By David Butler
Sacking a manager in football is rarely cheap. Their coaching team usually go with them and multiple severance packages ensue. A replacement team need to be recruited and typically want guarantees of future transfer funds. If the new managerial appointment is not unattached further compensation will be required. Of course all of this upheaval happens because clubs can’t/won’t sack the players.
Why sack? I suppose there might be an opportunity cost of having a ‘do nothing’ policy; risk of relegation, lost European qualification places etc – performance declines typically map into revenues losses. Club boards often may view a sacking as damage limitation despite the high costs. Perhaps they are thinking that given the uncertainty, we don’t know how bad this could get? That said, while some sackings may seem economically justified in the short term, they may simply recycle the same problems within clubs.
There is a large literature on the effect of managerial change, but not as much is known about the process of losing your job. Of course, we know it is almost always down to performances (although Nuno is a recent exception), but what type of losses matters most and how many? Is there a ‘beyond the point of rescue’ stage? Robbie had an entry below some weeks back on how incentives are changing here given the size of managerial contracts.
Graham Potter’s head is now on the chopping block and the chart below shows the market odds for him to be the next manager sacked – it almost now looks inevitable. Odds for Potter to be sacked tumbled after an opening day loss. He got brief reprieves due to other clubs’ poor performances and a win at Nottingham Forest only for the odds to shorten and not recover following a 3-0 defeat at home to Tottenham. David Moyes could put the final nail in the coffin this weekend.
Sacking a manager in football is rarely cheap. Their coaching team usually go with them and multiple severance packages ensue. A replacement team need to be recruited and typically want guarantees of future transfer funds. If the new managerial appointment is not unattached further compensation will be required. Of course all of this upheaval happens because clubs can’t/won’t sack the players.
Why sack? I suppose there might be an opportunity cost of having a ‘do nothing’ policy; risk of relegation, lost European qualification places etc – performance declines typically map into revenues losses. Club boards often may view a sacking as damage limitation despite the high costs. Perhaps they are thinking that given the uncertainty, we don’t know how bad this could get? That said, while some sackings may seem economically justified in the short term, they may simply recycle the same problems within clubs.
There is a large literature on the effect of managerial change, but not as much is known about the process of losing your job. Of course, we know it is almost always down to performances (although Nuno is a recent exception), but what type of losses matters most and how many? Is there a ‘beyond the point of rescue’ stage? Robbie had an entry below some weeks back on how incentives are changing here given the size of managerial contracts.
Graham Potter’s head is now on the chopping block and the chart below shows the market odds for him to be the next manager sacked – it almost now looks inevitable. Odds for Potter to be sacked tumbled after an opening day loss. He got brief reprieves due to other clubs’ poor performances and a win at Nottingham Forest only for the odds to shorten and not recover following a 3-0 defeat at home to Tottenham. David Moyes could put the final nail in the coffin this weekend.
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