Iain Dowie and Bayesianism

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.

Comments

[Jeremy Jacobs]

Mike Flanagan is now Assistant Manager at Margate FC.

MFC

[tom s.]

Since we are slumming in the Championship here, I've been guilty of the fundamental attribution error when looking at Preston North End's chances over the last few years.

First David Moyes went after a successful run despite the fact that PNE is cheap as a .... well, cheap. There go their chances, I thought, but they still did OK.

Then after last year's near-promotion Davies went to Derby because PNE is cheap. Idiots, I thought, they've no chance now.

But here we are in November and PNE are at second place and looking strong (at least from 5,000 miles away). Is that due to new manager Paul Simpson? Well, apparently the captain thinks so (http://news.bbc.co.uk/sport1/hi/football/teams/p/preston/6128380.stm) but then he'd hardly say anything else.

[james higham]

Bring back the beautiful women and that's no spurious, quick comment.

[Gracchi]

Great post- the folly of management illustrated by football chairmen could be a series on this blog- Freddy Shephard or Peter Ridsdale anyone?

[dave heasman]

There seems to be no correlation between football chairmen's competence and their wealth. Actually, it's quite hard to find competence. For incompetence how about the twerps at West Ham, forced to sell 2 whole great teams this last 7 years? And still likely to coin it when the club is sold.
Martin Edwards - nearly sold Man U to M Knighton for 20 million, and it was not that long ago, either - 1989 says Wikipedia.

[chris]

Gracchi - no mortal man has the time or energy to describe fully the stupidity of football chairmen. Len Shackleton came closest, when he entitled a chapter of his book, "The average director's knowledge of football". It was a blank page.

[Gracchi]

You are right Chris- apologies the other thing I suspect is that its just too easy. But I think it does illustrate the folly of saying the guy at the top who invests is neccessarily the guy who takes the best decision for his company.