Unlock Editor’s Digest for free
FT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.
The author is the author of Uncharted: How to Navigate the Future
Changing direction is tougher than it looks. The story (always told backwards) suggests that a lone hero (usually a man) drives into a city, makes a bold and risky decision, and quickly emerges victorious. These myths are dangerous because they focus on a single man who excludes the past. These heroes may be as dangerous as the dangers they face. Is that exactly the position Sir Jim Ratcliffe, minority stakeholder in Manchester United and head of the club’s football operations, is now in?
It is true that United’s restart is long overdue. But Ratcliffe’s early strategy is worrying. Telling a fan that their favorite team is “mediocre” may be a cruel truth, but it does nothing to instill trust in the fans or the players. It is wrong to spread blame and blame when the first thing an organization needs on the painful journey from failure to success is hope.
Alan Mulally provided important encouragement to Ford in 2006, when the company had just posted a $12.7 billion loss. Rather than branding his employees as losers, he restored empowerment by restoring trust in each other and allowing employees to focus on the future rather than the past. Just as important as fixing the finances was Mulally’s insistence on changing the culture. Ford executives realized that they could not succeed alone and learned to help each other. You might expect this to be well understood in the world of sports, but that’s rarely the case.
Similarly, at a time when critics were preparing Microsoft’s obituary, Satya Nadella’s turnaround of the company focused on learning and growth instead of its infamous competitive points scoring. Defined by placing.
It’s easy to instill confidence in a new team if you can demonstrate decent success in the past. Mr. Mulally has just brought Boeing back from the brink and is off to an even better start. Mr. Nadella was already well aware of Microsoft’s demons. Ratcliffe has no such advantage. While his considerable achievements at Ineos do not loosely resemble the revival of a football team, his investment in multiple sports proves that he has brought a special magic to the sector. Not yet.
Indeed, his overconfidence in having spent £3 million to secure sporting director Dan Ashworth only to be sent off five months later suggests boldness and experience rather than panic. There is. Rebooting is always urgent. But clarity and consistency are at least as important as speed. It took Ford eight years, Apple four years after Steve Jobs returned, Chipotle five years, and Lego seven years.
Business turnarounds are known to start with cost cutting, as it is important to stem losses. But you have choices about how to achieve them.
You can easily fire people. Alternatively, we can use this pivotal moment to strengthen our unity. When Nokia began reinventing itself as an internet infrastructure provider in 2013, it had to lose 12% of its workforce. But rather than blaming employees, Nokia Chairman Risto Silasmaa clearly took responsibility and encouraged them to find new jobs, retrain, return to education or receive support for new businesses. I gave them the option to help.
In contrast, Ratcliffe seems to be going out of his way to alienate the community that loves and supports his team. As he frequently reminds them, he may be a local lad who grew up on council land. But at a time when jobs are being lost and the cost of living is rising, raising ticket prices and eliminating discounts on unsold tickets shows little understanding or sympathy for fans.
What is so striking about Manchester United’s rebuilding attempt is that it seems to be more focused on destruction than creation. A new stadium may be a bright prospect, but it’s what’s going on in people’s heads that matters.
