Three Lessons and Caution for Managers from Michael Eisner’s Purchase of Portsmouth FC

The New York Times’ Rory Smith recently wrote about former Walt Disney Company CEO Michael Eisner’s purchase of Portsmouth FC, a storied English soccer team that recently “flirted with oblivion.” Smith’s piece offers three lessons and one caution for managers and organizations beyond soccer.

Portsmouth Football Club, also called Pompey, was founded in 1898. Over its 120-year history the team has had tremendous success, most recently winning the FA Cup in 2008 (a tournament open to roughly 750 teams in the top 11 divisions of English soccer, from Biggleswade United in the Spartans South Midlands League to the legendary and frustrating Arsenal FC in the Premier League). Since 2008’s victory, Portsmouth slipped into the fourth tier of English soccer and and has run through a series of foreign investors. It took several thousand fans chipping in to buy the team to save it. As Smith reports, Eisner and his son have considered buying into teams in Major League Soccer in the US and in teams in England’s top division. But it wasn’t until Portsmouth that they finally invested, initially spending $7.8 million. To put that figure in perspective, Manchester United, the world’s most valuable team, is worth $3.69 billion. The most valuable team in the US is the Los Angeles Galaxy, which is worth $315 million.

As Smith notes, the Portsmouth fan-owners were understandably skeptical of another foreign investor trying to swoop in to buy their beloved club. Eisner took several steps to win and keep the support of fans from which managers coming into any troubled organization can learn.

Humility. Smith writes, “Portsmouth is a tough, tight-knit sort of a place; being lectured by a mogul who had just jetted in from California with no prior knowledge of or investment in soccer would not go over well.” Eisner learned about the town and its naval history. He pronounces Portsmouth like a local. He replies to fans’ email and retweets their comments. In commenting on the Times article on twitter, Eisner wrote: “…let me add one point. Without the great great work over 4 years by fan ownership , the PST [Pompey Supporters Trust], and Mark Catlin [Portsmouth FC CEO] there would be no Pompey.” Eisner demonstrated, and continues to demonstrate, respect for the history of the club and its fans.

New managers should do the same. No matter how troubled the company or division you are entering, it was there before you got there and if you do your job it will be there after you leave. A lot of people likely sunk a lot of their lives into the organization, and they have seen leaders come and go. The best new managers respect those who have been working hard to make the organization work.

Honesty and caution. Eisner isn’t borrowing tons of money and promising an immediate return to glory. He told the fan-owners that if they wanted quick infusions of cash, he wasn’t their guy. Instead, he committed to patience and smart growth. This approach helped secure the support of those the team needs to survive and succeed.

Organizations that are in trouble know there is no magic bumper sticker or bit of brilliance that will solve everything at once — if there were, you wouldn’t be needed because the job would have been done already. The best managers are honest about what it takes to build a strong, sustainable, organization. They express, and demonstrate, a belief in hard work and commitment to a shared goal.

A good story. As Smith put it, “In this case, the better business proposition goes hand-in-glove with the better story.” In making his pitch, Eisner used video clips of real winning professional sports teams with which he has been involved (Anaheim’s Angels and Ducks) and clips from Disney sports movies including “Remember the Titans” and “The Bad News Bears.” In Smith’s words, “Sports and movies, to Eisner, are the same thing at heart: They are both — they are all — stories.” Eisner told the fan-owners a story about their club. The story was a familiar one of hope, loss, and redemption; a once great team had fallen on hard times through no fault of its own, but with hard work and focus would win again. Portsmouth was Brando as Terry Malloy who could have been somebody if it weren’t for corrupt outsiders, and in the end rises bruised and bloody to victoriously lead a crowd at the docks. Eisner has local support in part because he is telling the fans their own best story, and making them the heroes of that story.

Leadership is, in many ways, storytelling. These stories put the staff and organization in a larger context, and like Disney’s “Miracle” about the 1980 US men’s Olympic hockey team, are true to life. This is different than true, but not quite fiction. We know the stories aren’t fully factual; we embrace them because they are familiar and help us make sense of where we are and where we are going next. The best managers then make their staff the heroes of those stories. In Lake Placid in 1980 Herb Brooks (Kurt Russell) gave the speech, but it was Mike Eruzione who scored the go-ahead goal and Jim Craig who make a last minute save to preserve the lead.

Embedded in this story is a caution for Portsmouth and for managers — being the underdog is a double-edged sword. By definition an underdog is someone not as good as the opposition. Winning is never expected by either players or fans. As a result when the winning stops, which it always does, players and fans assume the failure is deserved. Shoulders drop, fans sigh, and losing becomes a self-fulfilling prophesy. Portsmouth is doing well and rising, but at some point the players will get their heads handed to them by a team whose worst player cost more than what Eisner spent to buy his entire team. If the players believe the loss was deserved, that the fairy tale is over, then Eisner’s story doesn’t get its Disney ending. At some point Portsmouth’s players need to be confident enough to win the games they should win and some they shouldn’t, and also confident enough to bounce back from losses.

The same is true in organizations. If your organization is the scrappy outsider fighting for a seat at the table or a shot at a big contract, you may over-perform and get the unexpected victory. But once you get that victory, you have to believe you deserve it. Being an over-performing upstart is exhausting and unsustainable, and ultimately means you will always be the outsider who everyone (including your staff) is surprised got the contract. Having used underdog status to get the initial success, managers need to coach staff to see they deserve that success and can build on it. The new contract or new project is the new status quo; sometimes you will lose bids or customers, and sometimes you will do better than expected, but your current success needs to be your norm.

For more lessons from soccer for managers and organizations look for my book Soccer Thinking for Management Success due out this summer.

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