Management Lessons from Football: Inspired by Sir Alex Ferguson's Retirement

As much as I hate to admit it, Sir Alex Ferguson is indeed one of the greatest, if not "the" greatest football manager in the modern game. With his recent decision to retire, it somehow struck me that football does indeed offers us many management lessons which we can adopt in our organization:

1. A team full of star players would be useless unless they can function as a team. Look at Manchester City. With all the money which they have spent, one would have expected them to perform better. As such, it is important to get players (or workers) who wanted to play (or work) for the team (or organization).

2. In any organization, it is important to have players (or workers) of different skills and personalities. You certainly cannot have a team with strikers only. As such, it is important to place equal emphasis on workers of different skills, e.g. the manager (i.e. workers who is good at managing teams and getting things done who is like the hard working midfielder such as Roy Keane, Michael Carrick, etc. - not spectacular, but get things done) and the technician (i.e. workers who provides the spark in the organization or someone with in-depth technical knowledge who is like Robin Van Persie, Eric Cantona, etc.).

3. Every now and then, an imported player (or personnel from outside the organization) would be good for the team (or organization) if the imported player (or personnel) adds value to the team (or organization) and does not jeopardize the team's (or company's) harmony. Look at what Eric Cantona and Robin Van Persie contributes to Manchester United. Similarly, player who disrupts the team's harmony should be kicked out as soon as possible.

4. It is important to develop the right culture in any organization. With the right mentality, challenges can be overcome together rather than resort to negative in-fighting. One of the traits which makes Manchester United so successful is their belief, determination and never say die attitude. I don't think it is a coincidence that they can grind out results when they have an off-day or perform last minute heroics which are features of champions from the Liverpool team of the 80's to the Manchester United team of the 90's.

5. It is important to develop the organization to the extent that it is able to attract junior talents. This is the same for a company as well as for a football team. Manchester United would not be so successful if it did not manage to attract young talents such as Ryan Giggs, David Beckham, Paul Scholes, etc. and develop them into world class talent.

Finally, I also find it amazing that Sir Alex Ferguson is "only" a manager for 26 years. If we were to compare with other organization in the private sector, it would be considered a failure if someone is "only" a manager for 26 years and not promoted to Director or something like that. This struck me because I have encountered challenges where one of the reasons given by a colleague for leaving a company is because of not promoted to Director even though remuneration, working environment, etc. is not an issue. What he wanted is only the title and recognition. So, if we were to use football manager as an example, can we give job satisfaction irregardless of the title as long as the person feels he is in control and given due recognition of his role/contributions? The Directors should also be happy to be out of the limelight and let the manager handle the spotlights. Or maybe it is just because Directors are paid less in a football club compared to a Manager (I really don't know)?

Happy inspiring and looking forward to Brendan Rogers vs David Moyes.

Adapt: Why Success Always Starts with Failure

The latest work from Tim Harford who is one of my favourite authors is another good read and perhaps, explain in an easy to understand manner the importance of adapting and why we should not be afraid of failure. For those who have read Tim Harford's works, you will know that Mr. Harford always manages to get his message across with good arguments and real life examples. It is such good story telling skills which makes his works such a joy to read. This book with the simple title of "Adapt" explains why we should always be brave enough to try new things and to embrace failure as part of the process. The title of the book is apt as the most important part of embracing failure is the ability to learn from the failure and move on, i.e. adapt. If we did not learn anything from the failure, well, we will just keep on tripping on the same mistakes and I am sure, that is not something which we look forward to.

Again, I have selected some excerpts from the book which I find useful especially when things don't seem to be going to plan. It is good to remind ourselves that experiencing failure is part of the "joy" of life and to remind ourselves to move forward with the lesson/experience gained. Words in blue are my own opinion.

1) To survive and be profitable it is not enough to be good; you must be one of the best. (This is especially true in the age of the internet where information is readily available including your company's track records, customer satisfaction, etc.)

2) In a complex, changeable world, the process of trial and error is essential. (The point here is that the world is getting more complex and we cannot wait for the ideal solution, if ideal solution can be devised in the first place.)

3) But whether we like it or not, trial and error is tremendously powerful process for solving problems in a complex world, while expert leadership is not. (As a leader, our role is to guide our people towards a process of solving problems and not providing direct solution where the direct solution may be completely wrong! As a follower, we should not also expect our leader to provide the solution but we should devise a process towards solving the problem with the leader stepping in whenever the process is veering off its course.)

4) The great economic psychologists Daniel Kahneman and Amos Tversky summarised the behaviour in their classic analysis of the psychology of risk: 'a person who has not made peace with his losses is likely to accept gambles that would be unacceptable to him otherwise'. (Some of us may have experienced this first hand before. I think the most common place where we can observe this behaviour is in a casino. For example, we have loss considerable money and we tend to place one last bet of the same amount that we have loss with the hope of recouping our money. This happens because we have not accepted the loss and we ended taking huge gambles which we would not have taken in other circumstances.)

5) The economist Terrance Odean has found that we tend to hang on grimly, and wrongly, to shares that have plunged in the hope that things will turn around. We are far happier to sell shares that have been doing well. Unfortunately, selling winners and holding on to losers has in retrospect been poor investment strategy.

6) Faced with a mistake or a loss, the right response is to acknowledge the setback and change direction. Yet our instinctive reaction is denial. That is why 'learn from your mistakes' is wise advice that is painfully hard to take.

7) ...... recipe for successfully adapting. The three essential steps are: to try new things, in the expectation that some will fail; to make failure survivable, because it will be common; and to make sure that you know when you've failed.

8) ..... organisations which ignore internal criticism soon make dreadful errors.......

9) ..... bright ideas emerge from the swirling mix of other ideas, not from isolated minds.

10) But once a new idea has appeared, it needs the breathing space to mature and develop so that it is not absorbed and crushed by conventional wisdom.

11) And in the quest for truly original research, some failure is inevitable. (This not only applies to research. To create a responsive and dynamic organisation, it is important that the management accepts that some failure is inevitable and what is important is how we learn from the failure and move on. If the organisation do not expect failure at all, it will paralyse its own people as no one would dare to try new things which benefit the company or make  important decisions and the company will end up with the motto: "The less we do, the better as there will be less chance of a failure". After all, the best way to avoid failure is to do nothing.)

12) Correlation is a treacherous guide to causation. (Don't rely on correlations too much!!!)

13) In a lecture of 1755, Adam Smith declared that 'little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism but peace, easy taxes and a tolerable administration of justice: all the rest being brought about by the natural order of things.' In other words, if the government can just get the basics right, everything else will gradually follow in time, and foreign aid can help - if only it is properly tested. (I would think that the same principle applies to a company. If a company or its management manage to get the basics right, i.e. condusive working environment for employees to thrive and contribute, clear reward system and a system of check and balance, the organisation will probably take off on its own. What do you think?)

14) ..... three different types of error. The most straightforward are slips, when through clumsiness or lack of attention you do something simply didn't mean to do.

15) ..... violations, which involve someone deliberately doing the wrong thing.

16) Most insidious are mistakes. Mistakes are things you do on purpose, but with unintended consequences, because your mental model of the world is wrong. (This reminds us of the famous statement by General Von Manstein on the German Officer Corps:

There are only four types of officer. First, there are the lazy, stupid ones. Leave them alone, they do no harm......Second, there are the hard working intelligent ones. They make excellent staff officers, ensuring that every detail is properly considered. Third, there are the hard working, stupid ones. These people are a menace and must be fired at once. They create irrelevant work for everybody. Finally, there are the intelligent lazy ones. They are suited for the highest office.

I guess General Von Manstein also realise that the most insidious of errors are mistakes and hard working but stupid people tends to do the most mistakes. This is just to put the message across in a direct manner but for me, hard working is an important trait which I value the most. This is because there is no way for us to know whether we are stupid or intelligent as some good decisions are probably due to luck. Anyway, if we are hard working, we can certainly fulfill our own potential and if we are lazy, no amount of talent in the world will make us successful.)

17) There are three essential steps to using the principles of adapting in business and everyday life, and they are in essence the Palchinsky principles. First, try new things, expecting that some will fail. Second, make failure survivable: create safe spaces for failure or move forward in small steps. As we saw with banks and cities, the trick here is finding the right scale in which to experiment: significant enough to make a difference, but not such a gamble that you're ruined if it fails. And third, make sure you know when you've failed, or you will never learn. As we shall see in the next chapter, this last one is especially difficult when it comes to adapting in our own lives.

18) Being willing to fail is the essential first step to applying the ideas of Adapt in everyday life.

19) ..... three obstacles to heeding that old advice, 'learn from your mistakes': denial, because we cannot separate our error from sense of self-worth; self-destructive behaviour, because like the game-show contestant Frank, or Twyla Tharp when marrying Bob Huot, we compound our losses by trying to compensate for them; and the rose-tinted processes outlined by Daniel Gilbert and Richard Thaler, whereby we remember past mistakes as though they were triumphs, or mash together our failures with our successes.

20) The ability to adapt requires this sense of security, an inner confidence that the cost of failure is a cost we will be able to bear. Sometimes that takes real courage; at other times all that is needed is the happy self-delusion of a lost three-year-old. Whatever its source, we need that willingness to risk failure. Without it, we will never truly succeed. (Fortune favours the bold?)

In summary, this book reminds me to be brave and to try new things, adapt and move on. Which one do you think is better? To have tried, failed and try again or to live in regrets that you have never tried and you can only wonder, what if? I think most of us know the answer to that question.

'Ever tried. Ever failed. No matter. Try again. Fail again. Fail better' - Samuel Beckett.

Top 3 Recommended Authors

My recommended top 3 authors on subjects ranging from economy, business, finance and general management/philosophy are based on the following criteria:

1) After reading the book, you would have a great feeling of being "enlightened" or prompt you to have a complete re-assessment of your views of the world or approach to life, finance or management, i.e. the book has a profound impact on me.

2) The Author has produced more than one good work and every book which you have read by the same Author gives you the same excitement.

3) The book is grounded in practicality and is based on real-life experience, i.e. practical and realistic.

Based on the above criteria, my list of top 3 authors are as follows (with no order of preference):

1) Nassim Nicholas Taleb

The words that I would use to describe Nassim Nicholas Taleb is brilliant, frank and unconventional. His two books, "The Black Swan" http://businessmanagementbooksreview.blogspot.com/2011/04/black-swan-impact-of-highly-improbable.html and "Fooled by Randomness" http://businessmanagementbooksreview.blogspot.com/2012/06/fooled-by-randomness-hidden-role-of.html are simply brilliant and he certainly explained a lot of questions which have always puzzled me and opened up my mind. To me, an Author who is able to open up my mind and made me questions a lot of the established rules/norms are very important and for that, Nassim Nicholas Taleb's books are a must read for me.

2) Malcolm Gladwell

Books by Malcolm Gladwell is so easy to read and insightful. That is not surprising since he introduced the concept of tipping point to the world. His four books books, "The Tipping Point", "Blink", "Outliers" http://businessmanagementbooksreview.blogspot.com/2011/10/outliers-story-of-success-by-malcolm.html and "What the Dog Saw" http://businessmanagementbooksreview.blogspot.com/2012/01/what-dog-saw-and-other-adventures.html are all classics and should be in everybody's book shelf.

3) Tim Harford

Tim Harford made economic relevant to everyone and explained economic concepts using simple language and practical examples. His works are also easy to read, practical and insightful. The book, "The Undercover Economist" http://businessmanagementbooksreview.blogspot.com/2011/07/undercover-economist.html is one of my must read book. His other works such as "Logic of Life" http://businessmanagementbooksreview.blogspot.com/2012/04/logic-of-life-uncovering-new-economics.html and "Adapt" continue Mr. Hardford's previous good works on how to present important but sometimes "dry" subject in an easy to read format.


That's it folks. Just my humble opinion on three of my favourite Authors. You may have different opinions and I would like to hear your opinions and look forward to be introduced to other great works.

Take care and may the year of the snake brings you good health and joy. Happy Chinese New Year.