13 February 2011

Finally, Business Savvy in the Anfield Board Room

Even before the colossal sale of mega-striker Fernando Torres for a whopping £50M, new Liverpool owner John Henry had been making all the right noises that hinted at the sort of American business savvy that had been missing from the Anfield boardroom all these years of living under the shadows cast by Manchester United’s successes. Liverpool was – then – courting the Amsterdam club Ajax to persuade it sell its Uruguayan World Cup star striker Luis Suarez, who would eventually make the move to Anfield for a reported £23M.

To concerns that the Anfield wage bill was already astronomical as it was, Henry replied that Liverpool was, in fact, not looking to cut down on the wage bill but – rather – looking to increase it. That said – and being the savvy businessman that he is – Henry also said that Liverpool was looking for avenues to increase its income.

With those statements alone, Henry pointed the club in the direction that had not been given all these years during which the club languished in the footballing boondocks. Interpreted, what Henry was trying to say was that if the club was as ambitious as it has always claimed to be, it could not be fearful about splashing the cash – especially where the purchase of top caliber players was concerned.

How good a football club is ultimately depends on what sort of team it puts out on the pitch. Hence, a truly ambitious club cannot be timid about purchasing the best players. In other words, if you pay for mediocrity, then you will get mediocrity. If you pay for class, you will likewise get class.

Apart from the 24-year old Suarez, Liverpool also acquired from Newcastle United the services of 21-year old Andy Carroll for £35M. A lot has been said Carroll’s transfer fee being overly capricious. Yet, even the transfer window deadline activity shows more business savvy on Liverpool’s part than meets the eye.

First of all, although at 27 Fernando Torres is probably entering the prime of his career, he has also been injury-prone and has fewer years at top-level football left than both of the youthful Suarez and Carroll. He was also a sulking and unmotivated figure at Anfield; and nobody wants a player who no longer has the hunger to perform for any club.

If you add the reported £6M German club Hoffenheim paid Liverpool for the services of the erratic Ryan Babel to the £50M the latter obtained from Chelsea as payment for Torres, then Liverpool actually acquired the services of two young and hungry international strikers – Carroll has already been called up by England – for a mere cash outlay of £2M.

In contrast, Chelsea’s spending – particularly on Torres – seemed rash, particularly in view of the fact that the club had reported financial losses for two consecutive seasons. The club has the fallback of digging into the pockets of billionaire Russian owner Roman Abramovich – but there is always the risk of Abramovich packing his bags and leaving the club to fend for itself. The deficit spending, therefore, is something that does not make fiscal sense; and Henry was careful to point out that Liverpool – under his ownership – would be doing no such thing.

Liverpool’s operations, in other words, will have to pay for itself. When Henry spoke of increasing the club’s income, he was looking to make full use of the Liverpool brand to pay for players’ wages and club operations and have profit left for improvements and for the owners and management to enjoy. This means increasing revenues from merchandising, television rights and gate receipts as well as exploring heretofore revenue generating activities that had not been previously tapped.

In this regard, Manchester United’s boardroom had been running rings around Liverpool’s for more than two decades. United started selling public shares long before it was thought fashionable for football clubs to do so. It redeveloped its stadium so that it now seats 75,000 spectators, in contrast to Liverpool’s 45,000. It developed and sold merchandise globally and sought and found strategic and lucrative company sponsorships. It went on off-season playing tours of untapped markets, particularly in North America and the Far East.

In other words, United had known for the longest time that the key to being and staying on top is not cutting down on costs but, instead, generating income. Liverpool’s boardroom, spoiled by decades of its own successes, was lulled into the sort of complacence that subsequently spells the downfall of those who reach the top.

Apart from its complacency and lethargy, another colossal mistake on the part of the Liverpool boardroom was the appointment of Graeme Souness in the aftermath of Kenny Dalglish’s sudden resignation from the post of manager back in 1991. To be fair, the board was appointing – in Souness – another former Liverpool player who was himself aware of the club’s traditions and aspirations.

However, Souness was very much his own man and started to bring in his own players at a pace way faster than he really ought to have done. Souness’ claim was that – under Dalglish – Liverpool had ageing players who did not have the quality required at such an illustrious club. That said, Liverpool was at second place when he took over; and seventh after his first season in charge.

The players he quickly disposed of – Peter Beardsley, Ray Houghton, Gary Gillespie, to name a few – were all part of Dalglish’s trophy-laden years at the helm. How could so many quality players have gone bad overnight? In contrast, the players Souness himself brought in were ultimately proven – in hindsight – as no more than average.

Souness was subsequently dismissed; and after his departure, a string of managers all tried to restore Liverpool to where it has always felt it belongs. However, every barren year that passed simply heightened the sense of both frustration and expectation that only ultimately burdens the men in all-red on the playing pitch.

The boardroom should have appointed Dalglish when the latter made himself available last year after Rafael Benitez’s departure from the managerial position. True to form, it instead appointed Roy Hodgson who, while he is the archetypal gentleman footballer, was always bound to be the wrong person for the job.

It is not the Liverpool way to dismiss a manager after less than a season in charge. New owner Henry, however, saw that the situation had already become untenable. With his club in seeming freefall, his decision to replace Hodgson with Dalglish was not so much acceding to the fans’ desire as many were quick to suggest but – rather – a quick businessman’s recognition that Hodgson was not the right man for the job.

Hodgson was never, prior to his appointment as manager, ever associated with Liverpool. That he would not know what the club was all about and where it wanted to go was something most who followed the fortunes of Liverpool had known since Hodgson first arrived to manage the club. In contrast to Henry’s decisiveness in dealing with this managerial dilemma, the Liverpool boardroom two decades earlier took three seasons to dispose of Souness; and by the time they did, the damage had been done.

Two losses and a draw seemed hardly the results to vindicate Dalglish’s appointment, even in a caretaker capacity. However, every manager needs time to bed in; and that measly returns were subsequently followed by a run of four straight wins – including a sweet 1-nil victory at Chelsea’s Stamford Bridge stadium – and a draw.

With a manager who has not only lifted the doom and gloom at Anfield but has also unified the entire club, along with ownership that brings business savvy into the boardroom rather than outdated conservatism, dare the Liverpool faithful now hope a corner has been well and truly turned? We will all see as the weeks unfold, I suppose.

Hoping is what the club anthem is all about; but hope ought to be rewarded by eventual success. Success in football, they say, is cyclical. With the Henry ownership and Dalglish management, the general hope now is that the end of the storm has come and the time has come to await the golden sky.





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Fernando Torres is History
King Kenny Is Back to Finish What He Started!

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