Management by Baseball

It's Winter Meetings week for major league baseball, a time for free agent signings and trades and leaks to the baseball press (some of them even indicating true info) about teams' intentions. Intentions in baseball, as they are in all organizations, are not the same as what the team actually ends up doing. There's what a buyer has in mind, and then what they actually end up doing.

Buyers beyond baseball are subject to the same drift -- planning one thing but being deflected by their own lack of focus or by the manipulation of a clever salesman (or both).

In this entry, I'll point out a classic baseball case and how it manifests itself outside of baseball. In the next entry, I'll describe the forms that inability to focus on objectives tend to take. I'm going to deviate from my norm in this entry, btw, and use other sports, too, where the point is less subtle.

"FRANCHISE" PLAYERS

I think all sports fans know this term, though it has a fuzzy definition.. I define it as a player who is so effective her skill or his results just change the whole complexion of a franchise, someone you can build a whole team around (in soccer, Mia Hamm or Maradona, in basketball, Michael Jordan or Lauren Jackson).

Franchise players can be surrounded with very good players (think Willie Mays or Stan Musial or Mickey Mantle), or surrounded with mostly ordinary players (think Barry Bonds) or dogmeat (think Ken Griffey Jr when he was on the Mariners).

Execs in baseball and beyond love the idea of having a franchise player. Not all teams have one, but if you do, it makes every other decision easier.

• Marketing: Put franchise player in ads.
• Program cover: Pic of franchise player.
• Promotional chatchkas: Bobble-heads, belt buckles, stained-glass windows, album of Fatboy Slim covers featuring franchise player.
• Roster design: Build around the franchise player's aptitudes.
• Facilities: If your franchise player is a power-hitting lefty like Babe Ruth, pull in or drop down the right-field fence.

Team building is a complex endeavor in and outside baseball. It's so complex, I'm going to simplify it by using a lesser, simpler endeavor, football, as an example. Back before he was a hand model, OJ Simpson was drafted by the then-deplorably-weak-everywhere Buffalo Bills. Simpson was a remarkable running back, needing only about 6 inches of hole for about .2 of a second to create a broken-field run, and once past the line, he was exceptionally hard to stop. The Bills had about nothing, they got this #1 draft pick, they had a franchise player. It became obvious that one would build the team around this exceptional talent and his aptitudes, obvious where to go next: build an offensive line that could consistently create 6-inch holes for .2 of a second, get a quarterback who could hand off reliably, get a complementary running back who could block effectively.

It didn't mean ignoring everything else, but there was a cascading set of personnel & strategy & tactical decisions that became obvious once you had a franchise player. This takes a lot of burden off the decisionmaker that would weigh on a peer running an organization without a franchise player.

So there's a managerial simplification advantage in having one. The problem is there aren't very many franchise players; demand is higher than supply. It's not like Toyota Priuses or armored humvees -- there's no factory just waiting to build more franchise players once buyers snap up what's out there. Because -- and here's the dirty little secret -- if there were enough for there to be one for every team, they wouldn't be franchise players. The whole concept is self-limiting. The franchise player has to be the "best" player on any team she could play for, so how many of those can you have?

In that sense, the concept "franhcise player" is as much a marketing concept as it is an operational factor.

CAVEAT PHLEGM-TOR

In baseball, teams will pay more for what they believe to be a franchise player than the player's apparent surface value because they are getting this tangible simplification benefit. Players who are very good but not considered franchise players won't get that extra kick over surface value.

In non-baseball organizations, this is equally true of C-level executives, such as CFOs and CEOs. So agents (executive recruiters) benefit if they can convince teams that perfectly fine players are actually franchise players, team-changing experiences.

One of the masters of the technique of exploiting teams' wishful thinking is Scott Boras, perhaps the best known agent. He's not the best known, btw, because he's the best. While he's very effective, there are a half dozen equals. It's just that Boras is a very effective self-promoter and he's also tapped into a particular strain of American business style: leave nothing on the table ever, and achieve your ends by any means necessary.

His latest son et lumiere is around his client Adrian Beltre. According to Jack Curry's piece in the International Herald Tribune:

Scott Boras swiveled his chair to the left, then the right, then abandoned his seat because he needed to emphasize a point. So he jumped up, grabbed a red marker off a conference table and drew on a white board.

The subject was how to determine the value of baseball players, and, of course, Boras was an expert. He scribbled a few words and numbers to illustrate why he thought he could prove that Adrian Beltre was a franchise player (my underline) who could become one of the best third basemen in history.{snip} Boras explained that he had thought Beltre was a superstar before he hit 48 homers for the Dodgers last season. Many baseball officials would disagree.

Once Boras finished putting evidence on the board, he sat down again and opened a blue binder. Beltre's name and autograph were in silver on the front of the 36-page binder, and "Scott Boras Corp." was printed in the lower left-hand corner. Boras said it took years to compile a binder like that. The binders are Boras's way of telling teams how valuable his clients are. Turn the page, Boras will say with a confident expression, and become a believer. For Boras to be successful, only one team needs to believe.

"Our job is to understand what landmarks we can find in the game, going through an entire history, and use our data to portray a player and let teams know, 'Excuse me, you have a flashing light before you,"' he said. Welcome to the intensely prepared, always patient and usually rigid world of Boras, the agent who tells players what they are worth, tells teams the same and waits for the outcome to satisfy him.

Truly, Beltre is very good young player. Let me mention the good things about his vitæ.

• In this last season, he led the National League in homers, and tallied 120 RBIs.
• He was sturdy: he played in 156 games & had 200 hits.
• He's maturing: This season he cut his strikeouts by one-sixth while boosting his walks by a third.
• His defense is net positive: At third base, his zone factor leads the majors, & his range factor is well-above average.
• He's 25 years old, not yet at his peak, but he's played for 6½ seasons already.

Very cool. Now here's the part Boras isn't including in the glossy marketing brochure: Beltre's career, separated from that one super-ultra-premium year, is fairly-good-not-very-good.

ADRIAN BELTRE

Year	G	AB	R	H	2B	3B	HR	RBI	BB	K	SB	CS	AVG	OBP	SLG	OPS
1998	77	195	18	42	9	0	7	22	14	37	3	1	.215	.278	.369	.648
1999	152	538	84	148	27	5	15	67	61	105	18	7	.275	.352	.428	.780
2000	138	510	71	148	30	2	20	85	56	80	12	5	.290	.360	.475	.835
2001	126	475	59	126	22	4	13	60	28	82	13	4	.265	.310	.411	.720
2002	159	587	70	151	26	5	21	75	37	96	7	5	.257	.303	.426	.729
2003	158	559	50	134	30	2	23	80	37	103	2	2	.240	.290	.424	.714
2004	156	598	104	200	32	0	48	121	53	87	7	2	.334	.388	.629	1.017
Career	966	3462	456	949	176	18	147	510	286	590	62	26	.274	.332	.463	.794

From BigLeaguers.Yahoo.Com

I put in bold his best years for the stats presented in this table. As you can see, 2004 stands alone. It's npot that he's a bad player -- just an average one with a great season. Lots of players have great seasons after a few years of average play. A few go on to repeat their performance, more never repeat.

Adrian Beltre is a very attractive free agent. A guy who would help almost any team -- if his bat reverts, you still have his glove, and while not worth the same, it's something.

Adrian Beltre is not a franchise player, a contributor you want to build a team around -- that fragile algebra of interconnecting parts you cobble together to leach the most of your franchise player collapses quaquaversally like a pile of pick up sticks during an artillery barrage.

Boras only needs to find one wishful thinker who, even though she or she knows it's hype, holds out the hope, or needs the media impact for the season-ticket holders.

BEYOND BASEBALL

You see this marketing all the time outside of baseball, only it's fiercer. An organization looking for improvement goes out into the marketplace looking for executive talent. Maybe the suit just looks great. More often, the suit has been a team member in a big effort that succeeded. The prospective CxO or her recruiter has a great binder that spins the legacy of success in a way that makes it look like the Franchise Candidate was "responsible" for the success.

¿Why is it fiercer?

Because there are no reliable stats in most cases, as there are in baseball. These hiring managers are flying almost blind, armed with pretty much nothing beyond glossy marketing materials.

There are things you can do, of course. I have a three-point plan I advocate for my clients. I might outline it for you, if readers want it.

But I can't begin to tell you how many Archie McCardells (failure at Ford, moved to Xerox; failure at Xerox, moved to International Harvester; failure at Harvester) there are -- even proven failures are marketable, so the merely passable or very good become very easy to market as The Salvation of Western Civilization.

In the next post, I'll discuss some of the factors that contribute to buyers getting into this situation.