Wednesday, August 27, 2014

Who Is This Mythical Striker?

The injury to Arsenal's first-choice center forward Olivier Giroud has tightened the widely held grip on a prevalent myth about the Arsenal squad. It goes something like this: Arsenal did not score enough goals in 2013-14, and the side needs more to contend for the Premier League title, therefore it must recruit a center forward who scores at least 25 goals a season.

As an explanation, this train of thought does have simplicity on its side, a core feature of myth. It also fails to distinguish between correlation and causation of last year's weaknesses, overlooks the historical record, and denies current realities.

Timing of goals was as important as goal total

The final 2013-14 Premier League table makes the obvious point that Arsenal scored far fewer goals than its title competition. Champions Manchester City racked up 102 goals, while second place Liverpool finished with one fewer. Arsenal's total of 68 paled in comparison.

Even Wenger has focused on this discrepancy. "We scored 66 goals," he said before the 2-0 season finale at Norwich gave the Gunners 68 in total, "compared to 100. We have some room for improvement there.

"We miss goals, and that's what we want to improve."

Although Wenger did not say the shortage of goals caused the title challenge to falter, that's the conclusion many critical supporters have drawn and where the error in the premise lies.

It can just as reasonably be said that the context of the goals not scored mattered just as much as the total number. If the team had scored more goals in games that were already decided in its favor, putting five rather than three past West Ham in April, for example, those goals wouldn't have influenced the final standings. Additional goals would have been just as meaningless in those four infamous road contests against Man City, Liverpool, Chelsea, and Everton; Arsenal could have scored 12 more goals arrayed in a certain way and still lost all those matches.

Maybe, then, the issue is not the need for more goals, but the need for important goals in close matches. Aaron Ramsey's emerging specialty. That's Ramsey, midfielder.

The importance of goals against in particular situations

Another route to success would have been conceding fewer goals. Arsenal could have edged out Man City for the title by allowing four fewer goals, the equalizers by Everton, Southampton, and Swansea and Stoke's penalty. The first three turned Arsenal's second-half leads into draws, and the one at Stoke decided that match as a loss. That's eight points forsaken in a campaign that ended with a seven-point gap between first place and fourth.

Sure, several teams could rewrite their league finishes based on fine differences such as these. And the historical correlation between goal difference (not goals scored) and league finishes might make a more probable argument than this counterfactual account in which Arsenal wins the league with a fourth-best, plus-31 goal difference.

I'm willing to see validity in both those points. I just don't want to accept without question the notion that Arsenal's goalscoring inadequacy, which some see as evidence of the squad's poor quality and the manager's incompetence, was an incontrovertible cause of its failure to win the league.

The great man of history

We should also study the records to identify the prolific goalscorers who brought their teams league titles. That's the second element of the myth, that Arsenal must acquire someone to score at least 25 goals to bring that prize back to North London.

With a swift swing, Tim Bostelle of 7amkickoff has batted away that argument. Earlier this week, he answered the question "Do you need a 30-goal scorer to win the league?" with a definitive no. In the 21 Premier League seasons, just six titles have gone to a team with a 25-plus goal scorer.

Tim's examination is pointed and devastating to the myth.

An academic discussion given the situation

If the premises underlying the 25-goalscorer argument are dubious, the realities of August 2014 lay the myth entirely bare. Meaning, even if a prolific, available striker would vastly improve Arsenal's title chances, that player does not exist.

Using the stats on, I searched for players who exceeded the 25-goal threshold in the five major European leagues in the past three full seasons. Lionel Messi, Cristiano Ronaldo, and Zlatan Ibrahimovic are in a class by themselves, all having registered at least 25 goals in each of those seasons. None would be available to Arsenal anyway.

Nor would be others who had netted that many goals at least once:
  • Diego Costa (27 goals for Atletico Madrid in 2013-14), always destined for Chelsea
  • Edinson Cavani (29 for Napoli in 2012-13), massive wages and not leaving Paris Saint-Germain while Ibrahimovic is injured
  • Radamel Falcao (28 for Atletico Madrid in 2012-13), realistically too expensive for Arsenal on a permanent transfer
  • Robin Van Persie and Wayne Rooney of Manchester United, not Arsenal prospects for obvious reasons
  • Luis Suarez (31 for Liverpool in 2013-14), a sordid case that doesn't bear repeating
There are two strikers from the Bundesliga whose records make them seem more promising, but their careers have likely peaked. Stefan Kiessling scored 25 goals for Bayer Leverkusen in 2012-13, but he's now 30 years old, and 31-year-old Klaas-Jan Huntelaar scored 29 for Schalke in 2011-12. By the time either adjusts to the Premier League, he would be well past his prime and unlikely to return to that goalscoring form.

Two players come to mind who are comparable to Giroud, Mario Mandzukic, now of Atletico Madrid, and Mario Balotelli, now of Liverpool. Wenger and his colleagues at Arsenal were not acting unreasonably in declining to pursue those two. Intense salivating has also covered Borussia Dortmund's Marco Reus--great player, not a center forward, never scored more than 16 goals in a campaign, one of the last valuable playing assets at the club. In other words, he's not coming to Arsenal to play center forward.

The likely outcome

Debunking the myth of the center forward helps us set expectations for the next five days. The world-class striker arriving to save the day, or Arsenal management's inability to secure the services of said striker, are equally unrealistic. That player isn't out there to be had.

Instead, as Andrew Mangan argues on this week's Arsecast Extra, the club might acquire someone more experienced and durable than Yaya Sanogo but less accomplished than Giroud. The hope will be that the player fills out the squad in the near term and develops into real competition for Giroud in the longer term.

That's not as exciting as a headline acquisition as the transfer deadline nears, but it's better than perpetuating a myth.

Wednesday, August 20, 2014

We Are All Bean Counters Now

Michael Lewis's 2003 book Moneyball and its 2011 feature film offspring made Oakland A's general manager Billy Beane a well known figure. The story also popularized sabermetrics, the use of specific statistics to guide personnel decisions. With the success of Oakland and the Beane-inspired Boston Red Sox, baseball observers and fans began to examine arcane measures and used those analyses to predict individual and team performance.

It's not a huge conceptual leap from sabermetrics to an ongoing, detailed assessment of the underlying sports business, particularly because Beane's approach was designed to advance a financially disadvantaged franchise through a novel application of statistics. Financial and operational scrutiny do seem to have become the new sabermetrics, as fans of many major sports teams have made fair game of studying their preferred sports businesses.

There's been resistance from the old school and from those who contend that this corporate emphasis saps the passion from sport. For me, examining the business enhances appreciation, understanding, and enjoyment of the competition, but there are dangers in obsessing about the finances and operations of sports organizations in general and Arsenal FC in particular.

The business as the source of performance risks and rewards

As it happens, Billy Beane is an Arsenal fan. This makes sense given the parallels between his approach and manager Arsène Wenger's penchant for seeking players undervalued by consensus opinion.

In an expansive conversation on last week's Arse America podcast, Beane also made a strong case for paying close attention to the underlying business. Bad business decisions can be catastrophic in European football, Beane said, because they heighten the risk of relegation and perpetual decline. The recent histories of Wolverhampton and Portsmouth in England indeed serve as cautionary examples.

Rewards on the pitch also have their foundations in the business. In particular, a strong correlation appears to exist between a Premier League club's expenditures on transfers and player salaries and its finish in the league table. (See the Pay as You Play blog and Twitter observations of Zach Slaton @the_number_game for deeper analysis.)  

Wenger recently noted this relationship and associated it with Arsenal's prospects in the league, saying "I would say that the balance of power is a bit more even than it was five or six years ago, in the Premier League. That's because of Financial Fair Play, added to us having more financial power than five years ago, that gives us a better chance."

These positive and negative effects on performance justify widespread interest in clubs' operations and accounts.

The business as a storytelling device 

Supporters should understand a club's business for an additional reason: The management of affairs expresses a value system, which should guide club officials' words and actions (I wrote about this dynamic in "The Brand's the Thing" two years ago.) When they don't, supporters are right to criticize.

Fans are reasonable, too, in their pride when business developments provide direct evidence of principles that carry meaning for them. CEO Ivan Gazidis evoked this pride to Sports Illustrated's Jeff Bradley when he emphasized the courage it took the Arsenal board to build Emirates Stadium.

"Most people would have just sat back and said, 'This is great. Everybody loves us.' But what do they do?" Gazidis said. "They throw all of that up in the air, a massive risk. They say, 'We're going to commit all the resources of this club to building a stadium that we think we are going to need 15 and 20 years from now if we want to be a really global football club.'"

Gazidis is skilled at emphasizing this compelling part of the Arsenal story, and it's worth our effort as fans to pay attention. If we as individuals share the values captured by the story -- planning for the long term, resisting the urge to rest on laurels, etc. -- we feel more closely connected to the club. At the same time, though, we should be wary that the story of the business isn't used to gloss over poor performance and unmet expectations. 

Dangers of shallow analysis

The same level of vigilance should also apply when we're faced with faulty analyses of the business. For example, even the casual Arsenal fan has probably heard that the club had more than 100 million to support transfer activity this summer.

That hefty balance seems to have convinced many that all the club needs to do was write some big checks and, presto, world-class players would arrive in droves. They draw up their own lists of targets and then criticize the manager and the club when those players don't end up donning the red and white. (A recent culprit was Elliott Smith, @YankeeGunner, who often has interesting insights but set forth completely unrealistic expectations in the season-opening Arse2Mouse podcast.)

We're wise to resist another urge when we focus on the business side of the Arsenal Football Club, that impulse to make the business a story in itself. This tendency turns the financial affairs of the club into another competition, pushing observers to view different clubs in an arms race for resources.

What's the reason to manufacture a contest on this level, stacking statements of accounts against each other? We already have contests to watch, from mid-August to mid-May. All the financial and business activity matters only if it plays out on the pitch. That's where the real drama and meaning of football happen.

Monday, August 4, 2014

Forward, Upward, or on Some Generally Positive Trajectory

There's something newly bold about the Arsenal.

My recent piece "Suddenly, This Summer" assessed the club's current position and paid particular attention to manager Arsène Wenger's public stance and the strategic importance of signing the young defender Calum Chambers from Southampton. Another way to analyze the club's direction is to reexamine the factors I identified in August 2013's "Platform or Plateau."

Supports of the platform

What has reinforced or undermined the sources of Arsenal's progress over the past year?
  1. The club's own financial strength. The advantages continue to accrue. Although updated figures won't be available until late September's annual report, the Puma kit sponsorship and the blockbuster Premier League television deal have expanded the club's coffers, while costs of Arsenal PLC overall have declined. The Arsenal Supporters Trust has estimated that the result is a £140 million cash balance, the bulk of which might be deployed to fund transfers.
  2. The different level of transfer target. Success. The term now should be acquisition, because the club isn't just targeting world-class performers; it's landing them. Mesut Özil and Alexis Sánchez are top talents in their positions brought in from Real Madrid and Barcelona, respectively. The persistent links to Real Madrid's Sami Khedira are further evidence that Arsenal is a serious contender for the world's best players.
  3. Unrest elsewhere. A missed opportunity. Manchester United was decidedly weaker in 2013-14, and neither moneybags Manchester City or Chelsea proved a juggernaut in the league. In that context, Arsenal's fourth-place league finish represented a failure to capitalize on the situation.
  4. Continuity in Arsenal's management and playing squad. Reinforced. Wenger has agreed to extend his stay for three years, while the changes in the player development staff have been methodical and promising. In raw numbers, there's been considerable turnover among players, but only the Bosman transfer of right back Bacary Sagna has had a meaningful effect on the first team. There's a strong case to be made -- and 7amkickoff makes it on Arseblog -- that quality improves with the arrival of Sagna's replacement Mathieu Debuchy from Newcastle. The integration of Debuchy and Sánchez will be a major factor in the team's performance in 2014-15.
  5. The winning mentality of this squad. We won the FA Cup.
  6. The exits of unwanted players. More additions by subtractions. Although most of this summer's departures have been from the youth ranks, cutting ties with Niklas Bendtner and Park Chu-Young has had a material impact on the reserve squad and the financials. Their salaries might well offset part of what the club will be paying Sánchez.
  7. The impact of Financial Fair Play (FFP). Mixed results. UEFA, European football's governing body, did punish Paris Saint-Germain and Manchester City, among others, for failing to meet financial requirements. The sanctions reduced their squad sizes for the upcoming Champions League competition and levied multimillion-euro fines. The squad restrictions may not matter much, though, especially because specific instructions on home-grown players appear not to be harsh. (See sports law expert Daniel Geey's explanation here.) Meanwhile, the fines aren't material amounts for these clubs or even definitive. Indeed, PSG continues to spend like mad, breaking the record transfer fee for a defender to acquire David Luiz from Chelsea. That same transaction shows Chelsea's different reaction to FFP; it has stopped, at least for now, indiscriminate spending.

Conditions on the plateau 

How have the five forces suggesting stasis played out over the past year?
  1. The existing distance between Arsenal and the top of the table. Narrowed but persisted. The team amassed 79 points in the 2013-14 league campaign, its highest total since 2007-08, and finished just six points behind champions Manchester City. Not since that 2007-08 season has the team finished closer to the top in points. And yet. Against leading competition, the team's performances were again found lacking. Arsenal secured only 13 of 36 possible points (W3, D4, L5) against other clubs in last season's top seven and only three of those points came away from home, the 1-0 victory at White Hart Lane.
  2. The risk-averse transfer approach. Loosened. This has been one of my biggest concerns, partially because skittishness about transfers has affected the quality of play but even more because it's risked damage to the Arsenal brand. I'm less concerned now. The purchases of Özil and Sánchez indicate looser purse strings; the clearest sign, though, is the risk the club took to pay as much as £16 million for Chambers. As a result, mitigating transfer risk no longer appears to be a guiding policy in building the team or in running the business.
  3. Lack of experience in transfers at the high level. Dealt with. Acquiring Özil and Sánchez from the two Spanish giants shows that CEO Ivan Gazidis, Wenger, and chief negotiator Dick Law can close deals on world-class talent with top clubs.
  4. Uncertain enforcement of FFP. Continues. UEFA did not expel any clubs from European competition. Still, Manchester City agreed to sanctions without contest because they must have concluded that the potential of a ban was real. Neither City nor Chelsea has continued its transfer profligacy, suggesting that at least the English clubs are now taking compliance seriously. Wenger has observed that this development tightens the Premier League title chase and enhances Arsenal's chances.
  5. The composition of the Arsenal board. Barely changed. The retirement of longtime director and former chairman Peter Hill-Wood and the arrival of Josh Kroenke, son of majority owner Stan Kroenke, have reduced the board's average age and introduced some youth. Still, the board is small, white, and male, so it continues to represent the Arsenal fan base poorly, while it's just as unlikely to benefit from differences of opinion. 

What progress looks like

A review of these 12 factors points to the conclusion that the club has made progress and is on a promising trajectory. That's not to say conditions are perfect, that success is inevitable, or that every result and bit of news will be positive. Life doesn't work that way, especially in professional sport, which could be the most publicly competitive environment there is.

What can reasonably be said is that the Arsenal's fundamental position is as strong as it has been in a decade and that the prospect of highly entertaining football is real and immediate. I'm not sure a reasonable person can ask for more.

Tuesday, July 29, 2014

Suddenly, This Summer

A year ago, my post entitled "Platform or Plateau" considered whether the Arsenal Football Club had reached a static position or had established the foundations for greater success. Although its 2013-14 campaign brought silverware in the form of the FA Cup, featured a long stay at the top of the Premier League, and finished with the most league points since 2008, the question of progress persisted because of the way the title challenge faltered and because manager Arsène Wenger had not yet agreed to renew his contract.

Wenger's signature on a three-year contract extension may not have quieted those who complain because they enjoy complaining or who criticize him due to francophobia or an exaggerated sense of their own importance. Any reasonable analysis suggests, though, that the Arsenal is back to a level of competitiveness not seen since the move to the Emirates Stadium in 2006.

Top-level talent arrives and signals a renewed intent 

The most obvious indication of the upward trajectory is this summer's transfer activity: Four headline players have arrived since the current transaction period began, while none has been sold. That's a significant change even from this point in 2013, when the inexperienced Auxerre striker Yaya Sanogo had been the only acquisition.

The cost of these 2014 acquisitions stands at £56 million according to the Arsenal Report's Transfer Centre; the club has never entered an August with a transfer bill even remotely near that figure. That points to a confident, proactive approach to the playing staff and validates CEO Ivan Gazidis's contention that this summer would see enhanced revenues deployed to strengthen the team.

The level of investment and the obvious quality of the players recruited, forward Alexis Sanchez, fullback Mathieu Debuchy, goalkeeper David Ospina, and defender Calum Chambers, have rightly received the attention. What's struck me, though, is the change in Wenger's image and emphasis.

The manager recrafts his image

I try not to make assumptions about people's thoughts, feelings, or intentions, particularly those of individuals whom I've never met or interviewed. Doing so leads to facile analyses and conclusions that are both flimsy and irrefutable.

It's not presumptuous, though, to remark on the image public figures present. In the past three months, Wenger has stopped giving the appearance of a drawn, tense man and has (re)established the look of a relaxed, assured one.

Whether he felt any differently about himself or considered his future in a new light after beating Hull City in the FA Cup final, we can never know. What most observers will say is that he has appeared revitalized. It didn't hurt that he displayed the skills and physique of a much younger man in a much publicized video of his beach football exploits during the World Cup.

Emphasis and strategy emerge as different

Wenger's recent comments also reveal a return to confident competitiveness. He is no longer bemoaning the irrationality of the transfer market or downplaying Arsenal's prospects of landing recognized, world-class talent. He is instead stating the assumption that the players he wants want to join the club.

When asked about the Ospina deal before it had closed, Wenger did not redirect the inquiry or wait for the official announcement. He said: "There were four candidates, and I decided on one." When? "It was during the World Cup."

"I decided on one," and I was confident he would join us. Not "we had to negotiate with his club, convince his agent and entourage, court him, and get him to accept our financial terms." This is not a tenuous stance or a nervous message. 

What the manager said as the signing of Chambers drew close was similarly telling. The Telegraph reported these remarks from Wenger: "He hasn’t played many games, no, but the English players on the market in England are very expensive and at the end of the day I was ready to take a gamble because he is a player for the future."

"I was ready to take a gamble" -- those are not words common in Wenger's public statements about players in recent years. It's a fair and revealing characterization, though, of the potential £16 million outlay for a 19-year-old defender.

It's one thing to break the club's transfer record to secure Mesut Özil. Wenger and Gazidis knew then that they were getting a mainstay of the German national team and a star at Real Madrid. I think it's even more consequential to acquire an unproven Chambers with potentially one of the club's five highest transfer fees to date. This move reverses nearly a decade of aversion to transfer risk and emphasizes the desire to be a serious contender.

Future titles aren't guaranteed, primarily because the difference between victory and defeat at Arsenal's level of competition is so fine, but the intent to engage the contest on advantageous terms has certainly reemerged. Supporters should watch with less trepidation, while opponents approach more warily.

Saturday, March 15, 2014

On the Question of Media Bias

On Tuesday in Munich, Arsenal and reigning champions Bayern Munich drew 1-1 in the UEFA Champions League, giving the German club a 3-1 aggregate victory and a berth in the quarterfinals.

This is a classic first paragraph from a news agency or wire service report of Arsenal's most recent match. I can write it with authority even though I was not at the match and distribute it even though I do not work for a news outlet. In other words, I can perform many of the functions of a journalist, but I have not been one for a long time.

Others claiming a tighter hold on the mantle of journalist went far beyond the tone and structure of the "lede" I wrote and published immediate and withering criticism of Arsenal's performance, particularly that of playmaker Mesut Özil. I won't link to those stories for reasons I lay out later; they proved of fleeting value anyway, given evidence that Özil suffered an early injury in the match.

This coverage of the match provoked considerable discussion among Arsenal supporters, most of whom railed against bias in the media. Although this reaction is understandable, it has only a slightly less tenuous hold on logic and evidence than the original provocation did.

Tim Stillman's (@LittleDutchVA) thoughtful column on Arseblog debunked the notion of a media out to get Arsenal and its fans. I'd like to build on Tim's analysis and argue that the indignation over media bias stems from outdated concepts of journalists and journalism and fuels exactly the kind of behavior it decries.

Journalism the profession

The profession of journalism originated with individuals who wrote for printed works published daily, journaux in French. Publications of this nature had emerged in the early 18th century, famously The Spectator produced by Joseph Addison and Richard Steele. A little more than a century later, individuals came to prominence as the named authors of articles in periodicals.

In the early 20th century, standards emerged to guide the activities of these individuals. Generally speaking, journalists were expected to be independent, to reveal the evidence that supported their stories, and to treat matters of public interest. Professionals in the field therefore followed practices of:
  1. Remaining impartial
  2. Disclosing sources or insisting on a minimum of two unnamed sources
  3. Quoting those sources accurately
  4. Writing in the third person with a detached tone
  5. Choosing topics with a priority on the public interest
Journalists often took license with these standards, particularly the disclosure of sources, and they usually gave themselves the authority to determine what would be in the public interest.

Impartiality vs. absence of bias

The expectations of impartiality and voice and tone created writing that did not betray an interest in the outcome of an event. Whether that was a political campaign or an athletic contest, the journalist's account was supposed to unfold with little indication of the writer's own preferences.

This didn't mean journalists had no biases. That would have made them superhuman.

My experience as a sports journalist suggests that professionals in the field did and do carry biases. When I wrote for a daily newspaper in the US, we preferred certain outcomes, based on fairly mundane considerations, especially:
  1. The personality or approachability of the participants
  2. The potential for lively quotes
  3. The prospect of a result leading to a trip to a desirable destination or event
  4. The possibility for enhanced personal visibility
  5. The opportunity to enjoy a better pre-game and game experience (read: spreads)
These are hardly noble or complex motives, and they constitute biases. The professional directive was just that these biases didn't influence the writing.

Early 21st-century sportswriting and the Arsenal

That mandate has lost its power in the media saturation of the early 21st century. Twitter's immediacy and brevity and commercial websites' hunger for content both encourage writers to publish opinion as news. The objective is no longer performing the craft of journalism; it's gaining attention. 

With this attention comes scrutiny. Anyone with access to a computer can now engage in an instantaneous debate with members of the media in a sort of perpetual Letters to the Editor. Meanwhile, media colleagues can react with public ribbing, which may have been limited to in-person banter before.

The speed, omnipresence, and vulnerability associated with modern media all strengthen the tendency to align one's writing with popular or easily understood storylines. Shaping a piece to fit the "Arsenal in Crisis" or the "Lazy Foreigner" plot requires little in the way of thought, analysis, or time. It's also not likely to provoke ridicule from one's peers. 

What's more, these plotlines summon indignation and attention from Arsenal supporters, which is of course the objective.

My recommendation? Instead of taking that bait, ignore it. Focus on the club and its performance, not on what published writers say about the Arsenal. 

And don't dignify those writers by calling them journalists. They clearly don't meet the professional standards that title implies. "Writers" or "media," sure, if you want to be generous, but in many cases they're just provocateurs and self-promoters.

Wednesday, March 5, 2014

And All the Clocks Wound Down

Time is running short on Arsenal manager Arsène Wenger's contract, and as his current agreement draws to its end, speculation mounts about his and the club's future. 

Not to worry, says CEO Ivan Gazidis. "Arsène will be extending with us, and at the right time, we'll announce it." That was his statement at the unveiling of the club's £150 million new kit deal with Puma on January 27.

Yet every time he's faced questions about the renewal, the manager has demurred. He admitted in October that the club had offered him a new contract, but with supporters, journalists, and his superiors hanging on every word, Wenger has been cagey. Hints that no lawyer or linguist could construe as a commitment are all he's offered.

This drama has played out longer than any of Wenger's previous three contract extensions, intensifying suggestions that he may leave. Some papers report heightened concerns within the club, though their sources are unclear and they could simply be stirring up mischief.

Meanwhile, even such measured supporters as Andrew Mangan of Arseblog and James McNicholas of Gunnerblog have put forward a 30 percent probability that Wenger will decide to walk away. (Listen to the excellent Arsecast Extra from March 3 for their rationale.)  

It's a delicate line

Rather than address the oft-opined-upon question of whether Wenger should be offered or should accept a new contract, I want to point out some implications of how the club's executives, specifically majority owner Stan Kroenke and Gazidis, have handled probably the most pressing issue affecting the club's future.

As Andrew rightly stresses on the Arsecast Extra, the club's executives have no contingency plan in the event Wenger decides not to return. Their near-term succession plan consists of Wenger and Wenger alone. As a result, even a 10 percent chance of his departure represents a major risk to the business.

I've written before that the club has often erred in elevating personnel risk, in the form of transfer fees and related player salaries, to the level of strategic business risk. In the current situation with Wenger, the personnel risk is significantly higher than it is for any other person on the payroll; it's as close to a strategic business risk as you'll see connected to any one employee's status.

Not only has the Arsenal brand become closely linked with Wenger's approach to  management and playing style, his skills have adapted to the club's environment. He has had a substantial role in shaping that environment, perhaps even the self-sustaining business model, which makes him particularly suited to shaping decisions there. Studies in the management field have drawn a strong correlation between employees with specific knowledge of their firms and those firms' successful performance. (Anyone interested in the nerdy details can read this analysis from The Journal of Applied Psychology.)

Kroenke and Gazidis may recognize this relationship between experienced staff and organizational achievement, which would make their current deference to Wenger in his deliberations somewhat understandable. Still, their stewardship of the club requires a backup plan.

And the names were all erased

The club has also recently publicized staffing decisions that Wenger either made or endorsed. It hired a new Academy director in Andries Jonker to oversee youth player development, brought on Ian Broomfield as a scout, and finalized contract extensions with midfielder Tomas Rosicky and center half Per Mertesacker. All accounts suggest that record signing Mesut Özil agreed last summer to join Arsenal to play for Wenger.

If Wenger leaves and a new manager arrives, player morale could be a major issue. The replacement will have to build trust among the players he favors and work within the bounds of some long-term commitments that he may not like. Either that or the club will have to buy out the deals. Football performance might suffer, along with the finances. Just look at Manchester United's league position and market value under David Moyes.

Arsenal's costs likely start at £15 million in the near term. That's a figure based on a Center for American Progress review which indicates that losing highly skilled and highly compensated executives can cost organizations more than twice that person's salary.

Again, these factors could partly explain why Kroenke and Gazidis have given Wenger so much leeway as he considers his future.

In standing off so much, though, and in leaving themselves no Plan B, they have worsened the potential effects of a Wenger departure. Gazidis would find himself in an untenable position due to his clear public statement about Wenger's return, and the club will likely be searching for a new chief executive with all the financial and operational consequences that entails.

One good minute could last me a whole year

Even with the best intentions of managing the valuable asset the club has in Wenger, Kroenke, Gazidis, and the rest of the Board have lost control of the situation and the discourse. The question has moved away from whether Wenger is the right person to carry the Arsenal football management forward. It's now a matter of how the club's executives could cope if Wenger decides of his own accord to move on. Allowing that shift to happen seems like negligence on their part.

I'm hopeful in spite of that mismanagement. Part of the reason is that organizations have ways of enduring, especially organizations as rooted to history and the community as is The Arsenal. The club has also combined sound financial management and expanded commercial relationships to amass funds that Kroenke and the Board could bestow on a new manager in the form of his own salary and incentives and a historically large transfer budget.

Or Wenger could stay on and make maximum advantage of his intimate knowledge of the club and its expanded resources. My guess is he will indeed re-sign. I say that because Wenger strikes me as a person of integrity, and I have trouble believing he would mislead Özil and especially Rosicky, who, after all, could have enjoyed a more lucrative career sendoff in MLS or elsewhere. 

So maybe, like many organizations, The Arsenal will find itself in a reasonably advantageous position despite what appear to be some odd choices on the part of its executives. 

Thursday, August 8, 2013

Platform or Plateau

After the final match of the 2012/13 campaign, Arsenal supporters allowed themselves, if not happiness, pleased relief at achieving a fourth-place finish. I admit to a slightly more positive outlook, perhaps encouraged by my three-year-old daughter's singing unprompted that Monday, "And the boys from the Arsenal knocked one down!"

The club did its part to perpetuate the vibe. In early June, CEO Ivan Gazidis did the rounds with supporters and the press and said, "This year we are beginning to see something we have been planning for some time - the escalation in our financial firepower." He went on to suggest that not only could the club afford the transfer fee and wages of the likes of Manchester United's Wayne Rooney, but "we could do more than that."

The financials support these assertions: When the next annual results are publicized, the cash stake will probably top £180 million, which would include season ticket renewals and the first payment of the new Emirates shirt sponsorship. With a new kit sponsorship on the horizon, the club's buying power will have expanded considerably.

Nevertheless, the summer has seen growing discontent among the base as the wealth is not deployed.

This entry takes a step back from the daily dramas and looks at factors suggesting promise and stasis. In most instances, my inclination would be to compose an analytical narrative, tying these observations together into a larger argument. However, because I want this post to start a discussion and not produce a conclusion, I'm ranking the factors by their influence and describing them only briefly.

Ready to start

Here are the developments and forces that point to an era of enhanced competitiveness for the Arsenal:

  1. The club's own financial strength. After the kit deal is finalized, the club will be able to call on at least £65 million in additional annual cash flow from commercial deals, increasing a transfer fund that already stood at £70 million before the two major sponsorships (kit and shirt) materialized.
  2. The different level of transfer target. Reliable reports have linked Arsenal with Real Madrid's Gonzalo Higuain, Liverpool's Luis Suarez, Everton's Marouane Fellaini, and other top-notch talent. These would have been out of Arsenal's price range in recent years and do not depend on the misfortunes of other clubs, such as the financial woes at Malaga that forced the sales of Santi Cazorla and Nacho Monreal.
  3. Unrest elsewhere. Four of the Premier League's top six clubs will have new managers for the 2013/14 season, and the transitions could be fraught for Manchester United's David Moyes, Manchester City's Manuel Pelligrini, Chelsea's Jose Mourinho, and Everton's Roberto Martinez. Tottenham, alongside Arsenal the only top-six club to keep its 2012/13 manager, faces the real prospect of losing by far its best player. The uncertainties present a major opportunity for Arsenal...
  4. ...strengthened by the continuity in Arsenal's management and playing squad. The club will keep everyone it wants to keep this off-season, meaning the additions of the past two years will have experience together under the same footballing philosophy.
  5. The winning mentality of this squad. When faced with the gap famed in song and story, this group of players summoned the will and applied the technique to succeed. In the last nine matches of the 2012/13 season, it secured 23 points from 27 available, 15 of those away from home.
  6. The exits of unwanted players. At last count, 26 players have left the first-team squad, reserves, and youth since May. These include Andrei Arshavin, Sébastien Squillaci, Denilson, Andre Santos, Vito Mannone, Gervinho, and are soon to add Marouane Chamakh. These departures will free more than £10 million from the annual wage bill. That figure, added to the existing financial strength (point #1 above), primes the club to go after world-class players (point #2).
  7. The impact of Financial Fair Play (FFP). I place this last in this ranking because it is the factor least in Arsenal's control. UEFA will be gathering the second round of reports from clubs and assessing their compliance between October 2013 and March 2014. As this happens, it's possible that previously spendthrift clubs will slow their acquisitions. 


Stand in the place where you are

Despite these significant advantages, several forces are working to keep the club in place--that is, competing not for trophies but only for a Premier League finish that sends the team to the following year's Champions League. I would identify those as:

  1. The existing distance between Arsenal and the top of the table. The club finished the 2012/13 season 16 points behind Manchester United. Perhaps most telling, the team took just seven points from a possible 30 against the other top-six clubs (W1, D4, L5). This analysis from 7AMkickoff suggests the need to spend at least £100 million in one transfer season to get within smelling distance of the title, given the correlation between the outlay on transfers and wages and the likelihood of success in a season. (See the Play as You Pay blog for an in-depth study of the connection.) Considering the financial and performance gaps, can the seven advantages be decisive?
  2. The risk-averse transfer approach. In January, I wrote an entry about the club's risk calculus in transfers, observing that its decision-makers appear to have elevated mitigating transfer risk to the level of business strategy. That's short-sighted. It loses track of the potentially huge impact to the Arsenal brand, which could cost far more than the transfer fee and wages of a big signing who doesn't quite pan out. 
  3. Lack of experience in transfers at the high level. If Gazidis, manager Arsène Wenger, and their colleagues are backing off their risk aversion--and links to Suarez indicate they are--a significant amount of time has passed since Wenger (then accompanied by former vice chairman David Dein) operated in the upper echelons buying world-class talent from top clubs. Neither Gazidis nor lead negotiator Dick Law has. It's an unstable environment almost defined by its irrationality. The uninitiated may not have the skills to succeed there.
  4. Uncertain enforcement of FFP. Given the timing of clubs' submissions to UEFA, sanctions will not be possible before late spring 2014, meaning any bans on participation would not be effective until the 2014/15 UEFA competitions. (See this free report from Mondaq for details and analysis.) Some clubs, prominently Paris-Saint Germain and Monaco, have taken the opportunity to spend freely. They appear to be banking on the assumption that UEFA will not penalize them harshly. If that turns out to be the case, Manchester City and Chelsea will resume their mad outlays, if they even slow them in the interim.
  5. The composition of the Arsenal Board. The executive leadership of Arsenal PLC consists of six members, all white males whose median age is 72. Not only is its profile unrepresentative of Arsenal's fanbase, the group's small size and relatively long service to the club suggest that change, a challenging proposition for most organizations, is doubly difficult at Arsenal. Read the report and recommendations commissioned by the Arsenal Supporters' Trust for a fuller analysis. 


You know better, but I know him

An additional consideration is important, but I hesitate to identify it as an indicator of opportunity or status quo. That's the future of the manager. Wenger's contract runs only through the end of the upcoming season. Many supporters frustrated with the lack of titles will say that as long as he remains in charge of the playing personnel, preparation, and game execution, Arsenal will remain stuck in an unattractive place.

The matter is hardly this simple. Wenger is a lightning rod because he is the club's most public face and has been so for a long period of time. He also is an agent, perhaps a very influential one, of a system and not the sole force for good or ill that the more simplistic, personalized analyses would suggest. With or without Wenger, many of the other factors I describe above will still be at work.

Can you read the signs

The next month will be telling, if not decisive, as we assess whether the club is entering a new era of opportunity or is embarking on more of the same. A successful transfer season, driven by softening the risk aversion and characterized by top-notch acquisitions, will show that the club is ready and able to use the financial resources at its disposal. It's a tremendous amount of pressure, intensified by the absence of activity thus far.

Although the club's leadership has brought this pressure on itself through decisions and communications, I have to think there's a plan to capitalize on the opportunity. It would be unusual for a sensible group like this to endure the constrained years since the stadium construction only to balk when the constraints are off. Unusual, but not impossible. How's that for Arsenal-like decisiveness?