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Mid-Season Manager Firings – A Measureable Business Decision?

Mid-Season Manager Firings – A Measureable Business Decision?

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Jonathan Howard, Senior Editor, Business of Soccer

Jonathan Howard, Senior Editor, Business of Soccer

Every summer the opening of the transfer window progresses into the carnival of rumors that is the transfer silly season. While much of the focus is on the players as they and their agents angle for moves away, or maneuver contract negotiations, at times clubs find themselves equally occupied with finding new managers as they are with keeping and signing players.

Tottenham Hotspur find themselves among the group of clubs searching for a new manager this summer but incidentally they were among a similar group of clubs in the Premier League doing the same thing in the middle of this past season having parted ways with current Zenit St Petersburg manager Andre Villas-Boas.
Sacking, firing, letting go, parting ways by mutual consent, whichever term or turn-of-phrase you prefer, deciding to change managers in the middle of a season is one of, if not the biggest decision a board or owner can make at a professional soccer club.

Sometimes the decision is welcomed by the fans, other times it comes up against protest, but when it comes down to it, the decision is for the club’s well being given recent performance in the league.

Seeing as performance, in a way, drives all three revenue streams of professional sports (Match day, Broadcasting and Commercial) the decision to change a significant member of the club in order to bring about a positive change in performance can be seen as a business decision.

A possible measurement of the impact of that decision is at the end of the season with a club’s final table position. The difference in table position at the time of the change compared to the final table position can provide a perspective on how effective the decision was in overall performance and short term objectives.

With regards to the Barclays Premier League, this form of assessment falls somewhat short of comprehensive if a club started and ended outside of European competition contention or relegation in regards to when the new manager took over.

Therefore a measurement of success based on exact league position becomes more applicable. That measurement may be found in the Premier League’s merit prize money distributed by the league based solely on final league position. The prize money this past season is believed to be roughly £1.2 million per position from last place up to first-place champions, which would be £24 million (£1.2 mil x 20).

With that estimate, Business of Soccer took a look at each club that changed managers mid-season, looked at their league position at the time the club changed managers, and compared it to the club’s final league position using the change in position to calculate that change in prize money earned at the end of the season.

Here are the results:

Of the nine clubs that made a managerial change during the 2013/14 Premier League season, there appears to be a relatively even distribution of results. Three teams improved their table position post-change, three teams ended in the same position, while three teams ended up moving farther down the table.

Furthermore the degree to which the clubs moved, up or down, doesn’t appear to deviate much. The combined negative table position movement from the three teams that moved down the table, twelve positions, is only three fewer than the total positive table movement by the teams that improved their league position, fifteen positions.

The median positive movement is six while the median negative movement is four, and the difference between the average positive movement and average negative movement is only one table position (+5 vs -4).

Since monetary prize money is directly correlated to a league position based on a fixed base amount, the financial impact will have the same trends, as shown in the third graph.

Objectively, a club’s manager can have a major influence over a team’s performance, which directly contributes to its final league position but could also find himself in a hole too big to dig out of. Additionally there are a number of other factors that can possibly affect a team’s performance and eventual league position both positively and negatively. For example, rival teams’ performances, referee errors, bad or good luck (if you believe in it) personal tragedy in a player’s life, injuries, etc.

The point being that this measure of financial return on a business decision (changing a manager mid-season) should not necessarily be used as the sole judgement or barometre of such a decision. Rather, it provides an example of how varied the impact a managerial change can have beyond the performance between the two goal frames.

EPL fans may look at the positions between 8th and 17th and see a no man’s land of fruitless survival. Club directors, board executives and owners on the other hand, may see an extra three, five, even ten million added or removed to the year-end bottom line in the club.

It is a complicated, almost impossible, matter to break down the overall cost of a managerial change. Determining the severance compensation package and accounting for it in a lump sum rather than over time as an employee, the new manager’s wages, successful and unsuccessful signings by the outgoing manager; there are countless things to monetise.

All of it though paints the incredibly complicated and intense mural that is the decision to make a managerial change in the middle of a season. It can prove financially fruitful or devastating, but regardless of the outcome it takes the assessment of more than one impact to determine whether the decision was right or wrong. A new manager may have kept a team in the same position as before and shown no monetary gain or loss from taking over, but the previous manager may very well continue to manage a further descent.