Economics -Why the Manager Doesn't Matter and the Wisdom of Crowds.

Discussion in 'Bulletin Board ARCHIVE' started by Jimmy viz, Dec 5, 2014.

  1. Jimmy viz

    Jimmy viz Well-Known Member

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    Random thoughts sone mine some nicked.

    People say that money buys success and they are half right. The amount a club spends on transfers bears little relation to where they finish in the league. If you looked at spending on transfers for the top 40 English clubs between 1978 and 1997 spending on transfers explains about 16% of variation in League position. This is balanced against the spending on salaries which explains 92% of that variation.

    Obviously in any one season the link between salaries and success is weaker because in such a short space of tine because luck, injuries dodgy refs and poor form play a bigger part. Even then it still explains about 70%. Luck or statistical randomness evens out over time. So over a longer period wages form about 90% of the reason for a clubs success.in the period 1998/2007 Barnsley's average league position was 28th our average spending on wages relative to all clubs was 0.45. We were the highest placed club with a relatively low spending on wages. We over achieved. We were a statistical anomaly.

    While the market for players' wages is relatively efficiently - the better a player is, the more he earns - the transfer market is inefficient. Much of the time clubs buy the wrong players at the wrong price. This suggests it's better to pay your players better wages rather than risk losing a couple and having to go out and buy replacements. It also shows the difficulty in replacing all your players in a short period of time to meet the SCMP regulations as we did this summer. It shows that we were unable to apply sound economic logic which would have guaranteed success and had to act illogically. Strange then that given this pretty absolute correlation that people are moaning about a lack of success. We were forced to act counter-intuitively to the formula that would guarantee success. People talk of budget they usually mean transfer budget when in fact what they need to analyse is wages budget.

    Football clubs should use the 'wisdom of crowds'. Major decisions on transfers should not be made by one individual as this is inefficient they should be made by a collective of informed individuals. In England we favour the 'short term dictatorship' model. The manager is treated like some divine being who gets to decide everything right up to the point he us sacked. Then the next one comes in clears the previous ones out and the process starts again. We should move away from this model if management to gain an advantage towards the 'wisdom of crowds' . This needs to be coupled with stability. It need not be the manager who provides this stability. For May years at Oakwell Eric Winstanley provided this stability and it is clear that we have performed statistically worse without him. This is not about sentiment though many of us have a lot of that towards Eric it is about using stability as an economic and therefore sporting advantage.

    In terms of recruitment we have in the main started to follow the rule that the best time to buy players is in their early 20s. Teenage prodigies burn out and older players have decreasing value. The next step in gaining an advantage through recruitment is knowing when to sell. Each player should have a figure that we think is the maximum they are worth and if anyone at anytime offers more than this then we should accept the offer. As the Chairman of Lyon once said 'every player is un transferable until the offer surpasses what we expected'. This should not be seen as a negative it is the right choice to guarantee success.

    Football managers are hired and recruited in a bizarre and illegal way. In an average business the average search for key personnel takes four to five months. In football if it goes much beyond five days this is seen as weakness. In normal business. A wannabe chief executive writes a business plan, makes a presentation and undergoes several interviews. In football a club calls a managers agents mobile and offers them the job.

    The new manager is neatly always white, aged between 35 and 60 has a conservative haircut and is a former player. The clubs know that even if the manager fails they won't be blamed as they followed the traditional route. There is no evidence that being a good player (or being white or have a conservative haircut) makes you a good manager. In fact two of the best current managers Wenger and Mourinho were barely players at all. As Jose said "my dentist is the best in the world but he's never had toothache".

    The problem with ex players is their experience. They are steeped in the game and it's traditions. They know what to do and how to train and font need to investigate whether these prejudices are in fact correct.

    Most managers have little or no besting on their clubs chances of success. The best service they can do is not spend daft money on transfers and spend money on wages instead as the vast majority of success is based on wage spending.

    Sacking the manager has become a ritual almost a human sacrifice.

    When a manager is sacked there does tend to be a brief upturn in results. Typically a club earns 1.3 points per game. A club sacks it's manager when it is earning on average 1 point per game (a low point in the cycle). Any statistician will tell you what will happen after a low point irrespective of whether a club sacks it's manager or changes it's biscuits., it regresses to mean. So from a low point you are always likely to improve regardless of any action. A new manager rarely makes the difference he is just the beneficiary of mathematical certainty. Eventually results return to the norm and 3 months after the average sacking clubs regress to the average of 1.3 points per game. - cheers Sue Bridgewater for the stats.

    Perhaps we should dispense with managers altogether and allow sections of the crowd to pick the team instead. It would be cheaper and utilise the wisdom of crowds.

    So clubs success is not based on managers or transfers but on salaries. To gain an advantage we should stop relying on the judgement of one man and enlist the wisdom of crowds backed by a stable figure and sacking or not sacking your manager has little impact either way.

    Enough random *****.
     
  2. Jay

    Jay Well-Known Member

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    I'm going to have to question this wisdom of crowds malarkey. Have you read this forum?
     
  3. Jay

    Jay Well-Known Member

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    One thing I do agree on though, more managerial jobs for people with unconventional haircuts.
     
  4. Ext

    Extremely Northern Well-Known Member

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    Find me Denis Rodman, ideal new manager.
     
  5. Jay

    Jay Well-Known Member

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    And the new Barnsley manager is... Robert Smith from The Cure.
     
  6. Jimmy viz

    Jimmy viz Well-Known Member

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    Maybe Ben's special people are already being groomed...
     
  7. Jimmy viz

    Jimmy viz Well-Known Member

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    Bollicks I was hoping someone from The Exploited or Siouxsie Sioux would be taking the helm.
     
  8. MarioKempes

    MarioKempes Well-Known Member

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    I think Johnny Bravo is our number one candidate.
     
  9. Red

    Red Rain Well-Known Member

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    Some football manager, I forget who it was, included a chapter in his autobiography titled roughly "football knowledge of the average director of a football club". He left the chapter blank. Actually, directors do not need any knowledge. They just look at the numbers coming through the gates and when they get below a given minimum, the manager goes. It is an example of the wisdom of crowds.... or not. The appointment of the next manager is based upon roughly the same principles.

    Your average director has less backbone than a jellyfish, but an in depth knowledge of weather systems, and in particular, which way the wind is blowing. This mean that even though they know the club is operating on a budget that it far below its competition, it is far easier to keep their heads down and let the manager take all the blame for everything, both on the field and off it. Taking the example of our current structure, it would be far easier and far cheaper to let Ben Mansford take all the blame and sack him when the going gets tough. That way, the club maintains continuity of team management and the fans have their ritual sacrifice. But will it happen.... I doubt it very much.

    It has been obvious to me for years that our problem was the budget for wages, but the fans lose focus when the talk turns to budgets. As you have pointed out, the crowd focus tends to be turned towards the headline figure of transfer budget, even though in any year this is far below the wages budget. How much we paid for X, rather than how much does X earn. Again, as you have pointed out, no club sells a player unless it is offered more than it think the player is worth. However, there is more to this negotiation than just the two parties. Broadly speaking, the player (through his agent) is not going to sign a contract unless the financial inducement is better than he thinks he can get elsewhere. The club must decide whether it is prepared to meet the players terms, and this is where it can get messy. The club will sometimes offer clauses which will potentially benefit the player, but which will cost them nothing on the wage bill and which only become active if the player improves his overall market value. I am thinking sell on clauses in the contract that get involved if another club makes an offer above an agreed valuation. Frankly, everyone walks away from such deals happy. The player moves on to a better club for an improved salary, and often playing in a better league, which justifies his decision to take less in the short term in order to improve his longer term earning potential. The club are happy because they have a player on salary below his market worth, and they make an agreed profit on his transfer. The only people not happy with this deal are the crowd, who know only part of the deal. The part where they lose a player for a lower sum than they believe he is worth. The wisdom of crowds could only work if the crowd had all the available knowledge at every stage of the deal, and that I'm afraid, is just not possible.
     
  10. Gor

    Gordon Ottershaw Well-Known Member

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    Maybe we should be giving Gerry Francis a call?
     
  11. Jimmy viz

    Jimmy viz Well-Known Member

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    The book was the Clown Prince of Soccer by Len Shackleton.

    Th bit about the actual crowd was a joke but I think the 'wisdom of crowds' is the ideal we should follow. With key decisions made by 6/7 decision makers with at least one person providing stability. The old Anfield boot room had it right. And in a smaller group Clough and Taylor.
     
  12. Gor

    Gordon Ottershaw Well-Known Member

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    I once got a birthday card from Len Shackleton. I also once got one from Bryan Moseley ("you're a big man, but you're in bad shape..."). Quite random I suppose.

    But on the subject of footy managers it is something I've often thought about, the 'throwing the baby out with the bath water' type scenario that occurs time and time again and costs footy clubs loadsamoney. Best example at Oakwell must be the (with hindsight) disastrous appointment of Spackman. Not only did we go backwards big time on the pitch, but the changes he made to the backroom have never been corrected. Similarly, the damage that Bassett did by re-signing players on big contracts that should have been allowed to leave. That had a part in the poor performances both on and off the pitch that were to follow.

    It's always the manager's get out clause though isn't it. "Well they're not my players". Like you say, in very few other walks of life would a manager get appointed who would be allowed to pretty much immediately replace all the staff. There would always be changes that would gradually happen, but not in one fell swoop. Then again, in most other walks of life a manager wouldn't be sacked if the company wasn't performing better within six weeks!
     
  13. Jay

    Jay Well-Known Member

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    Was he trying to sell you a chair? Ooh, they're lovely.
     
  14. Gor

    Gordon Ottershaw Well-Known Member

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    The older you get the more those chairs become appealing though. A nice comfy chair that can recline a bit and support your legs, can tip you forward to give you a helping hand when getting up and has a little table built into the side to put your pint on*, what's not to like?

    *although, to be fair, Thora's chair didn't have one of those as I recall.

    Thora Hird. She was Mel Tormé's mother in law. Bet you didn't know that.
     
  15. Jay

    Jay Well-Known Member

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    I didn't, but until I just typed his name in to Google, I didn't know who Mel Tormé was.

    Went to Batley a few years ago and saw the Shackleton shop for the very first time. Stood outside and gawped at it in awe for about half an hour. Best advert ever. I then saw Mike's Carpets. Thought I'd gone to heaven.

    [video=youtube;E7bGzlth_6s]https://www.youtube.com/watch?v=E7bGzlth_6s[/video]
     

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