What key lessons can small businesses learn from Sir Alex Ferguson?

Even if you’re not a Manchester United fan (and many of us aren’t), you have to respect the club’s success under former manager Sir Alex Ferguson. Without him, United’s phenomenal achievements simply would not have been possible.

Things could have been very different. Had United not won the FA Cup in 1990, months after what Ferguson describes as his darkest period in the game, he may have lost his job, three years after joining United from Aberdeen.

His first English Premiership title came in 1992 and 12 more followed. On retiring in 2013 Ferguson had played a pivotal role in bringing 38 trophies to Old Trafford, including two UEFA European Champions League crowns and an historic treble in 1999.

Harvard Business School

Knighted in 1999, the 75-year-old Glaswegian continues to serve United as a director. And such is the regard for his management, in 2012 the Harvard Business School created a case study  of his career, and he is now a Fellow to Harvard’s executive education program.

So, what of Ferguson’s management philosophy and what can it teach small-business owners? Truly fascinating insight is offered by the recently published Leading, which publishers Hodder & Stoughton describe as: “An inspirational guide to leadership, from the most successful football manager of all time”. Ferguson and his friend, the author and investor Sir Michael Moritz, have penned the book, which is “packed with insight, wisdom, humour and honesty”.

“If you are leading people, it helps to have a sense of who they are. The only way to figure this out is by listening and watching” – Sir Alex Ferguson

Team talk

If running a company, Ferguson says he’d listen to its most talented youngsters, because they’re most in touch with today and “the prospects for tomorrow.” Youth should be blended with experience to create great teams, but true teamwork comes from members understanding and having close bonds with each other, he explains.

“If you are leading people, it helps to have a sense of who they are. The only way to figure this out is by two underrated activities: listening and watching”, Ferguson argues. Balance is the key to successful teams and Ferguson describes maintaining this as a perpetual challenge. Successful organisations must change with the times he reminds us (at United, he reveals, the cycle was every four years).

From an early age Ferguson says he absorbed the idea that the only way to improve his life was to work very hard

Discipline and hard work

As you might expect, Ferguson believes discipline is crucial and he says many of United’s triumphs were the result of “consistent application of discipline”. From an early age Ferguson says he absorbed the idea that the only way to improve his life was to work very hard. He was always first to turn up (7am) at United’s training complex, and among the last to leave (9pm some days), and never took his full holiday entitlement.

Success in business and football comes from hard work and commitment, and Ferguson admits to being irritated by those who waste their natural talent because they won’t put in the hours (he even played football on the day he got married). “Top managers have a formidable work ethic”, he writes.

“I cannot imagine how anyone, without firm convictions and deep inner beliefs, can be an effective leader,” he states. Successful managers must remain true to their own beliefs and convictions. He adds: “Desire and a ferocious need to win are wonderful attributes, but they have to be tempered by a cool head.”

“As a leader you don’t need to be loved, though it is useful, on occasion, to be feared. But most of all, you need to be respected” – Sir Alex Ferguson

Motivating staff

Success comes with a series of small steps, not one giant step, says Ferguson. He recommends dividing big challenges into digestible chunks. He also believes in “prioritising a long-term strategy”, while warning that failure to stick to your plans can land you in trouble. He describes complacency as a disease, and says despite his success, he always looked ahead and tried to think of ways to improve.

While famous for his no-holds-barred half-time dressing downs (known as giving players ‘the hairdryer treatment’), revealingly Ferguson writes: “You don’t get the best out of people by hitting them with an iron rod. You do so by gaining their respect, getting them accustomed to triumphs and convincing them they are capable of improving… The two most powerful words in the English language are, ‘Well done’”. Much leadership, he says, is extracting “that extra five per cent that individuals didn’t know they possessed”.

He doesn’t believe in getting too close to those you manage. In summary he says: “As a leader you don’t need to be loved, though it is useful, on occasion, to be feared. But most of all, you need to be respected.”

• Leading by Alex Ferguson with Michael Moritz is published by Hodder & Stoughton. This blog appeared originally on the HSBC Knowledge Centre website and was commissioned by Atom Content Marketing.