What Is Our Club's Long Term Plan?
At our Open Meeting last month we mentioned that we wanted to know what Manchester City's business plans were and for these to be communicated to the supporters and shareholders.
Some years ago David Bernstein talked about our Club's "five year plan" and the vast majority of supporters and shareholders backed it. There has been no long term plan communicated by our Club for some time and perhaps with the current football season coming to an end, the time is right to tackle this important area.
As you may know, a business plan is a written document that describes a business, its objectives, its strategies, the market it is in and its financial forecasts. It has many functions, from securing external funding to measuring success within a business.
In December 2005, the Football Association issued a document entitled "Governance: A Guide To Football Clubs". The introduction of that document sums it up nicely "Good governance (ie good leadership, direction and control) is essential for a football club to be managed effectively and to demonstrate accountability and transparency. In addition, adopting the principles of good governance contained in this Guide benefits football clubs in terms of engaging the trust of all stakeholders. It is in the interest of all clubs and the game that clubs adopt and can demonstrate good governance. Good governance will not itself ensure success, but it should improve a club's management, stewardship and, most importantly, sustainability." The full document can be read here
The FA's guide is just that, a guide, and is not enforceable however, it does make interesting reading on many issues and not just about business plans.
The FA's views on business plans for football clubs are clear "The executive body should prepare and approve a rolling one year business plan, including budget, in detail. Larger clubs may also consider developing a three year business plan in outline."
We are not suggesting that should our Club forumlate a plan that it publishes detailed financial information but there are other areas in a business plan that could or should be communicated to the supporters/ shareholders.
What exactly is the Club's aims and objectives over the next three years? By setting these out we would have a good idea where we our Club is heading or at least wants to head. If we had a three year business plan in place then three years from now we could measure performance on and off the pitch.
We have heard some people comment that football is not a "normal business" or that you "cannot have long term plans in football". To a certain degree that might be right however, football clubs are employing good management/ business principles and business plans are being put in place at other clubs.
One of the Clubs that we have looked at during our research and planning stage was Ajax. Ajax actually have a lot in common with our Club and probably more than you might think. Ajax are a publicly quoted company, they do not have access to large sums of funds (they are self-funding), they do not own their stadium (they own 13% of it) and they have not enjoyed any relative footballing success for quite some years now.
Ajax are not in the world's top twenty richest clubs (in terms of revenue) and as mentioned do not have access to large sums of money. Ajax are though founded on good business principles and as we all know have a youth academy second to none (much like our Club) which underpins everything that they are about.
Last year the board of Ajax published their long term (five year) plan. It makes very interesting reading and a brief summary can be read here. Ajax's board formulated the plan and then set about communicating to their supporters and shareholders. The following quotes have been taken from Ajax's year end accounts which details the plan in full:-
"The 2006-2011 Policy Plan
In the past year, the Executive Board formulated a stratgic policy plan, which was formally approved by the Supervisory Board in May 2006. In this plan, the Executive Board sketched a vision with ambitious targets, strategies and activities designed to bring Ajax to a higher plane on a structural basis.
The aim of Ajax is "To win the UEFA Champions League"
It's targets are:-
1) to win the Dutch league title at least once every two years;
2) to consistently rank among the best 16 teams in Europe;
3) to increase turnover by 5-6% per annum.
The principles on which these targets are based are:-
1) Ajax plays attacking, creative and dominant football;
2) Ajax inspires football fans all over the world;
3) Ajax has an excellent climate for sporting success and a unique youth training program;
4) Ajax has a professional organisation which focuses on quality and continuity;
5) Ajax strives to preserve its historic club culture and is conscious of its responsibility to society.
The success of this plan will be largely determined by the way in which it is implemented, the focus and the consistency of the policy."
Ajax's plan then goes on to detail each of the areas targeted and their views in that respect. The report is too long to list here in full but there are some interesting points they make:-
When talking about success on the pitch Ajax says "Ajax believes it can achieve this, first and foremost, by working with a team that is balanced in every respect, and especially in terms of age, experience and background. This is extremely important consideration when signing new players. The point of departure for picking the first selection is that half the team should be "home-grown" players we have trained ourselves."
When talking about coaching and finding young players Ajax says "If the access to young players stagnates for whatever reason, it will be necessary to call on players from outside Ajax. This is simplified by Ajax's scouting department, which numbers many scouts domestic and abroad...Ajax attaches great importance to the quality of its scouts and the size and structure of its scouting organisation. In order to improve the return, Ajax has made a clearer separation between scouting for the professional football organisation on the one hand and for its youth academy on the other. The position of technical advisor was created for this very reason."
When talking about finances Ajax confirms that "Ajax's financial aim is to break even in operations."
When talking about strategic partnerships Ajax says "...Ajax still has a 51% interest in Ajax Cape Town. This joint venture has everything it takes to become profit-making certainly in light of the World Cup in South Africa in 2010. Ajax also continues to invest in Ajax America, a more commercial form of collaboration which mainly focused on the organisation of soccer camps....there is also a technical joint venture in the Netherlands with HFC Haarlem and FC Omniworld, which is especially geared to training young players."
Time will tell if Ajax's long term plan works and in 2011 their supporters/ shareholders will be able to review/ measure progress in terms of that plan.
We strongly feel that it is time for a similar plan to be put in place at our Club. In doing so, the supporters and shareholders would be sold a vision with attainable aims; we are sure such a plan would receive much support at a time when all of us have a role to play in contributing towards the future success of our Club.
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