Another example from the world of sport exemplifies regression to the mean beautifully: the new manager effect. The new manager effect concerns the idea that new football managers appear to improve the success of a football club relative to its performance under the old manager just prior to his sacking. The data on that appear pretty conclusive. Analysing managerial turnover across 18 seasons (1986 to 2004) in the Dutch premier division, Bas Ter Weel 5 revealed noticeable patterns of prior decline and subsequent improvement centred on the sacking of one manager and the appointment of a new one. Crucially, however, almost the same pattern could be observed where managers had not been sacked. How so? Ter Waal was unequivocal in his explanation: “If managers do not matter for differences in performance across firms and quality does not vary across managers, the only observed performance change following turnover would be mean reversion.” David Sally, co-author of The Numbers Game: Why Everything You Know About Football is Wrong 6 , emphasises the point: “In the same way that water seeks its own level, numbers and series of numbers will move towards the average, move towards the ordinary.
