Post by Macmoish on Jul 7, 2013 8:11:28 GMT
Bump another Year - Two Years ago
Year Bump (Obviously has since (just) sold Caterham
I don't think we'd argue over what has happened in the world of sport; our hope - maybe expectation- is that he's learned and that what has happened is not the same as what will happen. (And of course, there's a
broader picture than just "Success" or "Failure")
The Economic Times
economictimes.indiatimes.com/news/news-by-company/corporate-trends/why-an-assessment-of-airasia-chief-tony-fernandes-sports-failures-is-important/articleshow/20945989.cms?flstry=1
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
By Binoy Prabhakar, ET Bureau | 7 Jul, 2013, 06.53AM IST
Malaysian low-cost carrier AirAsia boss’s aviation business is shipshape, but his football and Formula One teams are in a shambles.Malaysian low-cost carrier AirAsia boss’s aviation business is shipshape, but his football and Formula One teams are in a shambles.
Three days have passed since Tony Fernandes left India. But the dust he kicked up is yet to settle. Fernandes, group CEO of Malaysian low-cost carrier AirAsia, landed in India on a whistle-stop tour last Saturday, about five months after announcing plans to create an airline in India partnering the Tata group.
Wherever he went, a procession of microphones and flashbulbs followed because it soon became clear his trip was going to be vastly different from the visits of foreign CEOs, who with their carefully-chosen words, would give diplomats a run for their money. Fernandes, in contrast, was not afraid to name the big guns, notably blaming Jet Airways' Naresh Goyal for lobbying for a restrictive rule in aviation. In Delhi, he drew plenty of chuckles, guffaws and belly laughs from the audience.
One reporter asked him if he had plans to buy Air India, the government-run carrier. After the tiniest of pauses, Fernandes said: "I've heard plenty of crazy things during this trip. But you, sir, win the prize." He offered the journalist and his wife a free ticket to anywhere AirAsia flies. On why AirAsia would focus on south India, he said that's because Mittu (Chandilya, the CEO of AirAsia India) and S Ramadorai (chairman) are from there and they are very nationalistic. Journalists might well have been watching Jay Leno at work.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
If the straight talk and jokes were aimed at creating a buzz around the launch of the airline, it worked. Fernandes displayed in abundance his sharp understanding of the aviation business. About the rationale behind free ticketing — a key strategy of AirAsia — he reminded everyone that the journalist was offered only a one-way ticket.
"We are going to charge a fortune for his return trip," he said. Tony Fernandes, the successful aviation entrepreneur (see Aviation), came, saw and left no one in doubt about his ambitions for the Indian aviation market. The visit to India burnished his reputation.
Sour Story
Yet, not everything Fernandes has touched has turned into gold. There have been failures — a recent one actually. AirAsia was forced to end a joint venture with ANA Holdings in Japan. True to form, Fernandes glossed over the failure with a joke. "ANA was horrible in bed," he said. Seriously.
Fernandes has also failed spectacularly in his other big area of interest — sports. Queens Park Rangers (QPR), the English Premier League football club he bought in August 2011, was relegated last season. QPR managed to only narrowly avoid a drop the previous season.
Fernandes' Formula One team Caterham hasn't fared any better. The team is now in its fourth year in Formula One, but is still stuck at the bottom of the grid. Caterham hasn't won a single point since its launch in 2010 and its best race finish so far is a lowly 11th.
The team is also trailing behind Sahara Force India, part owned by Vijay Mallya, the promoter of the grounded Kingfisher Airlines. "I think we run a better airline and he's run a better Formula One team," Fernandes had told a gathering before the start of the Formula One Monaco Grand Prix in May.
An assessment of the failures of Tony Fernandes the sports entrepreneur is important because they might have a bearing on his airline business in India. Even for an industry that resembles a disaster area as a whole, Indian aviation stands out because of the high costs and rigmarole of rules. AirAsia has already faced disappointments in India. It has struggled on overseas routes from India.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
The airline faces a potentially challenging 2013 as it accelerates expansion in core markets, according to aviation consultancy Capa. AirAsia will continue to incur losses at its recently launched Philippines affiliate, Capa said in a recent report.
Capa said AirAsia clearly has the cash to withstand the storm of challenges that 2013 brings. But all that can change because Fernandes also has his financial antenna tuned to his sports businesses, particularly his football team. To date, he has sunk £50 million QPR — to no effect. Current manager Harry Redknapp the third appointment since the acquisition. By Fernandes' own admission, QPR will not return to the Premier League anytime soon.
Poor Scorecard
Fernandes defended his poor record in sports, saying he wasn't successful in aviation from day one. "It time," he told ET Magazine. Fernandes said his teams are competing at the highest levels in sports. "In F1, we will be where we are hoping to be in a year. And in football, we will rebuild."
There is a key difference in sports and aviation, according to him. "I think in aviation I need to make an impact by myself. But in sports, I rely on other guys to make an impact. I can do whatever I want but the 11 guys [on the field] have to perform," he said.
Sadly for Fernandes, his players haven't delivered. Worse, they have turned out to be a huge burden. QPR's wage bill for the 2011-12 season almost doubled to £58.46 million from £29.74 million a year ago. This hike was before it signed big names such as Park Ji-Sung, Julio Cesar and Chris Samba.
QPR is an exception to the norm in top-flight football that the more a club's owner spends on player wages, the better they will perform. It has emerged as one of the clubs, if not the club, which most underachieved against what it spent, according to data by
sportingintelligence. com, a UK-based website that studies football business and finance. "It is not the spending per se that is the problem, it is spending consistently badly," said Nick Harris, the editor of sportingintelligence.com.
The inflated wage bill has been inversely proportional to QPR's fortunes. Most of his players will not take a pay cut despite relegation, according to their contract. The poor spending is reflected on the club's balance sheet. QPR made a loss of £23 million in 2011-12. Fernandes said he has some highly paid professionals who are also highly emotional and highly volatile.
"If you think the volatility of jet fuel is high, the volatility of sports persons is much higher," he told ET Magazine. "One day, they can be amazing and the next day, they can be the worst players in the world. It's like the performance depends on the side of the bed they wake up from. There is no consistency."
Harris begs to differ. "I think QPR failed so spectacularly because Tony Fernandes does not understand football and threw sacks of money at a club without sufficient knowledge. He got ripped off by agents, got impatient with Mark Hughes as manager, appointed one [Redknapp] famous for spending lots and making excuses when things go wrong and continued to spend his way out of trouble even when spending had failed," he said.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important In many ways, Fernandes' tryst with football is strikingly similar to that of Venky's, the poultry giant from Pune, which owns English club Blackburn Rovers. Rovers too has been relegated and Venky's has been sinking money into the club. Fernandes remains sanguine, however. Under Redknapp's watch, he believes the club will bounce back into the Premier League.
A Different Ball Game
History presents a different picture. Relegation has been catastrophic for English football clubs such as Bradford City, Sheffield Wednesday and Nottingham Forest, according to sportingintelligence. com. The only difference is that these clubs were not backed by wealth such as that wielded by the QPR owners, it said in a recent report.
Fernandes' spiralling costs in football present a sharp contrast to his aviation business, which owes its success to his ability to run a tight ship. It should not be a surprise then that when it comes to sports, Fernandes comes across as a different personality. The swagger is missing. Gone are the colourful quotes. He oscillates between pointing fingers and owning up to faults.
At Caterham, Fernandes has stepped aside as team principal. He insists he has no plans to quit the team. He also has had to consistently deny reports that he would plough the potential proceeds of a sale into QPR. He has been forced time and again to pass assurances that all is well with his sports ventures. Harris says Fernandes seems a nice guy but he has been naive about football. "Very naive."
Fernandes agrees. "I was naive in thinking that everyone was like me," he said. Yet, Fernandes said he believes niceness counts. "You have to make tough choices, but you can be nice than trying to be an schmuck!. Sometimes it backfires but it is a much better way to run a business."
Year Bump (Obviously has since (just) sold Caterham
I don't think we'd argue over what has happened in the world of sport; our hope - maybe expectation- is that he's learned and that what has happened is not the same as what will happen. (And of course, there's a
broader picture than just "Success" or "Failure")
The Economic Times
economictimes.indiatimes.com/news/news-by-company/corporate-trends/why-an-assessment-of-airasia-chief-tony-fernandes-sports-failures-is-important/articleshow/20945989.cms?flstry=1
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
By Binoy Prabhakar, ET Bureau | 7 Jul, 2013, 06.53AM IST
Malaysian low-cost carrier AirAsia boss’s aviation business is shipshape, but his football and Formula One teams are in a shambles.Malaysian low-cost carrier AirAsia boss’s aviation business is shipshape, but his football and Formula One teams are in a shambles.
Three days have passed since Tony Fernandes left India. But the dust he kicked up is yet to settle. Fernandes, group CEO of Malaysian low-cost carrier AirAsia, landed in India on a whistle-stop tour last Saturday, about five months after announcing plans to create an airline in India partnering the Tata group.
Wherever he went, a procession of microphones and flashbulbs followed because it soon became clear his trip was going to be vastly different from the visits of foreign CEOs, who with their carefully-chosen words, would give diplomats a run for their money. Fernandes, in contrast, was not afraid to name the big guns, notably blaming Jet Airways' Naresh Goyal for lobbying for a restrictive rule in aviation. In Delhi, he drew plenty of chuckles, guffaws and belly laughs from the audience.
One reporter asked him if he had plans to buy Air India, the government-run carrier. After the tiniest of pauses, Fernandes said: "I've heard plenty of crazy things during this trip. But you, sir, win the prize." He offered the journalist and his wife a free ticket to anywhere AirAsia flies. On why AirAsia would focus on south India, he said that's because Mittu (Chandilya, the CEO of AirAsia India) and S Ramadorai (chairman) are from there and they are very nationalistic. Journalists might well have been watching Jay Leno at work.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
If the straight talk and jokes were aimed at creating a buzz around the launch of the airline, it worked. Fernandes displayed in abundance his sharp understanding of the aviation business. About the rationale behind free ticketing — a key strategy of AirAsia — he reminded everyone that the journalist was offered only a one-way ticket.
"We are going to charge a fortune for his return trip," he said. Tony Fernandes, the successful aviation entrepreneur (see Aviation), came, saw and left no one in doubt about his ambitions for the Indian aviation market. The visit to India burnished his reputation.
Sour Story
Yet, not everything Fernandes has touched has turned into gold. There have been failures — a recent one actually. AirAsia was forced to end a joint venture with ANA Holdings in Japan. True to form, Fernandes glossed over the failure with a joke. "ANA was horrible in bed," he said. Seriously.
Fernandes has also failed spectacularly in his other big area of interest — sports. Queens Park Rangers (QPR), the English Premier League football club he bought in August 2011, was relegated last season. QPR managed to only narrowly avoid a drop the previous season.
Fernandes' Formula One team Caterham hasn't fared any better. The team is now in its fourth year in Formula One, but is still stuck at the bottom of the grid. Caterham hasn't won a single point since its launch in 2010 and its best race finish so far is a lowly 11th.
The team is also trailing behind Sahara Force India, part owned by Vijay Mallya, the promoter of the grounded Kingfisher Airlines. "I think we run a better airline and he's run a better Formula One team," Fernandes had told a gathering before the start of the Formula One Monaco Grand Prix in May.
An assessment of the failures of Tony Fernandes the sports entrepreneur is important because they might have a bearing on his airline business in India. Even for an industry that resembles a disaster area as a whole, Indian aviation stands out because of the high costs and rigmarole of rules. AirAsia has already faced disappointments in India. It has struggled on overseas routes from India.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important
The airline faces a potentially challenging 2013 as it accelerates expansion in core markets, according to aviation consultancy Capa. AirAsia will continue to incur losses at its recently launched Philippines affiliate, Capa said in a recent report.
Capa said AirAsia clearly has the cash to withstand the storm of challenges that 2013 brings. But all that can change because Fernandes also has his financial antenna tuned to his sports businesses, particularly his football team. To date, he has sunk £50 million QPR — to no effect. Current manager Harry Redknapp the third appointment since the acquisition. By Fernandes' own admission, QPR will not return to the Premier League anytime soon.
Poor Scorecard
Fernandes defended his poor record in sports, saying he wasn't successful in aviation from day one. "It time," he told ET Magazine. Fernandes said his teams are competing at the highest levels in sports. "In F1, we will be where we are hoping to be in a year. And in football, we will rebuild."
There is a key difference in sports and aviation, according to him. "I think in aviation I need to make an impact by myself. But in sports, I rely on other guys to make an impact. I can do whatever I want but the 11 guys [on the field] have to perform," he said.
Sadly for Fernandes, his players haven't delivered. Worse, they have turned out to be a huge burden. QPR's wage bill for the 2011-12 season almost doubled to £58.46 million from £29.74 million a year ago. This hike was before it signed big names such as Park Ji-Sung, Julio Cesar and Chris Samba.
QPR is an exception to the norm in top-flight football that the more a club's owner spends on player wages, the better they will perform. It has emerged as one of the clubs, if not the club, which most underachieved against what it spent, according to data by
sportingintelligence. com, a UK-based website that studies football business and finance. "It is not the spending per se that is the problem, it is spending consistently badly," said Nick Harris, the editor of sportingintelligence.com.
The inflated wage bill has been inversely proportional to QPR's fortunes. Most of his players will not take a pay cut despite relegation, according to their contract. The poor spending is reflected on the club's balance sheet. QPR made a loss of £23 million in 2011-12. Fernandes said he has some highly paid professionals who are also highly emotional and highly volatile.
"If you think the volatility of jet fuel is high, the volatility of sports persons is much higher," he told ET Magazine. "One day, they can be amazing and the next day, they can be the worst players in the world. It's like the performance depends on the side of the bed they wake up from. There is no consistency."
Harris begs to differ. "I think QPR failed so spectacularly because Tony Fernandes does not understand football and threw sacks of money at a club without sufficient knowledge. He got ripped off by agents, got impatient with Mark Hughes as manager, appointed one [Redknapp] famous for spending lots and making excuses when things go wrong and continued to spend his way out of trouble even when spending had failed," he said.
Why an assessment of AirAsia chief Tony Fernandes’ sports failures is important In many ways, Fernandes' tryst with football is strikingly similar to that of Venky's, the poultry giant from Pune, which owns English club Blackburn Rovers. Rovers too has been relegated and Venky's has been sinking money into the club. Fernandes remains sanguine, however. Under Redknapp's watch, he believes the club will bounce back into the Premier League.
A Different Ball Game
History presents a different picture. Relegation has been catastrophic for English football clubs such as Bradford City, Sheffield Wednesday and Nottingham Forest, according to sportingintelligence. com. The only difference is that these clubs were not backed by wealth such as that wielded by the QPR owners, it said in a recent report.
Fernandes' spiralling costs in football present a sharp contrast to his aviation business, which owes its success to his ability to run a tight ship. It should not be a surprise then that when it comes to sports, Fernandes comes across as a different personality. The swagger is missing. Gone are the colourful quotes. He oscillates between pointing fingers and owning up to faults.
At Caterham, Fernandes has stepped aside as team principal. He insists he has no plans to quit the team. He also has had to consistently deny reports that he would plough the potential proceeds of a sale into QPR. He has been forced time and again to pass assurances that all is well with his sports ventures. Harris says Fernandes seems a nice guy but he has been naive about football. "Very naive."
Fernandes agrees. "I was naive in thinking that everyone was like me," he said. Yet, Fernandes said he believes niceness counts. "You have to make tough choices, but you can be nice than trying to be an schmuck!. Sometimes it backfires but it is a much better way to run a business."
