democracy in football only works if you make exceptions

“It’s all well-and-good having a democracy where everybody has a say; but if people are too thick, and too stupid, that there opinion shouldn’t even count, then it’s not a very good idea at all…”

“Too true!”, I thought, as I watched Lorenzo from Shipwrecked – a spatty reality television show on Channel 4 (for those who don’t know it) – provide the unlikely source of my inspiration for this piece.

Hardly Socrates, is Lorenzo – a punk-haired and arrogant chap, his comments made up of imprecise English – but I liked the fact that I found myself in agreement with someone so obscure and uninfluential. Indeed, inspiration can come from the most improbable of sources, at the most improbable of times… just ask Albert Einstein (crikey I sound very conceited).

Little did Lorenzo know the significance of his comments, however, in relation to the world of football. His comments – you see – were broadcast in the days following the announcement that Ebbsfleet United, a little-known football club currently residing in the Blue Square Premier League, are to be taken over by MyFootballClub.co.uk, a consortium made up of fans wishing to purchase the club. In short, members pay a registration and administration fee and, in return, they are entitled to an equal share in the club. Members will have their say in certain decisions surrounding the running of the club, by means of an online voting system.

The concept is, at first glance, an interesting idea. At a time when the notion freedom of speech – at least in the UK – is as prominent as it ever has been; and the power of the internet has led to both the enhanced revolution and globalisation of communication channels (just look at the fact that I am even writing this blog). The concept of people power is high in favour right now, even if the cynic that I am knows it’s far from as simple as that sounds. I will not elaborate on that now but I’m sure you all understand what I mean.

Back to MyFootballClub’s takeover… The irony and reality – as backed up by our friend, Lorenzo – is that the majority of people that are naïve enough to believe that an operation such as this could actually function successfully, or that their say will actually represent a force, are also unlikely to have informed opinions on something like the business of football. Put another way, if such miraculous errors can be made by so-called knowledgeable and experienced businessmen at football clubs such as Leeds United (and any other club, for that matter), then goodness knows what carnage lies in store for a club that is, ultimately, governed by 20,000 ‘anybodys’. If – that is – that it is actually governed by them.

So, let’s assume it is… What perils lie in store for the organisation, and why is it that I think it cannot work?

For a start, let us be clear that running a football club is a complicated thing. Indeed, we are talking about the running of a considerably-sized business where, ordinarily, a significant number of people would be employed on a full-time basis to oversee executive decisions on all matters, including those of most intricate nature. How, then, will it be possible for all 20,000 members to be available to have their say, and come to decisions upon each and every matter? With this in mind, how can they maintain competitive as a business?

Martin Samuel wrote a good article in The Times (not dissimilar to this one), where he used the following example:

“Will MyFootballClub make the minutiae of every proposed transfer available to its members to better inform their decision? If so, there will be heightened risk of failure as rival clubs know exactly what bid or financial package needs to be matched. If not, the members will be voting in the dark. It is an insane way to operate.”

I agree with Samuel, entirely… and this is just one of many examples. As he says, it’s an insane way to operate… in fact, it’s an impossible way to operate. Impossible – that is – to succeed without compromising the core democratic principle. Consequently, it is important to consider that, in order to make this club operational – let alone successful – then there will have to be times when the entire democratic concept is compromised as someone will have to enforce a decision.

Then there is the problem of internal unhappiness. Let me explain what happened at Barcelona:

Joan Laporta led an organisation called ‘Elefant Blau’ to club presidency in 2003. The group opposed the current management and, although Laporta publicly fronted the group, they prided themselves as a team of ‘equals’. By 2005, however, Laporta faced the resignation of five members of the club's board of directors, including that of right-hand man, Sandro Rosell. As far as I understand, Rosell and company became unhappy with the autocratic manner in which Laporta ran his so-called democracy.

Now I’m not saying I disagree with the overall concept of a democracy, it’s just that I think it is practically very difficult, and I am aware that – as in the case of Barca – there will always be a decision that needs to be taken, and not everyone will agree.

This is all getting a bit intense. Back to Ebbsfleet and whether or not MyFootballClub actually intend to govern by absolute democracy…

As far as I know, this is not the case and, as a result, I think it’s fair to say I am being a little idealistic and unfair in my criticism. Ebbsfleet will, in fact, operate as a normal club but a number of eventual decisions will be passed on to members in what is, ultimately, a series of polls. ‘Absolute democracy’ is not the plan. Instead – and according to Wikipedia – the idea is to pass on “many of the decisions usually made by the manager” on to the members.

Even so, if the organisation only wants to be semi-democratic, then I would argue that it isn’t really run by the members at all and is nothing more than a bit of fun, in which case I suppose I have no problem with that, on one hand… but people should not be stupid enough to think they are running the show, and be aware that the time and money they spend on subscription and voting is unlikely to result in any radical changes to the club, especially none of those that they envisage.

Let me finish by saying that, as a venture, I appreciate the idea and I commend the people behind MyFootballClub in their attempt to create something new. No doubt, the publicity will be good, and the money made as a result of the subscriptions and ensuing sponsorship deals will be beneficial to the club. Good for them! However, it is difficult to see it as anything more than a gimmick… at least for now. Unless, of course, they revert to rule by absolute democracy… in which case it will almost definitely fail.

a positive look at arsenal football club

A little over two months ago, Arsenal Football Club published their annual report, announcing turnover figures exceeding £200m. I believe the smart business decisions that have brought about this financial success should be commended – especially amidst significant losses suffered by other clubs during the same period.

So how have Arsenal succeeded where others have not…?

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1. Major investment in a stadium in place of major investment in player transfers.

Although Arsenal have spent money on player transfers in recent years – Reyes, Rosicky, Walcott, Hleb… a quota of which have achieved varying degrees of success – the club has, ultimately, spent significantly less than its Premiership peers. Darren Bent’s £16.5m move to Tottenham earlier this year reinforced my belief that football clubs are spending too much money on buying out player contracts and transfer fees. Whilst I accept it is important to acquire the best players in order to be able to compete at the highest level, I cannot help but think such clubs are allowing themselves to be overcharged.

If we look at them purely as business assets, players represent an extremely risky investment for two key reasons:

Firstly, the scope for failure (in terms of on-field results) is extremely high. In other words – and historically speaking – there is little to suggest that success is either directly or proportionally attributable to spending on player transfer fees. Football teams consist of eleven players (plus an extended squad) and so the likelihood of one man making a difference on his own is minimal. Potential for injury is also very high (although I understand many transfers are covered by a level of insurance).

Secondly, any large outlay is unlikely to ever result in appreciation. A player costing more than £15m is unlikely to ever be resold again for the same amount or more. As a result, for him to be considered a justified investment, he will either have to sell a lot of shirts, create substantial publicity (at least indirectly) or score a lot of goals and/or play well over a significant period.

Subsequently, I would argue that the only justification for buying a player for more than around £10m is if the player offers significantly more than just their value on the pitch. By this, I mean a club has to buy a star: the sort of player that can, by sheer profile alone, raise – or even determine – the characteristics of a club (the likes of David Beckham, Ronaldinho etc.) Otherwise, common sense would suggest you can almost always find a similar player for cheaper. It is, ultimately, a case of opportunity cost, especially when you consider the scope for foreign imports and the potential to exploit cheap(er) EU markets.

How, then, has it happened that transfer fees have become so unpredictable and inflated? It is obvious to say that the (American) commercial structures deployed in European football during the last twenty years have allowed big clubs to capitalise on the money-making potential of the game. But this doesn’t fully explain the inconsistent nature of the transfer market (i.e. the fact that someone can be worth £17m at a particular point in time, yet someone else – possibly of similar ilk – can only be worth £5m).

The key to the problem is that it is impossible – or, at least, extremely difficult – to evaluate the overall impact of a player’s transfer to a given club, particularly in terms of measuring financial return on investment. Consequently, this affects the transfer cycle: if it is impossible to put a price on return on investment, then it becomes impossible to set a fair price in the first place. This makes for a heavily fluctuating, volatile and unpredictable market; particularly when coupled with other market forces – such as a club’s current financial state, the competition for purchase amongst other clubs (i.e. a bidding war) and overall levels of need, will and desire to purchase at a given time. It is interesting – although somewhat tangential – to point out that a similar situation also exists within the markets of corporate sponsorship and PR.

So how can clubs make better use of their finances? One option is to invest money elsewhere, such as in the building of a world-class stadium. In doing so, clubs can virtually guarantee a steady flow of revenue for years to come. The outlay is – admittedly – large, however, the property is unlikely to depreciate (especially not in the drastic way the value of a player might) and, in the unlikely event that the club significantly fail in their football, then the stadium is still purposeful and profitable as a platform to outsource pop concerts, business expos etc. The potential for high-level sponsorship is also large, and could provide a significant contribution to the overall cost of the stadium (as Arsenal have found in their deal with Emirates).

I think it is fair to suggest that club executives are, all too often, succumbing to the immense pressure put on them to achieve short-term success. Of course, I appreciate that the success of a club is (especially in terms of financial success), ultimately, dependent on winning matches. However, in reality – and as we have seen with Arsenal – a club may be better off directing its attention to long-term success and sustainability; that is, investing in the development of resources and infrastructure (including stadium, training facilities and the building of a strong and lasting brand), perhaps making the club more profitable and attractive in the long run.


2. Patience and long-term investment in a manager.

Such long-term strategy also applies to team management. It is important to consider why managers such as Arsene Wenger and Alex Ferguson have been so successful over a sustained period. It is not a simple case of time and patience equals success. Instead, it is the fact that time has allowed these managers the opportunity to do the following:

Firstly, they have been able to assemble a team and squad that is almost entirely self-created. The pressure put in place to achieve short-term success means many managers are forced to build a makeshift, stop-gap team – an approach which is understandable in terms of minimising risk, yet results in a cycle which will almost always need to be broken if a club wishes to achieve sustainable progress (whether it is with a new or existing manager). Many so-called ‘Yo-Yo’ clubs, incidentally, find themselves in this position. The current situation at Crystal Palace proves an excellent example of this: the club have only recently realised the need to revert to recruiting from a strong academy in a bid to salvage the identity of the club and reclaim a sense of direction amidst a muddled few years. Two years, in fact, which have seen a new manager – and an almost entirely new group of players – amongst the assembly of a seemingly confused and unapparent route to success.

Secondly – and this, for me, is the most important factor – time allows a manager to, at first, buy into the identity of a club and, then, gradually become a determinant of this identity. This is a key process, and can only be achieved with time. Initially, of course, there is a period of compromise – there has to be a compromise, especially if a club is failing (the manager has to gain trust and meet a certain level of expectation… he cannot drive the club to absolute failure) – yet as time goes on, the influence that a manager has on a club will exponentially increase. Let me explain, by exploring the case of Rafael Benitez…

Benitez is a good example of a manager who has bought into the identity of Liverpool, yet with an element of compromise. He made Gerrard and Carragher his key players and captains, in a statement that would reassure and gain the trust of wary stakeholders – the stakeholders, that is, that preach the retention of tradition at the club. He also purchased players such as Xabi Alonso – a team player whose passing and focus on possession represents a style of football which is (at least widely and historically) accepted as a ‘Liverpool style’. However, he also does things his way – and rightly so – such as his belief in a team rotation policy, and his trust in Spanish players. It is, you see, the compromise of the club executives who employ him, as much as it is of Benitez. They understand that, in order for him to be successful, he has to be given the license to operate as he wishes; yet he, in turn, understands the commitment he has made in signing to Liverpool Football Club and, so, he chooses carefully his decisions.

As years go on, players like Xabi Alonso become stalwarts, not new boys or negative representations of change. The Spanish connections become cherished, not fought against; and Benitez becomes part of the Liverpool Football Club culture – so much so that now people will start describing elements of his team’s playing style as ‘typical Liverpool’, as well as ‘typical Benitez’. The longer Benitez stay at Liverpool, the more his approach will filter into and influence the overall approach of Liverpool’s football team. In other words, what may have started as a compromise (on the part of both club and manager) has now developed into a key characteristic of the club and/or team.

The same thing has happened – albeit to a much greater degree, as a result of time – at Arsenal and certainly at Manchester United. The French, African and foreign contingent at Arsenal may be opposed by a number of people outside of the club (both influential and otherwise); however, players such as Emanuel Eboue are now regarded as quintessential Wenger-like signings and, in turn, they are regarded as quintessentially Arsenal. Eboue is fast, raw and – at the risk of sounding racist to stupid people – displays all the stereotypical footballing characteristics and natural attributes of an African player. However, his role as an attacking full back at Arsenal, is not ‘natural’. He didn’t arrive and play like that. This is the result of him being moulded and conditioned by Wenger, into the player he wants him to be within his team.

In principle – and, to an extent, evidently speaking – the longer a manager stays with a club, the stronger the understanding he has of the club becomes, and the stronger the relationship between himself and various stakeholders will become, too. In turn, this should lead to increased trust and clearer direction of both the setting of objectives and, crucially, the plan in place to achieving these objectives. Eventually, it is likely that this will lead to the manager of the team having increased influence on the executive decisions made by the club as a whole, not just that of the team. This leads on nicely to my next argument…


3. Consistency in terms of characteristics, identity and branding.

I would stress that all of the points I examine here are, by no means, mutually exclusive. In fact, in order for any of the above concepts to be transferred into success, it is necessary for them to be deployed as part of a fully congruent operation which is filtered and integrated all the way through the club.

The sale of Thierry Henry suggested Arsene Wenger’s intention to create a team which is not heavily reliant on a single player. Wenger has assembled a team which is governed by a focus on a number of key factors: tempo (i.e. speed of passing, thought and movement), youth (there a few exceptions here but, I think it fair to suggest this is a preference) and, finally, possession and teamwork.

With this in mind, Wenger has introduced a structure whereby every player is, in theory, replaceable. Obviously the model is not foolproof: a player like Fabregas is so good that he becomes more important than others – and it is the one-off expressive potential of someone like Fabregas that adds ‘sparkle’ and creativity to such a team. However, the guiding principle ensures that the club values are placed higher in importance than that of retention of a specific player. As a cycle, you will see how this links back to my original point as, once you have a team-focussed system in place such as this one, then there can be little need to spend over a certain amount on one-off players. Instead you buy players who have the potential to stand for, fit in and buy into the team ethic and club values.

The same principle applies to the business, marketing and brand decisions made within a club. The case of Arsenal has seen their manager’s influence develop so much that it has, in turn, had a generous say in determining the characteristics of the club. Remember ‘boring boring Arsenal’? Well, they are not so boring now… and all aspects of the club have been made more attractive as a result of this brand reinvention. They are sponsored by Nike: a symbiotic sponsorship agreement which, on both parts, states excellence in creativity, expression and internationalism – much like that of Nike’s sponsorship of the Brazil national team – a statement that is backed up by the creation of the new Emirates stadium.

It may not sound anything other than obvious – and I know I could be accused of unnecessarily enticing the North London rivalry here – however, let me give you an example of a club that, at least in my opinion, consistently fails to get this uniformity of identity right…

The problem with Tottenham, is that the club is governed in a way that displays a contradictive and misplaced identity. In some instances, the club claims commitment to “young, English talent”; yet club executives frequently either overbuy and/or do not fully develop these talents. At the same time, Tottenham further contradicts itself by employing foreign players and managers (such as Martin Jol and Juande Ramos). In addition, the kit is manufactured by Puma – a typically European sports brand – as if to promote cosmopolitan and international values. In this respect, Tottenham risk creating a sense of uncertainty which may filter through all departments of the club.

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Contrary to implications, you may be surprised to hear that I am not, in fact, an Arsenal supporter. I certainly do not believe the running of Arsenal Football Club is perfect, and I have a number of criticisms – those of which I will vent on a (separate) rainy day.

I am, however, in admiration of the business operations the club has put in place in order to ensure it remains uniquely competitive and profitable – especially in terms of re-branding club identity.

With a takeover looming, the precise future of Arsenal Football Club remains uncertain. For the time being, however, the club can embrace the strong position it has found itself in as a result of considered investment and congruent decision making.