What business can learn from sport is to perform. Sport is about winning and business is about making a profit. Alex Ferguson, Clive Woodward and Eddie Jones are systematic in their approach to management but also visionaries and full of energy just like Richard Branson in the world of business. However, if you google “sport and business” you also find articles on how business management is quite different. It is also too easy to draw simple comparisons. As a life-long sports lover and sports player; having researched this, I suggest some specific tips or lessons. I also describe what is unique in sport and business. I summarise Alex Ferguson’s tips for management from an excellent London Business School video link included below.
I will start with this insight which is a fantastic case study in management. You can see various interviews, but this one at the London Business School is concise and gives a great overall view. His tips and lessons:
- Be early into work
- Share the same purpose
- Be energetic
- Staff followed his example, and were in early
- He liked people who knew they were good
- He was there to solve peoples’ problems
- The Press – The Utd Manager has to deal with more challenges than HSBC, M&S etc.
- Answer the question, but do not come out “beaten”
- Developing young talent is crucial, they rely upon you as do the organisation
- Developing talent creates a long-term opportunity and assets
- Discipline is crucial
- Managing risk: take risk, but apply common sense
- Make sacrifices – there is no other way, show example, paramount e.g. miss family occasions
- Key relationships key was CEO David Gill who was never afraid of him and was completely honest
- A fantastic communicator, problem solver, solution provider and provided financial solutions
- People could stand up to him
- Seconds in command – essential to have a confident, quality team his #2 was Carlos Queiroz
- Very smart, sat forward, imagination, intense, concentrated and focused
- Leaders Alex admires: Nelson Mandela – no bitterness after 27 years in prison
- Key advice to future graduates on leadership?
- Be consistent to inspire people all the time
- Observation – not so much what you see all the time but what you can miss
- You can also pick up “I wonder what is wrong with him today?”
- “Should I talk to him” Have your head up to see what is going on
So that was a smapshot from Sir Alex. Here are thoughts on what business can learn from sport.
What is unique to sport and business
In sport especially in team games, there can be more reliance upon the players than there is the manager and coach. As we have suggested mid and long term success is always down to management but short term, individuals determine immediate success. In business, the leaders have far more control and effect on what happens in most circumstances, due to financial, contractual and legal circumstances.
A Vision, Strategy, A Plan
Andy Murray was unrelenting in his vision to achieve certain things in his career and put a strategy in place with his team, with plans to deliver this. He could not do this alone. Like all plans, when the rubber hits the road they have to be adapted and constantly modified. Murray changed personnel, processes, and tactics but never his vision. Henry Mintzberg is famous for his emergent strategy reflecting the need to modify plans but still focus on the objectives. This ability to adapt is now common practice in agile managment practice.
In team sports you hear time and again, the importance of leaders in the team. Some of the great teams such as the England 2003 rugby union world cup winners, or the England 1966 football team, were littered with strong characters. They were also led by fantastic leaders for managers who could rely upon their coaching to be implemented on the field of play with a number of leaders out there on the pitch. These managers would create and implement strategies and plans using ways described below, equally found in business.
Sports people are very focused and need goals. The same is true in business. Clear personal attainable goals are vital as Michael Phelps empahsises here. It’s about your goals, hitting them, or adjusting based upon the outcomes. In business and personally the SMART acronymn works well: Specific, Measurable, Achievable, Relevant and Time-Bound.
This is such an over-looked but rich area of opportunity for business, sport and life in general. You are defined by the decisions that you make…they project the values that you hold to the world around you. Ferguson and Mourinho are tactical decision making geniuses as are and were Federer, Djokovic, Shearer, Bobby Moore, Lewis Hamilton and Ronnie O’Sullivan. Quick and agile minded, focused and bright. But even within the cauldron of sport and the competitive fury of business if you can understand how decision making works, you can be better at it. Here are a couple of experts relevant to both sport and business. The Building Code for decisions by Dr Joe Arvai describes 5 elements:
- Goals and objectives
- Options to choose among
- Outcomes and consequences
- Tradeoffs – Based upon values and then fundementally….
- Monitor, Learn and Adapt over your lifetime
The tradeoff is between accuracy and effort and is very well covered by another decision making expert here on Heuristics Nick Hixson. How do you make good decisions with limited information and time: very relevant in sport for example in the middle of a tennis match. Going back to Dr Joe Arvai, a key point is that all these small decisions are made based upon our value system, and become easier, to some extent with experience. From a purely analytical point of view here is an excellent very short video showing how decision-making is coached on an individual level for soccer players. We touch on use of analytical tools below. Michael Mauboussin from Credit Suisse Financial give a fascinating insight here into how to avoid bias, rejecting new data, in decision making and how to then forecast more accurately.
Communication and Culture
In sport this is presumed to be aural more so than in business. In sport this is between primarily between coach and player expressing ideas, information, knowledge, thoughts and feelings. Non-verbal communication in sport is through facial expressions, gestures, group actions and demonstrations. Sales is often seen as close to sport. However sales structures and cultures vary across industries and countries. The culture of an organisation or team is critical to the success. Some notable examples of strong culture are The All Blacks . The Saracens culture too has been a business and rugby success. It means that young talent is encouraged, egos are kept in place but also recognised.
Motivation and Ambition
There are specific challenges in any sporting situation. This could in fairness be compared to making a speech or a sale in business. This is well described in this sports psychology graph here which focuses on immediate sporting tasks rather than longer term ambitions. The work a manager does with a team member or his player longer term can be similar in sport and business. This is down to reviewing what the person and organisation needs, aligning objectives, and agreeing strategies. A regular review and feedback, formal and informal is essential. The level of determination varies in all of us, so contributes to the outcome.
Capability, Skill and Creativity
Sport gives huge rewards for talent, and results, in 2016 topendsports showing Christiano Ronaldo on $88m earnings. Whilst in business $147.6m was the top earning CEO on the managementtoday list 2016. Which indicates it’s the bosses who earn the money – ie the guys who “direct the chess pieces” . However when you think of it, the goal scoring at this level really comes from the strategic thinkers at the top; these are the people that really make a difference in business.
The teamwork essential even with a tennis player but crucial with NFL, soccer, rugby and alike extends beyond the pitch into the backroom, to reserve teams, medical support, scouts and the whole infrastructure. More immediately as Alex Ferguson stated, the senior management need to set an example as indeed Branson does or Lord Browne former CEO of BP did as he stated in this article on authenticity. This honesty is critical because of the importance of aligned leadership. In sports, key decisions have to be made and overseen at multiple management levels. Ultimately, it’s how the team performs, not the individuals. Pro sports teams are essentially small businesses. We see the importance of strategic partnerships with external suppliers of analytical resources.
This has become vital in recent years. Ferguson says ” Practice, Practice, Practice”, which is critical and begs the question, “how precisely?” Well analytics provides the precise answer with computer analysis of player, team and competitor performances. Attack and defencive strategies for example – how to balance skills across team. What formations to play, who to use and when. Benchmarking best practice with teams and players across the world. Does this sound like something marketers and market researchers have done in their business planning? Absolutely! Wider global, market and other analysis, audits and SWOTs to produce strategies are essential in business.
What business can learn from sport? There are particular activities peculiar and emphasised in sport but, as a massive business sector it shares many practises with other industries. It teaches other sectors and can learn from them too. Gurus such as Alex Ferguson and Clive Woodward will continue to be an inspiration.
Peter Eales BA Hons Chartered Marketer FCIM FIDM
A Founder Director Dorset Business Angels
MD o i solutions limited