This assignment is to provide a strategic analysis of the football club Liverpool FC within the business environment of the English Premier League. Liverpool FC is historically seen as the most successful football club within the Premier League, having won 18 League titles, seven FA Cups and the European Cup five times (now: Champions League) (Liverpool FC, 2009). However, they have failed to win the League title since the season of 1989/90. In terms of revenue it is the fourth largest club of the Premier League (Deloitte, 2009).
The English Premier League is the highest league of the English football league system. It consists of 20 members and is connected to the next lower league through a system of promotions and relegations. Although all 20 members theoretically form part of the same league, there is a significant gap in terms of revenue as well as sportive success between the
four most successful clubs and the remaining 16 (further description given in Task A – Five
Forces – Competitive Rivalry) Thus, they have to be regarded as two different industries,with the clubs Manchester United, Arsenal FC, Chelsea FC and Liverpool FC forming an oligopolistic industry at the top and the remaining 16 clubs gathering in a balanced, competitive environment below. Due to this division, all industry related analyses in this
assignment are focused on the “Top Four Oligopoly”. These analyses, namely PESTEL, Porter's Five Forces Analysis, form the first part of this assignment together with an examination of the "Critical Success Factors". Part B focuses on the company Liverpool FC
itself, analyzing its resource capabilities as well as its sustainable competitive advantage. The report ends with a critical breakdown of the strategic direction of Liverpool FC in its industry.
[...] Daily Post Hicks and Gillett refinance Liverpool FC bank loan. [Online] (Updated 27 July 2009) Available at: http://www.dailypost.co.uk/sport-news/liverpool-fc/2009/07/27/hicks-andgillett-refinance-liverpool-fc-bank-loan-55578-24251001/ [Accessed 2 November 2009]. Deloitte Annual Review of Football Finance 2009, Manchester: Deloitte. ESPN FIFA thumbs-up for 'six-plus-five' player rule. [Online] (Updated 30 May 2008) Available at: http://soccernet.espn.go.com/team/squad?id=364&cc=5739 [Accessed 13 December 2009]. ESPN 2009/2010 English Premier League: Squad Statistics. [Online] (Updated 13 December 2009) Available at: http://soccernet.espn.go.com/team/squad?id=364&cc=5739 [Accessed 13 December 2009]. Footballfancast Top Ten Most Expensive Premiership Transfers. [Online] (Updated November 2009) 25 Available at: http://www.footballfancast.com/football-blogs/top-ten-expensivepremiership-transfers [Accessed 13 December 2009]. [...]
[...] Introduction This assignment is to provide a strategic analysis of the football club Liverpool FC within the business environment of the English Premier League. Liverpool FC is historically seen the most successful football club within the Premier League, having won 18 League titles, seven FA Cups and five times the European Cup (now: Champions League) (Liverpool FC, 2009). However, they have failed to win the League title since the season of 1989/90. In terms of revenue it is the fourth largest club of the Premier League (Deloitte, 2009). [...]
[...] Hence, Liverpool's past success can be regarded as sustainable, only however giving them an advantage over two of their three competitors Summary of Task B / Strengths and Weaknesses Table 6 finally sums up Liverpool's strengths and weaknesses as they became obvious in the resource/competency analysis Strenghts Financial resources: growth rate Financial competencies: wage costs Physical resources: Youth Academy Intangible resources: past success Weaknesses Financial resources: overall figures, financing structure Financial competencies: transfer expenditures Human resources: staff Physical resources: stadium Physical capabilities: stadium utilization Intangible resources: brand value Table Strenghts and Weaknesses Task C 4.1 Strategic Direction The Ansoff product/market growth matrix gives an overview about the different opportunities firms intending to evolve out of their status quo can take. [...]
[...] As long as this reputation can be kept stable, Liverpool should definitely pursue this opportunity Strategic Fit Table 7 finally assesses the strategic fit of Liverpool FC by checking their capability to counter threats and exploit opportunities with the help of their resources and competencies. In Table 8 the club is evaluated in regard of matching the factors necessary to be successful in the Top Four industry. Opportunity/ Threat Private investors Fit? X Comment Co-owners Gilett and Hicks have not proved to be sources of financial power so far. [...]
[...] The next parts will now analyze whether Liverpool FC matches the key success factors and has the capabilities to counter the threats and exploit the opportunities Task B The second part of the assignment will now deal with the strategic capabilities of LFC Value Chain The value chain model by Michael E. Porter was originally designed to analyse production or service companies (Johnson, et al., 2008). A football club's product or service can be determined as being the the entertainment that they deliver to their customers, meaning their spectators, sponsors and the broadcasters. [...]
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