Manchester United is a brand name that transcends sport. You don’t have to be a football fan – or soccer fan, depending on where you are from – to know of them. If you walk through any shopping mall in Asia you will stumble across their shirts for sale. Schools kids in Bahrain and taxi drivers in Mali wear their shirts.
United gave us David Beckham and back in the late 1960s George Best, the Beckham of his day (known as ‘The fifth Beatle’ he was so popular). The club is not just a high profile star maker. Since the formation of the English Premier League it has dominated it like no other team.
This year though United’s fortunes have taken a sudden turn for the worse. After a record breaking 27 years in charge, Sir Alex Ferguson, United’s legendary Glaswegian manager, stepped down, and David Moyes took over. Since Moyes installation United’s performance and results have dipped alarmingly. Last week’s victory over the Greek club Olympiakos, putting them into the last eight in the European Champions league, was a rare moment of glory in what has been an otherwise wretched year.
Of course the media and football fans have a habit of blaming the manager for everything – it goes with the job. So is United’s dramatic dip in form merely a bedding-in issue? Will Moyes come good?
Only time will tell.
What is clear though is that United could have handled the succession a whole lot better, and if they had they would be in a far stronger position. Senior leadership succession is a critical element of business strategy and United look like they didn’t have a plan.
So what is there to learn?
In 2013 Forbes Magazine valued United at $3 Billion, a billion more than any other sporting franchise in the world. They should have therefore handled the succession like the huge enterprise they are.
There are only two triggers for senior leadership change and they require very different approaches.
The first is when a business is under performing. In this scenario what is usually required is a leader with new ideas, energy and the ability to turn things around quickly. Organisations in this situation usually have a very short term need, they need to show an immediate improvement to shareholders, owners or fans. It takes a certain kind of high impact leader to do this, one who can build quick relationships with the key incumbent personnel and one with the vision and chutzpah to shake things up. Steve Jobs return to Apple in 1997 is a great example of this kind of leader.
The second trigger is when a senior leader wishes to retire, move on, or it just seems like the time for orderly change. In this situation there is no burning bridge, no crisis to handle. The challenge is to handover the tiller with no blip in performance. This was the scenario at United and it is a scenario they handled very badly. Again we can look at Steve Jobs for a steer. The reason for his succession was genuinely extraordinary - he knew he was dying. And it is a testament to the resolve of the man that even though that was the case he made sure a succession plan was in place. Tim Cook was groomed for the role. COO is perhaps the best place to have a future-leader-in-development as it is a role that provides a very broad view of the organisation, as well as a place around the executive leadership team table. Cook like Moyes had no track record in building a great business. He was a very capable executive, but like Moyes had no reputation for delivering the extraordinary. He was chosen as someone who could build on a legacy.
When United knew Ferguson was going to retire they had two choices: To replace him - a man who came to the club as a winner, having steered the small Scottish club Aberdeen to the amazing heights of a European Cup win - with another known winner, someone who would bring in a new order, his way of doing things; Or to find someone who would build on Ferguson’s legacy. They chose the latter. David Moyes has a very similar background and demeanor to Ferguson’s, albeit a little less feisty and without the halo effect of having delivered something extraordinary in the past.
What United should have done was install Moyes in a role long before Ferguson left, to allow him to build relationships, understand the complex operations of the business, to be well and truly part of the team before he stepped into the high office. United should have found a COO like role for him. This would have cost them money, but they had the resources to afford it and it would have been far less costly than the financial consequences of this year’s poor performance.
Leadership succession is a strategic issue, just like any other that affects the long-term wellbeing of a business. It takes forwards planning, senior team alignment, and some humility from the top dog and heir-apparent. It is hard to hand over the keys to someone new, especially when you have been at the helm as long as Ferguson had been, and hard for someone who has led an organisation to have to come in and listen and learn rather than lead and change. But really that is the ultimate sign of a great leader – putting aside ego for legacy.
The root of the word ‘succession’ is ‘success’ for a reason.
David Moyes interview > http://www.bbc.com/sport/0/football/26634094