STRATEGIC MANAGEMENT CASE 3
Arsenal was founded 127 years ago, when a group of workers from the Woolich Arsenal Armament Factory decided to form a football team (Appendix 1). At first they called themselves Dial Square in relation to the sundial atop the entrance of the factory, but shortly after they renamed themselves Royal Arsenal.
The football industry started with an innocent game of ball between friends, but it has transformed into a billion dollar industry. The football industry worldwide generates billions of dollars in revenues. FIFA World Cup, UEFA Champions league, English Premier League, Spanish League and Italian football league are huge money earners for the world wide football industry, also broadcasting rights, player transfer fees, endorsements, footballers earnings and product manufacturers earnings add to the impressive total revenue.
Arsenal FC is one of the richest and highest profile clubs in Europe today, they always have and at present are standing on their own two feet. Ivan Gazidis (Appendix 2) is proud to have a sustainable business model especially in these times of crisis. Arsenal might have a sustainable business model but it is increasingly losing its essence of being a professional football club. From a business standpoint their model might seem successful but from a strategic standpoint, Arsenal has to restate the question because the answers from yesterday will not be valid today.
Yesterday’s answers will not justify Arsenals winning drought since 2005, which will eventually damage their brand image and result into a disability to attract footballers to their club, in addition to decreasing ticket and merchandise sale. Overall Arsenal FC is suffering from weak strategic management, as they have not been making long-term decisions.
Football is a business, however, the most important aspect of any football club will always be the football team itself. The ‘football’ and the ‘business’ must operate in tandem. In...
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