Is ‘Fifagate’ a re-run of All The President’s Men?

May 27, 2015

The arrest of five Fifa executives in a Swiss luxury hotel has freaky echoes of the Watergate scandal which was to lead to the impeachment of President Nixon

Wednesday 27th of May, 2015:  Breaking news that five Fifa executives had been arrested by Swiss police on charges of corruption and money-laundering over a period of twenty years.

In breaking the news, The New York Times offered the curious headline: FIFA Officials Arrested on Corruption Charges; Sepp Blatter Isn’t Among Them

In its first report, still in the early hours in New York, the paper outlined the background to the breaking news:

Swiss authorities conducted an extraordinary early-morning operation here [today] to arrest several top soccer officials and extradite them to the United States on federal corruption charges.

As leaders of FIFA, soccer’s global governing body, gathered for their annual meeting, more than a dozen plain-clothed Swiss law enforcement officials arrived unannounced at the Baur au Lac hotel,

The inquiry is also a major threat to Sepp Blatter, FIFA’s longtime president who is generally recognized as the most powerful person in sports, though he was not charged. Blatter has for years acted as a de facto head of state. Politicians, star players, national soccer officials and global corporations that want their brands attached to the sport have long genuflected before him.

An election, seemingly pre-ordained to give Mr. Blatter a fifth term as president, is scheduled for Friday. A FIFA spokesman insisted [at the news conference] that Mr. Blatter was not involved in any alleged wrongdoing and that the election would go ahead as planned.

The Lessons of History

In my mind, the business has remarkable aspects of the Watergate affair which eventually led to the impeachment and disgrace of President Nixon. The plot, if not the details of All The President’s Men, carries a great deal of accurate reporting of the drama.

It is usual to acknowledge the dangers of assuming history repeats itself accurately. It may help suggest ways of interpreting a contemporary story. Or, if we follow the gloss on Hegel made famous by Marx, the events of Watergate occurred as tragedy and may now be re-occurring as farce.

If Fifagate is a farcical rerun of Watergate, don’t expect a sudden resolution. Richard Nixon continued to protest his innocence as the evidence against him mounted. Sepp Blatter, will do likewise, although the suggestion that he was unaware of any corruption going on around him is itself evidence of at least leadership incompetence on a heroic scale.


Warnock fired, as Football’s naïve owners cling to outdated leadership beliefs

January 9, 2012

Another premiership manager is dismissed as football owners in the Premier League cling to outdated beliefs about the great man who will reverse the fortunes of their clubs

Neil Warnock was dismissed as manager of Premiership club Queens Park Rangers (QPR) yesterday [Sunday 8th of January] . The circumstances are all too familiar. Warnock is a controversial and outspoken character. He has a reputation of demanding the best from players often working with a limited budget. He is only eight years younger than Sir Alex Ferguson. Last year QPR gained promotion with him as their manager.

Events contributing to a sacking

Some of these events seem familiar for cases in which managers are removed from their positions in the premier league.

[1] A takeover after which the new owners take the opportunity to put ‘their’ man in charge
[2] The club does not perform to expectations in the ‘honeymoon period’ for the new owners
[3] A case of success elsewhere after a change of manager is noted by the new owners and the fans.

The Martin O Neill effect

All three factors are evident in the QPR case. Martin O Neill has hit the headlines after a great start at struggling Sunderland recently.

The Great Man Theory

The idea of a leader as hero/rescuer was popular a century ago, but has become increasingly challenged. In business, as in sport, the evidence for a reversal of fortune after introducing a dynamic new manager is contestable. There are other factors including the resources that are made available to the new leader to ‘make a difference’.

Fanciful expectations

Yes, a transformation in fortune will require effective leadership. The owners may well have found Warnock not the kind of manager they would have preferred for a fresh start. However, significant change will also require effective governance and expectations that are not too fanciful. And a Martin O Neill or a Kenny Dalglish is hard to find, and harder to attract without special personal reasons for accepting the challenge.


Mothercare: Rumours of takeovers continue

December 12, 2011

Susan Moger & Tudor Rickards

Mothercare is a high profile brand in the UK which is struggling to become a successful global operation. It is also facing rumoured takeover bids

Recent rumours suggest that Mothercare is ‘ripe for a takeover’. These have been supported by speculative share purchases. Venture capitalist Cinven is currently [Dec 12th 2011] favourite to move for Mothercare.

Background

To the general British public, Mothercare has developed iconic status since its origins in the 1960s. In some ways it has the ‘much loved’ status of Woolworths. LWD subscribers will be familiar with the demise of “Woolies” adding to the gloom of last Christmas for its employees. In hard times, sentiment is a commodity that does not guarantee survival.

The Company was founded by Selim Zilkha and James Goldsmith in 1961. In 1982 it merged with Habitat to form Habitat Mothercare and in 1986 Habitat Mothercare merged with British Home Stores to form Storehouse. Mothercare also acquired the Early Learning Centre (ELC) in 2007.

Profits have been increasingly coming internationally, this year just about balancing losses in the UK. The financials suggest that a takeover by a venture capital organisation would result in more rapid and drastic actions to address UK losses.

The declining fortunes of Mothercare are indicated by a sequence of CEOs. Ben Gordon was the fifth in rapid succession four years ago. At first,his appointment was accompanied by a strong rise in share price which eventually reversed (until the recent takeover rumours)

Crisis actions

The firm has followed the well-known steps for businesses facing financial problems. In particular, there have been changes in leadership, and steps to reduce costs.

Any signs of rethinking its strategy?

Cost cutting has included announcements of reducing the number of stores in the UK as leases expire. Signs of rethinking strategy are less evident.

Alan Parker, executive chairman of Mothercare was quoted in The Telegraph [17th Nov 2011] as saying

“We have to rejuvenate the whole brand and offering. The competition in the UK is more intense than overseas. We need to review the format and location of our outlets in Britain.”

More than an economic downturn?

Matt Piner, at the retail consultancy Conlumino, said: “Mothercare has blamed its falling UK sales and profits on the economic environment, but in reality all this has done is expose the wider issues the retailer faces.

However, with consumers now increasingly confident using the internet and sites such as Mumsnet to educate themselves, the once habitual visit to Mothercare is becoming a thing of the past. Instead, consumers research what they need online and head to the cheapest retailers to buy it – which nowadays normally means one of the supermarkets.”

In addition, retailers such as Boots and Superdrug have made great efforts at providing advice as well as products for young families and with greater high-street footfalls.

Is the story straightforward?

Oner evaluation was less convinced about the non-UK business prospects.

Mothercare’s overseas growth has been hugely impressive. But despite the rapid growth in the international business over the past six years, the UK remains the driver (or not) of profits. For all the talk of reducing exposure to the UK market and restructuring the property portfolio, retail space in the UK actually grew last year.

Of course [Former Chairman] Peacock – and his chief executive Ben Gordon – would rather talk about Eastern Europe than the UK. International sales rose 15pc-plus, while the UK has seen sales fall 4.3pc, despite weak comparatives.

The retailer has made much of its international franchisee business in recent years, [flying out analysts and journalists] as far as India to see the business. But whatever the spin, Mothercare’s fortunes are still tied to the UK market. Last year the group sold £587m worth of baby stuff and toys to UK shoppers and £206.4m to its international franchisees. Mothercare – rather bizarrely in my view – prefers to highlight “network sales”, which include the international franchisees mark-up (of which Mothercare takes just a small “mid-single digit” cut).


Murdoch Meltdown

July 17, 2011

Elisabeth Murdoch and father Rupert

In three turbulent weeks in July 2011, Rupert Murdoch faced a complete meltdown of his global corporation News Corp. The crisis has a timeline which can be traced to the imprisonment in 2004 of a few ‘rogue’ journalists in one newspaper, the News of the World. This spread to allegations of a culture of corruption and phone hacking at the NOTW, and its closure. The story continued to spread with political fallout reaching the wider global corporation

We concentrate on the turbulent weeks at the start of July 2011, after briefly reviewing the wider timeline of events.

BBC Timeline

The BBC gave a good summary of the timeline of events from 2000 to July 20th 2011. although for whatever reason, overlooked the dimension of police corruption which is also to be found within the story. The Timeline It begins with the appointment of Rebekah Wade (later Rebekah Brooks) as editor of News of the World in May 2000, and ends with her resignation as Chief Executive of News International, July 15th 2011

Resignation of a News Corp executive fuels the wider story

Within hours of Rebekah Brooks tendering her resignation as head of News International, her predecessor Les Hinton, one of Rupert Murdoch’s closest lieutenants in the United States, fell on his sword, saying that the pain his reporters had inflicted on innocent people was “unimaginable”. Mr Hinton has been the publisher of The Wall Street Journal since Mr Murdoch bought it in 2007 and his continuing presence was threatening to drag the media mogul’s prize US newspaper asset into the scandal.

Two symbolic events

Two events received particular media attention. They were presented as reflecting a callous culture, which ignored the impact of behaviours on members of the public who were already victims of tragic events. Each story involved journalists who had targeted families of victims of highly emotive tragedies. In the UK, the definitive episode involved tampering with the mobile of the murdered teenager Millie Dowler which may have given false hope to the family. Rupert Murdoch was to meet and apologise personally.

In the USA, allegations developed of hacking of phones of families of victims of the 9/11 World Trade Center bombings.

An unfinished case

This post ends [17th July 2011] at the start of a week which promises more in the unfinished drama surrounding Rupert Murdoch and the business empire he founded. One interesting theme is being reported concerning his daughter Elisabeth, on whom it is reported he is now pinning his hopes to take the dynasty forward. This is certainly consistent with a story that has cropped up from time to time within biographic accounts.


Exclusivity in a linked-in world. Making sense of fast-changing news stories

June 7, 2009
zzstructure modelling

zzstructure modelling

News stories are increasingly fast-breaking. Traditional ideas of journalistic exclusivity are being challenged by processes in which the news is co-created

It has become a truism to assert that information technology is transforming journalistic processes of news collection and distribution. The current political crisis in the UK makes a good example to explore these ideas.

The traditional scoop still exists

Part of the current political narrative in the UK has a traditional air to it. The Daily Telegraph acquired an exclusive story which became labelled the MPs expenses scandal. It was able to reveal the often outrageous expenses claimed by every Member of Parliament, pacing release of information.

The competitive edge has been maintained over a period of weeks. Other papers and news media were restricted to stories building on the fresh revelations day by day as The Telegraph eeked out its precious competitive resource.

Exclusivity in a linked-in world

But exclusivity in a news story is becoming transformed through the new linked-in world of the internet. Professional news-gathers are in uneasy competition with the amateurs who can also gain recognition and transient fame for being in the right place at the right time. This means being in a place when something dangerous and spectacular happens, and being equipped to capture the story and pass it on.

Remember the spectacular image of Flight 1549 ditching into the Hudson which was transmitted around the world recently? The observer had captured video footage on his mobile phone, and then on to his blog which became a global source of the breaking news.

Journalists are becoming increasingly twitchy that such stories are part of a significant change in journalistic practice. A decline is predicted in the costly business of news collection by ’real’ reporters reporting on the spot as a story breaks.

The broader political picture

But for all its competitive edge, the Telegraph could not retain exclusivity because the story broadened out into a wider range of themes outside its control. The expenses story became enfolded in the wider problems facing the Government. The global financial crisis continued to produce damaging local consequences for millions of people, threatening jobs and pensions.

In less than a week, there has been a succession of stories some connected with the expenses story, some less so. Rumours developed of a plot to force the Prime Minister to resign. Plotters appeared to be leaking information to the Westminster press corps, but not in a way in which any news medium journalists could claim exclusivity except for minor elements of the emerging story.

This took play against a backdrop of local and Euro-elections correctly anticipated by just about everyone who commented as likely to turn out very badly for the Government. To add to the information overload, there were several resignations of government figures.

One Labour MP, who also has a voice as a political commentator, was utterly convinced it was a coordinated plot and expressed the conspiracy theorist view that the events demonstrated evidence of a coordinated plot to overthrow the Prime Minister.

As the weekend approached, the events ebbed and flowed in favour of the Prime Minister holding on. In what appeared as an act of desperation, Gordon Brown initiated a cabinet reshuffle (which was also to precipitate at least one resignation).

At a remarkable Press Conference, Gordon Brown faced an audience of journalists which seemed mostly convinced that the Prime Minister was fabricating a story which was within their grasp to expose.

Could this be a modern version of that Robert Nixon moment when the most powerful politician in the world was brought low by the diligence of journalists?

Gordon Brown wriggled uncomfortably, but despite their increasingly aggressive questioning, the journalists failed to land a fatal blow.

A new approach to news stories

Whew! Stop all the clocks, as a poet put it. Information collection and dissemination has become easier and more rapid. But there is also the evident condition of increasing uncertainty surrounding any story. What’s going on? What’s going on now? New ways of dealing with such uncertainties might not just be desirable but necessary.

I have recently been introduced to new ways of dealing with complex systems. My informant was Alex Hough, a regular contributor to LWD. Alex is experimenting with a host of creative ploys to explore new ways of data management, building architectures which break away from the linearity of old-style narratives. He introduced me to concept of zig-zag data-base construction .

Alex, as well as Zig Zaggers, seem to be pointing towards a world in which news is co-created by groups or communities creating (or maybe co-creating) stories.

ZigZag holds a new, liberated form of data and shows it in wild new ways. Conventional data structures …are created from a rigid top-down specification. ZigZag structures are created from individual relations, bottom-up, and can be irregular and unlimited. Our logo says it all: locally rational, globally paradoxical, yet somehow comprehensible.

Towards that zig-zag way of managing news

In the past, the journalistic edge was based on two different and hard-to-imitate factors. The first was a temporal edge of news producers over news generators. That is being eroded when any news conference can be received globally and through many different media. The second is based on the particular skills of news management.

But even this competitive advantage is being eroded. What if the viewers can work things out in alternative ways which include skills of dealing within those ZigZag structures which are created (I would say co-created) ‘from individual relations, bottom-up, irregular and unlimited’.

Or to use another metaphor, news may be better seen as processes of map making, map testing and map reading. In the past, the journalists read the maps provided by the politicians, tested them, and presented their own versions of the maps.

The journalists still have a vital role to play in trying to reveal hidden stories. But the process of making sense of the stories is more open to outsiders who can weigh up the efforts of politicians and journalists alike, and take part in the mews making consensus. In the zig-zag world, the map reading, map testing, and map making are increasingly collaborative ventures.

Acknowledgements

To Alex Hough for drawing my attention to Zig Zag data structuring . To the