Tuesday, 19 April 2011

How do you replace Arsene and Sir Alex?

Back in January Apple announced that their inspirational CEO Steve Jobs would be taking a medical leave of absence - his third since 2004. The following day the company announced another set of record-breaking quarterly figures (sales rose 71% seeing net profit hit $3bn) yet that wasn't enough to calm investors and across the week shares fell by 5% knocking $15bn off the value of the company.  

Apple's success over the last 14 years has been inextricably linked with one man and so, just like with Sir Alex Ferguson at Manchester United and Arsene Wenger at Arsenal, there is considerable concern about how the firm will fare when Jobs steps down for good; so much so that a month after the announcement about his health a third of Apple shareholders voted in favour of a motion calling on the company to reveal details of its succession plan.

iPod therefore iAm

Apple's board refused citing potential loss of competitive advantage and the fact that they have a strong 'management bench'. Indeed on all three occasions Jobs has taken a leave of absence the company's COO Tim Cook has temporarily replaced him with little disruption.

Of course as we all know football is a strange business, as despite being a business club owners routinely fail to treat it as such. The employment and (almost always inevitable) sacking of managers is a case in point.


Back in April 2006, just a few weeks before Arsenal's Champions League Final defeat to Barcelona the club's chairman Peter Hill-Wood said: "We have got the best manager of all and I dread the day when he tells us he's had enough. There is no plan B after Arsene. I have no idea what happens when he goes." Oooh, blimey. That doesn't sound too good.

While we're at it, let's take a look at Newcastle; the guys who wrote the manual on how not to run a football club. Over the last 15 years or so, they have employed what can at best be described as a chaotic policy when appointing their managers, regularly swinging from one personality type to another.

Following Kevin Keegan's (first) departure in 1997, the club appointed Kenny Dalglish - a decision which actually made sense. However, when he failed to produce the attacking style of play required the 'dour' Scott was replaced by the 'sexy football' of  cosmopolitan, young foreigner Ruud Gullit (hell, he even had dreadlocks). When he 'failed' he was replaced by locally-born, experienced Bobby Robson. When his avuncular approach was deemed to be responsible for a poor start to the 2004/05 season they shot Bambi and went for 'hard bastard' Graeme Souness instead.

When he failed, the club put Glenn Roeder in temporary charge. A good end to the season saw him get the job full-time but he couldn't sustain the success. So in came Sam Allardyce, only he was too 'boring' so out he went and in came, oh, Keegan again (who readily admitted he hadn't watched a live game of football in three years) and so the club staggered on - to Joe 'Fucking' Kinnear, Chris Hughton, Alan Shearer, Hughton again and now Alan Pardew.

No long-term strategy, no continuity. No success.

While Newcastle are an easy (and fun) target it would be unfair to single them out as the only culprits. Just think of almost every recent managerial replacement and it is likely to have been a messy, chaotic affair. Furthermore, research conducted by Professor Sue Bridgewater at Warwick Business School suggests that in the long-term changing managers in the knee-jerk fashion that characterises football rarely brings a change in fortune. Of course, this isn't to say clubs should never change managers, but that the change - or succession - should be planned and executed over a long period of time so as to reduce risk.

Jack Welch was CEO of General Electric for 20 years from 1981. Seven years before his departure he identified 23 possible candidates to replace him. That list was narrowed down to eight in 1998 before he was replaced by Jeffrey Immelt (who is still in post) in 2001. And then there's Arsenal, with no plan B.

Although they probably didn't see it in these terms Liverpool, through the fabled Boot Room, created an almost perfect succession plan which helped the club dominate English football from the late 1960s to the late 1980s. Just like Apple and GE, Liverpool - thanks mostly to Bill Shankly - created an incredibly strong 'management bench' with provided three of his successors (Bob Paisley, Joe Fagan and Roy Evans) as well as many other key personnel in that period of success.

The succession from Shankly to Paisley worked for a number of reasons; the board correctly recognised in Paisley (who was himself reluctant to take the job) the attributes needed to be a successful manager. The ethos of the club meant he had a strong support network in place when he had doubts in his early days, yet he was also his own man and was not afraid to do things differently to his predecessor (particularly with regard to player recruitment).

OK, Peter, you can let go now...

Paisley inherited a club on the up - it had in place a strong scouting network and youth policy. Of the players which won the European Cup in 1977 only three were not at the club when he took over in 1974. Finally, the board decided not to offer Shankly another role at the club - they recognised his strong personality might have overshadowed Paisley.

In essence, what a successfully executed succession plan does is create the stability, strength and thus hopefully the success that Manchester United and Arsenal have gained through having just one man at the helm since 1986 and 1996 respectively.

It seems Manchester United is already planning for life after Ferguson. Earlier this season chief executive David Gill spoke to an American radio station about the club's succession plans, saying it was developing a young squad to ease the transition when the manager retires. Gill also identified the type of manager the club would target.

And what of Arsenal? Well, they're now effectively in the hands of Stan Kroenke who, through his wife, has links to Wal-Mart. A few years ago they successfully changed their CEO after years of planning. Maybe Kronke will be able to come up with a Plan B for the post-Wenger Gunners.

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