Introduction

This chapter presents an exploratory discussion of the concept of the virtuous circle. It refers to the use of chains of reaction and interaction for the furtherance of an organization's cause. We see how the players of such chains comprise different stakeholders. The virtuous circle provides the justification for and the theoretical framework of coordinated and concerted actions on account of the synergies that they will release. Sport clubs, business entities and governmental bodies may thereby greatly enhance the effectiveness and efficiency of their tasks.

This chapter describes the virtuous circle of value creation in the world of sport and analyses each component in turn (Figure 1.1). The virtuous circle is a concept predicated on the assumption that when, in sport activities, town or regional development, for example, an appropriate measure is taken it will unleash a chain of positive reactions amongst the involved stakeholders. It implies the value creation process that reinforces itself through dynamic feedback loops.

Sports events: rivalry and competition

The main objective for the organizers of sports events and the teams or individuals who take part in them is to entertain the fans and win the competition. The basic ingredients that keep any competition alive are interest, uncertainty and a passionate involvement in the outcome. To create these ingredients, there has to be fierce competition between the teams and an enduring rivalry (Figure 1.2).

Without strong, evenly matched rivals there is no uncertainty or excitement about the outcome and the fans do not feel the need to proclaim their identification with and loyalty to their team. A championship that is a foregone conclusion or that is always won by the same person or team (because the rivals are unevenly matched) loses its main attraction, which is the excitement of the result. When that happens, attendance at sports events plummets and the fans lose interest, at least temporarily.