The Purchase of Paris Saint German Football Club by Qatar Sports Investments - Case Study Example

? In What Way is the Purchase of Paris Saint German Football Club by Qatar Sports Investments (QSI) a Good Strategy for the Company? Lecturer: Institution: Course: Date: Executive Summary The project provided an introduction to the research problem with a brief historical background of Paris Saint German football club. The project provided varied arguments revealing why the purchase of PSG association by Qatar was a good strategy. This included the need for Qatar sports to invest in football as one way of promoting Qatar business interests. Investing in the football club can enable them to develop a powerful team; thus contributing to increased performance level. It was also an effective strategy because purchasing the football club by QSI was one way of showing the national pride. The strategy motive was also the belief in the future growth of sports and enable PSG to achieve their big dreams. It was also an effective strategy for transforming the PSG into one of the biggest teams in the globe. Thus, placing people in power who have knowledgeable and effective skills about the sport would be significant for the success of PSG club. The project also focused on the other argumentative side by revealing that to a smaller extent, the purchase of Paris Saint German FC by QSI was not a good strategy. This was because selling the PSG FC to Qatar is one of putting the football club under risks. It was not a good strategy because it might be due to political interest and the aim for Qatar to achieve their business objectives. Lastly, the conclusion was included that provided a brief summary of the argumentative points presented in the project. In What Way is the Purchase of Paris Saint German Football Club by Qatar Sports Investments (QSI) a Good Strategy for the Company? Paris Saint German FC is a qualified association football team, which is based in Paris, France. It was founded in 1970 by Saint-Germain and Paris football associations who joined and formed the association, which has been always representing Paris. PSG (Paris Saint German) is an interesting football association across the globe. This team was bought by QSI during summer 2011, thus the French club has shocked many people because of its immense transfer expenditure. The Paris team has always been on the forefront and it has been in the competition record since it began its football association in 1974. PSG is among the teams that have won main European cup, and it became the major team in 1994 after it won the tournament cup. It was also ranked among the best leading teams in the UEFA tournament winners in 1998, and is currently ranked 16th in the IIHS (International Federation of Football History & Statistics) and 46th in the UEFA team ranking. The purchase of PSG football club by Qatar is a good strategy for the company because of varied reasons. First, Qatar sports could be investing in football as one way of promoting Qatar business interest at large. For instance, Qatar will offer football companies a patronage pact to enhance their brand. Moreover, there is not team across the globe with higher interest than PSG. Since this football club was purchased by QSI, the club has greatly improved; thus shocked the world with their massive transfer cost. Many people are expecting a lot from QSI over the coming decades because they invest a lot; hence good for benefiting of the club. This is because it will enable the company to achieve their dreams of building a competitive team which will become among the best teams across Europe (Hytner, D. (September 11, 2012). The company owner has pledged to spend a lot in the coming years in order to enable the PSG to become the greatest football club across the globe. In addition, the purchase of PSG by QSI was a good idea because it is a big advantage to the company. This is because investing in the football club can enable them to develop a powerful team; thus contributing to increased performance level. The higher the organizational performance, the better the company will receive high revenues. Moreover, it was a good strategy because it enables the company to invest in the football club and fund them in order to enable them improve their performance level. The presidency of PSG football club argued that the purchase of PSG by QSI is a good strategy for the company because it will enable the company to compete effectively with others. Having enough money will boost the football club and enable them become highly competitive in the global market. Purchasing the football club by QSI was one way of showing the national pride. Khelaifi, the company manager of QSI decide to pour millions of money to the giant football team in Paris. He did this because of varied aspects one of them being the need to promote national pride. Football club is one of the effective activities that have become more demanding because they contribute to increased revenues. Therefore, by purchasing PSG, Khelaifi wanted to boost the pride of their nation. Although the research study argues that Khelaifi, PSG presidency’s aim was due to political ambition, Khelaifi, claimed that by purchasing PSG, it was one way of boosting the pride of the nation in hosting the world cup, in 2022 (Whittal, 2012). The strategy motive was also the belief in the future growth of sports. Many football sports club have been performing poorly because of inadequate finance to support the team. Whittal (2012) argues that business owners with inadequate financial resources artificially inflate wages for all football team in Europe. Hence, by QSI purchasing this football club, it was an effective strategy for boosting the football club; hence enabling team players to achieve their demanding goals successfully. Adequate financial resources in any football club is desirable because it enables the club to improve their performance level because this money will be used for varied activities such by increasing training programs and providing necessary sport equipment. Lawrie (2013) argues that PSG are going the right way of achieving their big dreams. This is because other football teams such as Chelsea and Manchester City tried it and became successful. Therefore, PSG put their money in proper use; thus they will eventually become the next genuine European superpower. Many people expect QSI Company to invest a lot and join the elite of Europe in the next coming years, as the company owner wants the PSG to become the greatest football club across the globe. PSG made a good strategy after spending five year drafting a plan on the way to become successful. Therefore, this is one way through which they will be in a position of winning the cup following the coming two years. This is a team that aims to achieve success; thus they are not prepared to wait for success to fall upon them but rather seek effective ways of achieving it. Thus, the PSG want to become strong contenders for the global champion league. Moreover, the club president, Khelaifi realized that by placing people in power who have knowledgeable and effective skills about the sport would be significant for the success of PSG club. Despite the purchase of the club with an intention of improving the performance, the club also requires successful people who are knowledgeable and have effective e skills to manage the PSG football team (Lawrie, 2013). Team management in an organization is vital because it will contribute to the success of the company. Hence the company should recruit people who can manage and run the PSG football club effectively in order to create change. This people will act as mentors and offer effective training programs to team members in order to enable them achieve higher performance level; hence achieve a competitive advantage in the global tournament. Cutler (2012) argues that by purchasing of PSG by QSI was an effective strategy for transforming the PSG into one of the biggest teams in the globe. The club president of PSG argued that this was an effective means that will enable the club to attract the best players from the planet; thus turning the PSG club into a profitable company. The company had the belief that the new owners will overcome the initial reservations of the fans of PSG team; hence creating significant change of the company. Sayare (2012) argues that PSG’s new slogan of transforming the company is the idea of dream bigger. Therefore, the Qataris aim to transform the PSG into a powerful football club was to challenge the best and most extravagantly financed football clubs. The search analysts argue that aspiration efforts align effectively with those of Qatar towards the promotion of the national brand. Moreover, by purchasing PSG into European soccer, the company is purchasing a marketing platform, which is very attractive (Sayare, 2012). Paris is an ideal city for soliciting prospective investors; thus the location of this club in Paris and purchasing it was an effective aspect. This is because the PSG team will become a successful and competitive team across the globe Roberts (2013) Qatar Sports Investment has established a good reputation as a global financial power. The former president of PSG football club, Nicholas Sarkozy created good relationship with the Qatari leaders, which is an effective aspect towards success of the company. There are varied benefits realized from the purchase of PSG by QSI one of them being taking advantage of any opportunity to use the company in increasing the investments. Qatar has invested a lot in Europe and they have taken their time studying the political and business environment; thus they know the business, as well as, political leaders, who will enable them to achieve their business goals effectively. The good relationship created between Qatar and Europe makes centrally significant towards achieving success in their business activities. Therefore, by purchasing PSG, Qatar will gain a big advantage of increasing their investments through PSG football club. However, to a smaller extent, the purchase of Paris Saint German FC by QSI is not a good strategy. Varied arguments have been raised against this strategy whereby the opponents have attempted to give diverse reasons for behind the PSG purchasing strategy. First, the opponents of against the strategy that the company employed argue that selling the PSG FC to Qatar is one of putting the football club under risks. This is because Qatar would be only investing in the PSG football club as means for boosting their business and not a good strategy for the football club team (Hytner, 2012). For instance, Qatar would offer PSG football club sponsorship in order to push their brand; thus this is a form of political ambition, which may put the football club under risks (Scott, 2012). Moreover, this is not a good strategy in case it is only dreaming big for only getting money; thus the football club may offer a mere mark of change comparing to the other opportunities venture entrepreneurship, who can offer these oil and gas oligarchs (Hytner, 2012). Many opponents of this strategy argue that Qatar, which is among the millionaire companies in the United Arab Emirates may not be interested in the PSG football club just to dispense millions of money in Paris but rather it may be just because of national pride, love of sport or boredom ((Hytner, 2012). The company can certainly piece together a coherent and effective business strategy for achieving their business goals; thus the PSG league needs an effective way of achieving their big dream. The potentially huge cash for being a major player will not only enable the company to achieve their interest in overseas, but rather need to examine the motives of Qatar, which might be the political interests before selling their football team to them. Consequently, the Qatar strategy appears comprehensive and this posses varied questions about their motives of purchasing PSG. It has not been the first time companies purchasing their football club teams. For instance, a fellow emirate, which is the Abu Dhabi, employed a similar strategy like that of Qatar by purchasing Manchester City, who operates a crowded marketplace (Winton, 2012). PSG stands alone, giving the football club a confined market and the club may not in the truest sense be a football association city but rather a throb with football sub-culture. In conclusion, the purchase of PSG football club by Qatar is a good strategy for the company because of varied reasons. First, Qatar sports could be investing in football as one way of promoting Qatar business interest at large. Secondly, investing in the football club can enable them to develop a powerful team; thus contributing to increased performance level. Thirdly, purchasing the football club by QSI was one way of showing the national pride. The strategy motive was also the belief in the future growth of sports and enables PSG to achieve their big dreams. It was also an effective strategy for transforming the PSG into one of the biggest teams in the globe. Thus, placing people in power who have knowledgeable and effective skills about the sport would be significant for the success of PSG club. However, to a smaller extent, the purchase of Paris Saint German FC by QSI is not a good strategy. First, the purchase of PSG by Qatar was not an effective strategy because selling the PSG FC to Qatar is one of putting the football club under risks. Lastly, it was not a good strategy because it might be due to political interest and the aim for Qatar to achieve their business objectives. References Cutler, M. (March 7, 2012). Qatar Sports Investment (QSI) has acquired the remaining 30% stake in Paris Saint-Germain in a deal that values the French Ligue 1 club at Eur100 million. Sport Business. Retrieved on April 11, 2013 from http://www.sportbusiness.com/news/185199/qsi-completes-psg-buy-out Hytner, D. (September 11, 2012). Paris Saint-Germain has dreams and cash to match. Mail & Guardian. Retrieved on April 11, 2013 from http://mg.co.za/article/2012-09-28-00-psg-has-dreams-and-cash-to-match Lawrie, F. (March 20, 2013). PSG are going the right way about dreaming big. talkingbaws.com. Retrieved on April 11, 2013 from http://talkingbaws.com/2013/03/20/psg-are-going-the-right-way-about-dreaming-big/ Roberts, D. (February 2013). Qatar as a Financial Investor. Norwegian Peaceful Building Resource Centre, Policy Brief. Pp.1-3. Sayare. S. (October 26, 2012). Qatar Is Becoming a Player in French Sports. The New York Times. Retrieved on April 11, 2013 from http://www.nytimes.com/2012/10/27/sports/soccer/with-paris-saint-germain-qatar-is-a-player-in-french-sports.html?pagewanted=all&_r=1& Scott, M. (October 3, 2012). European football booming with image of most importance for PSG and Zenit St Petersburg owners. Telegraph. Retrieved on April 11, 2013 from http://www.telegraph.co.uk/sport/football/european/9584118/European-football-booming-with-image-of-most-importance-for-PSG-and-Zenit-St-Petersburg-owners.html Whittal, R. (September 21, 2012). Why did QSI buy Paris Saint-Germain?.The Score.com. Retrieved on April 11, 2013 from http://blogs.thescore.com/counterattack/2012/09/21/why-did-qsi-buy-paris-saint-germain/ Winton, R. (July 17, 2012). PSG 'project' gains momentum with Zlatan Ibrahimovic bid. Heraldscotland. Retrieved on April 11, 2013 from http://www.heraldscotland.com/sport/football/psg-project-gains-momentum-with-zlatan-ibrahimovic-bid.18170897 Read More