Monday, 19 May 2014

Massimo - Its good to talk....

Leeds' season ended with somewhat of a whimper, however the post-season events have shown that Massimo Cellino has started to establish his regime and the beginning of the cost savings which are required by the club.

We know that the club was running operating losses of ca. £11.5m during the 2012/13 financial year, and sources have suggested to me that these costs increased significantly over the first half of 2014 (notwithstanding any cost increases over the first half of the 2013/14 season). It would therefore seem that the somewhat abrupt and drastic actions undertaken by Cellino have been driven by this circumstance.

Whichever buyer was intending to buy Leeds United would have had to instigate significant cost reductions, with a club operating with operating losses of £11.5m being unsustainable in a post-FFP era. If, as expected, the costs have increased significantly from this position, then it is likely these cuts would have had to be much more extreme.

Corporate restructuring is generally a painful and messy business, not least for the employees affected. It is even more complex when you have multiple stakeholders to deal with, which in the case of a football club is the fans. It is incredibly na├»ve to assume that the fans of a football club, who whilst not shareholders, are equally engaged in its operation will not have concerns on how it is run. Cellino did in essence pay £35m for a company which has few assets aside from a paying fanbase. It is this element which whilst not necessarily kept happy, does need to be kept relatively informed and in an appropriate way.

A club operating in an information vacuum, with a manager ostracised, players informed via Twitter whether they are being retained or released, and a son of the owner tweeting information (true or false, we shall see) over the internet is not the appropriate way to manage the communications for what is a complex and emotive period, even in the context of the club's recent history. This is one element which needs to be improved significantly by Cellino over the coming weeks, ideally with some clarity as to what the medium-term plan is. It is an information vacuum which allows dis-information to prosper, and ultimately is proving divisive amongst fans. That is not for the benefit of any of us.

The other element is whether these cost elements are being correctly allocated. From an outside perspective, but one with a relative understanding of the financial position, struggles to see whether the limited cost savings (given it is shut for a relatively short time, rent is still due, other staffing costs and utility bills will still have to be paid) outweigh the reputational and operational damage in having players with nowhere to train, utilisation of limited physio facilities at Elland Road and also the view from outside the club, where prospective players (in a season where we need to rebuild) looking at a club which seems to be in turmoil and can't seem to afford its training facility.

Now perhaps this is a completely justifiable move which will lead to substantial benefits, however it does leave me concerned and coupled with the information vacuum, is only seeking to provoke concern amongst much of the fanbase.

Personally, I remain supportive of Cellino's intentions, it is clear he needs to undertake some significant restructuring, and if the elements which have been suggested to me are correct, Leeds are in a significantly bad situation which will require his full support and focus which it would seem he is engaged in providing.

A key element which is lacking is the communication with the staff, players and fans. This is a long-haul project which is likely to take at least 1-2 years in my opinion to turn it around. Cellino is going to have to take the fans with him on this journey and without better communication, I doubt whether he will be able to make this project a success. Communication of the current situation, a medium term plan for stabilising the club, and proactive engagement with the fanbase would go a long way to ensuring that the club unites behind him.

2 comments:

  1. Graet Blog mate, agree wholeheartedly...The fans have to buy into what he is doing here,I know they would if it was their employer trying to safeguard their jobs, ...and we need to remember #lufc is a business , not a social club ! He is the first owner for many years that has told us the truth and guess what we dont like it !! ..But I genuinely believe he will turn us round....and yes the communication of his intentions needs to be addressed....one voice will do ....HIS !! No need for little tweets and Facebook rumours ..."if its not from Cellino, its not true philosophy going forward" But this ethos has to come from him !! I hope it happens ! MOT

    ReplyDelete
  2. Spot on with the analysis. He needs to take the fans with him as the loyal fanbase is about all he got for his money as you say.
    If he alienates the majority of fans then he's got an impossible job. #communication

    ReplyDelete