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Applied Strategic Management MAN0209M

Module leader: Dr Nikolaos Papageorgiadis

WH Holding Limited

UB number: 11007848

Word count: 1975

Statement of Authenticity:

By submitting this assignment through Blackboard, I confirm:

That this work is my own and that I have not plagiarised the work of others in any form whatsoever.

That I am aware of the University’s definition of Plagiarism and understand how it can be avoided.

That this work, or any part of it, has not been previously submitted to the University of Bradford for assessment in any other module.

That I have read and understood the information provided below.

Signed: Popa Lucian Date:

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Contents 1. Executive Summary ............................................................................................................................................... 3

2. Internal analysis..................................................................................................................................................... 4

2.1. Definition of the Organisation ...................................................................................................................... 4

2.2. Highlights of the year 2012/2013 ................................................................................................................. 4

2.3. Financial Information .................................................................................................................................... 5

2.4. Objectives ..................................................................................................................................................... 6

2.5. Current Strategy ........................................................................................................................................... 6

2.6. Strategic capabilities and VRIN Analysis ....................................................................................................... 8

3. External Analysis .................................................................................................................................................. 12

3.1. The Industry ................................................................................................................................................ 12

3.2. PESTEL Analysis ........................................................................................................................................... 13

3.3. Porter’s Five Forces Analysis ...................................................................................................................... 14

3.4. Benchmarking ............................................................................................................................................. 15

4. Internal and External Summary ........................................................................................................................... 16

4.1. SWOT Analysis ............................................................................................................................................ 16

4.2. TOWS Matrix............................................................................................................................................... 17

5. Strategic Recommendations ............................................................................................................................... 18

5.1. Six Evaluation Criteria ................................................................................................................................. 19

6. Implementation ................................................................................................................................................... 21

6.1. Strategy Timeline ........................................................................................................................................ 21

6.2. Allocation of Resources .............................................................................................................................. 22

6.3. Customer Driven Strategy .......................................................................................................................... 22

6.3.1. Customer profiling ............................................................................................................................. 22

6.3.2. Segmentation ..................................................................................................................................... 23

6.3.3. Communication with customers ........................................................................................................ 24

6.3.4. Pricing ................................................................................................................................................ 25

6.4. Type of Strategic Change ............................................................................................................................ 25

6.5. Styles of Managing Change......................................................................................................................... 26

6.6. Modes of entry and Internationalisation Drivers ....................................................................................... 27

6.7. The Balanced Scorecard ............................................................................................................................. 28

7. Conclusion ........................................................................................................................................................... 28

8. References ........................................................................................................................................................... 29

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1. Executive Summary

This corporate-level report aims to develop a strategic recommendation for WH Holding Limited based on

internal and external analysis. The first part of the report is represented by the internal analysis and

includes topics like the definition of the organisation, financial information, key objectives, current

strategy, strategic capabilities as well as a VRIN analysis. The second part of the report represents the

external environment and includes issues like the definition of the industry, PESTEL analysis, Porter’s

Five Forces and Benchmarking. Based on the internal and external analysis the report further presents the

SWOT analysis and TOWS matrix. The major findings of these analyses are the opportunities that the

organisation can address in order to further develop, such as targeting a foreign market using strengths like

the global awareness of the brand. The opportunities emerged from the SWOT and TOWS analysis

further generate three possible strategic recommendations which are briefly presented in the third part of

the reports. Based on the finding and as well on the identified objectives, resourced and capabilities of the

organisation, Strategy 2 is further investigated in terms of implementation procedures. The strategy is

consistent with market development and suggests the entrance in a foreign market, Australia through a

strategic partnership. Finally, the third part of the report presents the implementation procedures in terms

of timeline, allocation of resources, customer driven strategy, managing strategic change and

internationalisation drivers.

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2. Internal analysis

2.1. Definition of the Organisation

WH HOLDING LIMITED is a company based in London, United Kingdom which manages West Ham

United Football Club and its related activities. The Football Club plays in Premier League, the highest

division in English football. Due to the average results that West Ham United FC has accomplished in the

football-related activities in the last years, the club is not qualified in any European competition. Still,

Brandfinance placed West Ham United FC in the top 7 of Premier League clubs in the worlds’ 50 most

valuable football brands, fact that suggests the club’s popularity at a world-wide level.

2.2. Highlights of the year 2012/2013 The following figure presents the highlights of the year ended 31 May 2013, according to the Report and

Financial statements for the year ended 31 May 2013. These highlights suggest potential development of

the organisation, as the new sponsorship contracts will generate additional funding, while the 99 year lease

of the Olympic Stadium will increase the stadium capacity by 54% which will generate significant

additional revenue from match and season tickets.

Top 10 finish in the FA Premier League

Awarded the Olympic Stadium on a 99 year lease, starting August 2016

Major new sponsorship contrcts secured with Adidas and Alpari

Significant financial support from makor shareholders of £10.5m

Highest average match attendance in the 118 years history of the club, achieving a number of 16 sell-out matches

The Retail Team recorded a 25% increase in sales, achieving a club record high in turnover

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2.3. Financial Information

The following table presents the profit and loss account for the years ended 2012 and 2013.

2012 2013

Operations

excluding

player

trading

£000

Player

trading

£000

Total

£000

Operations

excluding

player

trading

£000

Player

trading

£000

Total

£000

Group turnover 89,815 - 89,815 46,165 - 46,165

Other operating income 1,032 - 1,032 734 - 734

Administrative expenses (75,956) (13,838) (89,794) (58,687) (9,774) (68,461)

Group operating profit/

(loss)

14,891 (13,838) 1,053 (11,788) (9,774) (21,562)

Profit from disposal of

players

- 171 171 - 911 911

Profit/(loss) on

operating activities

before interest and

taxation

14,891 (13,667) 1,224 (11,788) (8,863) (20,651)

The table above shows significant improvement in terms of financial results in comparison to year 2012,

due to the promotion from Championship to Premier League at the end of season 2011/2012. The growth

in turnover and the growth in terms of profit before interest and taxation show great prospect for the

future, with potential investment being possible, as the organisation is more financially stable. Even

though an increase in administrative expenses was expected after the promotion to Premier League, the

table shows that the reduction of expenses can increase the financial stability of the club.

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2.4. Objectives The following table depicts both the objectives the management of West Ham United has set in order to

further develop the club, as well as the way in which each objective can assist the club in the development

process, according to the Report and Financial Statement of 2013.

Top 10 finish in FA

Premier League

The higher the club finishes in the

FA Premier League, the higher is the

revenue that the organisation receives

from the FA.

The increased

budget can be

used for

investments in all

the areas of the

organisation.

Increase the match

attendance after the

move on the

Olympic Stadium

A stadium with a higher capacity

increases the match attendance, and a

higher attendance increases the

revenues from ticket sales.

Make West Ham

United a global

brand

Making West Ham United a global

brand has the potential to increase

both the sales of merchandise and the

sponsorships, factors that increase

the revenue of the club.

Increase the sales of

merchandise

Increase of sales means an increase

in revenue.

Increase the revenue

from the

Commercial and

Sponsorship

departments

Increase the budget of the

organisation.

2.5. Current Strategy The following table presents the most expensive season tickets and the most expensive match day tickets

for the 2013-2014 FA Premier League Season.

Most expensive season tickets Most expensive match day tickets

Club Price (£) Club Price (£)

Arsenal 1995 Arsenal 126

Tottenham 1845 Chelsea 87

Chelsea 1250 Tottenham 81

Fulham 999 Fulham 75

Manchester United 950 West Ham 67

West Ham 910 Manchester City 58

Liverpool 850 Manchester United 53

Manchester City 780 Liverpool 52

Aston Villa 595 Aston Villa 45

Hull 405 Hull 30

Source: the Guardian, 2013

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The previous table suggest the strategy that West Ham United currently uses which on the Bowman Clock

can be positioned as presented in the following figure.

Considering both the fact that West Ham has high season and match tickets in comparison with other FA

Premier League club and also the fact that the club has above average prices for official merchandise, the

currents strategy of West Ham Unite can be positioned on the Bowman Clock as ‘Risky/High margins’, as

the average results suggest an average perceived customer value.

High

High

Low

Perceived Value to

Customer

Price Low

West Ham

Risky/High

margins

Hull

Arsenal

Focused

differentiation

Manchester City Differentiation

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2.6. Strategic capabilities and VRIN Analysis

Strategic capabilities

Resources Type Competences

Joint-Chairman David Gold

Vice-President Karren Brady.

Human David Gold is the former

Chairman of Birmingham FC

from 1993 to 2007. Karren

Brady was appointed Managing

Director at Birmingham in 1993

when she was just 23 years old

and is now considered as ‘The

First Lady of Football’. Both

have the experience in this area

to ensure the club’s success.

West Ham’s home stadium, The

Boleyn Ground.

Physical The stadium has a capacity of

35.016, the ticket sales

generating a revenue of £18

million in the year 2011-2012

The Olympic Stadium, West

Ham’s home stadium starting

from the season 2016/2017.

Physical With a 54% increase in

capacity, the new stadium will

assure an increase in revenue

from ticket prices.

The Financial Statements for the

years 2012 and 2013.

Financial The profit and loss account for

the year 2013 shows an increase

in revenue comparing to 2012

from £46,165,000 to

£89,815,000. This suggests a

more stable financial position of

the club which can assist the

organisation in making further

investment.

Two Official Stores located in

London and the online store

with global reach.

Physical These stores suggest the ability

of the club to reach all the

customers willing to purchase

official merchandise, generating

which generates extra revenue.

Global fan support with

affiliated fan clubs located in 31

countries in Europe, United

States, Oceania and Asia.

Reputational The immense fan support

ensures both the promotion of

the club at a global level and

potential increase of sales in

terms of official merchandise.

The Academy of Football – is

the name given to West Ham’s

Youth Academy, due to the

quality footballers developed.

Human/Financial The Youth Academy of West

Ham is recognised as being one

of the best in the world,

developing footballers like Rio

Ferdinand, Joe Cole, Glen

Johnson, Michael Carrick,

Jermain Defoe or Sol Campbell.

The Academy has different

functions, as the players can be

either used to increase the

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quality of the squad or sold to

increase the financial stability of

the club.

Resources Competences

Threshold Capabilities - West Ham’s home

stadium, The Boleyn

Ground.

- Two Official Stores

located in London and

the online store with

global reach.

- The home stadium

generates revenue from

ticket sales.

- The stores generate

revenue from official

merchandise sales.

Distinctive Capabilities - Joint-Chairman David

Gold Vice-President

Karren Brady.

- The Olympic Stadium,

West Ham’s future

home stadium.

- Global fan support.

- The Academy of

Football

- Both have experience in

this area to ensure the

club’s success.

- The future stadium will

increase the revenue

from ticket sales and

has the potential to

assist the club in

reaching the next level.

- Ensures the promotion

of the club and potential

increase of sales in

terms of official

merchandise.

- The Academy has

different functions, as

the players can be either

used to increase the

quality of the squad or

sold to increase the

financial stability of the

club.

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The previous tables present the strategic capabilities of West Ham United, divided into threshold

capabilities and distinctive capabilities. The threshold capabilities represent the basic requirements for

West Ham United to be able to compete in the market, such as the home stadium and the stores, both

representing important sources of revenue. Still, more focus will be given to the distinctive capabilities

which will assist the organisation in achieving advantages over the competitors. Like presented in the

tables above, the future stadium of West Ham United, the Olympic stadium will add extra revenue in

comparison to the Boleyn Ground Stadium. Still, there are more benefits to come from playing home

games on a modern arena, such as increasing brand awareness and brand value, both of which have the

potential to increase the future sponsorships for the club.

The following table will present the VRIN assessment of the club’s capabilities.

Capability Value Rarity Inimitability Non-

substitutability

Joint-Chairman

David Gold Vice-

President

Karren Brady

This human

capability offers

strong

competitive

advantage due to

the experience

that David Gold

and Karren Brady

can offer

Relatively rare at

Premier League

level. The current

trends see foreign

investors

acquiring football

clubs without

previous

experience in this

market

Can be imitated

only by

investing

contracting

experts with

experience in

the field

Average, possibly

hard to substitute.

Significant

investment is

needed.

The Boleyn

Ground Stadium

This capability

has good value,

but the average

capacity does not

provide a

significant

competitive

advantage

Not rare, as the

capacity is

average at

Premier League

and

Championship

Level

Can be imitated

as most

Premier League

and

Championship

clubs have

similar

stadiums

The Boleyn Ground

will be substituted

with the Olympic

Stadium starting

from the season

2016/2017

The Olympic

Stadium

This capability

has an immense

value and can

generate

important

competitive

advantage

The Olympic

Stadium will be in

the UK’s Top 5

stadiums by

capacity which

makes this

capability rare

This capability

is very hard to

imitate without

significant

investment,

which most

clubs are not

intending to do

Hard to substitute

The Financial

Statements for

the years 2012

and 2013.

The financial

stability of the

club is a very

important aspect

The financial

stability of

football clubs at

Premier League

level is not rare,

considering the

investments that

owners and

shareholders

make, but has the

Like stated

before, this

capability is

currently easy

to imitate by

competitors but

the situation

might change

with the

implementation

Not substitutable

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potential to

become rare one

the new Financial

Fair Play

regulations are

implemented

of new

regulations

Two Official

Stores and the

online store

This capability is

valued and can

provide

competitive

advantage in

financial terms

All the English

football clubs

from Premier

League and

Championship

have this type of

facilities, making

this capability not

rare

This capability

is not hard to

imitate

Even though the

clubs consider

official stores as

very important, this

capability has the

potential to be

substituted by non-

official merchandise

Global fan

support

This capability is

highly valued and

can provide

significant

competitive

advantage,

especially in

financial terms

FA Premier

League is

considered to be

the world’s top

division and

English football

clubs have great

world-wide fan

support, making

this capability not

rare

This capability

can be imitated

with

investments in

promoting the

club at a global

level

In the case of non-

UK fans, this

capability might be

easy to substitute as

in the majority of

cases there is no

emotional

connection between

the club and the

supporter

The Academy of

Football

Being one of the

best Youth

Academies in the

world, this

capability has a

recognised value

and can provide

competitive

advantage

The Academy of

Football is often

considered to be

in the Top 10

Youth Academies

in the World and

in Top 3 in

English football,

making it a rare

capability,

considering the

current trends to

acquire players

rather than invest

in the Youth

Academy

This capability

is hard to

imitate as

significant

investment is

needed.

Moreover, the

current trends

are to acquire

players rather

than invest in

Youth

Academies

Considering the

reputation of The

Academy of Football

and the results it had

throughout the

history, it is not

likely for this

capability to be

substituted

The VRIN analysis suggests that different capabilities that West Ham United has can offer significant

competitive advantage. Capabilities like the Olympic Stadium, The Academy of Football and the

experience of the management can assist West Ham United to overcome their competitor not only in the

United Kingdom, but also at a global level.

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Matchday23%

Broadcast50%

Commercial27%

Sources of revenue for Premier League clubs

3. External Analysis

3.1. The Industry West Ham United operates in FA Premier League, the highest ranked division in English Football.

According to Deloitte, football finance experts, Premier League clubs had cumulated revenue of £2.36bn

in 2011-2012. Moreover, Deloitte estimates that the revenue grew to £2.5bn in 2012 and that it will reach

£3bn for the first time in 2013-2014. The following figure presents the sources of revenue for Premier

League Football clubs for the season 2011-2012, according to Deloitte. Moreover, according to the

football financial experts, in the summer of 2012, the Premier League clubs had a total debt of £2.4bn.

£1.4bn of that was represented by interest-free soft loans from, of which around 90% related to three

clubs: Chelsea, Newcastle United, and Queens Park Rangers.

Source: Deloitte, 2014

Source: Deloitte, 2014

League Revenue 2011-2012 Wages 2011-2012

Premier League, England 2.9 bn euros 2 bn euros (70% of revenue)

Bundesliga, Germany 1.9 bn euros 1 bn euros (51% of revenue)

La Liga, Spain 1.8 bn euros 1.1 bn euros (60% of revenue)

Serie A, Italy 1.6 bn euros 1.2 bn euros (75% of revenue)

Ligue 1, France 1.1 bn euros 0.8 bn euros (74% of revenue)

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3.2. PESTEL Analysis The following table illustrates the PESTEL Analysis for the industry in which West Ham United operates.

The table presents the industry’s major issues that create a better understanding of the industry in order to

develop a more feasible strategy.

Political/Legal -Employment Laws for players, such as Work Permits

-Consumer protection by price caps set by the Government

-Imposition of high taxes by the Government

-The new Financial Fair Play regulation by FIFA which is meant to increase cost

control and profitability for football clubs

Economic -Shift in the economic environment, from recession to recovery

-High concentration of people in London, due to high immigration rates leads to an

increase in production rates

-Low inflation rates which increases the spending power

Social -Improving living standards due to increase in pay

-Football is the most popular sport in the United Kingdom, fact that makes

consumers more keen to acquire the club’s products

-Increasing interest in English football from Asia, United States and Australia

Technological -Increase in the use of E-commerce

-Utilization of PROZONE3 for match day analysis

-Emergence of cloud computing which along with Enterprise Resource Planning

systems can increase the productivity of the organisation and assist the club in

increasing the match day experience for fans

Environmental -Emphasis on Environmental protection in relation to aspects such as noise pollution

The most important issues that will dictate the changes within the industry are the taxes charged by the

Government, the Financial Fair Play regulation and the increasing interest in English football. The

Financial Fair Play regulation prevents the football clubs spending more money that they earn in order to

achieve success. These regulations are meant to balance the gap between the most powerful clubs and the

others and in the future, will offer benefits to clubs like West Ham United which do not have the financial

capability that other clubs like Manchester City and Chelsea have. The increasing interest in English

football will benefit the organisations that are seeking to extend in different markets.

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0

1

2

3

4

5The threat of entry

The bargaining power ofbuyers

The threat ofsubstitutes

The bargaining power ofsuppliers

The extenct of rivalrybeween competitors

Porter's Five Forces Analysis

3.3. Porter’s Five Forces Analysis The following figure presents an overview of the industry using the Porter’s Five Forces analysis.

The following table explains the different aspects of the industry using Porter’s five Forces analysis.

The threat of

entry

The bargaining

power of buyers

The threat of

substitutes

The bargaining

power of

suppliers

The extent of

rivalry between

competitors

The threat of new

entry is average in

this industry as

immense

investment is

needed in order to

enter in the

market. The only

threats are the

clubs promoting

from

Championship to

Premier League

which usually

have little

resources, fact

that makes them

unable to compete

with the top clubs

The bargaining

power of buyers is

low in this

industry as the

fans have little

influence on the

decisions

regarding ticket

and official

merchandise

prices. Clubs

reduce buyer

power by offering

loyalty schemes

(such as season

tickets) and

discounts for

different segments

(such as under 18

customers or over

65 customers)

The threat of

substitutes is low

in the industry as

football is the

most popular

sport not only in

the United

Kingdom, but also

at a world-wide

level

It is average -

high in the

industry.

Organisations that

supply football

clubs with sports-

related products

or services (such

as turf,

merchandise,

training and

match equipment)

are usually

official sponsors

of the club (such

as Adidas in the

case of West

Ham) status that

increases their

bargaining power

It is high in this

industry. Clubs

invest more and

more in squad and

facilities as higher

positions in the

league generate

more income in

terms of revenues.

Moreover, the top

5 positions in the

league ensure the

club’s presence in

European

competitions

which generates

further revenues

and increases

brand equity

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3.4. Benchmarking

The following table presents a comparison between West Ham United and other football clubs. The table

includes two types of competitors: top Premier League clubs and clubs that West Ham is currently

competing against.

Factor West Ham

United

Tottenham

Hotspur

Fulham

FC

Southam

pton FC

Arsenal

FC

Hull

City

Stoke

City

Revenue (2013)

£000

89.815 147.392 N/A 71.800 280.400 N/A N/A

Profit/ (loss)

before tax

(2013)

1.224 11.461 N/A (6.600) 6.700 (28.00

0)

(31.000)

Stadium

Capacity

35.303

(60.000

from 2016)

36.240 25.700 32.251 60.355 25.404 27.743

Squad Value

(Source:

Transfermarkt

)

£million

85 240 71 90 325 54.5 78.5

No. of stores 2 4 1 1 4 1 2

2012-2013

league position

10 5 12 14 4 - 13

The following table depicts the competitive gaps between West Ham United and other players in the

market.

The gaps in the table represent the opportunities that can further develop West Ham United. For example,

Arsenal recognised the immense support from the fans and decided to charge very high prices for the

tickets. Even so, the stadium is almost full for every match, increasing the revenue from the tickets.

Moreover, Arsenal’s stadium capacity assists in increasing the revenue, gap that Wet Ham United will

close in 2016 when the club will make the move to the Olympic Stadium.

16

4. Internal and External Summary

4.1. SWOT Analysis The following table presents the summary, in terms of strengths, weaknesses, opportunities and threats

emerged from the Internal and the External evaluations of West Ham United and the industry in which the

club operates.

Strengths Weaknesses Opportunities Threats

-Globally recognised

brand, with an increase

in awareness in Asia,

US and Australian

markets

-High quality

merchandising

-Future home stadium

with increased capacity

-Associated sponsors

like Arsenal, Alpari or

SBOBET

-Great fan support

-Stable financial

position in comparison

with competitors of the

same size

-Less global awareness

and popularity in

comparison with other

English clubs like

Manchester United or

Liverpool

-A lower financial

power in comparison

with some competitors,

like Manchester City or

Chelsea FC

-Targeting foreign

markets, like Asia,

Australia or the United

States of America

-More advertising in

foreign markets will

increase the brand

equity

-Benefit from ticket

revenues after the

move on the Olympic

Stadium

-Other football clubs

being acquired by

financially strong

businessman

-The new Financial

Fair Play regulation

-Other football clubs

following the trend and

targeting foreign

markets

17

4.2. TOWS Matrix The following table presents the TOWS Matrix generated from the Internal and External evaluations.

TOWS Matrix Strengths Weaknesses

Opportunities Follow the objective to expand

into foreign markets, especially

in the regions with the highest

fan density

Strategically use the future

Olympic Stadium to increase

revenues and brand equity

Invest in marketing the club in

foreign markets in order to

compete with other English

clubs in the specific market

Threats Use the current awareness to

overcome the possibility of new

entrants in a foreign market

The Financial Fair Play

regulation can benefit clubs

with lower financial power, as

more financially stable clubs

will be prohibited to invest

money that do not come from

the revenues

Invest in marketing the club in

foreign markets in order to

compete with possible new

entrants in the specific market

18

5. Strategic Recommendations The following figure depicts the three strategic recommendations for West Ham United as well as the

description regarding what each strategy involves.

The first recommended strategy is for

West Ham United to aquire

a smaller footbal club

from a market like Australia or China. Following the example of

Ajax Amsterdam owning Ajax

Cape Town in South Africa, the new club

will be named for example West Ham

Sydney and will use the same logo as West Ham United.

The new club will be used to promote the

West Ham United brand in

the foreign country in order to increase the brand equity

and the sales in merchandise. Moreover the

new club will be used to develop football players,

that can be used by the parent club, West Ham

United in the future.

Strategy 1:

Market Development

The second recommended strategy is for

West Ham United to sign a

partnership with a company operating in a

foreign market. For example, Manchester

United signed a three-year partnership

with Unilever which implies

that the Unilever

products sold in South-East Asia

will bear the crest of

Manchester United on the

packaging.

The same approach can

be undertaken by West Ham

United in order to promote the brand of West

Ham United in a foreign market. This strategy is

meant to increase the

sales in merchandise

and the brand equity.

Strategy 2:

Market Development

The third recommended

strategy involves the development of a new product under the logo of West Ham United.

The recommendation

is for West Ham to develop a rugby team, as rugby is the second most popular sport in

the United Kingdom after football. This

strategy will see West Ham United

making use of their knowledge

and experience in sports

management in order to increase the revenues by a new addiction to their products.

Strategy 3:

Product Development

19

5.1. Six Evaluation Criteria The following table presents the six evaluation criteria for the three recommended strategies. After being

examined from this perspective, a decision will be taken regarding the strategy which will be further

recommended and implemented.

Evaluation Criteria Strategy 1 Strategy 2 Strategy 3

Consistency Strategy 1 is consistent

with the club’s

objective only

regarding making West

Ham United a global

brand.

Strategy 1 is consistent

with the club’s

objective regarding

making West Ham

United a global brand.

Strategy 3 is not

consistent with the

club’s goals and

mission.

Suitability This strategy is suitable

for the environments in

which West Ham

United operates, as

many football clubs

follow the trend of

targeting a foreign

market.

This strategy is suitable

for the environments in

which West Ham

United operates, as

many football clubs

follow the trend of

targeting a foreign

market.

This strategy is suitable

to the environments in

which West Ham

united operates, as

rugby is the second

most popular sport in

the United Kingdom.

Validity This strategy has been

tested once, by Ajax

Amsterdam, and

proved to be successful

in some regards. Still,

more research has to be

done regarding this

strategy as Ajax

Amsterdam might have

different expectations

and different

capabilities from West

Ham United.

This strategy has

already been tested by

multiple other

European football clubs

and proved successful.

Some examples are:

Manchester United,

Liverpool, Tottenham,

and Real Madrid.

Rugby is a very

popular sport in the

United Kingdom and

the industry has been

consistent in terms of

revenues. Still, no

football club has

attempted to implement

this strategy which

makes the possible

outcomes

unpredictable.

Feasibility This strategy is feasible

as West Ham United

has managers with

significant experience

in the football industry.

Still, there are

problems with the

market the club might

choose, as in a different

market the managers

will face different

issues (regulations, key

drivers of change)

This strategy is feasible

as West Ham United

has managers with

significant experience

not only in the football

industry. Using their

knowledge they can

tackle the issues they

may face and they will

ensure the new

partnership will act in

the club’s best interest.

This strategy is not

feasible, as the

managers and

employees of the club

have experience in the

football industry and

not in rugby.

Business Risk The risk for this

strategy is high, as a

The risk for this

strategy is low, as a

The risk for this

strategy is high, as the

20

Considering all the evaluation factors presented in the table above, Strategy 2 is the one that is going to be

further discussed in the remainder of this report and implemented by WH Holding Limited on a timescale

of 3 years.

foreign market might

not be as developed as

the FA Premier

League, therefore the

investment made in

implementing this

strategy might not have

the expected results in

terms of financial

results.

partnership does not

involve high

investments and the

risks are divided by the

two collaborating

organisations.

knowledge that the

employees have in

football industry does

not fully relate to the

rugby sector.

Moreover, rugby is less

profitable than football

so the investments

might not have the

expected results.

Attractiveness to

Stakeholders

The attractiveness to

shareholders is low for

this strategy as it

necessitates significant

investments. Still, the

suppliers might be

attracted by this

strategy because they

will add another client

to their portfolio.

The attractiveness to

shareholders is high for

this strategy as it

involves the possibility

of making West Ham

United a global brand

without significant

investment. The rest of

the shareholders will as

well be attracted by this

strategy because

increasing the club’s

equity will have

immense benefits for

them.

The shareholders of

West Ham United

might not be attracted

by this strategy as this

strategy requires

significant investment

that might not have the

expected result. Still

the suppliers, for

example might be

attracted as Adidas, for

example, is specialised

in different sports, not

only football. A new

activity would mean

extra revenues for the

suppliers.

21

6. Implementation The internal and external analysis on West Ham United illustrated different opportunities that the

organisation can use in order to further develop. The most important factors that suggest the

implementation of this strategy are: the increase of interest in English football from foreign markets like

Asia, US and Australia, the fact that West Ham United is a globally recognised brand and the fact that the

club has leased the Olympic Stadium in London for 99 years, starting from 2016, which will increase the

brand equity.

Considering both that the United Kingdom and Australia are both part of the Commonwealth and also the

fact that West Ham United has six Affiliated Supporters’ Clubs in five cities in Australia, this strategy

aims to further advertise West Ham United in that geographical area, through a strategic partnership with a

company that already operates in that area.

6.1. Strategy Timeline The following figure presents the strategy’s progress in the next three years.

2015: Implementation of Strategy 2

2016: West Ham moves to the

Olympic Stadium

2016-2017: Increasing

awarness of West Ham

2017: Building West Ham

Official Stores in Australia

2017-2018: Increase in

sales of merchandise

End of 2018: Sucessfull

implementation

22

6.2. Allocation of Resources An important part of the implementation process is the way the organisation manages to allocate the

resources in order to ensure the use of the best practices. The following table presents the allocation of

resources that will assist in the implementation of the strategy.

Resource Contribution Risk associated with this resource

Marketing Team The Marketing Team will work along

with the Marketing Team from the

collaborating company in order to ensure

the best design of the packaging that will

incorporate the West Ham United crest.

Low: The Marketing Team that is

already working for the organisation

will be in charge of this assignment.

Financial Financial resources will be needed in

order to pay the marketers and to cover

the operating costs of the implementation

process.

Low: The club has a stable financial

position that makes the risk concerned

with the availability of finances to be

low.

Executive Team The Executive Team will be in charge

with overviewing the implementation of

the process.

Medium: Even though the Executive

Team is part of the organisation,

considering the high amount of

operations in the club, the team will

not be permanently available to assist

the process of implementation.

6.3. Customer Driven Strategy Considering that the value of the strategy is given by the perceived value from the customer perspective, it

is paramount important to target the right market segment.

6.3.1. Customer profiling

The following table presents the profile of the customer that this strategy is targeting as well as the

purchasing decisions made by the customers, who are of great importance in the targeting and positioning

decisions.

Men Families with children Tourists

Football enthusiasts aged 18-65:

This represents the usual majority

of season ticket holders and

match day ticket holders.

Football is currently promoted as

an activity to be undertaken by

the entire family. West Ham’s

official merchandise includes

clothing for man, woman,

children and also infants

Tourists that visit London can

have a great experience of

watching a football match in

England. This segment will be

especially targeted after the move

to the Olympic Stadium which

will attract tourists due to its

modern design. The official store

inside the stadium provides

customers with the opportunity to

buy West Ham’s official kit but

also memorabilia and souvenirs.

23

6.3.2. Segmentation

The following figure presents the market segments that the organisation is going to target. Is important to

realise that each segment has different approaches and makes the purchasing decisions in different ways.

As part of the strategy, the organisation aims to target all the segments with more emphasis on Men aged

18-65, Families with children and tourists.

Target

Men 18 to 65

Men over 65

WomenTourists

Families with

children

24

6.3.3. Communication with customers

Due to the low budget that can be allocated for promotional purposes it is very important that the

organisation uses cost efficient approaches to communicate with customers. This can be done by the

Official Website that has in incorporated customer data-base and by collaborating with the Affiliated

Supporter Clubs in Australia. The following figure presents the ways in which these tools can be used for

an efficient communication with customers.

• Make use of the data-base to inform customers regarding the new products provided by the club.

• Gather information from website users in order to gain a better understanding of the customer

Official Website

• Gather information about the foreign customers through surveys carried by the Affiliated Supporter Clubs

• Market the new products of the organisation through the Affiliated Supporter Clubs

• Organise Social Events

Affiliated Supporter

Clubs

25

6.3.4. Pricing

Pricing is a paramount important factor for the organisation’s success and the pricing approaches within

this strategy are presented in the following figure.

6.4. Type of Strategic Change The following figure depicts the position of West Ham United in the context of strategic change.

•The prices for merchandise will remain as in the season 2013-2014 for UK stores, while the prices for Australia will see a 10% discount in order to encourage consumption.

•Men over 65 and children under 18 will benefit from further 10% discount both in Australia and In the United Kingdom.

Merchandise prices

•Season and match tickets will have the same prices as in the season 2013-2014, until the season 2016-2017 when the prices will see a reduction of 10% in order to increase the number of season ticet holders . the objective of this decision is to increase attendace in the new stadium.

•Men over 65, children under 18 and women will benefit from discounts of 20% on both season and match tickets.

Ticket prices

Adaptation Evolution

Reconstruction Revolution

Extent of change

Realignment Transformation

Incremental

Nature of change

Big Bang

26

The previous figure depicts the type of change that the organisation will undertake. Considering that the

organisation will realign step-by-step with the latest trends in the industry, the type of strategic change the

organisation will face is Adaptation.

6.5. Styles of Managing Change The following figure presents a concept of styles regarding change management. The style that is going to

be used in the implementation of the new strategy within West Ham is a hybrid between participation and

education. Humans are usually resistant to change but in this case, the management carries the roles of

leaders, making sure that the process of change management is gradually implemented. In order to ensure

that the employees will not resist the changes, the management will previously inform the workers

regarding the changes that are going to happen and moreover, will try to involve employees in the

implementation, making them less-likely to resist change.

Styles of managing

change

Education

Collaboration

CoercionDirection

Participation

27

6.6. Modes of entry and Internationalisation Drivers In the case of West Ham, the mode of entry will be by an alliance. This is represented by a partnership

with a company that is already operating in Australia, dividing in this way the risks between the two

organisations.

The following figure presents the Internationalisation Drivers. The impact of these factors on the

implementation of the strategy will be further discussed.

Drivers impact on the implementation strategy

Type of driver Risk

Market Driver Low: Considering that football is a globally

recognised and appreciated sport and that the

interest in the FA Premier League is growing

constantly, existing global customers have

developed similar needs as the customers from the

host country.

Cost Drivers Medium: The global economic is currently in an

uncertain position, changing from recession to

recovery. Therefore, the cost drivers might have an

impact on the implementation due to the instability

in exchange rates and oil price.

Competitive Drivers High: Considering that the current trend in the

industry is for organisations to tap foreign markets,

the risk that a competitor might have the same

approach in the same market needs to be

considered.

Government Drivers Medium: The fact that both countries are part of the

Commonwealth facilitates the trades between the

United Kingdom and Australia.

•similar customer needs

•global customers

•transferable marketingMarket drivers

•scale economies

•country specific differences

•favourable logisticsCost drivers

• interdependece between countries

•competitor's global strategiesCompetitive drivers

•trade policies

•technical standards

•host government policiesGovernment drivers

28

6.7. The Balanced Scorecard

The following table presents the Balanced Scorecard for this strategy.

Strategy Perspective Example Key Performance Indicator

Financial -increase sales of merchandise by

50% by 2018

-increase ticket sales by 50%

from 2016 to 2018

-increase turnover by 25% by

2018

-sales revenue

-ticket sales revenue

-total group turnover

Customer -customer satisfaction with match

day experience and merchandise

-sales of merchandise

-average match attendance

Internal -recruiting and retaining the best

employees

-employee performance

-organisational performance

Future -increase brand equity -number of foreign customers

-level of sponsorships

7. Conclusion This report has examined the internal and external analysis of WH Holding Limited, the parent company

of West Ham United in order to recommend a strategy that would assist in the further development of the

organisation. The most important findings of the analysis showed that is an increasing interest in English

football from foreign markets which generates the opportunity to target a foreign market in order to make

the club a global brand. Considering that the findings are consistent with the objectives of the

organisation, the strategy to target an external market has been further discussed in the third part of the

report, which is concerned with the implementation procedures for this strategy.

29

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