I decided to persevere with finding funding for the new Arsenal stadium in Islington. By the end of April 2003 a number of banks had turned us down and we were about £100 million short of what we needed to finance the stadium. I had to choose whether to keep trying, and I decided we could do it. We restructured our kit sponsorship deal with Nike so that we got more than £50 million upfront, which we injected as equity into the stadium. We raised another £10 million through a debenture scheme for season tickets. Finally, we visited 10 banks individually and got six of them to loan more money. It took 10 months, but it was worth it.
The new stadium has capacity for 60,000 people. The money from the 9,000 premium seats alone will be close to the total revenue that we currently take out of 38,500 seats at Highbury. The remaining seats will all be additional revenue. It's a historic decision to move, as we've been at Highbury for 90 years. Yet the new stadium, which should be completed in August 2006, will position Arsenal as a substantial European power in football.
MY WORST ...
When I was CEO of BhS, I failed to end a relationship early enough with our outsourced IT supplier. The IT department had been outsourced before I joined, to save money. We were heading towards the millennium and we knew we had to rewrite our systems, as they otherwise might not operate through to the year 2000. But because we'd had this relationship with our IT partner for several years, it was tough to move away from them, so we stayed where we were. They ran the existing systems very well, but we didn't have control over implementing new systems - they wrote them all and they weren't up to the job. It was a slow, tortuous process, and it ended up costing us money and time.
Eventually, we restructured and brought in other people to manage the IT. It probably shouldn't have been outsourced in the first place, as IT is very important for a retailer. I learned that you shouldn't make short-term decisions based on cost-saving, as it can hamper your long-term strategic development. I also learned that core activities should be retained by the organisation.