{"id":7914,"date":"2023-01-27T09:55:58","date_gmt":"2023-01-27T09:55:58","guid":{"rendered":"https:\/\/www.twentyfirstgroup.com\/?p=7914"},"modified":"2023-01-27T11:23:02","modified_gmt":"2023-01-27T11:23:02","slug":"off-the-pitch-interview-one-metric-tells-a-significant-story-about-the-challenges-the-new-owners-of-liverpool-and-man-utd-will-face","status":"publish","type":"post","link":"https:\/\/www.twentyfirstgroup.com\/off-the-pitch-interview-one-metric-tells-a-significant-story-about-the-challenges-the-new-owners-of-liverpool-and-man-utd-will-face\/","title":{"rendered":"Off The Pitch Interview: One metric tells a significant story about the challenges the new owners of Liverpool and Man Utd will face"},"content":{"rendered":"<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-0  el_before_av_three_fifth  avia-builder-el-first  \" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-1  el_after_av_one_fifth  el_before_av_one_fifth  \" style='border-radius:0px; '><div  style='padding-bottom:10px; ' class='av-special-heading av-special-heading-h2  blockquote modern-quote  avia-builder-el-2  avia-builder-el-no-sibling  thought-leadership-heading '><div class ='av-subheading av-subheading_above  ' style='font-size:15px;'><p>Thought Leadership<\/p>\n<\/div><h2 class='av-special-heading-tag '  itemprop=\"headline\"  >Off The Pitch Interview: One metric tells a significant story about the challenges the new owners of Liverpool and Man Utd will face<\/h2><div class='special-heading-border'><div class='special-heading-inner-border' ><\/div><\/div><\/div><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-3  el_after_av_three_fifth  el_before_av_one_fifth  \" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-4  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock  av_inherit_color '  style='color:#80808a; '  itemprop=\"text\" ><h4><span class=\"span-reading-time rt-reading-time\"><span class=\"rt-label rt-prefix\"><\/span> <span class=\"rt-time\"> 13<\/span> <span class=\"rt-label rt-postfix\">MIN READ<\/span><\/span><\/h4>\n<\/div><\/section><br \/>\n<section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-author '   itemprop=\"text\" ><h3><strong>By AJ Swoboda<\/strong><\/h3>\n<hr \/>\n<h3>January 18, 2023<\/h3>\n<\/div><\/section><br \/>\n<div  style='height:5px' class='hr hr-invisible   avia-builder-el-7  el_after_av_textblock  avia-builder-el-last '><span class='hr-inner ' ><span class='hr-inner-style'><\/span><\/span><\/div><\/p><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-8  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><p><div  class='avia-image-container  av-styling-    avia-builder-el-9  el_before_av_hr  avia-builder-el-first  avia-align-center '  itemprop=\"image\" itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/ImageObject\"  ><div class='avia-image-container-inner'><div class='avia-image-overlay-wrap'><img decoding=\"async\" class='wp-image-7915 avia-img-lazy-loading-not-7915 avia_image' src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency-.jpg\" alt='' title='Off The Pitch - Wage Efficiency' height=\"1139\" width=\"1920\"  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency-.jpg 1920w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--300x178.jpg 300w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--1030x611.jpg 1030w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--768x456.jpg 768w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--1536x911.jpg 1536w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--1500x890.jpg 1500w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Off-The-Pitch-Wage-Efficiency--705x418.jpg 705w\" sizes=\"(max-width: 1920px) 100vw, 1920px\" \/><\/div><\/div><\/div><br \/>\n<div  style='height:5px' class='hr hr-invisible   avia-builder-el-10  el_after_av_image  avia-builder-el-last '><span class='hr-inner ' ><span class='hr-inner-style'><\/span><\/span><\/div><\/p><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-11  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-12  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-share '   itemprop=\"text\" ><h3>Thought Leadership<\/h3>\n<p>Inspired by what you&#8217;re reading? Why not subscribe for regular insights delivered straight to your inbox.<\/p>\n<\/div><\/section><br \/>\n<div  class='avia-button-wrap avia-button-left  avia-builder-el-14  el_after_av_textblock  el_before_av_textblock ' ><a href='https:\/\/www.twentyfirstgroup.com\/contact\/news-signup\/'  class='avia-button  avia-color-theme-color   avia-icon_select-no avia-size-small avia-position-left '   ><span class='avia_iconbox_title' >Subscribe<\/span><\/a><\/div><br \/>\n<section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock  '   itemprop=\"text\" ><hr \/>\n<h3><\/h3>\n<\/div><\/section><br \/>\n<div  class='av-social-sharing-box  avia-builder-el-16  el_after_av_textblock  avia-builder-el-last  '><div class='av-share-box'><h5 class='av-share-link-description av-no-toc '>Share this story<\/h5><ul class='av-share-box-list noLightbox'><li class='av-share-link av-social-link-facebook' ><a target=\"_blank\" aria-label=\"Share on Facebook\" href='https:\/\/www.facebook.com\/sharer.php?u=https:\/\/www.twentyfirstgroup.com\/off-the-pitch-interview-one-metric-tells-a-significant-story-about-the-challenges-the-new-owners-of-liverpool-and-man-utd-will-face\/&#038;t=Off%20The%20Pitch%20Interview%3A%20One%20metric%20tells%20a%20significant%20story%20about%20the%20challenges%20the%20new%20owners%20of%20Liverpool%20and%20Man%20Utd%20will%20face' aria-hidden='false' data-av_icon='\ue8f3' data-av_iconfont='entypo-fontello' title='' data-avia-related-tooltip='Share on Facebook' rel=\"noopener\"><span class='avia_hidden_link_text'>Share on Facebook<\/span><\/a><\/li><li class='av-share-link av-social-link-twitter' ><a target=\"_blank\" aria-label=\"Share on Twitter\" href='https:\/\/twitter.com\/share?text=Off%20The%20Pitch%20Interview%3A%20One%20metric%20tells%20a%20significant%20story%20about%20the%20challenges%20the%20new%20owners%20of%20Liverpool%20and%20Man%20Utd%20will%20face&#038;url=https:\/\/www.twentyfirstgroup.com\/?p=7914' aria-hidden='false' data-av_icon='\ue8f1' data-av_iconfont='entypo-fontello' title='' data-avia-related-tooltip='Share on Twitter' rel=\"noopener\"><span class='avia_hidden_link_text'>Share on Twitter<\/span><\/a><\/li><li class='av-share-link av-social-link-linkedin' ><a target=\"_blank\" aria-label=\"Share on LinkedIn\" href='https:\/\/linkedin.com\/shareArticle?mini=true&#038;title=Off%20The%20Pitch%20Interview%3A%20One%20metric%20tells%20a%20significant%20story%20about%20the%20challenges%20the%20new%20owners%20of%20Liverpool%20and%20Man%20Utd%20will%20face&#038;url=https:\/\/www.twentyfirstgroup.com\/off-the-pitch-interview-one-metric-tells-a-significant-story-about-the-challenges-the-new-owners-of-liverpool-and-man-utd-will-face\/' aria-hidden='false' data-av_icon='\ue8fc' data-av_iconfont='entypo-fontello' title='' data-avia-related-tooltip='Share on LinkedIn' rel=\"noopener\"><span class='avia_hidden_link_text'>Share on LinkedIn<\/span><\/a><\/li><\/ul><\/div><\/div><\/p><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-17  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-main-content '  style='font-size:20px; '  itemprop=\"text\" ><p>Only time will tell if the Mykhaylo Mudryk transfer from Shakhtar Donetsk to Chelsea FC is to become a prime example of how things should be done \u2013 or more likely \u2013 a lesson in how you should never, ever do transfers as a football club.<\/p>\n<p>This interview is not about Chelsea, and AJ Swoboda, managing director Americas at Twenty First Group, didn\u2019t even mention the above transfer when he spoke to Off The Pitch &#8211; probably because when the interview took place it looked very much as if the promising young Ukrainian offensive player was going to sign for Arsenal. But a last-minute intervention from Chelsea meant he ended up signing a 8.5 year deal with the Stamford Bridge club.<\/p>\n<p>There is a whiff of desperation around this transfer Chelsea made when they were sitting 10th in the table and burdened with a long injury list. But ahead of the transfer being confirmed, Swoboda made a comment that stood out:<\/p>\n<p>\u201cIt is not about WHO you sign \u2013 but HOW you sign players.\u201d<\/p>\n<p>The director of Twenty First Group explained that what he meant was the fact, obvious maybe, that behind every success in business or in football lay in the ability to hire the right people, establish the right processes, and learn from your mistakes.<\/p>\n<p>\u201cIf you are good as an owner at hiring and setting strategy, then you will be successful. Your sports club must have a multi-year strategy to guide decisions, and an evidence-backed process to evaluate the degree to which each decision allows the club to progress along its strategy,\u201d says Swoboda.<\/p>\n<p>He explains that in recruitment and squad planning, this approach allows clubs to successfully move through transfer windows with plenty of optionality. It allows owners and executives to learn from past decisions. If a club does not have a proper strategy and process feeding into recruitment, the club exposes itself both to paying too much in transfer fees and wages, and to not learning from its mistakes.<\/p>\n<p>\u201cWhen it comes to recruitment, owners must understand that there is never just one player out there that can solve all your problems. There is no player with such unique skills that it is worth signing this \u2013 and only this \u2013 specific player at any cost.\u201d<\/p>\n<p>Actually, the interview with Swoboda was about how he and Twenty First Group, the B2B sporting intelligence firm founded 10 years ago, would begin to describe the reality for new potential owners of either Liverpool FC or Manchester United, since both clubs are currently up for sale. You can find several investment banks out there who can execute traditional due diligence work looking at the financial and strategic weaknesses and strengths of both clubs.<\/p>\n<p>But unlike banks concerned with whether a transaction completes, Twenty First Group are concerned with what will happen for the years to come. So they provide unique sporting intelligence, which helps potential owners cast new light and perspective on the assets they might be willing to buy and own for years, if not decades.<\/p>\n<p>According to Swoboda, for a start, every potential new owner of a football club needs to understand that they are not buying an asset which can be evaluated in a similar manner to traditional businesses. Sports clubs might have revenue streams that can seem rather predictable historically, but the commercial viability of those assets depends inherently on how well the sporting entities, the teams themselves, are performing on the pitch.<\/p>\n<p>\u201cI would argue that many investors, even sophisticated investors, don\u2019t conduct sufficient due diligence prior to buying a football club. This isn\u2019t their fault, as the majority don\u2019t know where and how to look. In the case of Liverpool and United, you might have a unique and innovative understanding of all the business areas of a football club: the income streams from broadcasting, match day, sponsorship and merchandise,\u201d he says and continue:<\/p>\n<p>\u201cBut if you don\u2019t explicitly understand how to build and run a successful football team in the best league in the world over consecutive seasons, then it doesn\u2019t really matter if you are best-in-class at everything on the commercial side. You\u2019ll be spending all your energy and money on matters that likely distract you from your original intentions with the asset,\u201d he says and continues:<\/p>\n<p>\u201cThe sporting product \u2013 which we analyse through our own models \u2013 is going to dictate your entire reality. So you better understand it thoroughly before investing. And then you better get it right once you\u2019ve invested.\u201d<\/p>\n<p>Swoboda says that looking from the outside, Manchester United and Liverpool FC may seem like two similar assets. Obviously, there are differences, but both clubs are just 30 miles apart, both with significant training grounds, historic stadiums, global brands, and global fan bases to name a few.<\/p>\n<p>\u201cWe don\u2019t exactly view them as comparable. While the assets might seem similar, what an investor would be buying into is in fact complete opposite, and my view would be that they would attract two very different kind of investors,\u201d says Swoboda.<\/p>\n<p>In football, they have had the ambition to develop a nuanced metric capable of measuring how competitively a team is performing at any point in time. It is not enough to look at the league tables or build price-per-point calculations, as they don\u2019t provide the kind of in-depth knowledge that club owners and investors are looking for in today\u2019s modern world.<\/p>\n<p>Twenty First Group is constantly developing its performance metrics and stress testing their predictiveness against the markets. Even though Swoboda wouldn\u2019t \u201cbet money via that metric and expect to make a fortune, I would definitely sleep well at night\u201d.<\/p>\n<p>It turns out that wage spend is a very strong measure of performance in football \u2013 and in fact has one of the best correlations with performance of any singular metric, much stronger than transfer spend. That said, it is not a perfect predictor of performance. There are clubs who \u2018earn\u2019 and \u2018waste\u2019 significant sums of money due to how they make decisions.<\/p>\n<p>In this context, if you are considering buying either a minority or a majority stake in Manchester United or Liverpool FC, one of the most critical pieces of information to understand when walking into such an investment is the asset\u2019s state of performance and wage efficiency, and how these compare to your appetite and ambitions for the future.<\/p>\n<\/div><\/section><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-19  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-20  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-21  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><div  class='avia-image-container  av-styling-    avia-builder-el-22  avia-builder-el-no-sibling  avia-align-center '  itemprop=\"image\" itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/ImageObject\"  ><div class='avia-image-container-inner'><div class='avia-image-overlay-wrap'><img decoding=\"async\" class='wp-image-7928 avia-img-lazy-loading-not-7928 avia_image' src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1.jpg\" alt='' title='Line Graph 1-03 (1)' height=\"1519\" width=\"2388\"  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1.jpg 2388w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-300x191.jpg 300w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-1030x655.jpg 1030w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-768x489.jpg 768w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-1536x977.jpg 1536w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-2048x1303.jpg 2048w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-1500x954.jpg 1500w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-Graph-1-03-1-705x448.jpg 705w\" sizes=\"(max-width: 2388px) 100vw, 2388px\" \/><\/div><\/div><\/div><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-23  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-24  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-25  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-main-content '  style='font-size:20px; '  itemprop=\"text\" ><p>Exploring the wage efficiency of Premier League clubs for the last 3.5 seasons, we can see certain clubs above and below the \u201cefficient line\u201d \u2013 or in other words, the on-pitch performance we would expect to see of an average club spending a certain amount of money.<\/p>\n<p>Taking a closer look at Liverpool FC, the data show they have performed at a level over the last four seasons as if they had spent an additional \u00a399 million each year on wages, whereas Manchester United are in the opposite situation, effectively wasting \u00a3132 million in wages every year.<\/p>\n<p>Then the key question would be, how should you read these numbers as a potential new owner of one of the clubs?<\/p>\n<p>\u201cNaturally any new owner would want to find out how you get above that wage-efficient line. If you were specifically evaluating Manchester United and you realised that you could save \u00a3132 million each year if you started to spend your money as effectively as your average peer, then I would consider that as massive potential,\u201d says Swoboda. \u201cAssuming a potential 10-year ownership period, getting that right can be a \u00a31bn decision.\u201d<\/p>\n<p>He says the perspective from a Liverpool point-of-view would be very different, such that as a potential new owner might be reluctant to buy a majority of shares outright.<\/p>\n<p>\u201cLiverpool\u2019s owners know how to spend their money wisely. They have been truly excellent at ensuring every pound they spend is worth more than many of their rivals. So how do you, as a new control owner, improve that capacity even further? Can you actually do that from day one? How long does it take to get that right?\u201d<\/p>\n<p>\u201cOn the other hand, Liverpool likely have larger growth potential across their commercial revenue streams. So as an investor, you would be happy structuring a deal where you could let the current ownership and management team get on with things \u2013\u00a0or at least learn from them over a transition period. Manchester United is the opposite case. Possibly the worst thing you could do as an investor is come in to that club with a minority position. For every pound you hand them, one-third of that would vanish instantly due to whom you\u2019re transferring your capital.\u201d<\/p>\n<p>According to Swoboda, the absolute key point in the diligence process is that any potential owner of either Manchester United or Liverpool FC understands all the elements at play behind this wage efficiency metric. \u201cWhat is the baseline efficiency of the club? What is driving this? How has that efficiency been trending in recent seasons? Why is that?\u201d<\/p>\n<\/div><\/section><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-27  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-28  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-29  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><div  class='avia-image-container  av-styling-    avia-builder-el-30  avia-builder-el-no-sibling  avia-align-center '  itemprop=\"image\" itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/ImageObject\"  ><div class='avia-image-container-inner'><div class='avia-image-overlay-wrap'><img decoding=\"async\" class='wp-image-7929 avia-img-lazy-loading-not-7929 avia_image' src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-1.png\" alt='' title='Line graph 1' height=\"412\" width=\"570\"  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-1.png 570w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-1-300x217.png 300w\" sizes=\"(max-width: 570px) 100vw, 570px\" \/><\/div><\/div><\/div><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-31  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-32  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-33  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-main-content '  style='font-size:20px; '  itemprop=\"text\" ><p>\u201cFor a start, we must buy into the basic understanding and acceptance that sports clubs cannot significantly grow their revenues if they don\u2019t produce and maintain a successful sporting product. Look at the impressive market position Manchester United have built worldwide over the last 20 years and ask yourself how they managed to do so? Because they were a title-winning machine under Sir Alex Ferguson.\u201d<\/p>\n<p>He believes that all those titles gave them a unique platform to build a global brand.<\/p>\n<p>\u201cI sincerely don\u2019t believe they would have been able to do that if their results had been mediocre or regularly inconsistent. But once a club establishes its commercial footprint, it is easier for the club to maintain that revenue generation during periods of inadequate sporting performance.\u201d<\/p>\n<\/div><\/section><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-35  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-36  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-37  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><div   data-size='featured_large'  data-lightbox_size='large'  data-animation='slide'  data-conditional_play=''  data-ids='7927,7930,7933'  data-video_counter='0'  data-autoplay='false'  data-bg_slider='false'  data-slide_height=''  data-handle='av_slideshow'  data-interval='5'  data-class=' avia-builder-el-38  avia-builder-el-no-sibling  '  data-el_id=''  data-css_id=''  data-scroll_down=''  data-control_layout='av-control-default'  data-custom_markup=''  data-perma_caption=''  data-autoplay_stopper=''  data-image_attachment=''  data-min_height='0px'  data-lazy_loading='disabled'  data-default-height='42'  class='avia-slideshow avia-slideshow-1  av-control-default av-default-height-applied avia-slideshow-featured_large av_slideshow  avia-builder-el-38  avia-builder-el-no-sibling   avia-slide-slider '  itemprop=\"image\" itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/ImageObject\" ><ul class='avia-slideshow-inner ' style='padding-bottom: 46.79029957204%;' ><li  class=' slide-1 ' ><div data-rel='slideshow-1' class='avia-slide-wrap '   ><img decoding=\"async\" class=\"wp-image-7927 avia-img-lazy-loading-not-7927\"  src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Bar-Graph-1.png\" width=\"701\" height=\"328\" title='Bar Graph (1)' alt=''  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Bar-Graph-1.png 701w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Bar-Graph-1-300x140.png 300w\" sizes=\"(max-width: 701px) 100vw, 701px\" \/><\/div><\/li><li  class=' slide-2 ' ><div data-rel='slideshow-1' class='avia-slide-wrap '   ><img decoding=\"async\" class=\"wp-image-7930 avia-img-lazy-loading-not-7930\"  src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-2.png\" width=\"837\" height=\"471\" title='Line graph 2 (2)' alt=''  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-2.png 837w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-2-300x169.png 300w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-2-768x432.png 768w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-2-705x397.png 705w\" sizes=\"(max-width: 837px) 100vw, 837px\" \/><\/div><\/li><li  class=' slide-3 ' ><div data-rel='slideshow-1' class='avia-slide-wrap '   ><img decoding=\"async\" class=\"wp-image-7933 avia-img-lazy-loading-not-7933\"  src=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-3.png\" width=\"852\" height=\"442\" title='Line graph 2 (3)' alt=''  itemprop=\"thumbnailUrl\" srcset=\"https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-3.png 852w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-3-300x156.png 300w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-3-768x398.png 768w, https:\/\/www.twentyfirstgroup.com\/wp-content\/uploads\/2023\/01\/Line-graph-2-3-705x366.png 705w\" sizes=\"(max-width: 852px) 100vw, 852px\" \/><\/div><\/li><\/ul><div class='avia-slideshow-arrows avia-slideshow-controls'><a href='#prev' class='prev-slide' aria-hidden='true' data-av_icon='\ue87c' data-av_iconfont='entypo-fontello'>Previous<\/a><a href='#next' class='next-slide' aria-hidden='true' data-av_icon='\ue87d' data-av_iconfont='entypo-fontello'>Next<\/a><\/div><div class='avia-slideshow-dots avia-slideshow-controls'><a href='#1' class='goto-slide active' >1<\/a><a href='#2' class='goto-slide ' >2<\/a><a href='#3' class='goto-slide ' >3<\/a><\/div><\/div><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-39  el_after_av_three_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding first  avia-builder-el-40  el_after_av_one_fifth  el_before_av_three_fifth  column-top-margin\" style='border-radius:0px; '><\/div>\n<div class=\"flex_column av_three_fifth  flex_column_div av-zero-column-padding   avia-builder-el-41  el_after_av_one_fifth  el_before_av_one_fifth  column-top-margin\" style='border-radius:0px; '><section class=\"av_textblock_section \"  itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock thought-leadership-main-content '  style='font-size:20px; '  itemprop=\"text\" ><p>The other point you need to clearly understand as an owner is what lies behind those clubs who are constantly outperforming their peers on wage efficiency \u2013 a club such as Brentford perhaps.<\/p>\n<p>\u201cRun your football club like a Fortune 100 business, where your supporters are your most loyal customers. This doesn\u2019t mean be a dispassionate owner. This means invest in building a clear long-term vision and strategy for the club. This means hire super-bright business and sporting decision makers who can be appropriately empowered to run your club. And of course, this means build efficient structures and processes that are designed to help you to stay on course. Results aren\u2019t guaranteed to come fast or easy,\u201d says Swoboda.<\/p>\n<p>In terms of ability to be consistently and highly efficient with your spending, everything comes down to a combination of strategy and reflection in the sporting department.<\/p>\n<p>He says that as a top European football club, you would need a clearly-defined strategy and system for identifying and hiring sporting talent. And in this very competitive market, this system and the IP within it will likely evolve as your ownership tenure matures at the club.<\/p>\n<p>\u201cYou need to accept that you will lose out on some very interesting players by sticking to your strategy and budgets. If you have a defined process, updating theses as you go, then you will win in the long run. Many clubs do have a version of these systems in place, but they may not be based on real-life evidence or the clubs may not have the ability or discipline to stick to them. In a stressful transfer window or opportunistic point in their club\u2019s trajectory, they can end up making decisions which take them off course and cost them dearly in the long run.<\/p>\n<p>The director of Twenty First Group explains that he does not encourage executives to be stubborn and ignore the dynamics of the market.<\/p>\n<p>\u201cFor example, the system you set up in your recruitment department might be correct and work out brilliantly, but it doesn\u2019t prevent you from making bad decisions. For every bad decision, you need to have a reason why you made a certain decision. Then you can reflect on the result of that specific decision and how it may impact your strategies. If you don\u2019t have clear reasoning behind your decisions, then you will never be able to learn from them; they become ultimately influenced by random inputs and fleeting priorities. Making decisions repeatedly in a vacuum of real multi-year strategy will ultimately lead to failure for your club.\u201d<\/p>\n<article class=\"block block-offthepitch-article-blocks block-offthepitch-article-blocks-text article-blocks-text\">\n<section class=\"article-blocks-text__content\">\n<div class=\"article-blocks-text__body\">\n<p>Swoboda acknowledges he previously said that owners need to understand that they are not buying a traditional business during the investment process. But he would nevertheless encourage them to run their sports clubs it as if they were businesses.<\/p>\n<p>\u201cIn a traditional business, and especially in the best-performing businesses globally, they never ever roll the dice on decisions and hope for a great outcome. They have an extremely detailed set of strategies and processes, which allow their executives to learn and update their direction as they go from being inefficient to being super-efficient in a specific market,\u201d he says.<\/p>\n<p>That is what all the potential new owners of Liverpool and Manchester United must be doing today.<\/p>\n<p>\u201cDeeply understand where these two clubs are now, why they are where they are now, and what it really takes to change them. This is probably the hardest thing. To understand how much work you need to put in, and where you need to do that work, before you are routinely performing brilliantly.\u201d<\/p>\n<p><span style=\"font-weight: 400;\">If you would like to find out more about Twenty First Group\u2019s Investment Intelligence services, please get in touch with <\/span><a href=\"https:\/\/www.twentyfirstgroup.com\/contact\/get-in-touch\/\"><span style=\"font-weight: 400;\">AJ Swoboda<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0\u00a0<\/span><\/p>\n<p><em>This article was originally published by\u00a0<a href=\"https:\/\/offthepitch.com\/a\/interview-one-metric-tells-significant-story-about-challenges-new-owners-liverpool-and-man-utd?check_logged_in=1\">Off The Pitch<\/a>.<\/em><\/p>\n<\/div>\n<\/section>\n<\/article>\n<\/div><\/section><\/div><div class=\"flex_column av_one_fifth  flex_column_div av-zero-column-padding   avia-builder-el-43  el_after_av_three_fifth  el_before_av_codeblock  column-top-margin\" style='border-radius:0px; '><\/div><\/p>\n\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":16,"featured_media":7915,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_oasis_is_in_workflow":0,"_oasis_original":0,"inline_featured_image":false,"footnotes":""},"categories":[54,33],"tags":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.0 - 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