Charlton Athletic's decision to sack Iain Dowie reveals, I suspect, two ways in which management decision-making can go wrong.
1. Over-reaction. In judging whether Iain Dowie is a good coach, we should compare his reasonable success at Oldham and Palace against his poor performance in the first 12 games of this season. In theory, we can use Bayes' formula to weight these competing considerations. But why should we weight the last 12 games more heavily than three years of success?
It could be that Charlton chairman Richard Murray is just over-reacting to a small sample of evidence, which is contaminated by bad luck. There's some evidence that stock market investors can do this too.
2. Over-confidence. Just three months ago, Murray thought Dowie was such a good boss that he offered him £11.2m to spend on players. Now, he thinks it's worth spending £2.5m to be shot of him. In both cases, he seems to have been remarkably sure of his judgment.
These aren't the only biases of which Murray might be guilty. Maybe there's also: neglect of probability, the failure to see there was a good chance of Charlton doing badly in 12 games anyway; the pseudocertainty effect, the tendency to make risky choices when faced with a possible bad outcome (relegation); and the fundamental attribution error, the tendency to over-rate the importance of individual agency.
The message here is that apparently simple judgments - to sack a man or not - can be prone to numerous errors, when the evidence is uncertain.
* No mention of Charlton would be complete without reminding everyone of the famous fight between Derek Hales and Mike Flanagan, recalled here. When Hales says the fight "was a bit more than that", he's referring to the fact that Flanagan called him a one-bollocked bastard.
** My main reason for posting this is to show that I can illustrate my posts with something other than pictures of beautiful women.