Introduction
Arsenal Football Club (FC) is presently one of the leading professional clubs in England and across Europe. Having been established in 1886, Arsenal FC is one of the clubs that have played in England’s top league for the last seven decades. Historians in the field of sporting acknowledge that the club has enjoyed a number of successful periods. Past managers have been keen to establish and implement powerful business models and strategies that explain why it has remained successful. The strategy ought to be a continuous process intended to develop talent, promote productivity, maximize revenues, and increase sustainability. Unfortunately, the past decade has been challenging and unproductive for this professional club. This report evaluates Arsenal FC’s internal and external environments and offers a rationale for the strategic direction put in place.
Background
Since its establishment, Arsenal FC has relied on the power of strategy to identify emerging opportunities and capitalize on existing situations to remain competitive. Within the past century, this club has managed to clinch 13 premier league titles and 14 FA victories or cups (Challies, 2021). The established business model has made it possible for Arsenal FC to compete in England’s top-flight league for the longest time. During the first years of the 21st century, Arsenal focused on relocating to Emirates Stadium in an effort to maximize revenues and support its financial plan. It holds the title for the longest unbeaten form of 49 games in 2003 and 2004 (Şener and Karapolatgil, 2015). These strategies and achievements have made Arsenal FC among the top ten clubs in terms of revenues. For the 2016-2017 league season, this club was able to earn a total of over 487 million pounds. Additionally, the club has continued to attract more fans. Its value has also been increasing steadily over the years.
Despite these remarkable achievements, some gaps exist that might affect Arsenal FC’s current and future success. For instance, the nature of strategy has been unsustainable following the successful departure of Arsène Wenger in 2018 (Challies, 2021). During Wenger’s tenure, this club developed a unique strategy that would be implemented within a period of two decades. He always considered the best ways to get young and talented players and developed fitness centers. His primary focus was to acquire more players from France (Andrews and Harrington, 2016). The manager was also keen to formulate a winning model for playing football characterized by technique, fast pace, and power (Hinson et al., 2020). The completion of Emirates Stadium would also augment the club’s financial strategy and reduce the level of debt. As described in the next section, the present moments are characterized by unique hurdles and challenges that might affect the club’s future performance and productivity.
Internal and External Environment
Business analysis is an evidence-based initiative aimed at understanding the current situation in a particular firm and identifying some of the possible changes that can help improve organizational performance. Arsenal FC can be studied as a successful sporting organization whose top leaders have been focusing on the best approaches to strategize, attract talent, and entertain the targeted followers (Arsenal Football Club PLC and Callow, 2015). A detailed analysis of the internal and external environments could help understand some of the unique opportunities and issues that the leaders need to capitalize on and steer them in the right direction (Challies, 2021). The use of powerful analytical tools would also be necessary to provide timely insights and help Arsenal FC achieve its goals.
SWOT Analysis is a powerful tool that can help analysts and leaders at Arsenal FC understand the internal environment and determine how it affects the current level of performance. The first section provides the club’s leading strengths. First, the club relocated to Emirates Stadium, a modern sporting facility that can accommodate more than 60,000 people (Challies, 2021). The availability of this resource means that the club is able to manage its operations, maximize revenues, and provide comfort to all visitors (see Appendix 1). Second, the club is presently competing in one of the most successful and admirable leagues in the world. This attribute means that it is capable of attracting top talent depending on the formulated strategy (Andrews and Harrington, 2016). Third, its consistent performance in the domestic top league has been ensuring that Arsenal FC gets a place in most of the Champions Leagues.
Third, Arsenal FC stands out as one of the clubs in England that has adopted and pursued a powerful corporate social responsibility (CSR) framework. It has been giving back to society by helping the less fortunate and providing support to those with a wide range of social and financial needs (Marthaler, 2017). Fourth, the managers and leaders try their best to develop balanced and committed squads that are capable of delivering the anticipated results. Fifth, Arsenal FC is one of the leading sporting organizations in the world today in terms of fans. Its followers are loyal ad would be willing to sacrifice for the club by all means (see Appendix 1).
On top of the outlined strengths, Arsenal FC encounters some unique weaknesses and gaps that have the potential to affect its current and future performance. For instance, this sporting club has not won any significant trophy within the past decade. This long stretch without any victory is capable of discouraging more fans from moving to other clubs. Similarly, some of the talented players from different regions across the globe would be unwilling to join Arsenal FC due to the recorded poor performance (Andrews and Harrington, 2016). Additionally, the club has lacked form and consistency within the past few years. This weakness means that it has been unable to find its ground and engage in activities and plays that are capable of delivering the much-needed victories and trophies (see Appendix 1). Strategists at the club should, therefore, consider the nature of these issues and propose better approaches to improve the current level of performance.
The external environment is worth examining because it is capable of affecting the productivity of any sporting organization both indirectly or directly. To begin with, the external market presents a number of opportunities that the club’s top leadership could consider to transform the current situation (Marthaler, 2017). For instance, Arsenal FC can identify and attract more competent players from some of the emerging markets in Africa, India, and China. Additionally, improved club performance would mean that it attracts more young fans who can support the club’s ideology and push it to higher levels of achievement. While focusing on these new markets, Arsenal FC should be on the frontline to attract homegrown young players who can deliver positive results and improve its glory.
On the other hand, Arsenal FC continues to encounter a number of threats that have the potential to affect its current form and future performance. For instance, this club has been operating in a domestic league that is extremely competitive. This reality means that the managers will have to move fast and look for good players before they can join their rivals. The global sporting world is also borrowing better and more realistic managerial strategies from the corporate world (Andrews and Harrington, 2016). This kind of transition means that clubs that rely on traditional ways of management, such as Arsenal, might have higher chances of becoming obsolete. Another undeniable threat coming from the external environment is that Arsenal FC is one of the 6 major clubs operating in London (Marthaler, 2017). This scenario means that such organizations will continually share fans and engage in derbies. For Arsenal FC to stand out, there is a need to consider some of the best efforts, strategize, and identify new ways of competing successfully.
On top of the SWOT Analysis tool, the PESTEL model could be considered to identify some additional factors in Arsenal’s external environment. The first element would be political influence and would have little impact on the club since it follows the outlined guidelines and respects foreign jurisdictions. The environmental element would require that Arsenal FC develops a superior model that could help transform the environment and sensitize its fans to reduce their carbon footprints. The social aspect indicates that the club should be on the lookout and identify the changing income levels, sports consumption, and expectations of fans belonging to different age groups (Marthaler, 2017). The technological element means that Arsenal might be completed to transform or change its strategy in line with emerging technological developments. The economic and legal aspects are influential since the cub should be keen to follow Premier League and Fédération Internationale de Football Association (FIFA) guidelines in every activity or decision. Failure to do so would mean that it risks being fined or discontinued from most of its current competitions and leagues.
Weighting and Ranking
The above section has revealed that Arsenal FC is a sporting organization facing both opportunities and threats in both the external and internal environments. Most of these forces will directly impact performance and dictate the club’s ability to attract top talent, retain players, and meet the changing demands of most of the key stakeholders (Andrews and Harrington, 2016). Weighting and ranking is a powerful strategy for determining a company’s current situation and identifying some of the key areas where additional improvements could be necessary.
The External Factor Evaluation (EFE) tool is a matrix that makes it easier for analysts to examine the external environment of a given company. From the completed EFE (see Appendix 2), it is agreeable that Arsenal FC can consider new markets and tap local talent. The sporting organization can capitalize and leverage emerging technologies for marketing processes and encourage more people to support the introduced model. The sporting club would also consider the need to change management in such a way that it will resonate with the demands and expectations of most of the stakeholders (Marthaler, 2017). Another critical opportunity for Arsenal FC would be to launch powerful initiatives to maximize revenues. These efforts are standardized in the sporting industry and have the potential to steer clubs to positive performance.
While capitalizing on some of the outlined opportunities, it remains necessary for Arsenal FC to identify some of the threats that have the potential to disorient the recorded performance (Marthaler, 2017). For instance, the club’s leaders need to take these key issues into consideration: competition from rival clubs in London, management changes in the sporting world, clubs purchasing the best players, and foreign investments.
From the completed matrix, it is agreeable that Arsenal FC is not responding the way it should to the recorded threats and opportunities (see Appendix 2). The recorded results reveal that the club is not prioritizing some of the key areas and initiatives that can help improve performance (Şener and Karapolatgil, 2015). The response of between 1 and 2 shows that it is below the industry average. This scenario could explain why it is yet to begin winning trophies and improving its current attractiveness to investors and fans in different parts of the globe, including Europe, Asia, and North America.
The rationale for Current Strategic Direction
With the above issues and realities, Arsenal FC has transformed its strategic direction in such a way that it resonates with the recorded market dynamics and changes. To record positive gains, the managers and leaders have been focusing on the best ways to maximize the club’s income levels. They began this journey in 2006 after the club began to operate from the Emirates Stadium (Şener and Karapolatgil, 2015). The involved trainers and experts have been keen to create football that is attractive, entertaining, and capable of attracting more fans. This initiative has helped increase the club’s commercial value.
Additionally, the club’s top management has considered the presence of a good academy that is capable of training and developing young players. It identified young individuals in England and across Europe who can meet the anticipated future goals. A scouting network aimed at finding talent is also in place. These young players find it easier to grow with Arsenal FC and take the idea of club loyalty seriously (Marthaler, 2017). These efforts are capable of guiding Arsenal FC to achieve most of its goals and eventually remain sustainable.
Despite these initiatives, Arsenal FC is yet to develop a quality and experienced squad that is capable of winning matches. The leaders are yet to strike a balance between experience and youthfulness. Such a mix has been observed to work positively in other clubs across Europe. Another critical issue is that Arsenal FC used to have quality leadership and management prior to 2010 (Arsenal Football Club PLC and Callow, 2015). Unfortunately, the past decade has been characterized by changes and management and style of play. The club is yet to motivate and ensure that most of the players develop a winning mentality. The leaders are not capable of providing the much-needed support that can help reshape the club’s playing philosophy.
In the field, much needs to be improved since the club has not been delivering results. For instance, the club’s management is yet to develop a team that offers maximum entertainment. The level of confidence has been declining over the years, thereby affecting the nature of the recorded results (Rippon, 2020). Without the much-needed dominance in different competitions or leagues, Arsenal FC has not succeeded in getting its balance and stability. Such gaps in strategy are analyzed from the models and achievements other clubs in the country and across Europe have recorded.
This description is founded on the unique attributes or rationale that many clubs pursue. These include the desire to create stability, promote effective management, develop a winning or quality squad, increase overall income, and produce talent. The discussion has revealed that Arsenal FC is performing positively in some of the areas while doing poorly in others (Rippon, 2020). The overall outcome is that club’s strategy is less competitive and incapable of delivering results. Being one of the leading clubs in England, Arsenal FC would, therefore, need to strategize and consider some of the best initiatives that can deliver positive results and return it to its former winning ways. Such an effort will help transform the situation and ensure that it capitalizes on all emerging trends and opportunities.
Recommendations
Arsenal FC is currently performing poorly despite its prestigious status in the English Premier League. Having competed in the league for the longest number of uninterrupted years, there is a need for the top management to reconsider some of the issues recorded in both the internal and external environments (Ráthonyi-Ódor et al., 2020). This knowledge will present additional insights and ideas for transforming the current strategy and preparing the club for possible success in the future. The involvement of all key stakeholders would be necessary to ensure that timely and sustainable outcomes are recorded in the near future.
The first recommendation would be for Arsenal to create a new strategy or mission that will become the guiding principle for all possible operations. For instance, the club can concentrate on generating the maximum revenue possible in order to compete effectively and competitively at all levels. To achieve such a goal, the club can capitalize on emerging technologies and social media platforms to advertise and attract more supporters. Additionally, they will need to create a winning formula that is capable of delivering entertaining football matches (Shushkova, 2021). Commercial deals would also e necessary to attract more viewers and become a more competitive brand in the region.
The second recommendation that is founded on the trends recorded in the eternal environment would revolve around the creation of the best environment whereby most of the fans will enjoy all games. This solution is multifaceted whereby the club will have to identify and attract more paid members, scout and employ more young and talented players, and equip them with the right resources to deliver results (Ajadi et al., 2020). Arsenal FC will also have to create a wide range of services and products that resonate with the changing expectations of all supporters. Such a strategic direction will help elevate this club to the next level, address the problem of competition, and maximize sustainability.
Conclusion
The completed report has identified Arsenal FC as one of the successful clubs in England. Competing in the top league, this club has been forced to change its strategy severally depending on the experienced external and internal forces. The current business model remains inappropriate and incapable of taking this football club to the next level. The presented findings have revealed that there are some unique gaps that might affect its future success. The introduction and implementation of the proposed recommendations will help Arsenal FC adopt a new strategic direction and be prepared for a sustainable and successful future.
Reference List
Ajadi, T. et al. (2020) Eye on the prize: football money league. Manchester: Deloitte Sports Business Group.
Andrews, M. and Harrington, P. (2016) Off pitch: football’s financial integrity weaknesses, and how to strengthen them. Boston: Center for International Development at Harvard University.
Arsenal Football Club PLC and Callow, N. (2015) Arsenal’s greatest goals. London: Carlton Books.
Challies, J. (2021) ‘Arsène Wenger explains Arsenal transfer strategy and criticizes Liverpool over Thiago Alcantara’, Football London, Web.
Hinson, R.E. et al. (2020) ‘Internationalisation and branding strategy: a case of the English Premier League’s success in an emerging market’, Qualitative Market Research, 23(4), pp. 747-766.
Marthaler, J. (2017) Arsenal FC. Minneapolis: Abdo Publishing.
Ráthonyi-Ódor, K. et al. (2020) ‘How successful are the teams of the European football elite off the field?—CSR activities of the Premier League and the Primera División’, International Journal of Environmental Research and Public Health, 17(20), 7534-7562.
Rippon, A. (2020) Arsenal: the story of a football club in 101 lives. Yorkshire: Casemate Publishers.
Şener, İ. and Karapolatgil, A.A. (2015) ‘Rules of the game: strategy in football industry’, Procedia – Social and Behavioral Sciences, 207(1), pp. 10-19.
Shushkova, L. (2021) ‘The 5 tactical solutions that will save Arteta’s job at Arsenal – tactical analysis’, Total Football Analysis, Web.
Appendices
Appendix 1: Arsenal FC SWOT Analysis
Appendix 2: Detailed External Factor Analysis for Arsenal FC
