Last week a very discrete event took place in the obscure world of German regional football that few people will have noticed. It was, however, a bad omen for European football, which –  being a microcosm of European business more generally – should serve as a striking metaphor for the kinds of mismanagement that threaten to insulate the continent from global competition.

On Tuesday 30th January Hasan Ismaik quietly scaled back his duties on the Board of German football club TSV 1860 Munich. His announcement that he would relinquish his executive positions on the Supervisory and Advisory boards of the club is a bad omen for European football, and –  to the extent to which the industry represents European business more generally – should serve as a warning against the kind of outdated practices that threaten to weaken the continent in the face of increasing global competition.

1860 is a Traditionsverein – a club steeped in history. One of the founding members of the Bundesliga in 1963, and West Germany champions in 1966, 1860 has played 20 seasons of top-flight football. However, the club was in unrecognisable form when Ismaik took over in 2011. For the second time since 2006, the club faced insolvency –  years of mismanagement that had restricted 1860’s success, now threatened its very survival. Recognizing the potential of an established club with a large fan base, teetering on the brink; Ismaik intervened to save 1860 from bankruptcy.

As he had done many times before in business, Ismaik hoped to turn the club around and was unabashed about his ambitions to return 1860 to the Bundesliga. However, the club has not seen the rapid ascent in its fortunes that he had hoped. Despite his €18m injection to rescue the club, and the 60% share ownership it secured him, Ismaik’s voting rights on 1860’s board were restricted to 49%. This is due to a quirk of German football called the 50+1 rule, which reserves the right for club members to hold a majority of voting rights at board level. Unfamiliar with the manner in which the rule would actually be exercised, the club’s new owner could be forgiven in thinking that his investment would nevertheless enable him to translate some of his ambitious ideas into actions.

Since Ismaik’s rescue of the club, the other members of the 1860 board have used the 50+1 rule to repeatedly block the investor’s initiatives to rehabilitate the club. Even initiatives that any fan would welcome, such as increased investment in new players and facilities, have been shelved one after the other. The serious institutional changes that the club has so desperately needed have never been made.

Why is it that a failing club would do so little to change its fortunes? One summation is that at 1860 the 50+1 rule is being used not to represent, but to control. Last month, it was widely reported that German football magazine Kicker had published internal documents revealing that senior members of 1860’s board were actively pursuing a concerted policy of “death by a thousand cuts” against Ismaik – constant refusal to adapt has been the means; Ismaik’s departure – rather than the club’s success – the desired end.

In the corporate world, poor performance and cartelism would lead to a management overhaul. At 1860, the 50+1 model of club ownership has hampered any change – in strategy, management or – most crucially – in the club’s success.

Though still held up as a model elsewhere on the continent, the 50+1 rule is facing increased domestic criticism, with a strong case even being made that it impinges on EU competition law. In theory, the rule keeps ticket prices low and ensures that each club maintains a strong link to its fan-base. In practice however, it has led to the oligopolisation of the Bundesliga, where leviathan clubs dominate while the minnows contest the remainder of the table. In Spain, a select number of clubs abide by the same system, including its two most successful; Barcelona and Real Madrid. Crucially, however, these are the exception, not the rule. Clubs that have been at the top for decades don’t require drastic strategic overhauls. It is those who require the investment who do.

It is a lesson for European business management practices more broadly. European politics is presently plagued by perceived differences between local and metropolitan interests. When it comes to grassroots investment, ambition, and rejuvenation – across many different industries – often the most determined energy comes not from Europe’s capitals, but from successful businessmen outside the continent. Too often, their passion and resources are either ignored or taken for granted. Mr. Ismaik, the real estate magnate behind the meteoric ascent of Arabtec, the Middle East’s most successful construction company, is a prime example of this.

In last week’s statement, Ismaik explained that his decision was driven by his expanding global interests and commitments which prevent him from dedicating the amount of time he feels necessary to effectively perform his roles at the club. However, it is more likely the tycoon became frustrated with his inability to enact his strategy for a vision with which he’d become infatuated It is a shame for the club, as well as for German football. As for European business culture, it is worth understanding what Mr. Ismaik’s considerable ‘global interests and commitments’ actually represent, and what strategic business acumen will now be 1860’s loss.

As the global recession of 2007/08 got underway the UAE property bubble burst in spectacular fashion. Contrary to most developers at this difficult time, Ismaik chose to adopt a long-term view, holding firm to his belief that the downturn was temporary. His limited use of debt placed his enterprise in a uniquely liquid position when many were scrambling to access money. He invested in quality wholesale assets at low prices, building up a scalable business in the process. In several cases, it was these investments that enabled many cash-strapped companies to survive the economic downturn. In time, his persistence and confidence in the market paved the way for others to follow in his steps. In turn, slowly propping up the market again.

By now widely recognised as a visionary businessman, Ismaik’s reputation was consolidated in 2010 when, counter to market-sentiment, he bought shares in Arabtec Holding PJSC, a prominent contractor in the region. As CEO, his vision was to turn the company into a top 10 global industry leader by expanding into new geographies and sectors.

During his tenure, the company grew exponentially, rising to over 50,000 employees. He hired big names in the construction industry and won several prominent contracts, including the Louvre Abu Dhabi and the Fairmont Abu Dhabi, and secured the biggest joint venture (JV) in the region’s history with Samsung. Staggeringly, at one stage, almost 80 percent of all stock market trading in the UAE came from Arabtec shares alone. At the time of his departure, his leadership had contributed to Arabtec’s market capitalisation increase from AED 3.7bn (USD 1bn) to AED 32.2bn (USD 8.8bn).

Since leaving Arabtec, his company, Marya Group, has invested in multi-million-dollar real estate projects in the UAE and begun expanding into property and retail in Europe and the US. The company has worked hard to develop a diversified investment strategy, again moving away from the traditionally uniform approach that is typical to companies in the region.

Ismaik is evidently a businessman who thrives on the freedom to exert full control over ambitious, high-risk projects, and prevails by means of capitalising on economies of scale – facilitated, of course, by his deep pockets and unparalleled network.

These are resources that 1860 has simply failed to exploit. The industry figures with whom Ismaik rubs shoulders, serve well to illustrate the kind ambition he had in mind. In his role as Managing Director and CEO of Arabtec, Ismaik signed a sponsorship deal with another football club, Manchester City. One of the co-signatories to the deal was Ferran Soriano, City’s CEO.

As fate would have it, Soriano had found his way to Manchester City after a successful spell with Barcelona was brought to a close by similar difficulties to those Ismaik faces at 1860. Acting as Barcelona’s interim CEO, Soriano increased revenues from €123m to €308m, turning a €73m loss into an €88m profit. Subsequently, he made plans to set up franchise clubs throughout the world. For a club owned by 143,000 voting fans, to whom Barcelona’s local ethos was more important than its international expansion, it was a step too far.

Soriano’s ideas were welcomed however by Manchester City’s leadership, who swiftly hired him as the club’s CEO. He has transformed Manchester City, turning it into a global brand with franchises throughout the world that serve to localise its appeal, its franchise clubs, and the City Football Group have enjoyed a meteoric and unprecedented rise to the uppermost heights of world football.

Businessmen with the resources, vision and zeal of Ismaik or Soriano are rare. Given the right business conditions, and the freedom to wield their experience and insight to a degree that does their investments justice, such figures are uniquely placed to merge the local with the global. If the opportunities they present are not taken advantage of, we risk alienating them to the point where they may feel their business ideals are not suited to Europe’s shores, or worse; unwelcome.