The reason the Chilean national team won the latest America’s Cup is a new way of thinking; one that transcended the names of those who started and ended the process. It’s never been easy neither in sports nor in commerce: there is no strategic shift without cultural change. Not in the pitch, not in the company.
By: Gregorio Etcheverry – Ignacio Martín.
Winning the 2015 America’s Cup is the greatest achievement of a Chilean national football team. That happened not by chance, but as a result of a process that began in 2007, with the arrival of Harold Mayne-Nicholls, President of the national football association, ANFP, and Marcelo Bielsa as the team’s coach. Together they imposed a stamp of professionalism on the national frame and a winning mentality not seen before on these shores. And even with complex and surprising changes in this story – like Bielsa replaced by Claudio Borghi who in turn was succeed by Jorge Sampaoli, or the replacement of Mayne-Nicholls with Sergio Jadue – the national squad dodged roughness, bad behavior and even crime. With all this, the image-brand prevailed and, for example, in December 2012 they signed a US$106 million contract with TV channel Mega for the qualifying matches of Chile for the 2014 World Cup in Brazil, and income from nine local matches in that process reached US$12 million. The model outlined by the duo followed almost every good business logic: the higher the risk, the higher the chance of big return. In March 2015, nearly three months before the America’s Cup, ANFP signed a contract with Nike for US$7 million and a duration of eight years. The bet was reckless, because at that time La Roja maintained exclusivity with Puma, whose contract ended in July, as expected. The risk-return had paid off: that same month, Chile not only won its first Continental Cup but, above all, also against Argentina. Before this feat the team was valued at $198 million. Today, the figure remains at that level.
Mental and commercial turn
The sporting success of the national selection allowed sponsors and players to promote specific product lines, commercial and public niches and exclusive customers. But the initial support for those million dollar bets was the asset in the form and substance of the curriculum vitae of Bielsa, in sports discipline, and Mayne-Nicholls, in business. Order and planning in a sector they weren’t from is, perhaps, the best legacy of their time for La Roja. Almost as in a company, each in their area faced rhetoric based on bad customs, individualities, lack of understanding, lack of professionalism and commitment; hard-to-counter attitudes, manifested by a paternalist style that doesn’t return good dividends. Improvements in the training facilities – impelled by Bielsa who experienced at Juan Pinto Durány pitch the end of the raptures, together with a tacit prize for good behavior and commitment, summoned players who never had thought about the dream of the Selection – realized that for sporting success decisions have to be taken like in a good enterprise.
Grays and lights
But like all entrepreneurship, be it commercial, sporty – even political – there were massive criticisms, almost displacements and missteps. Although positive results followed the duo, resentments that left the enterprise at risk and transgressive for the traditional markets, interrupted the process, ultimately with costs for all actors involved. “Bielsa did not leave everything that he thought he’d be leaving. He imagined that this would be the Nasa and it’s not the Nasa,” criticized Borghi those days. They brought back the open door policy for the press, greater liberties for players, less demanding training and disorder, with economic costs. Discipline and planning, prevalent in every good company, gave way to individual and collective skills. But bad outcomes emerged, criticisms from sponsors, less income and bad sporting results. Yet, equilibrium shifted towards discipline and work; it’s probable that the habits of those who played in European clubs or dealt in developed markets had been crucial in this. Also that the brand was losing returns. Sampaoli took control and determined main direction, endorsed by sports and no less by economics. The culture in the Chilean dressing room had changed, but also in the happy stories it left and, guaranteed, permanently. La Roja is no longer just a bet of possible victory in the pitch. It is also synonymous with investment, brand and safe return. Many managers arrive at a new company with the mandate of profound change, as did Bielsa. Those executives usually quickly develop a new strategy, and restructuring of the organization often doesn’t strongly consider cultural change. For Bielsa, the game strategy he wanted to implant was based on an attitude and mentality that, at the time, the Selection didn’t have. He proposed to create it: his personal attitudes, messages and symbolic actions reinforced the values of effort, sacrifice and meritocracy. A culture that was based on the new form to play and therefore was key part of his process of change. There is no strategic change without cultural change. But to generate those value turns implies to defy the identity and customs of the group, and these are not difficult to turn against those who promote change. Bielsa could survive the beginning, because he had professional credibility and could count on the support of high management that shared his values. But that support disappeared and so he had to go. Managers who try to promote quick cultural change, without constructing sufficient credibility with those who are affected are many. They simply trust the support of the board, which usually is not sufficient. The social system tries to avoid the losses that change implies and a reaction that tends to return to the status quo is not uncommon. This is what happened to Borghi. But the new mentality had already taken root in part of the dressing room and that part supposed to lose, in this case the possibility of triumph, with a return to the status quo. From there, Sampaoli sped up his process: the force of change no longer came only from the authority, but from the very group. The lesson for organizations: cultural change cannot be decreed, it must be assumed by all and not only by high management.