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Reds Column III

Fenway Sports Group and Summer Transfer Window 2021 Significance

Liverpool Fc at one time faced the distinct possibility of Extinction but fortunately, Fenway Sports Group (FSG) purchased the Club around October 2010 (which also ended the turbulent reign of the previous Reds Owners George Gillett and Tom Hicks).

Considering that the Reds are currently estimated to be worth around £2 Billion (approx.); so purchasing a Legendary Club with an unrivalled Trophy laden history and a massive evergrowing Global Fan Base like Liverpool Fc (The Reds) for just a measly price of around £300 Million; surely will be regarded as a shrewd of piece of business by FSG.

 

However; it was not all smooth sailing for FSG, as the Reds they inherited had:

  • Financial Problems as the Reds were debt-ridden and unable to purchase any Players
  • Mismatch of Players who were inexperienced, few entering their prime and some disgruntled ones wanting to leave to ply their trade playing for another Club that was challenging regularly for Top Honours
  • Lacked experienced Managerial Leadership to steady the ship (after previous Reds Manager Rafael Benítez was sacked earlier by George Gillett and Tom Hicks)
  • Worse of all, a Team that was no longer a force in the Premier League and Europe

 

Also before becoming the Reds Owners; FSG purchased Boston Red Sox Team back in 2002 and helped the Boston based Baseball Club to banish one of the most infamous Sports Superstition called “Curse of the Bambino”, as the Red Sox ended a World Series drought that had gone back to 1918.

This is reminiscent of the Reds long wait to win their first League Title since 1990.

Since winning the World Series in 2004, it has been peaks and troughs for the Red Sox (in terms of ongoing success).

Some fine Seasons that followed by dismal ones, further promulgated the notion of whether Sustainable Success is the core of the decision making for FSG.

Through their former General Manager Theo Epstein; FSG approach mainly has been driven heavily by data and became proponents of the “Moneyball” system.

 

But after going through the period of troughs with their last World Series win in 2018 and the failure to win a World Series since then resulted in key managerial changes.

Eventually, Chaim Bloom took over the General Manager helm and he spoke about the need for Sustainable Success during his unveiling at the Club.

Sustainable Success for the Red Sox would be something that mostly likely means a period of success followed by transition through another slow rebuild to get back to winning the World Series again.

Back at Anfield, the Reds simply cannot compete with the likes of Manchester City Fc and Paris Paris Saint-Germain Fc as these Clubs are heavily funded by the bottomless pit of oil money.

And neither can the Reds compete with the likes of Chelsea Fc who are funded heavily by a Russian oligarch Roman Abramovich.

Similarly, the Red Sox can’t compete with the New York Yankees who are content to take the hit on the luxury tax that affects as the result of overspending on wages in Major League Baseball.

The Reds has to spend prudently on the Transfer Window to buy the right kind of player that fits a specific Player profile.

 

Likewise, by staying out of the higher end free agency market ahead of this Season, the Red Sox focussed on seeking ways internally to make the Club successful once again (especially after the impact of COVID-19 on the Club’s finances).

Regardless of what’s been said or done; Sustainable Success and Sustained Success are two different things.

Sustainable Success involves keeping things afloat and adapt to necessary changes without risking the organization but the path to Sustained Success is distinguished by periods of high performance followed by the periods of rebuilding to get things back on track quickly as possible.

Manchester United Fc (The Red Devils) under Sir. Alex Ferguson has shown the right way for Sustained Success but the Red Devils has lost their way since the retirement of Sir. Alex Ferguson.

Under Sir. Alex Ferguson; the Red Devils had periods of successes followed by period of quick rebuilding for future Sustained Success.

 

As such; the Legendary Scot accumulated with the Reds Devils a whopping 38 Trophies to eventually knock the Reds off their perch (of being the most successful English side).

Due to perceived lack of spending in the Transfer Market compared to their rivals; FSG are being rightly scrutinised at Liverpool as over the past 5 years, the Net Spend for the Reds has been well below their rivals which prove the effectiveness of FSG’s Transfer Strategies.

In the three of the last five Seasons; the Reds have recouped more from selling Players than they spent on new signings and whilst this is good business for FSG, it is simply not enough to size up with the likes of Manchester City Fc.

Most recently; the Reds utilised the £140 Million (approx.) on the Transfer outlay of Philippe Coutinho to fund the eventual transfers for Key Players like Virgil Van Dijk, Naby Keïta and Alisson.

Again considering the effects of COVID-19 on the Club’s revenues as well as the Reds winning the Champions League Title and Premier League Title proves that FSG does have a sound business strategy which other Clubs are aiming to replicate.

FSG approach to success by spending less and instead work smarter has eventually seen their efforts reach a crescendo but after the Crescendo; the Diminuendo arrives as the saying goes “Nothing Lasts Forever”.

 

Especially given how things panned out so far the Reds this Season; it’s no longer about how to stay loud but mainly damage control as the ongoing Season looks perilously going off the Rails!

Despite the unwarranted criticisms from Pundits and Former Players, the unprecedented injury crisis is never an excuse but instead has been a major factor as to why the Reds struggled to defend their Premier League Crown.

Losing Virgil Van Dijk who is arguably the World’s Best Centre Back for the Season and then being forced to play makeshift defenders simply can’t be ignored.

As such; FSG have been feeling the heat on both sides of the Atlantic of late.

Sustainable Success would have been demonstrated in not spending big in the January Transfer Window 2021 on an obvious need to bring a Centre Back.  

During the Winter Transfer Window 2021; FSG spent less than £3 Million (approx.) on Ozan Kabak and Ben Davies who could be potential gems over the course of time.

Still for the present and in terms of requiring to spend more money to demonstrate Sustained Success; FSG were arguably underwhelming as they were not what was needed to try and reach the Goal of attaining Sustained Success.

Perhaps FSG are only interested in the Sustainable Success or perhaps their Business Model might be bound by having to work in cycles but all these are purely speculative.

 

As mentioned earlier, without the bottomless pit of money afforded to other Clubs; FSG have to compete with others by working smarter with proper structure and purpose (unlike Chelsea Fc).

This may come as a bit of shock to some but FSG are not a charity organization with any sense of vanity or altruism as the relationship between the Reds and FSG are strictly Business, where the American Owners gauge success on the pitch.

Being business minded; sound business approach and Football more often than not have the rosiest of relationships.

Still for the sake of business, FSG most likely will not be prepared to go ‘All In’ like a Poker Game in pursuit of short-term Goals.

Like all business minded folks, decisions will be made to determine whether the financial risks outweigh the potential benefits.

On the bright side (and at least so far), FSG are clearly not like the Glazers (the current Owners of the Red Devils) as they care least what happens on the pitch as long as the big bucks keep on rolling in commercially, force huge debt onto the Club and still receive huge dividends.

 

After the takeover was completed, FSG – Principal Owner John W. Henry clearly stated that his main desire was to bring the Reds back to their glory days as well as oversee the Reds progress of challenging regularly for Top Honours.

Yet; after firing few managers and faced few hiccups in the Transfer Market; FSG eventually worked on a proper Managerial Structure, Transfer Strategies and a Team Culture that augurs well with their long-term plans for the Reds.

Hiring the current Reds Coach Jürgen Klopp will surely be considered a masterstroke as the Club enjoyed an unprecedented success under the Charismatic German Coach winning: Champions League 2018-19 Title, UEFA Super Cup 2019, FIFA Club World Cup 2019 and the coveted Premier League 2019-20 Title (the Club’s First League Title in 30 years).

Still after non-stop hard work from Klopp and his staff to ensure the Reds challenge regularly for Top Honours, FSG did prudently spent on acquiring Players but at the same time, sold some players to balance the books.

This Season has somewhat undone all those hard work as their decision not to bring a suitable Centre Back (following the departure of Dejan Lovren) can be regarded both as suicidal and massive oversight from the Club Owners.

 

Klopp surely would have liked a bit more help financially support from FSG as the Club were forced to work with a Limited Transfer Budgets for both  Summer Transfer Window 2020 and Winter Transfer Window 2021 (due to effects of COVID-19 on the Club’s revenues).

Combined that with the never-ending list of Player injuries, constantly utilising the predictable 4-3-3 Formation and many others subsequently led to the Doomed Premier League Title Defence.

Then again, after years of hard work in getting the Reds to the summit of World Football especially after spending less than the rivals; it is fair to imply that Klopp was hoping for a little more help from FSG to ensure that the Reds stays at top of the summit.

As such like in Liverpool; in Boston there has a growing consternation over the potential of another period without silverware and another period playing the long road to success.

 

Furthermore, even the Moneyball system will eventually runs its course as some Detractors of the ‘Moneyball’ system believes that such a system can only serve to affect the overall Football Product but misses several hidden factors which numbers can never quantify such as:

  • Unable to taken into account the characteristics of those maverick Players who can turn the game on its head in just a split second (or matter of a moment) which thereby misses the individuality that makes the beautiful game of Football even more breathtaking at times. Unpredictableness, creativity and many other hidden skills simply cannot be quantified.
  • Despite all the number crunching, it’s unable to properly assess whether the Player from another continent can get accustomed to different style of Football playing in other Leagues. For instance, not all South American Players becomes successful in European Football despite proving their skills and prowess back in the native Countries.
  • Some Teams just follows the good old-fashioned way of scouting and they are successful in their way with having little or no support from Data Analysts. Such Clubs just follows simple methods like “Due Diligence” to find a good Player through Former Players, Former Coaches and so on.
  • Being stuck in an office, a lot of the people who runs such Data (per se) are out of touch with the reality as they don’t get to deal with the Player Agent, Sporting Directors and so on.
  • There are Clubs like Manchester City Fc who have the money to burn for buying “Marquee Players” and it’s hard to compete every Season against such Clubs.
  • In the end; such a system is run by Humans and no one is perfect, so eventually there will be flaws in estimations/ assessments/ computations.
  • Obviously, every Team will soon want this system and Moneyball System becomes predictable. This also means that other Teams that do not follow the Moneyball system will eventually find a way to bring better Player through a hybrid combination of old-fashioned way of scouting and data crunching.

 

Perhaps in the defence of FSG, Klopp has stated that the current Reds Team does require rebuilding. Regardless of how things pans out this Season, rebuilding the current Reds Team is an undeniable necessity as:

  • Most of the Key Players are either soon-to-be on the wrong side of the 30’s and some of them are already in their 30’s.
  • Before their value further plummets; important decisions has to be made to replace the ageing trio (Sadio Mané, Mohamed Salah and Roberto Firmino) for young Strikers or versatile Wingers (that bodes well with the Club’s requirements of Players).
  • Even arguably the World’s Best Goalkeeper Alisson Becker needs to have an eventual heir to his throne, so the Club must bring in a proven prolific young Goalkeeper like Gianluigi Donnarumma as that can also keep Alisson in his toes, while his understudy is being groomed.
  • Given the importance of Georginio Wijnaldum in the side, FSG has to make a decision whether to extend the contract of Georginio Wijnaldum or let him the leave the Club as a Free Agent.
  • Informed decision has to be made to whether to sell Players (like error-prone Loris Karius, benchwarmer Divock Origi, underutilized Takumi Minamino, injury-prone Joël Matip, Xherdan Shaqiri, Alex Oxlade-Chamberlain, Marko Grujić, Nathaniel Phillips and so on) that has little or no future at the Club. 
  • The decision to bring in another young quality Centre Back will need to be assessed, if the experimentation of Ozan Kabak is deemed to be a failure but if the money is not available, the Club can consider signing David Alaba on a Free Transfer.

 

Verdict: It’s important to put things in perspective by pointing out those dark days of when George Gillett and Tom Hicks brought the Reds to its knees because of the financial mess created by these former Owners.

So, it is worth pointing the Reds meteoric rise under FSG but at the same time, it does not mean that they are safe from scrutiny. Also, despite FSG’s perceived successful strategy with the Red Sox, their legacy at Liverpool will be defined by whether FSG sought success that was Sustainable or whether they tried to bring Sustained Success.

To allay any fears; laying out the Post COVID-19 long-term plans to the supporters may be a good way to start similarly like how FSG revealed the plans to maximise the capacity of Anfield Stadium few years ago.

Whichever side that one chooses to stand by FSG or not, the American Owners can be regarded as shrewd Owners with business acumen or consider their Reds Business Model as “Boom and Bust”.

Yet, the upcoming Summer Transfer Window 2021 will be significant as that might well become one of FSG’s defining moments of their Reds Legacy.

 

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