Moneyball is Changing the Way NFL Teams Assemble Their Rosters

Management can be defined as “the process of reaching organizational goals by working with and through other people and other organizational resources.” The three common element with which management is concerned are (1) goals and objectives, (2) limited resources and (3) people. Management fundamentals remain the same regardless of most applied fields, including sport.

Sport management is defined as “a field concerned with coordination of limited human and material resources, relevant technologies, and situational contingencies for the efficient production and exchange of sport services” (Chelladurai).

The career that most embodies this principle is the role of a professional sports organization’s general manager, or GM. The four functions of management are planning, organizing, evaluating and leading, which are all simultaneously and continuously utilized in many aspects of the job description for an NFL General Manager.

Planning may be the most important of the functions for a General Manager as it is essential to the “vision” that they are trying to achieve, being an ideal roster structured for continual success as defined by regular and post-season wins, as well as division, conference and league championships. As an NFL GM you have to constantly plan; plan for the present and plan for the future. Every organizational goal and objective is conceived in the planning stage such as the team’s current and upcoming free agents for consideration, salary cap constraints, contract negotiations and the NFL Draft. Organizing a roster is the most important objective of an NFL GM, and this task can be carried out in a number of ways. According to Dan Hatman, many argue that the NFL Draft is the most important building block for any General Manager. This is a process that takes months, often years, of planning, organizing and evaluating college prospects, draft pick stock, and roster concerns.

The NFL Draft, hosted by the Commissioner himself, occurs once a year over a three-day period in which teams draft incoming players over seven rounds with each club initially allotted one pick per round. The draft is a team’s opportunity to a “premium product at wholesale prices.”

Former NFL General Manager Bobby Beathard, whose teams went to seven Super Bowls, said of the Draft “I think it is the foundation of the entire league, it’s the most important part of putting your team together. You build everything around the draft. You mold your team around the draft. For me, free agency, what you are getting sometimes, is too risky” (Hatman).

Teams take different approaches to handling their allotted draft picks. The New England Patriots, for example, led the NFL with 51 total draft picks from 2006-2010 while their divisional rival, the New York Jets, had the least number of picks in that span of time totaling 27 total draft picks. The Jets strategy at the time was to organize their picks by packaging and trading multiple picks for less picks of higher value while the Patriots traded back for more picks at a perceived lesser value to accrue more players.

NFL National Lead Writer, Mike Tanier, recently wrote an article for Bleacher Report entitled Moneyball Is Changing the Way NFL Teams Assemble Their Rosters. Moneyball, a term coined by former Oakland Athletics General Manager Billie Bean, is all about embracing analytics and evaluating players based on quantitative measurables. His theory was that on-base percentage led to more runs, and more runs led to more wins. Admittedly, moneyball is much more applicable to a sport like baseball than football, but the concept itself has got General Managers across the country trying to minimize their expenses while still generating more revenue.

The “perceived value” of draft picks has been a question mark and a topic of conversation for quite some time in the management world without every really being answered. In 1990, Mike McCoy, a Cowboys executive and minority owner, set out to create a solution. He evaluated all NFL Draft day trades in the previous four years to determine how Clubs had valued certain positions in the Draft and came up with the “Trade Value Chart,” which assigned numerical values to each pick in the Draft (Hatman). The Cowboys used the Trade Value Chart during the 1991 Draft to draft a total of 17 players and improved to 11-5, eventually winning the Super Bowl in 1992. Despite its widespread use, the Trade Value Chart was proven to be inaccurate and unreliable. Cade Massey and Richard Thaler of Duke and the University of Chicago, respectively, compared the value that teams gave up to get to a certain position in the draft with the actual performance of the players drafted at that position. Their research indicated that teams underwhelming undervalue future picks and overvalue early picks. “These types of errors permeated the Trade Value Chart, indicating that GMs must ensure that their Draft day decisions are based in reliable analysis” (Hatman).

Tanier talks about “the impact analytic principles had on some of the biggest transactions and most controversial decisions of the past few weeks—and what those same principles will mean for players and franchises in the months and years to come.” The discounting of the Trade Value Chart along with common analytics has led to bolder draft day deals, because the higher picks aren’t worth so much more than other picks and are now more easily attainable, which we saw last year with the Los Angeles Rams and Philadelphia Eagles trading up to the first and second picks (even though they arguably gave up way too much). Analytics have actually hurt the stock of running backs in the NFL more and more over time, pointing to their fragility, but now we’re starting to see a settle in their contracts that don’t scream “boom or bust” too loudly. More and more measurables are being added to the game of football, and the pre-draft combine has become a crucial part of the process. The “moneyball” research has shown a correlation between certain off-field drills and on-field success such as broad-jump results with pass-rushing ability, vertical-leap measurements with receiver success, and even Quarterback’s hand size with throwing ability. Tanier actually takes it to an extreme, “as wearable technology and real-time analysis spreads among NFL and college training staffs, the next step will be measurements of a player’s aerobic capacity, body symmetry and sleep-recovery profile.”

Some teams are now leaning away from signing seasoned veterans with declining prowess based on the analytics that higher upside potential at a cheaper price outweighs experience with a declining skill set and higher price tag. Kickers have even become a draft commodity because of their low price tag in comparison to veterans.

“Leadership may not be calculable, but cap numbers, productivity and potential age decline are (Tanier).”

We’ve seen these kind of decisions from the Panthers’ Dave Gettleman when the parting ways with aging veteran wide receiver Steve Smith, who went on to have a very successful two-year stint with the Baltimore Ravens before ultimately succumbing to a devastating Achilles injury. Good decision? That was a decision made ultimately about leadership, confused? Gettleman saw an opportunity to save a few million dollars for the future and to place younger, franchise Quarterback Cam Newton into the sole position of team leader to embolden his maturity both on the field and off (looks like it turned out pretty well…so far).

“The Carolina Panthers shocked the football world by cutting Josh Norman days before the draft. Then we all took a deep breath and realized the release was pure Moneyball” (Tanier). This free diving move by Gettleman looks like it may have been a bit emotionally driven based on reports of the negotiations gone wrong (God only knows what bargaining styles were used), but in actuality his leadership style of drafting players for the purpose of people development ended up working out in a different way. As an example of strategic thinking, we have begun to see the use of franchise tags to not only save money by locking a player up for a year at a predetermined positional rate but also to force longer term contracts with better value and even collect compensatory picks for letting the player hit free agency elsewhere.

Rich Horwath would say, once Gettleman realized he would not be able to keep his 6th round pick turned Defensive Player of the Year candidate, he used his football acumen to realize what benefits he could still get by focusing on future resources to allocate through a trade-off by taking action and executing a strategy to achieve a new goal (that was a mouthful). Realizing that Norman largely benefitted from the Cover 3 scheme run by the panthers (led by Luke Kuechly), Gettleman decided to keep that money in his pocket to use on the anchor of that scheme, the defensive line (mainly Kawaan Short and Star Lotululei).

As Benjamin Franklin said, “the person that knows “how” will always have a job, the person who knows “why” will always be the boss,” and I think Gettleman has proved he knows how and why.

Now that Gettleman has freed up even more cap space following the 2016-17 season (over $50 million), we will see what he does over the next few seasons to bring the Panthers back to the Super Bowl contending level they were in just a year ago.


References

Chelladurai, Packianathan. “Managing Organizations for Sport and Physical Activity (4th Edition).” SMEJ Sport Management Education Journal 8.1 (2014): 100-118.

Hatman, Dan. “NFL Draft Strategy.” The Scouting Academy. N.p., 06 Apr. 2015. Web.

Horwath, Rich. Deep Dive: The Proven Method for Building Strategy, Focusing Your Resources, and Taking Smart Action. Austin, TX: Greenleaf, 2011. Print.

Iacocca, Lee A., and Catherine Whitney. Where Have All the Leaders Gone? New York: Scribner, 2007. Print.

Levick, Richard. “The NFL Draft: Spectacle Requires Balancing Risks With Brand Strategies.” Forbes. Forbes Magazine, 05 May 2016. Web.

Massey, Cade, and Richard H. Thaler. “The Loser’s Curse: Overconfidence vs. Market Efficiency in the National Football League Draft∗.” Under Review: 02 Apr. 2005. Web.

Maxwell, John C. The Five Levels of Leadership: Proven Steps to Maximize Your Potential. New York: Center Street, 2011. Print.

Ruiz, Steven. “Why It Made Sense for the Panthers to Part Ways with Josh Norman.” For The Win. 20 Apr. 2016. Web.

Tanier, Mike. “Moneyball Is Changing the Way NFL Teams Assemble Their Rosters.” Bleacher Report. 22 May 2016. Web.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s