His first managerial job came at Fulham in 1976, after his former boss Alec Stock was sacked. After four years Campbell was sacked when the team made a poor start to the 1980–81 season. He moved on to Portsmouth, whom he led to the Third Division title in 1982–83. However he was sacked in May 1984.
Towards the end of the 1987–88 season, Campbell was appointed assistant to manager John Hollins at Chelsea, a team in the midst of a relegation battle; one month later Hollins was sacked and Campbell appointed caretaker manager until the end of the season. Campbell was unable to turn around the club's fortunes in the eight games which remained that season, and they were relegated via the short-lived play-off system.
He made amends the following season, however, as his side romped to promotion as Second Division champions with a haul of 99 points. A year later, he led to Chelsea to a 5th-place finish in the First Division, their highest league placing since 1970. He was relieved of his managerial duties after an 11th-place finish and appointed personal assistant to Chelsea chairman Ken Bates in 1991.