A Football Club's Strategic Performance Management

Abstract

The current study presented in this article shows that football teams should; generally speaking, implement a multifaceted performance management system that takes into account the opinions of all stakeholders. The Balanced Scorecard (BSC), which offers an integrated framework for measuring and managing performance, can assist clubs in evaluating both financial and non-financial activities. This study's context and content greatly advance our knowledge of the football industry and offer a thorough and all-encompassing set of contributions to the field of business academia. The knowledge acquired on a topic that has naturally shown to have a significant impact on people inherently adds something useful and beneficial to society.

Full text

Bulletin of the Transilvania University of Braşov
Series IX: Sciences of Human Kinetics • Vol. 17(66) No. 2 – 2024
https://doi.org/10.31926/but.shk.2024.17.66.2.8
A FOOTBALL CLUB'S STRATEGIC PERFORMANCE
MANAGEMENT
L. C. PĂNESCU1 M. DRAGOMIR2
Abstract: The current study presented in this article shows that football
teams should; generally speaking, implement a multifaceted performance
management system that takes into account the opinions of all stakeholders.
The Balanced Scorecard (BSC), which offers an integrated framework for
measuring and managing performance, can assist clubs in evaluating both
financial and non-financial activities. This study's context and content greatly
advance our knowledge of the football industry and offer a thorough and all-
encompassing set of contributions to the field of business academia. The
knowledge acquired on a topic that has naturally shown to have a significant
impact on people inherently adds something useful and beneficial to society.
Key words: juniors, football, management, Balanced Scorecard, evolution
1 PhD student, University of Craiova, Romania.
2 PhD., Dr., Prof., University of Craiova, Romania.
1. Introduction
Soccer has recently grown in popularity
all across the world [8]. It has been
described as a company involving
countless billions of dollars in investment,
with massive spending on player transfers,
conflicts, never-ending negotiations for TV
rights shares, and sponsorship battles to
recruit child and junior "stars" to promote
and advertise.
The topic of success in football
management is timely and important at a
time when clubs are focusing on achieving
a competitive advantage, and many
regulations and internal systems in place to
maintain the long-term viability of global
football are under scrutiny [1].
All of these initiatives indicate that the
football industry has become extremely
competitive [3].
To thrive in this competitive climate,
football teams should prioritize strategic
objectives such as efficiency,
effectiveness, competitiveness, and
sustainability, as well as extensively
measuring and managing their
performance [4].
In recent years, clubs have shifted to
corporate entity models; modern and
traditional clubs are no longer merely
football clubs, but functioning enterprises
with expanded plans, structures, and goals.

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Furthermore, as the world expands
rapidly, growing both closer and denser,
teams are no longer limited to their native
regions, realizing that loyal followers and
significant sponsorship opportunities can
be discovered beyond their borders.
It is no longer enough to be a winning or
profitable team; clubs must
internationalize and „modernize to
preserve tradition” [5].
Using several strategic performance
evaluation methodologies can help football
teams become more competitive.
Sports managers are currently working to
give global football teams a strong and
advantageous competitive position while
highlighting the athletic perspectives of
customers as well as their ongoing
interactions with these institutions.
Sports organizations and competitions
are increasingly in competition with other
leisure options, like restaurants, hotels,
theaters, and so on, for the money that
people spend on entertainment.
However, professional sport has adopted
a more commercial method, and as a result
[10], sports teams and leagues are finding it
increasingly common to debate and learn
about strategic performance evaluations as
a highly effective tool for differentiating
themselves from competitors.
The Balanced Scorecard (BSC) is a key
idea in accounting and management.
A Balanced Scorecard can be defined as a
means of converting an organizational goal
and strategy into a set of performance
metrics that provide a framework for
implementing the plan in real life [12], for
the sake of clarity [11].
BSC recently celebrated its twentieth
anniversary [6].
An instrument for strategic performance
management, the Balanced Scorecard
(BSC) is a report with a semi-standard
structure that managers can use to monitor
how successfully individuals under their
supervision complete tasks and the
consequences of their decisions [9].
Approximately 75% of businesses globally
adopt the Balanced Scorecard approach to
boost productivity. Kaplan and Norton
developed this approach of performance
evaluation in 1992.
It takes into account non-financial goals
as well as financial goals as ones the firm
should aim to achieve. The
accomplishment of the organization's non-
financial goals will have a favorable effect
on its financial goals.
Effective financial asset and liability
management is essential due to the
institution's chosen strategy. Effective
management of the unit's financial, non-
financial, and liability assets is still required
[9], [12].
Institutions can create relationships with
current customers to retain and satisfy
them, or they can search for prospective
consumers and enter emerging markets.
They can also gain loyalty and fulfillment
from consumers, develop and expand, and
create new products or services, among
other things, through analyzing financial as
well as nonfinancial levels of performance
using balanced scorecard measures [13].
Customer metrics are available online
and can be used by a sports manager to
determine market share and unit
customers in their intended customer
categories.
They are the most basic markers of the
plan's execution safety and efficacy as well
as the caliber of results attained [2].
Among the indicators evaluated are
market share, customer satisfaction,
customer retention, new customer
acquisition, and the number of agent
accounts in the intended markets [5].

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79
Football clubs must prioritize their
internal operations in order to identify the
most important areas to invest in.
This will allow them to create value that
sets them apart from the competition,
draws in customers, and ultimately satisfy
shareholders who get the best returns on
their capital.
The final perspective on the balanced
scorecard is that of education as well as
development, which is covered in more
detail below.
In order to achieve its long-term
objectives, sports club management must
adopt certain foundations, one of which is
the development as well improvement of
the administrative staff's, technicians', and
players' skills and expertise through
scientific as well as practical training [13].
Since players are the main source of the
team's competitive advantage, this is
particularly true for them [14].
However, the viewpoints that the
balanced scorecard represents are
identical to one another.
Rather, they collaborate; every
viewpoint influences the other in some
way [11].
When the financial and customer
perspectives are combined, football clubs'
management is given a clear understanding
of how to satisfy their customers.
This clarity enables them to pursue
strategies related to either quality (high
price compared to the market) or cost
savings (ease for purchase and use).
Customers who are superior to or distinct
from those of the competition, enabling
them to choose one of the related tactics.
Football teams' strategic performance is
assessed using the Balanced Scorecard in
Figure 1.
Fig. 1 An analysis of football clubs from a
strategic perspective
In simple terms, the Balanced Score
Card is a method for attaining equilibrium
between financial along with nonfinancial
metrics as every change in one will have
an equal and simultaneous impact on the
other, regardless of the degree of change
in one of the metrics.
The goal of this article is to build a
relationship between an existing BSC and
the approach that should be used.
2. Methodology of Research
A very useful and efficient framework for
identifying the pertinent management
aspects of conventional businesses and
bringing attention to some of their
interdependencies was the Balanced
Scorecard [12].
2.1. Methods of investigation
The Balanced Scorecard has been used in
sport-related contexts in a number of
scholarly studies [10].
Increased TV and merchandise sales, new
sponsorship agreements, and improved
sports performance all contribute to
improved financial performance [14].

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The ensuing financial resources can then be
used to invest in the team or young academy,
which, in most cases, leads to improved
athletic performance.
2.2. Samples and control norms used in
research
Perhaps the most well-known
framework for performance
measurement, the Balanced Scorecard
examines performance from four distinct
but intricately linked perspectives [8]:
1. Financial perspective;
2. The client's perspective;
3. Internal-business-process perspective;
4. Learning and development perspective.
The highest prospect in the
aforementioned pyramidal hierarchy and
consequently the more important to the
management of most companies is the
Financial Perspective.
In the past, companies relied primarily
on financial performance measures such
as profitability investment or economic
value analysis.
Although they still play a vital role in
modern companies, they are now
enriched with non-financial indicators [15].
Unlike the following perspectives The
Balanced Scorecard, Financial Perspective
does not contain substantial levers that
can be adjusted to improve performance.
Rather, adjustments in lower
perspectives are needed to lead to overall
financial success.
The customer perspective is the second
dimension of the Balanced Scorecard and
it has an impact directly on the financial
perspective.
Companies increasingly understand the
importance customer as a source of
financial success and consequently
become more and more oriented towards
client.
In general, customers tend to be
concerned with issues of time, quality,
performance, service and cost. Therefore,
companies aim to deliver products and
services that meet these criteria and are
therefore valued by customers.
Valuable products and services are
expected to improve key metrics of
customer satisfaction, loyalty, retention
and acquisition.
To deliver appropriate value
propositions to customers and meet
objectives financial, a company must
achieve key internal functions, which the
organization must master.
Four generic processes that practically
all the companies have in common are
innovation, customer management,
operations and logistics and regulations
and the environment.
The bottom of the Balanced Scorecard
pyramid is the Learning and Development
Perspective.
It influences the three higher
dimensions and therefore can be
considered as the foundation and success
factor of the future.
The main components of the Learning
and Development Perspective are
intangible assets, which have grown
significantly in importance in the Balanced
Scorecard.
3. Results and Discussions
As a result, football teams ought to
implement a multifaceted performance
management system that takes into
account the opinions of all parties
involved.

L. C. PĂNESCU et al.: A Football Club's Strategic Performance Management
81
The scoreboard ought to be made with
the club's strategic goals in mind, using
the proper metrics.
Each strategic aim should be evaluated
using at least one performance metric.
Performance measures Table 1
Stakeholder perspective
Position attained in a national league;
Position attained in a local federation cup competition;
Total points accrued from derby matches;
Position attained in international
tournaments/champions;
Responses to surveys soliciting feedback from fans;
Number of aid initiatives in which he actively participated;
Total funds raised through fundraising events;
Total sums donated to charitable organizations;
UEFA ranking
Internal process perspective
The average number of players invited to represent their country
at the international level; The worth of sponsorship deals;
The quantity of good news reported in the press; the number of
supporters who turned out to cheer on the team at the stadium;
The quantity of fans on social media;
The amount of time dedicated to training;
Time spent camping;
Number of games without injured players;
Games with yellow and red card bans;
Ranking.
Infrastructure perspective
Number of players on national teams;
Time allotted to young players in the first team;
Minutes of newly transferred players;
Results of player satisfaction surveys;
Value of investment in club facilities;
Number of new members joining the club;
Number of minutes played in new transfers;
Asset (facility) utilization rate.
Financial sustainability
perspective
Broadcasting revenue;
Match day revenue;
Club store profits;
Debt ratio (total liabilities/total assets);
Current ratio (current assets/current liabilities);
Return on assets (net income/total assets);
Transfer income;
Player market value:
Revenue from international organizations and activities.

Bulletin of the Transilvania University of Braşov. Series IX • Vol. 17(66) No. 2 – 2024
Supporting local and international aid
organizations is one of a high-level club's
strategic goals.
Performance metrics can be used to
evaluate the club's progress toward this
goal, such as the number of aid events in
which members have actively participated
or the total amount of money raised
through fundraising events.
Finally, soccer BSCs establish
performance targets for each
performance indicator, which are then
compared against performance results at
the end of each period.
Management should investigate
underperformance and potential causes of
player dissatisfaction, asset value decline,
and poor performance by young players.
Finally, based on the input, management
should implement corrective actions.
If management discovers faults with the
performance management system, such
as insufficient metrics, improper target
setting, or changes in strategic objectives,
it may be evaluated.
On the other side, good outcomes
should be examined, and the
accomplishments of groups or people
should be recognized.
4. Conclusions
Kaplan and Norton's primary idea is that
these four perspectives represent a
balanced view of any organization and
that no key area will be missed when
providing measurements for each topic.
BSC is a system that is significantly
impacted by its implementation
approaches.
Some activities may accurately
represent the company's performance,
while others may be misleading.
Departments and business divisions at
different levels typically do not contribute
when the BSC fails.
The acceptance, application, and
execution of the action all play a role in
the BSC's success. Thus, the BSC's design is
vital to its success.
In addition to highlighting the benefits
of the approach used in the case study, we
were also able to identify several
drawbacks.
The primary drawbacks of BSC are
difficulties in establishing causality and
effects, difficulty with selecting
appropriate indicators, and timely data
collecting.
According to the growing importance of
spectator sports support, an increasing
amount of attention is being devoted in
the modern world to the assessment and
oversight of different sports organizations.
A more comprehensive approach to
performance evaluation that takes into
account football teams' financial and
athletic achievements has been offered by
certain academic works.
A distinct kind of football club
performance system has been created in
order to satisfy the varying expectations
of stakeholders, as noted in the previously
referenced literature [7].
Football teams should therefore
implement a multifaceted performance
management system that takes into
account the opinions of all parties
involved.
The BSC offers an integrated framework
for measuring and managing performance
that is comprehensive and may assist
clubs in assessing both their non-financial
and financial operations.
There is no implementation of a
thorough quantitative model of BSC for
football clubs, despite the fact that several

L. C. PĂNESCU et al.: A Football Club's Strategic Performance Management
83
studies in the literature indicate using BSC
as a potential means of achieving
enhanced managerial efficiency for
football teams.
In the long run, financial assessment is
not helpful for addressing the necessities
of sports management, even though it can
be appropriate in the near term.
According to studies, the balanced
scorecard served as a tool for strategy
formulation and creation as well as
measurement. This gave managers the
ability to determine the best methods for
accomplishing the measurement
objectives.
The ability of such technology to
respond to external conditions gave the
management greater latitude in adjusting
and reshaping the plan in reaction to
developments that took place.
Following a number of investigations,
the researchers created a model that links
the strategic execution of the club overall
to the strategic performance of its
subperspectives (financial as well as
customer-facing operations), and also to
the strategic performance of the club's
growth and education initiatives.
This approach ensures that all relevant
data related to football club operations is
provided.
It is noteworthy that the evaluation of
sports clubs' strategic success differs
significantly from that of commercial or
industrial entities.
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