Gill’s departure leaves Ferguson isolated
David Gill’s surprise announcement on Tuesday, that he is to step down as chief executive of Manchester United after 10 years in the position, comes as a personal “blow” to manager Sir Alex Ferguson, leaving the 71-year-old Scot without a key Old Trafford ally. It is the most serious conclusion to draw from Gill’s resignation, which will take effect after the season has concluded in June.
Gill’s departure comes against the backdrop of the 55-year-old executive’s move into football politics. Gill, who has spent 16 years at Old Trafford first as chief finance officer and then ceo, recently joined the FA as vice chairman, and is applying to join UEFA’s executive committee. He will remain as a non-executive director of the club.
Meanwhile, 40-year-old Edward Woodward, very much the Glazer’s man, will take up his new role with a remit to further strengthen United’s commercialisation strategy. Woodward becomes ceo after a highly successful campaign to broaden United’s commercial reach over the past seven years, which has seen the club’s commercial revenues nearly triple to £117.6 million.
Woodward, formerly executive vice chairman at the club, led the team that globalised United’s commercial reach and diversified the portfolio of sponsors. Under Woodward’s executive leadership United’s aggressive commercialisation is highly unlikely to slow down.
But it is the impact on Sir Alex that is of primary interest to supporters, who have witnessed just three chief executives during Ferguson’s reign; Gill, Peter Kenyon and Martin Edwards. Indeed, Gill has become Ferguson’s close confidant in the past seven seasons, and a central link between the playing side of the club and the detached Glazer family in Florida.
“I have worked alongside the finest manager in the history of the game and been part of what I consider to be the best club in the best sport in the world,” said Gill in a statement released shortly after United informed the New York stock exchange on Tuesday.
“I have always been conscious of the fact that, as a member of staff, I was always just a temporary custodian of this marvellous institution. I am also of the view that all businesses need to refresh themselves with new management and ideas and after 10 years in charge I believe it is appropriate for someone new to pick up the baton. I’m delighted Ed has accepted the role.
“I am looking forward to continuing my involvement on the club board. And I hope to be able to make a contribution to the game on a wider national and European level.”
Without Gill, Ferguson’s political position at the club is challenged. After all, it was Woodward, not Gill, that was the primary driver of United’s IPO roadshow last summer, at one point promising potential investors that the Reds will not spend more than historical norms on transfers and wages. It was a promise that many people took at face value – an average net transfer budget of less than £20 million per season.
Recent analysis by blogger Andy Green forecasts that United’s surplus cash flow could reach more than £100 million in the coming years, putting Woodward on a collision course with Ferguson over budget, should the septuagenarian Scot remain at the club.
No wonder Ferguson admitted his dismay at Gill’s departure, with the man dubbed ‘Safe Hands’ no longer in the boardroom to facilitate his manager’s relationship with the American owners.
“I have been at United for over 26 years and for 23 of those years my boss has been one of only two men: Martin Edwards, who brought me to the club, and David Gill,” said Ferguson on Tuesday.
“Of course we have had a million arguments, but I have always enjoyed them because I know that David has two great qualities: he is straight and he always puts Manchester United first. No disagreement is ever personal with him. He always wants the best for United, whether it’s the players, the training ground or the staff.
“Him stepping down is a big loss to me but the fact that he is staying on the board encourages me that the reason for his departure is heartfelt, that he believes it is time for the club to move on. If I could have found a way of persuading him to stay I would love to have done that.”
In a decade as ceo, first under the Plc regime and latterly working for the Glazer family, Gill has generated significant controversy. Gill was integral to much of United’s first wave of commercialisation, provoking criticism from the media for United’s marketing approach, and from fans for the evolving nature of the Old Trafford matchday experience.
Gill also led the board’s strategy to increase ticket prices ahead of the Glazer’s leveraged buyout, justifying rises under the mantra of retaining the club’s ability to fight off a hostile takeover. It did little good.
Most controversially, Gill initially rejected the family’s approach for full control of the club in 2005, infamously stating that “debt is the road to ruin” and that the Glazer family’s business model was “overly aggressive”. Gill’s hostility soon morphed into support for the Glazer regime once the takeover was completed, although there was little material difference in either debt leverage or business approach.
It takes not a cynic to suggest that Gill’s salary, which has more than doubled since 2005, has bought significant loyalty to the new owners, who have sought to retain the executive’s involvement in a non-executive capacity.
“David has played a significant role in the success of Manchester United in his 10 years as CEO and he can take great satisfaction at all that has been achieved on his watch, both on and off the field,” said Joel Glazer, co-chairman in a rare statement from the family.
“I am very pleased he has agreed to remain on the board, so that his experience and counsel are not lost to us. I hope that the decision he has made will be to the benefit of the game in Europe as a whole, as he seeks election to Uefa’s executive committee.”
Meanwhile, Woodward called his appointment a “great honour,” adding that he is “humbled” to work with Ferguson. Yet, the obsequious words can do little to mask the new chief executive’s remit, which is to drive home the club’s profit goals, generating ever greater margins as the Glazer family seeks to extract equity from the business.
It is an objective that, as one reporter put it on Wednesday, completes the ‘Glazerfication’ of Old Trafford; an entity that now exists primarily to extract profit for its owners, and to be a football team as a by-product.
This process was once anathema to Ferguson, the socialist ship worker’s son, now working for the game’s most commercially geared organisation and under the leadership of the Glazer’s prodigy.