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Rula Khalaf, editor of the Financial Times, picks her favorite stories in this weekly newsletter.
The writer is the author of “Anonymous: How to Navigate the Future”
Transitions are harder than they seem. The stories (always told backwards) refer to a single hero, usually a male, who enters the city, makes bold and dangerous decisions, and emerges victorious in the blink of an eye. These myths are dangerous because they focus on just one man eradicating the past. These heroes can be as risky as the dangers they face. Is this the situation that Sir Jim Ratcliffe, a minority shareholder in Manchester United and the man in charge of the club's football operations, now finds himself in?
United's restart is certainly eagerly awaited. But Ratcliffe's opening maneuvers are worrying. Telling fans that their beloved team is “mediocre” may be a harsh reality, but it does nothing to instill confidence in them or the players. Spreading blame and mutual accusations is a mistake, when hope is the first thing any organization needs on its painful journey from failure to success.
Crucial encouragement is what Alan Mulally brought to Ford in 2006, when the company had just posted losses of $12.7 billion. Instead of labeling his workforce as losers, he rebuilt their competency by restoring their trust in each other and making them focus on the future, not the past. As important as financial restructuring was, Mulally was determined to change the culture. Ford executives have learned to help each other, knowing that no one person succeeds alone. One might expect this to be well understood in the world of sports, but it is rare.
Likewise, Satya Nadella's turnaround at Microsoft, at a time when detractors were preparing the company's obituary, was by focusing on learning and growth rather than scoring the competitive points for which it became famous.
It's easier to inspire confidence in a new team when you can demonstrate previous success and relevance. Mulally was off to a more auspicious start, having just rescued Boeing from the brink. Nadella already knew Microsoft's demons well. Ratcliffe lacks such advantages. His massive achievement at Ineos is not nearly the same as reviving a football team, while his multiple sporting investments have proven that he brings some special magic to the sector.
Indeed, his overconfidence, in spending £3m to secure sporting director Dan Ashworth, only to be sacked five months later, suggests less boldness or experience than panic. Reboots are always urgent. But clarity and consistency are at least as important as speed. Ford took eight years, Apple, upon Steve Jobs' return, took four years, Chipotle five and Lego seven.
It is well known that turnarounds start with cost cutting because keeping losses constant is crucial. But there are options on how to achieve it.
You can simply fire people. Or you can use this pivotal moment to promote solidarity. When Nokia began reinventing itself as an Internet infrastructure provider in 2013, it had to lose 12% of its employees. But instead of blaming his employees, Nokia boss Risto Siilasmaa took responsibility squarely and gave them options: help them find new jobs, retrain, return to education, or get support for a new company.
By contrast, Ratcliffe seems to be doing his best to alienate the community that loves and supports his team. He may be, as he often reminds them, a local lad who grew up on a council estate. But at a time of job losses and rising costs of living, increasing ticket prices and eliminating discounts on unsold tickets shows little understanding or compassion for audiences.
What is striking about Manchester United's attempt at transformation is that it seems more focused on destruction than creativity. A new stadium may be a glorious hope, but it's what's on people's minds that matters.
