20Academies.pdf. Football Association (FA). (2014). England DNA. https://community.thefa.com/ england_dna/. Football Association (FA). (2017a). The UEFA Pro Licence. www.thefa.com/ get-involved/coach/coaching-courses/the-fa-uefa-pro-licence.

Career development

129

Football Association (FA). (2017b). Coach. www.thefa.com/get-involved/coach. Hickey, C. & Kelly, P. (2008). Preparing to not to be a footballer: higher education and professional sport. Sport, Education and Society, 13(4), pp. 477–494. Hopcraft, A. (1968). The Football Man. Simon & Schuster. KPMG. (2016). Football Clubs’ Valuation: The European Elite 2016. https://assets. kpmg.com/content/dam/kpmg/pdf/2016/05/the-european-elite-2016.pdf. Lavallee, D., Grove, J., Gordon, S. & Ford, I. (1998). The experience of loss in sport. In Harvey, J.H. (ed.). Perspectives on Loss: A Source Book. Taylor & Francis, pp. 241–252. Loy, J.W., Curtis, J.E. & Sage, J.N. (1979). Relative centrality of playing position and leadership recruitment in team sports. In Hutton, R.S. (ed.). Exercise and Sport Sciences Review (Vol. 6). Journal Publishing Affiliates, pp. 257–284. Merton, R.K. (1957). Social Theory and Social Structure. The Free Press of Glencoe. Morrow, S. & Howieson, B. (2014). The new business of football: a study of current and aspirant football managers. Journal of Sport Management, 28(5), pp. 515–528. Office for Standards in Education, Children’s Services and Skills (Ofsted). (2017). Further Education and Skills Inspection Report: The Football Association Premier League Limited. https://reports.ofsted.gov.uk/provider/files/2696073/urn/54842. pdf+&cd=1&hl=en&ct=clnk&gl=uk. Premier League (PL). (2012, 21 January). Youth: elite performance. www.premier league.com/news/58934. PricewaterhouseCoopers (PwC). (2016). Financial Services Technology 2020 and Beyond: Embracing Disruption. www.pwc.com/gx/en/financial-services/assets/ pdf/technology2020-and-beyond.pdf. Professional Football Association (PFA). (2016, 4 May). On the Board: introduction. www.thepfa.com/transition/on-the-board/introduction. Roderick, M. (2006). The Work of Professional Football: A Labour of Love? Routledge. Roth, J.A. (1963). Timetables: Structuring the Passage of Time in Hospital Treatment and Other Careers. Bobbs-Merrill Company. Sportingintelligence.com (2011, 30 October). Revealed: English official football wage figures for the past 25 years. www.sportingintelligence.com/2011/10/30/revealed-official-english-football-wagefigures-for-the-past-25-years-301002. Sportingintelligence.com. (2016). Global Sports Salary Surveys 2016. www.global sportssalaries.com/GSSS%202016.pdf. Sports People’s Think Tank (SPTT) & Fare Network. (2014). Ethnic Minorities and Coaching in Elite-Level Football in England: A Call to Action. A Report and Recommendations from the Sports People’s Think Tank in Association with the Fare Network and the University of Loughborough. www.farenet.org/wp-content/ uploads/2014/11/We-speak-with-one-voice.pdf. Veblen, T.B. (1967). The Theory of the Leisure Class: An Economic Study of Institutions. Funk & Wagnalls. (Original work published 1899.)

Chapter 10

Conclusions Future industry business directions

Introduction Professional football is today the world’s most popular sport, as defined by cross-referencing the number of registered active football participants (FIFA, 2006), in-person attendance at live sports events (Deloitte, 2017; LMA, 2016) and the number of transnational or global fans (Mutz, 2015; Szymanski, 2016). The cumulative effect is that six professional football clubs feature in the top ten richest sports teams in the world (Forbes, 2017). Given the popularity of the game, a number of behavioural insight, commercial and business consultants have attempted to anticipate future trends for the football industry (Deloitte, 2015, 2016; KPMG, 2016; Performance Communications & Canvas8, 2017; Pew Research Center, 2016; PwC, 2016; Repucom, 2016; Technavio, 2016). This chapter is a synopsis of the trends and developments that football business executives and sports business analysts foresee taking place over the next five years.

The changing media landscape In 2016–17 approximately 13.6 million fans attended the 380 matches of the Premier League competition (with a quarter of its clubs attracting 50,000-plus average crowds – Manchester United (75,290), Arsenal (59,957), West Ham (56,972), Manchester City (54,019) and Liverpool (53,016) (BBC, Sport, 2017). The popularity and reach of the Premier League now extends far beyond the confines of its club stadia to a global or displaced audience. It is this audience and fan preferences for what, which, when, where and how it consumes ‘content’ that has driven an evolution in sports broadcasting and media distribution platforms (television, podcasts, mobile sports apps and websites) and potential revenue streams (Deloitte, 2015; Woods, 2016). Advances in digital and mobile technology now allow consumers to record any program and replay it at their convenience, skip advertisements and ‘stream’ games when and where they see fit. Digital innovation has disrupted the traditional broadcast

Conclusions

131

model used by clubs and placed control in the hands of the consumers. The virtual fan no longer ‘leans back’ or passively experiences audiovisual broadcasts but now ‘leans forward’ in search of a more immersive and interactive experience (Boyle & Haynes, 2004). Clubs now have the opportunity to utilise the opportunities created by such advances in digital and mobile technology and and engage a wider and more diverse audience by responding to consumer preferences. An inevitable consequence of football teams becoming media entities is their appeal to media companies to buy into their club structures. The vertical integration of media companies within club structures is clearly an effort on their behalf to appropriate and gain control of club broadcasting rights (Evens & Lefever, 2011). The challenge for league stakeholders is to ensure that broadcasting rights are not restricted and distributed via a separate club network and thus undermine the collective bargaining power of the league and its members. The marketing adage that ‘content is king’ is still relevant to the evolving sports media landscape, but remembering that the customer is in control is fundamental in a disrupted media landscape. The marketing adage that ‘content is king’ is still relevant to the evolving sports media landscape, but identifying the most effective distribution channel still appears to remain equally important.

Big data and the use of analytics Data and how the use of analytics will increasingly shape the business side of the sports industry (Deloitte, 2016). Having the best players is critically important, but so is having key insights to create better fan experiences, drive more revenue and create more value. Business functions such as finance, marketing and sales are seeking how best to interpret the data to which they have access and to improve their strategy and operations as a result. Some sources of increased data that are of interest to football clubs include: • • • • •

primary and secondary market ticket data; in-venue beacon technology; merchandise and food and beverage point-of-sale terminals; fan interaction through social media platforms and team and league websites; loyalty schemes.

Teams and professional leagues have generally sought to increase the overall technical know-how of their organisation so that all areas of the business are more conversant in the power of data. But creating insights is only half the challenge. Organisations need to trust and activate those insights as well. Failing to apply what is gleaned from data is often typically the biggest

132

Conclusions

barrier to driving value from analytics (PwC, 2016). Commercial departments within clubs have been augmenting traditional approaches with more analytical capabilities by having better leads on who is more likely to buy, what they are more likely to buy and when they are likely to buy. The challenge of appealing to a ‘millennial’ market means using the data analytics to better understand how to engage this significant market cohort. Data provided by Repucom (2016) and the Pew Research Center (2016) indicates that four in five millennials say they would be more likely to purchase from a company that supports a cause they care about. This data has been used to good effect by a number of clubs in creating community and cause-focused campaigns, which are identified as being appealing to millennials. For instance, Manchester United FC and Aon have previously committed to serving the Manchester community together, through programmes such as Skills and Drills football clinics with children supported by local charities. The sensitivity of millennials towards brands that are perceived as eco-friendly is a further consideration for the sports industry. In response, it appears that football equipment manufacturers are now replacing the traditional leather, synthetic rubber, nylon and other synthetic materials with organic cotton, water-based adhesives and recycled plastic materials in their manufacturing processes (Technavio, 2016). For instance, the newly developed and advanced non-toxic green material called thermoplastic elastomer is being increasingly used in the manufacture of different kinds of sports equipment. In 2015, Adidas came up with the concept of Sport Infinity, in which the worn-out football shoes of famous players are not discarded but broken down and remoulded with scrap material from different industries to create new products (ibid.). This increasing preference for environmentally friendly sports equipment is expected to propel the prospects of growth for the football equipment market over the forecast period (ibid.). CFOs and their colleagues are now increasingly capitalising on advances in technology and accountancy software to spend more time analysing results rather than preparing financial reports. Greater use of technology is also anticipated to allow media departments to better capture and enhance analysis of the consumers who interact with their digital and social platforms to improve campaigns and react in real time. The desired outcome for clubs’ integration of technology should therefore be to improve interactions with consumers, enhance sponsorship opportunities, and support increased efficiency and effectiveness of such internal functions as finance and marketing (Deloitte, 2016).

Improving the fan experience It is anticipated that teams will look to innovate game day and incentivise fans to attend in person more frequently with such ventures as technological in-stadium enhancements (e.g. video screens, wi-fi connectivity, heated seats with USB ports for premium tickets), visitor loyalty schemes

Conclusions

133

and experiential personalisation. For example, in 2017, Manchester City FC adopted a data-driven approach to fan engagement via their interactive membership platform Cityzens. The club collect information on their fans’ locations and demographic and social interactions via fan registration. The data is then used to personalise activations such as season ticket renewals, and reward fans for key milestones such as attending every match in a season or wearing their City shirt around the world. The short-term success of such initiatives has varied, and their long-term effectiveness is in many ways yet to be determined, but they represent a significant effort to use smart data as a tool of engagement for a global brand (Deloitte, 2016; KPMG, 2016). Teams also continue to search for ways to optimise the fan experience beyond simply watching the game live in the stadium. In the US, one way in which teams are improving the fan experience within stadiums is by partnering with already popular services, such as Uber and Amazon Prime, to enhance viewing parties and ‘tailgates’ (the name given by fans to pre-game social gatherings around the tailgates or boots of their cars). These partnerships appeal to the coveted millennial demographic, who are already well acquainted with these types of services and are likely to engage in experiential spending. Capitalising on the consumer habits of this subset of the population is important, particularly in the US, where millennials now outnumber ‘baby boomers’ as the nation’s largest living generation (Pew Research Center, 2016). Fans’ proximity to the stadium is not a prerequisite for tapping new revenue streams on game day. While catering to regular attendees and season-ticket holders is obviously valuable, there is also untapped potential in fanbases that have no access to the stadium at all. Over half of the fans from each major sports league in the US are ‘displaced’, meaning that they support teams that do not play in the state in which they reside. Manchester United FC boast 659 million social media followers worldwide – one tenth of the world’s population (Deloitte, 2016). How many of those fans come from Manchester? Fewer than 1% (Performance Communications & Canvas8, 2017). While the main driver behind expanding fanbases is profit, for fans it triggers a shift in the way in which they identify with sports, teams and athletes and it raises questions about authenticity and ownership. How far should sports go to attract new fans? And how will existing fans react to a more diverse fanbase? An opportunity exists in expanding the reach and generating revenue from these displaced fans. Teams for years have been looking for ways to innovate, yet have often had difficulty in defining what innovation means to them.

Augmented reality and virtual reality Augmented reality (AR) and virtual reality (VR) are anticipated to allow teams and leagues to become more personalised and integrated into players’ and fans’ daily lives (Deloitte, 2016; Performance Communications & Canvas8,

134

Conclusions

2017). Athletes with a high profile on social media such as Cristiano Ronaldo represents enormous commercial opportunities for the player, his club and the football industry. Ronaldo’s popularity extends to over 158 million followers across Facebook, Twitter and Instagram, making him bigger than most brands. The sports industry has now considerably increased its investment in AR and VR technologies, acknowledging their potential to disrupt content consumption. Teams and leagues believe that these could be solutions for enhancing the experience for casual fans and transporting displaced fans halfway around the world into pitchside seats. Self-evidently, online streaming and VR will present big opportunities to expand audiences globally. In 2015, Yahoo streamed the first online-only NFL game to 15 million viewers, a third of whom were non-American (Performance Communications & Canvas8, 2017). To date, interest in sports has been weighted heavily in VR technology. US sports team franchises are now partnering with VR start-ups to install 360-degree cameras in stadiums and to distribute games virtually (Deloitte, 2016). Eventually, leagues and teams may offer virtual season tickets, and these models will drive investment into more original programming and content. VR will allow people to switch between athlete, referee and fan. With Facebook, Sony, HTC, Samsung, Google and Microsoft all investing heavily in the technology, VR is promising to revolutionise viewing at home; Goldman Sachs expects the VR market to be worth $80 billion by 2025 (Performance Communications & Canvas8, 2017). Fox Sports is currently using it for boxing, and the ATP World Tour is revolutionising tennis with LiveLike VR to live stream courtside action to headsets. Meanwhile, the Google-financed AltspaceVR is using the tech to help people from different sides of the world watch in synchronicity by creating virtual rooms of up to 75 fans. The technology offers the potential to forge a new form of engagement with sport and create an immersive experience for fans. Teams also are incorporating VR technology into player training programmes to recreate game situations and help with decision making, while reducing the risk of overtraining or injury (KPMG, 2016).

Social activism and social media Questions about enabling, managing or redirecting athletes in ‘social activism’ will require strategic decisions by teams and leagues (Deloitte, 2016). Athletes have a long history of leveraging their public personas to support causes that are important to them, their families or their communities. Sports teams and leagues have previously promoted broad causes such as prostate cancer awareness, childhood fitness and natural disaster recovery efforts. However, the recent NFL activism spearheaded by Colin Kaepernick and Carmelo Anthony, among others, and now present across the US professional leagues is contemporary evidence of sports stars increasingly using

Conclusions

135

their TV air time and post-game press conferences as a way to draw attention to the issues or injustices that feel most critical to them, while teams and leagues stand by with varying levels of support (Deloitte, 2016; Lines, 2001). Social media has given athletes a global platform to support and advocate for causes in which they are invested, but also comes with a greater responsibility to be role models for others. These activities have resulted in a re-emergence of the fundamental question about the role that athletes play in political and social activism. While there are strong, mixed perspectives on whether athletes should use their status as high-profile figures to advance such public positions, particularly in the context of their on-field play, there is also growing sensitivity to how these activities might be impacting the sports industry. The rise of these politically and socially minded activities is potentially a factor that impacts fan perceptions and the viewership of live sporting events (Deloitte, 2016). As political and social topics permeate headlines in the coming years, many athletes will likely continue to use their platform to bring awareness to the issues that matter to them most, leaving teams and leagues with decisions to make regarding how to enable, manage or redirect this momentum.

Conclusion The professional football industry has undergone a dramatic revolution within Europe in recent years. The commercial development of the most popular competitions and the establishment and ongoing development of European political and economic institutions, in addition to societal problems to which sport is not immune, have prompted an increasing number of stakeholder organisations to take an interest in European sport, calling into question its traditional mode of governance (UEFA, 2017). If football clubs and the EPL are to rise to the numerous challenges facing the game, the FA as the national governing body has to take concerted action with their main stakeholders and political institutions to put in place appropriate and effective regulatory measures. For example, the FA needs to constantly monitor and evaluate a myriad of potential issues which range from the implications of club ownership structures and organisational behaviour to the internal and external management of legal disputes, with growing concerns regarding the influence of the European Union upon a post-Brexit Britain. Rarely will a commercial business affect the morale and togetherness of a whole community in the way in which a professional football club appears to. Football clubs are an intrinsic part of a community’s cultural heritage and fabric, memories and collective identity. The passion surrounding football can lead to often emotive and implausible observations, such as the one often attributed to Bill Shankly, the manager of Liverpool FC between 1960 and 1974: ‘Some people believe football is a matter of life and death. I am very disappointed with that attitude. I can assure you it is much, much

136

Conclusions

more important than that.’ Shankly clearly felt an impassioned connection for his team and the supporters who venerated him; the problem, however, is that he probably never actually said this. Shankly took his football seriously and his Liverpool team more seriously still, but he was too smart to ever resort to saying something so clumsy. His wit was sharp enough not to have needed the embellishment. Shankly said many things but the thing he is most famous for saying is, paradoxically, not one of them. Nevertheless, football has, and will retain, its ability to captivate regardless of political or economic motive or what theoretical and empirical analysis is applied to it. ‘Sport will, in the final analysis, always be taken seriously’ (Adcroft & Teckman, 2009, p. 13).

References Adcroft, A. & Teckman, J. (2009). Taking sport seriously. Management Decision, 47(1), pp. 5–13. Deloitte. (2015). Deloitte Sports Industry Starting Lineup: Sports Trends that Will Dominate and Disrupt 2016. https://www2.deloitte.com/content/dam/Deloitte/ us/Documents/consumer-business/us-sports-business-trends-disruption-2016.pdf. Deloitte. (2016). Deloitte’s sports industry starting lineup: trends expected to disrupt and dominate 2017. https://www2.deloitte.com/us/en/pages/consumer-business/ articles/sports-business-trends-disruption.html. Deloitte. (2017). Deloitte Football Money League 2017: Planet Football. Sports Business Group. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/ sports-business-group/deloitte-uk-sport-football-money-league-2017.pdf. FIFA. (2006). Big Count. www.fifa.com/mm/document/fifafacts/bcoffsurv/bigcount. statspackage_7024.pdf. Forbes. (2017, 19 January). Manchester United now biggest sports team in the world. www.forbes.com/sites/mikeozanian/2017/01/19/manchester-united-nowbiggest-sports-team-in-the-world/#4501c06923d4. KPMG. (2016). Football Clubs’ Valuation: The European Elite 2016. https://assets. kpmg.com/content/dam/kpmg/pdf/2016/05/the-european-elite-2016.pdf. League Managers Association (LMA). (2016, April). Kicking off. The Manager (preview), 27, p. 7. Lines, G. (2001). Villains, fools or heroes? Sports stars as role models for young people. Leisure Studies, 20(4), pp. 285–303. Mutz, M. (2015). Transnational public attention in European club football: current trends and driving forces. European Societies, 17(5), pp. 724–746. Performance Communications & Canvas8. (2017). The Future of the Sports Fan. www. fotball.no/globalassets/dommer/the-future-sports-fan_spilleregler_english.pdf. Pew Research Center. (2016, 25 April). Millennials overtake baby boomers as America’s largest generation. www.pewresearch.org/fact-tank/2016/04/25/millennial sovertake-baby-boomers. PricewaterhouseCoopers (PwC). (2016). Financial Services Technology 2020 and Beyond: Embracing Disruption. www.pwc.com/gx/en/financial-services/assets/pdf/ technology2020-and-beyond.pdf.

Conclusions

137

Repucom. (2016). Repucom’s Top Ten Commercial Trends 2016. http://nielsensports.com/wp-content/uploads/2014/09/Repucom%E2%80%99s-Top-10-com mercial-trends-ROs.pdf. Szymanski, S. (2016). Professional Asian football leagues and the global market. Asian Economic Policy Review, 11(1), pp. 16–38. Technavio. (2016, May). Global Football Equipment Market 2016–20. www.technavio. com/report/global-general-retail-goods-and-services-football-equipment-market. UEFA. (2017, 12 January). European club football’s financial turnaround. www. uefa.org/protecting-the-game/Club-licensing-and-financial-fair-play/news/newsid=2435355.html.

Appendix Job descriptions

The following is a sample of club job descriptions based upon a range of football industry employment publications and executive search organisations such as LinkedIn (n.d.), Executives in Sport Group (n.d.), Nolan Partners (n.d.), Sports Business Institute (n.d.), FC Business (n.d.) and Sri (n.d.), club websites, and FA guidelines (n.d.). The descriptions have been written in general terms and therefore cannot be relied upon to cover club-specific requirements. Inevitably, advertised roles and specific responsibilities vary from club to club i.e. they are subject to change according to the specific club’s ownership model and operational structures. ‘Role’, in general terms, can be regarded as the position within a club, whereas ‘responsibilities’ are most commonly the tasks that an employee is judged against and held accountable for. According to the LMA (2017), clarity of understanding regarding individual roles and responsibilities is essential for both club and employee if they are to avoid unnecessary confusion and errors. This is typically identified within the terms and conditions of a contract of employment. N.B. The profiles are not intended to provide an exhaustive list of responsibilities.

References Executives in Sport Group. (n.d.). www.eisg.com. FC Business. (n.d.). www.fcbusiness.co.uk. Football Association (FA). (n.d.). http://jobs.thefa.com/jobs_apply/vacancies. League Managers Association (LMA). (2017, April). Kicking off. The Manager (preview), 27, p. 7. LinkedIn. (n.d.). https://uk.linkedin.com. Nolan Partners. (n.d.). http://nolanpartners.com. Sports Business Institute. (n.d.). www.sbibarcelona.com/football-job-vacancies. SRi. (n.d.). www.sportsrecruitment.com/jobs.

140

Appendix

JOB TITLE: Chief executive officer (CEO) (reports to the chairman and executive board) JOB PURPOSE: Pivotal to the ultimate aims and success of the football club. Accountable for the day-to-day running of the club, and works very closely with the chairman, and across all aspects of the business, including the football strategy and recruitment. Works with the operations board to set, and manage, a budget that ensures the club continues to be operated in a sound and sustainable way. RESPONSIBILITIES: Formulating the club’s strategy with the club’s owner(s), with responsibility for the operational delivery of those plans across all areas. Taking the lead role in the negotiation of all player transfers and contracts. ESSENTIAL JOB REQUIREMENTS: Experience in the administration of professional football at either club, league or governing body level. A skill-set that incorporates all or most of the typical commercial activities of a football club such as sponsorship, digital, communications and CRM. Significant experience of setting targets for improvement activity and excellent staff management skills. Open-mindedness to the views of others while retaining the tenacity to achieve results. Effective negotiating, influencing and time management skills. Functional experience in finance, legal, marketing and strategic operations. Leadership and inspirational skills. Experience of attracting investment through sponsorship and the ability to develop a commercial strategy together with the operations board. Desirable: MBA in Business. N.B. Salary commensurate with skills and experience.

Appendix

141

JOB TITLE: Chief operating officer (COO) (reports to the chairman and executive board) JOB PURPOSE: Reports to the chairman and will be one of a number of senior executives in the business (e.g. CEO, CFO) responsible for providing executive leadership and direction for the club’s activities (typically off-field commercial and operational activities, though it depends on the club). Provides the club with the direction and leadership to deliver the operational objectives across all facets of the club’s stadium and training ground as agreed with the board. RESPONSIBILITIES: Planning, organising, managing and leading the activities of the club’s operations board in relation to all aspects of hosting a match at the stadium, including (but are not limited to) facilities management, security, safety, hospitality and catering. Developing strategies to develop non-matchday business at the stadium and the delivery thereof. Overseeing IT strategy, investment and operation within budgetary constraints. Planning the upkeep of the stadium and the training ground within budgetary constraints, with lateral thinking required to utilise all available resources. Establishing and maintaining appropriate systems for measuring all necessary aspects of operational management and development. Representing the club at public functions when requested. ESSENTIAL JOB REQUIREMENTS: Experience of managing cultural change and organisation development. A proven track record in business turnaround. A strategic thinker who makes choices to achieve his/her goals and to think laterally beyond traditional boundaries to solve problems. A visionary and inspirational leader with a proven ability to build, develop and motivate a team. A results-focused team leader, with a proven track record of delivery in a challenging environment. A convivial approach to both colleagues and subordinates to ensure a harmonious team working ethic. Desirable: Knowledge of the sports/leisure industry. N.B. Salary commensurate with skills and experience.

142

Appendix

JOB TITLE: Chief financial officer (CFO) (reports to the CEO) JOB PURPOSE: Responsible for delivering financial service leadership across the club and leading on the financial strategies to support the club’s strategic plan. As a member of the senior executive, contributes to the corporate and strategic leadership and management of the club. RESPONSIBILITIES: Overseeing accounting, financial analysis, financial reporting and the financial administration of the club. Providing leadership, direction and support to the CEO in the development and delivery of the club’s strategic plan. Developing and leading the club’s financial strategies to support the objectives of the club. Monitoring and controlling the club’s financial operations, including managing the process of capital and revenue budget setting. Monitoring and controlling the club’s procurement function to ensure both value for money and legal compliance. Developing the club’s approach to costing activities in order to robustly underpin business decisions and drive value for money. Undertaking economic forecasting and modelling to ensure the club’s success in the future. Managing the club’s annual operating budget, projections, cash flow analysis and financing ventures. Providing appropriate and necessary information, including up-to-date management information or accounts. Ensuring that the club has the appropriate insurance in place to cover both on- and off-field liability. Ensuring that all loans to the club should be documented in line with regulatory guidelines. ESSENTIAL JOB REQUIREMENTS: A degree in a relevant subject. A recognised professional accounting qualification, CCAB or non-UK direct equivalent. A proven track record of executive- and strategic-level financial management in a large, complex organisation. Demonstrable evidence of an innovative and commercial approach to financial management. Experience of successfully leading and managing the interrelationships between different teams to achieve overall corporate objectives.

Appendix

143

Experience of engaging with regulatory bodies, stakeholders and professional advisors. Sensitive relationship management skills across different groups of senior managers, boards/ committees and stakeholders, including financial communications to staff without significant financial experience. Personal presence, confidence and resilience in order to take personal accountability for managing challenging situations and relationships and brokering outcomes. A high level of emotional intelligence and skill in managing relationships. N.B. Salary commensurate with skills and experience.

144

Appendix

JOB TITLE: Director of football (DoF) (reports to the CEO) JOB PURPOSE: Accountable for creating and articulating the vision, strategy and environment for on-field club success. Required to perform operational and strategic business functions.

RESPONSIBILITIES: Overseeing football staff recruitment and budget, including first-team coaching staff. Managing the process of building and retaining playing talent at all age groups. Overseeing player research and recruitment, including player identification, acquisitions, sales and retention. Conducting contract negotiations with player representatives. Overseeing club academy youth development issues. Overseeing all aspects of sports science at the club, including fitness/ rehab/medical. Overseeing the club’s football training facilities, taking primary responsibility for reviewing and implementing improvements to the training ground environment and infrastructure. Communicating with both internal and external stakeholders regarding the strategic vision of the club.

ESSENTIAL JOB REQUIREMENTS: A UEFA professional licence or equivalent. Employment as a DoF or in another similar role in a recognised senior professional league during the last five years. Experience of supporting and challenging elite individuals within management, performance, coaching and leadership.

Desirable: Experience of managing or coaching in a recognised senior professional league for at least two of the last five years. Experience of managing or coaching an international team with a FIFA average ranking of 70th or higher within the last five years. N.B. Salary commensurate with skills and experience.

Appendix

145

JOB TITLE: First-team manager/head coach (reports to the CEO and/or the director of football) JOB PURPOSE: Responsible for establishing and managing a world-class sporting culture, and establishing and maintaining first-team success underpinned by high-quality performance. RESPONSIBILITIES: Coordinating all first-team-related activities and managing the multidisciplinary team (including high-quality coaches) who support team performance and results. Overseeing a coaching programme underpinned by cutting-edge resources and research to evaluate the effectiveness of the programmes put in place. ESSENTIAL JOB REQUIREMENTS: A UEFA Pro Licence/FA Level 5 in Coaching Football (mandatory for managing in the EPL and UEFA competitions). Experience in the professional game (or women’s equivalent) at a senior level as either a player (minimum five years’ experience), playercoach, coach, assistant manager or manager. Action-oriented (i.e. a shaper, implementer and complete finisher). People-oriented (i.e. a coordinator, team worker and resource investigator). Thought-oriented (i.e. a planner, evaluator and specialist). N.B. Clubs wishing to recruit a non-UK resident as manager need to first apply for a Governing Body Endorsement from the FA. Any application is reviewed according to the points-based eligibility criteria required by the Home Office under Tier 2 (Sportsperson: duration: three years or the length of the contract) and Tier 5 (Temporary Worker – Creative and Sporting: duration: 12 months or the length of the contract). Applicants are automatically endorsed by the FA if they can prove that they have managed an international team (with a FIFA average ranking above 50th) or in a ‘Top League’ (one of the six top European club leagues or Central and South American club leagues) for the ‘Prescribed Time’ (defined as a cumulative total of at least 36 months or a consecutive total of 24 months or more within the fiveyear period immediately preceding the date of application for a Governing Body Endorsement). This guidance is available on the FA website. N.B. Salary commensurate with skills and experience.

146

Appendix

Academy staffing structure (Category 1) JOB TITLE: Academy manager (reports to the CEO) JOB PURPOSE: Responsible for the management and direction of the club’s youth development programme designed to support and develop talented players for the first team and to co-ordinate and manage the academy programme. RESPONSIBILITIES: Being the strategic lead for the academy. Guiding the development of the club’s playing philosophy. Formulating/updating an academy performance plan. Monitoring, managing, developing and implementing the academy coaching/fixtures programme in line with EPPP requirements and the academy performance plan. Conducting an annual self-assessment of the academy in accordance with EPPP rules. Providing all necessary assistance to the league in connection with its ongoing monitoring and annual evaluations of the academy and to the ISO in connection with the ISO audits. Ensuring that all academy staff are undertaking relevant continuous professional development courses. Ensuring all policies and procedures are in place across all areas of the academy, including health & safety, risk assessment and safeguarding. Undertaking continuous professional development (organised by the club) to maintain the validity and currency of professional qualifications/licences. ESSENTIAL JOB REQUIREMENTS: An Academy Managers Licence. A UEFA A Licence/FA Level 4 in Coaching Football. An FA Advanced Youth Award. A current Safeguarding Children certificate (all staff working in direct contact with children are required to complete the FA’s three-hour Safeguarding Children Awareness workshop and undertake a refresher course, as advised by the FA, at least once every three years). An Emergency First Aid certificate. Enhanced DBS Disclosure. Experience of managing a youth development programme at a professional football club. Experience of managing staff, budgets and partnerships.

Appendix

147

Experience and understanding of policies and procedures in an academy environment, including the safeguarding and welfare of players and staff. High-level skills in management and administration, coaching and coach development, finance and accounting, sports science and medicine, and the recording and reporting of information. Desirable: An L20/A1 Award. Qualified Teacher Status. A sports-related degree. N.B. Salary commensurate with skills and experience.

148

Appendix

JOB TITLE: Head of coaching (reports to the academy manager) JOB PURPOSE: Responsible for the delivery of the academy’s coaching curriculum. Responsible for designing and delivering the club’s continuous professional development programme, which should reflect the club’s playing philosophy and coaching philosophy and the coach competency framework for each of the club’s academy coaches. RESPONSIBILITIES: Managing, implementing and monitoring the coaching programme for 9–16 year olds to ensure the delivery of excellence in all areas, especially technical and physical development, in line with the requirements of the FA, the Football League and the Premier League and adhering to EPPP. Implementing and monitoring the academy coaching syllabus for 9–16 year olds and ensuring that the coaching syllabus for the age range is delivered, meeting club and FA criteria including operational and legal requirements relating to coaching style, child protection, health & safety, first aid, diet and nutrition, etc. Recruiting, managing, supervising and developing the academy coaching staff, taking whatever steps are necessary to maintain the highest professional standards at all times. Providing regular updates on all academy activity and player progress to the academy manager. Structuring and chairing academy meetings with all coaches in conjunction with the academy manager, and coordinate all academy fixtures through close liaison with the academy administrator and other clubs’ fixture secretaries and other officials. Ensuring that young players train for quality and development, that the rules and regulations of the academy are adhered to and that the mission and philosophy of the club are endorsed at all times. Establishing and developing an extensive scouting network in the locality to provide contacts and information on all players with potential, and assisting in the development of effective and sustainable relationships with schools, local clubs, community groups and PFA educational welfare officers in order to build a strong base for the club’s academy. Working closely with schools and junior clubs, parents, teachers, managers, coaches and scouts to develop strong relationships with the academy and the club. Managing the recruitment of youngsters in the 7–16 age range into the academy.

Appendix

149

Undertaking continuous professional development (organised by the club) to maintain the validity and currency of professional qualifications/licences. ESSENTIAL JOB REQUIREMENTS: A UEFA A Licence/FA Level 4 in Coaching Football. An FA Advanced Youth Award. Coaching Module 1, 2 and 3 qualifications. Enhanced DBS Disclosure. An excellent manager and communicator. High-level planning and organisational skills, with an ability to pull together diverse information and work to tight timetables. Extensive local knowledge, with an ability to network effectively at all levels. Ability to create an enjoyable learning environment and to understand and relate to children, teenagers and adults. Ability to encourage and reinforce learning points and build on individuals’ strengths. Proactive and with a successful track record of establishing strong relationships within the community and with colleagues, officials, other football clubs and FA representatives. Knowledge and understanding of working with children and safeguarding procedures relevant to the position. N.B. Salary commensurate with skills and experience.

150

Appendix

JOB TITLE: Head of academy sports science & medicine (reports to the academy manager) JOB PURPOSE: Responsible for the development and implementation of the academy’s sports science & medicine plan in line with the club’s overall strategy for developing elite players (i.e. the interdisciplinary department for science, medicine, physiotherapy, match analysis and the other performance support services employed in support of academy players). RESPONSIBILITIES (in conjunction with the first-team head of sports science & medicine): Overseeing and developing: strength and conditioning; physiotherapy, including hydrotherapy and sports massage; medical services, including the prevention and treatment of injury; diet and nutrition; sports science, including physiology, biomechanics, physical testing and measurement; performance analysis; psychology. Taking on budgetary responsibilities as agreed with the academy manager. Meeting all EPPP guidelines including the recording of all injuries suffered and rehabilitation undertaken by academy players, and meeting criteria relating to the National Audit of Injury and Rehabilitation. Ensuring that the management of injuries effectively meets the club’s commitments to players, coaches and senior management through clinical audit and accurate documentation. Undertaking continuous professional development organised by the club to maintain the validity and currency of professional qualifications/ licences. ESSENTIAL JOB REQUIREMENTS: Either: a registered physiotherapist member of the Health and Care Professions Council; or a registered medical practitioner licensed to practise by the General Medical Council (and complying with the General Medical Council’s requirements concerning annual appraisal, scope of practice, indemnity and revalidation of doctors) with a diploma in Sport and Exercise Medicine or equivalent or higher qualification; or the holder of at least a Master’s degree in Sports Science (or other relevant discipline) from a recognised university and have or be

Appendix

151

working towards British Association of Sport and Exercise Sciences accreditation. Recent and relevant professional experience in a sports performance environment. Current registration with one, or several, appropriate governing bodies (BASES, HPC, CSP, GMC, etc.) with up-to-date CPD records. Professional qualifications as appropriate (UKSCA, NCA, NASM, etc.). Experience of working with young elite athletes and creating/managing programmes to facilitate their long-term athletic development. N.B. Salary commensurate with skills and experience.

152

Appendix

JOB TITLE: Head of education and welfare (reports to the academy manager) JOB PURPOSE: Responsible for all aspects of academy students’ education and welfare, including complete planning and delivery of the education and life skills programme, and the educational progress and welfare of the academy scholars and schoolboys, ensuring that the programme meets the requirements of the EPPP. RESPONSIBILITIES: Planning, organising and delivering the academy education and life skills programme. Teaching and supporting Achieving Excellence in Sport (AES), BTEC and GCSE subjects/modules to academy players aged 9–18 in conjunction with school curriculum requirements, and as part of the day release programme. Building and maintaining links with current education providers and associated partners and stakeholders such as parents, Local Education Authorities (LEAs), educational agencies and schools/teacher contacts of the academy scholars and schoolboys. Developing and maintaining an effective education timetable that meets the needs of all participating academy players. Leading the delivery of seminars and talks for parents as required. Procuring and managing teaching resources and equipment as required. Undertaking personal CPD as appropriate to meet the demands of the role. Creating and coordinating an effective CPD programme for education and life skills staff as appropriate. Maintaining appropriate records, both internal as required and those required by external agencies and regulatory bodies. Ensuring that all CRB and other regulatory requirements are up to date within the academy. Facilitating the delivery of child protection training for all appropriate staff and volunteers in line with guidance from the Premier League, Local Safeguarding Children Boards (LSCBs) and the FA. Undertaking continuous professional development organised by the club to maintain the validity and currency of professional qualifications/ licences. ESSENTIAL JOB REQUIREMENTS: Qualified Teacher Status (QTS) and relevant experience in a PE/sports performance environment.

Appendix

153

PGCE qualification or equivalent. Management and leadership experience in an educational setting (e.g. head of department, or similar). Recent mainstream teaching experience in an educational setting. Previous experience in a role with pastoral responsibilities. A clear and rounded understanding of the academy system and the professional football environment. An understanding of safeguarding children regulations and CRB requirements. IT skills, including a high level of competence using Excel, Word, Access and PowerPoint. A professional ‘can-do’ attitude with strong organisational and administrative skills. N.B. Salary commensurate with skills and experience.

Glossary

10,000 hours model The model for the development of elite performance based upon the notion of 10,000 hours of deliberate practice. A theory developed by Ericsson et al. (1991, 1993) and popularised by Gladwell (2008). academy (or football academy) The training environment operated by a professional football club for the development of youth players. academy licence This is issued by the board of the Premier League or Football League. A club is not permitted to operate a football academy unless it holds a current licence. The academy licence is valid for two years in the first instance. academy manager The person responsible for the operation of a club’s football academy. academy management team (AMT) The academy manager provides the strategic leadership for the academy. He/she is supported by an academy management team, which includes specialists in coaching, education, sports science and medicine, and talent identification and recruitment. academy performance plan (APP) The long-term strategy developed by the academy manager in consultation with the club board and/or technical board. The APP provides coaches and support staff with clearly defined performance targets which are closely aligned to the club’s football philosophy. academy system A system that produces home-grown players for the professional game in increasing numbers and quality. The very best of these players are consistently ranked amongst the best players in the world. A ‘world-leading’ academy system can also be characterised by the quality of the coaching and support staff and defined by the quality of the environment in terms of the built environment, facilities and infrastructure. The football philosophy and club culture underpins the approach of the staff and the club. audit process The approach that is adopted for the evaluation of each academy. The process takes place in three steps: Step 1 – self assessment;

156

Glossary

Step 2 – annual evaluation by the League; Step 3 – biennial evaluation by the ISO. audit tool An online application designed to enable effective measurement of each academy. The audit tool is available to all academy managers and is used by the ISO to establish the category of each academy. Category 1 academy The ‘optimum’ development environment for players in the youth system. Such academies typically produce EPL players and have the capacity to provide optimum access to the highest quality of coaching and development within an elite environment. Category 2 academy The ‘second tier’ of academy, which typically produce professional players in the Football League but also EPL players from time to time. Category 3 academy An ‘entry-level’ development environment for professional clubs that wish to maintain a performance pathway for players from U9. Category 3 academies typically produce professional players in the Football League. Category 4 academy A ‘late’ development model where formal entry into the academy begins with the Professional Development phase (U17 to U21). Category 4 academies produce late-developing players for the Football League and, from time to time, the EPL. Charter for Quality The 1997 plan (implemented in 1998) produced by the FA and Howard Wilkinson to provide a more structured and standardised approach to domestic club youth indigenous player development. The charter listed specific operational and environmental criteria that were considered essential for best practice in youth player development (e.g. staffing, facilities etc.). continuous professional development (CPD) The ongoing training provided to support the professional development of staff in the academy. Each club identifies a defined programme of CPD in its academy performance plan. The content of and approach to CPD is the sole responsibility of the club. Fédération Internationale de Football Association (FIFA) An association governed by Swiss law, founded in 1904 and based in Zurich. It has 211 member associations and its goal, enshrined in its Statutes, is the ‘constant improvement of football’. Football Association (FA) The corporation designated as the governing body of English football. The FA is a ‘limited company’ incorporated in England and Wales whose registered office is at Wembley Stadium, London. football philosophy This can be measured by the values that the club, staff and players demonstrate through their actions on a day-to-day basis. It is also very publicly demonstrated in the playing style and tactical approach to the game by teams and players representing the club.

Glossary

157

four-corner model The FA’s approach to long-term player development, which considers the interface between technical/tactical, psychological, physical and social elements of a player’s environment. home-grown player A player who, irrespective of his/her nationality or age, has been registered with any club affiliated to the FA or the FAW for a period, continuous or not, of three seasons or 36 months prior to his/her 21st birthday. Independent Standards Organisation (ISO) The organisation contracted to provide an objective audit of a club’s academy (youth structure). interdisciplinary approach The process by which colleagues (from a number of different sub-disciplines) work together to problem solve. League Managers Association (LMA) An unincorporated association that was established to represent and promote the views of professional football managers and that operates from St. George’s Park (the headquarters of the FA). manager The first-team manager or first-team ‘head coach’ of a football club. He/she has ‘overall responsibility’ i.e. ultimate responsibility and decision-making authority for the first team and first-team selection. N.B. ‘Overall responsibility’ does not mean sole responsibility for the first team and first-team selection. A manager can have overall responsibility even where he is advised or assisted by others (for example, assistant managers or assistant first-team coaches). multidisciplinary approach The process by which colleagues from the various ‘subject disciplines’ work together to problem solve. (Subject disciplines are characterised by their distinctiveness: for example, sociology, economics, psychology, political science, history, geography.) performance clock The process by which academies measure, monitor and provide documentary evidence of player progression where both coach and player can contribute to the qualitative statements. The performance clock is a player’s record of achievement and is used by the ISO in the classification process. performance management tool An online support service for academy managers which enables them to effectively manage the multidisciplinary approach in the academy. performance pathway The process of developing players from U5 to U21. The performance pathway is broken down into three distinct phases: the Foundation phase, the Youth Development phase and the Professional Development phase. Premier League (PL) The organising body of the Premier League with responsibility for the competition, its Rule Book and the centralised broadcast and other commercial rights. The PL works proactively and constructively with its member clubs and the other football

158

Glossary

authorities to improve the quality of football, both in England and across the world. revenue streams Matchday: season and matchday tickets and corporate hospitality; Media: television and broadcasting income, including distributions from broadcasting agreements, cup competitions and local radio; Commercial: sponsorship income and merchandising; Other: transfer and loan fees receivable and other sundry income. turnover Income arising from sales to third parties. This typically excludes transfer fees receivable (which are dealt with in the profit on disposal of players’ registrations) and value added tax. Included in turnover are matchday receipts and other matchday income. Union of European Football Associations (UEFA) The governing body of European football and the umbrella organisation for 55 national football associations across Europe.

References Ericsson, K.A. & Smith, J. (eds). (1991). Toward a General Theory of Expertise: Prospects and Limits. Cambridge University Press. Ericsson, K.A., Krampe, R.Th. & Tesch-Romer, C. (1993). The role of deliberate practice in the acquisition of expert performance. Psychological Review, 100(3), pp. 363–406. Gladwell, M. (2008). Outliers: The Story of Success. Penguin.

Index

Page numbers in bold indicates a table, italics an illustration academies and academy managers: aims and financial targets 105–106; appraisal of youth development 103–104; case study interview 110–117; coaching staff standards 114–115; contributing value 106–107; development phases by age 110–111; educational support 120–121; elite participation and mental well-being 105, 109, 112–114, 116–117; Elite Player Performance Plan (EPPP) 104, 108; management relations with DoF 78; manager’s job description 146–147; player pathway 113; player performance analytics 115–116; role and responsibilities 109–110, 112; scientific research partnerships 114; specialist staff, job descriptions 148–153; talent identification and recruitment 107–109, 112, 116 AC Milan 114 Adidas 132 Ajax FC 106, 112, 116 Anderson, Benedict 4 Ankersen, Rasmus 114 Arsenal FC 5, 85, 106, 130 Balanced Scorecard (BSC) 66 Baldridge National Quality Program 8 Barrow, Jeffrey 88 behavioural economics 47 Bennett, Nathan 60–61 Bennis, Warren 61 Black and Minority Ethnic (BAME) discrimination 87

board members: business strategies and planning 25–26; CEO succession strategy 40; male dominated 30; role and responsibilities 10–12 Bradbury, Steven 87 broadcasting rights 2–3, 3, 5, 131 BSkyB 2–3 BT Sport 3, 5 Butler, John K. 32 career development: coaches 122–124, 123; executive officers 125–128; first-team managers/head coach 124–125; insecurity and future planning 120–121; players 121–122 Carron, Albert 88, 94 Chapman, Herbert 85 Chelladurai, Packinthan 88, 90–91, 94 chief executive officer (CEO): board responsibilities 10; case study interview 35–40; job description 140; leadership qualities and accountability 29–30, 31, 35–36; management responsibilities 30, 30, 31–32, 38–39, 39, 58–59; manager/ head coach appointments 33–34, 34, 37; operational support from COO 58–59, 60–62; organisational culture 36–37; player transfer policy 37–38; recruitment and retention 25–26; succession planning 34, 39–40; trust and risk levels 32–33, 35, 36, 62 chief financial officer (CFO): case study interview 48–54; club valuation formula, approaches to 44–45;

160

Index

conventional roles 42; debt levels, UEFA regulation 43; digital assets and cyber safety 47; evidence based strategies 47–48, 49–50; finance IT, data analysis and reports 45–46, 52, 132; financial risk management 44, 53–54; financial team, retention and development 50–52; job description 142–143; personal bias questioned 52; recruitment and role shadowing 48–49; shareholder motivations 52–53 chief operating officer (COO): appointment criteria 61, 62, 64; benchmarking 66; case study interview 62, 64–69; e-commerce, benefits and risks 58; employee development 67, 68–69; job description 141; operational and CEO related responsibilities 58–59, 60–62, 63, 64–66, 67–68; operational challenges 57–58, 67, 68; performance management tools 66–67; succession planning 59–60 club chairman 12 club employees: BAME nonrepresentation 87; employment rights 33, 34–35; knowledge and skills development 67, 68–69; network-based recruitment 126–127; organisational culture and policy 25, 36–37; talented staff in demand 51, 80, 125; ‘toxic leaders’, dealing with 79; welfare commitments 51–52 club structure and organisation 7–12, 11 coach-athlete relationship 93–94 coach education 122–124, 123, 126 co-leadership 61 Connell, Ian 4 continuous monitoring (CM) 66–67 Cruyff, Johan 94 decision making: behavioural economics 47; business strategies and planning 24–26; ‘insider networks’, limitations of 87; management accounting 49–50, 52; on-field success, driving force 44–45; organisational culture and policy 8, 36–37 Deloitte Football Money League 5–6

director of football (DoF): case study interview 77–82; earlier versions of post 77–78; EPL appointments 76; job description 144; qualifications and personal skills 77, 80–81; relations with football managers 77, 78, 97; role and responsibilities 73–74, 74–75, 76, 78–79; staff expertise 79–80; ‘toxic leaders’, dealing with 78–79; transfer activity, role in 80, 81–82 Elite Player Performance Plan (EPPP) 104, 108, 110, 121 English Premier League (EPL): academy investment 106, 111–112; broadcasting contracts, lure of 2–3, 5; commercial attractiveness 16, 38, 125; costs of relegation 71–72; director of football appointments 76, 78; financial health 6–7, 7, 42–43, 43; foreign players domination 104; global brands and fan communities 3, 3–4, 130–131; ‘home-grown’ player 103–104; management changes 2016/17 84; new player investment 107; organisational structure 1–2, 2; owner and director licensing 17 Ericsson, Anders 124 European Club Association (ECA) 106 European competition 2, 16 Everton FC 30 fans: global appeal of elite teams 3–4, 133; owner motives, voiced concerns 17–18; owner’s relationship with 23–24; product targeting 132; relationship marketing 31, 132–133; virtual reality and live streams 134 FC Barcelona 96, 106 FIFA 125 first-team managers/head coach: appointment, CEO responsibilities 33–34, 34; career development 124–125; case study interview 94–99; commitment, maintenance of 95; corporate education and training 72–73; early professional roles 84–85; effective leadership and player relations 88–89, 91–92; hardiness and mental toughness

Index 91–93; job description 145; management relations with DoF 77, 78, 97; manager-player, shared motivation 93–94; recruitment considerations 86–87, 88–89; role and responsibilities 74–75, 95–99; skills development 94–95; support staff, building a team 97–98; traditional and modern roles 85–86, 86; transfer activity, role in 80; winning, importance of 98 Football Association (FA): BAME representation 87; board, male dominated 30; club’s legal obligations 9, 42; coach education pathway 122–124, 123; founding 1; governance review 135 football, definition 1 football finance: academy investment 106, 111–112; big data and commercial targeting 131–132; costs of relegation 71–72; Deloitte Football Money League 5–6; EPL’s financial health 6–7, 7, 42–43, 43; key performance indicators (KPI) 50; management accounting 49–50; owner responsibilities 20; player’s wages, strain on 20, 43; private and foreign investors 16, 17, 20, 21; recruitment budgets 107; revenue streams 4–5, 22–23, 38, 39, 130–131; salary-to-revenue ratio 53–54; shareholder motivations 52–53; UEFA’s Financial Fair Play (FFP) regulations 43; utility maximisation, pursuit of 44–45 Football League (FL): commercial potential recognised 15; early professional managers 84–85; founding clubs 1; organisational structure 1–2, 2; revenue disparity 4 Forbes, Daniel 76 Gill, David 78 Gould, Daniel 88, 92 Guidolin, Francesco 84 Hardy, Lew 8 Heenan, David 61 Howieson, Brian 124 ‘insider networks’, limitations of 87

161

Jowett, Sophia 93 Kahneman, Daniel 52, 112–113 key performance indicators (KPI) 50, 81 Kobasa, Suzanne 91–92 leadership: definition 88; effectiveness, research theories 89, 90; hardiness and mental toughness 91–93; multidimensional model 91–92 League Managers Association (LMA) 33, 34, 124, 126 Leicester City FC 30, 45 Lens FC 106 Lewis, Michael 72 Liverpool FC 5, 78, 112, 130 Loehr, Jim 88 Maddi, Salvatore 92 Manchester City FC 6, 107, 130, 133 Manchester United FC: community connections 132; executive officers 78; fanbase 130, 133; ownership 20, 53; revenue streams 5–6, 80, 107 Manning, John 108–109 matchday revenue 5 McMenemy, Lawrie 78 merchandising revenue 5 Miles, Stephen 60–61 Milliken, Frances 76 Morrow, Stephen 124 multi-club ownership (MCO) 18–19 Ogilvie, Bruce 89 owner(s) and ownership: business strategies and planning 24–26, 34, 35; case study interview 19–26; club’s financial health 20–22, 23; custodial and development roles 23–24; early club investments 15; employment retention 22, 25–26; EPL’s commercial appeal 16; ‘founder’s syndrome’ 36; multi-club ownership (MCO) 18–19; private and foreign investors 16, 17, 20, 21, 79; responsibilities and regulation 16–18; shareholder motivations 52–53 Paisley, Bob 78 Parry, Rick xi, 78

162

Index

Penman, Kenneth 89 Perez, Florentino 22, 74 player academies 24 players: career development and transition 121–122; celebrity status 4; recruitment and retention 81; salary-to-revenue ratio 53–54; social media enhancement 134; wages, strain on budgets 21, 43 Price, Colin 10 Professional Footballers’ Association (PFA) 122, 124 Puel, Claude 84 Queens Park Rangers 6 Rabbatts, Heather, Dame 87 Real Madrid FC 5, 22, 74, 116 recruitment agencies 33–34 Reilly, T. 108 research approach x–xiii Robinson, Peter 78 Roderick, Martin xi Ronaldo, Cristiano 134 Rosenborg FC 116 Roth, Julius 120 science in football: eco-friendly equipment 132; research partnerships 114; stress management 92–93; talent identification 108–109, 112 Shankley, Bill 78, 135–136 Sky Sport 3, 5 Smith, Jacqui 124 social activism 134–135 social media: data analytics 45, 47; educational support 127–128; fan relationships 3–4, 133, 134; social activism 135 Southampton FC 25, 78, 84 sponsorship deals 5, 23, 38 Stogdill, Ralph 89 Stoke City FC 79 Swansea City FC 84 Szymanski, Stefan 16 talent scouts 80, 81, 108, 112, 116 technology: augmented and virtual reality applications 133–134; big

data and data analytics 131–132; data analytics in recruitment 80, 81, 115–116; e-commerce, benefits and risks 58; finance IT, data analysis and reports 52; media content and fan accessibility 130–131; online educational resources 127–128; performance management tools 66–67; player performance analytics 115–116, 134 total quality management (TQM) 8 Tottenham Hotspur FC 5, 30, 53 ‘toxic leaders’ 79 Toye, Sharon 10 ‘trained incapacity’ 121 transfer activity: CEO’s policy on deals 37–38, 80; club revenues 5; clubs overspend, UEFA reaction 43; data analytics in recruitment 81; director of football’s role 74, 80, 81–82; loans and free signings 107 Tutko, Thomas 89 ‘two-in-a-box’ leadership 61 UEFA: competition regulations 18–19; executive governance training 125–126; Financial Fair Play (FFP) regulations 43, 105–106; UEFA Pro Licence 85–86, 123–124 university affiliated courses 126 Veblen, Thorstein 121 virtual reality (VR) applications 134 Weinberg, Robert 88, 92 West Ham FC 30, 79, 130 Williams, A.M. 108 Woodman, Tim 8 youth development: academies, contributing value 105–107; appraisal and formalised framework 103–105; development phases by age 110–111; education programmes 120–121; elite participation and mental well-being 109, 112–114, 116–117; talent identification methods 108–109, 112, 116, 121