Football Clubs Spend Millions on Head Coaches. So Why Do They Keep Getting It Wrong?

We usually discuss transfer fees for players, and most clubs seem to become better at evaluating potential and performance level of players. But the same clubs now regularly spend eight-figure sums just to buy a coach out of his contract – and tend to fail again and again.

Looking at the fifteen most expensive head coaches (one special one appears twice in the list) in football history, we see a couple of interesting findings:

Teams from England are most likely to spend big on head coaches, which is in line with player transfer sum. Top teams in Spain and Germany are the only non-English teams in the list.
Chelsea alone made it four times into the list, hinting at high ambitions, but also little patience at the box office.
During this last season alone, four of the 15 most expensive Head Coaches left their jobs prematurely. Their average tenure was only little more than a year.
Only two of them (plus three still in charge) were in office long enough to start a third season.
Four of them did not even complete one full season at their new club.
Not even half of them did win any major silverware; although titles are maybe not always the best way to judge a head coaches’ tenure, in the case of those clubs it should be the ambition.
Only three won more than one major trophy, which includes Enzo Maresca’s rather strange Club WC and Conference League double at Chelsea.

Although each case is unique, some characteristics that appear very often are:

Result thinking: Clubs hire managers based on results, not on performance relative to resources. Ronald Koeman for instance did improve Saints’ table positions after taking over from Mauricio Pochettino, but maybe this improvement was hardly done on his work.
Recency bias: Managers get hired based on their last job, not on their fit for the position. While winning the league with Sporting was definitely an achievement, the tactical and personal peculiarities of Rúben Amorim made his appointment difficult from the start.
Risk aversity: Hiring an established name (even at the cost of a high fee) is less risky than trying a lesser-known candidate. Appointing José Mourinho again will probably not solve a lot of Real Madrid’s problems, but an unknown coach who fails is much harder to justify.

Clubs spend enormous amounts reducing uncertainty by paying compensation fees. Yet the data suggests they’re often paying for perceived certainty rather than actual fit.

How to overcome these issues? Clubs need to understand succession planning as an ongoing process, not something that starts when the current head coach is made redundant or poached from somewhere else. Clubs must act strategically by scouting possible candidates on a regular basis, doing due diligence and ranking them based on fixed and stable criteria. Looking for a new head coach should not be any different from looking for a new striker.

The problem is not paying a fee for a new head coach. Quite the opposite: if clubs are convinced about a candidate, acting quickly and ruthless is the correct way. But this only works if clubs get their base right and do their homework.