To be fair, Wanyama, Osvaldo and Lovren is hardly blank cheque spending. It's targeted spending on areas he thought he could improve and knew the types of players he wanted. Plus, I don't think the fact he has been supported by the chairman is in any way a bad thing. I think they are an absolute model of how to run a club in the English league.
Martinez has been talking about it recently too, saying a DOF doesn't really work over here. I think the key is to have a strategy, trust the coach to handle the football side and get the players he needs. The coach has to value the youth players and to further enhance the long term strategy, if the coach does leave you replace him with a similar ethos.
I feel like Levy has tried so hard for this structure to ensure long term continuity but he's gone about it in the most complicated of ways. All of a sudden Swansea come up and slap him in the face with their good planning. They will do well long term because their chairman hires the same type of manager. Levy is worried about lurching from one type to another but all he needs to do is make the right hire and it shouldn't be a problem.
Levy's big mistake is backing away from his DoF system too quickly during times of uncertainty, imo. In 2008, Harry made it crystal clear that he would not work with Commolli: in a flash, Commolli was gone. Last month, AVB had to be sacked: instead of trusting Baldini to find a replacement, however, Levy rushed to appoint his own man Sherwood who now seems set on a 4-4-1-1/4-4-2 system that shunts most of the players bought in the summer (Who were chosen for their ability to fit into AVB's 4-2-3-1/4-3-3) into either unfamiliar positions or the unwanted list.
It is clear that Levy wants a DoF to ensure long-term stability. But in order to keep the side on the same track that Baldini was brought in to oversee, Levy needed to distance himself from the transfer committee entirely and let Baldini choose the successor to AVB, in order to obtain a manager (and possibly new players) that fit into the system AVB was trying to implement (slow tempo, controlled possession, bursts of activity, etcetera). Instead, Levy couldn't let go, and we ended up with Sherwood as the coach and murmurs of most of our expensive summer recruits either wanting to leave or wanting more game time as Sherwood inevitably started to trust his own youth-team players more than established internationals.
Even our 'transfer committee' was skewed in favour of Levy continuing to maintain control: likely not satisfied with just a veto on the process (he was the chairman, after all), it was very probably Levy that insisted on having Tim on the committee as well, which meant AVB and Baldini were always facing down Tim and Levy, evenly splitting the committee and ensuring Levy a massive say on which players ended up coming to the club.
I'm not saying having Levy overseeing everything is necessarily bad: he's a decent administrator and a gifted book-keeper. But if he wanted the stability that Swansea have, for example, he needed to trust Baldini with both player recruitment and managerial appointments. That's what he's thee for: to forge a long-term system that eventually runs flawlessly even if the cogs within (managerial cogs included) are replaced frequently. That requires trust in the system you want and a lot of time afforded to the DoF to implement said system: four, five years at the least.
I don't think the DoF system failed in England: I think chairmen have taken it upon themselves to act as DoFs with varying degrees of success (Swansea good, Tottenham (?) bad) and I think boards have given the few DoFs they did directly appoint too little time (Commolli at both Liverpool and Spurs, and now seemingly Baldini with ourselves again) before ditching the abortive project in favour of returning to more tried and tested 'English' managerial methods that have managed to bring relative success due to the fast and fluid nature of English football, which makes long-term trends very difficult to observe.
Give a (good) DoF power over managerial appointments and transfers. Set him a vision: this is how we the board want this club to play. Then let him shape the system, results be damned for the first couple of years. Then, and only then, note the results. Is there an Arsenal-like system in place? Is the team performing regardless of who manages it and the length of time players spend playing in it? Is there a 'brand' of football the club has become known for? These are the indicators of success, and they will not come quickly.
Sacking AVB was ultimately somewhat justifiable: we all (at least partially) got the system he was trying to implement, but his implementation of it was going horribly wrong somewhere and, given the comparison between his performance and the performance of, say Brendan Rodgers (signed at the same time as AVB, handed less of a warchest, still managed to get his team playing brilliantly), sacking the man was probably best. However, that doesn't mean everything he was trying had to be thrown out the window: a manager told to continue AVB's possession-based style (of course while being afforded space for a few tweaks of his own) would have kept us on the development track in terms of acclimatizing the players and staff to the long-term system. And if rumors are to be believed, that's what Baldini was trying to do: find a manager who could continue the development of the long-term style AVB was trying to implement, if the links to Spalletti and Enrique were anything to go by.
However, Levy panicked, lost his nerve and put Sherwood in the role permanently. It might work out, certainly. It might not. But it has provided no end of material to bash the DoF system with, which is unfair given that (imo) the DoF system has never been given a chance to succeed in this country.