Not at all, look at the difference between us and QPR, Sunderland, Newcastle etc..
Over time, it will, in general, tell.
QPR had a crap squad only a year and a half ago. If they were to continue spending like that (and remain in the league) over the next 5 years they would push on.
Newcastle's net spend is actually not very high because of the money they got for that donkey Carroll.
Sunderland also haven't spent as much in recent years after selling Bent and Gyan for big money.
Look at the teams at the upper end of the table. Spurs, City, Chelsea have all spent big over the last 5 to 10 years to get where they are now. Even Arsenal, who haven't spent much on transfer fees have spent a lot on wages, enough to ensure they can keep a big squad.