Tuesday, December 28, 2004

Negotiation, Not Scott Boras Style -- Part II:
Where to Start, Where Not to End  

Negotiation is a vital requisite to safely reaching First Base in the Management by Baseball Model (operational management). To be good at it, you need to have strengths in the skill sets required for Second Base (understanding people) and Third Base (self-awareness), too.

It's a useful life skill for anyone, but mandatory for anyone who's either a manager or planning to be one. If you "just don't do that", then there's roughly a 0% chance you can be an adequate manager.

Negotiation is not magic. It's not scary once you realize it's a big garage shelf area of tools and four basic concepts anyone who successfully survived 6th grade can grasp and muddle through. I have a favorite book I recommend for Negotiation 100 -- it's Negotiation - The Art of Getting What You Want by Michael Schatzki with Wayne Coffey, a Signet paperback that's out of print but you'll find in good used book stores or your library. Aside: Don't you just hate loaning a book to someone who promised to get it back and doesn't, and in the meantime, you've forgotten who it is you loaned it to and you're really frelled because it's out of print? End of Lewis Black Moment. My copy is on loan at the moment, so I will paraphrase their terminology but present the basic concept.

Start a negotiation with a Maximum Supportable Position (MSP) & a Minimum Acceptable Result (MAR). The MSP is the best possible case that's supported by data or common sense and the needs of your antagonist across the table. The MAR is the least beneficial outcome that's still worth accepting as a final outcome. You start a negotiation having researched both fully, and because you know the MAR in advance and stick to it, you never allow an emotional moment compromise your ability to walk away below that. And if you start with anything less than a solid MSP, you're not going to do as well for your side as you should.

The MSP and the MAR act as defined poles for the range of possible outcomes, and this turns negotiation into mapped, known arena..

One of Scott Boras' big "tricks" is no trick at all. It's the mastery of the MSP, the maximum arguable position. Now when I build an MSP, I like to be able to argue it with a straight face. Boras pushes the model farther than I do, either because

(a) he knows less about baseball players than I do (unlikely),
(b) he's better than I am at keeping a straight face through an overstated argument, or
(c) he doesn't care about keeping a straight face.

According to this Denver Post article pointed out by Baseball Think Factory's Baseball Primer:

Beltran's relative youth, 27, and heroic playoff performances have Boras seeking a 10-year contract. He doesn't say this, but his notebook gives it away.

Teams with the purchasing power to bid on Beltran - a group that figures to expand beyond the New York Yankees, Houston Astros and Chicago Cubs - are presented two sets of projections. The first suggests what Beltran's numbers should look like when he's 37, or 10 years from now. The second is what Beltran's totals could look like at 40.

If Beltran can maintain his averages of the past four seasons, he should have 436 homers, 562 steals and 2,695 hits at age 37. Give him three more years, and Beltran would have 3,208 hits, 523 homers, 673 steals and a plaque with your team's cap in Cooperstown.

These projections are listed along with the lifetime totals of other center field greats such as Willie Mays, Mickey Mantle, Joe DiMaggio and Ty Cobb. Lo and behold, Beltran is on pace to become, stats-wise, the greatest center fielder. "When owners see these names, then it starts to click," Boras said. "They start to realize what kind of player we're dealing with. I tell them, 'Now do you understand why I'm placing a premium on this guy?' I say: 'This isn't what Scott Boras says. This is what the facts are."'

This is Boras' MSP -- that Beltrán, if he could maintain the pace he set over over four years, three of them in an extraordinary hitter's home park he no longer calls home, for another 10 years, he'd have Hall of Fame type numbers and if he could do until he's 40 years old (13 more years) he'd be in the Willie Mays stratosphere. This MSP is an overreach.

If you follow sabermetrics much, you know that a significant majority of individual players have their peak season at either age 27 or 28. After that age, there are some skills that advance (homer power for a fair number of the better players), but overall value goes down. You may also know there's a tool used to track careers called similarity scores. If you know about them already, skip the rest of this paragraph, but if you don't please read it because this tool has a lot of application beyond baseball. Baseball players fall into certain loose patterns. Some are just darned logical (as a player ages he will probably gain weight, losing some speed and gaining some power). But some are statistical symptoms of specific patterns of abilities. With the exclusion of exceptional individuals like Ty Cobb and Ted Williams, Mays and Mantle, players have sets of strengths and weaknesses that express themselves in a certain limited set of variations. Luck and environment can help or hinder the basic achievements of like individuals, but like patterns create like results, and players with like results tend to have similar career trajectories. Beyond baseball, this concept has a lot of application. Even within fairly diverse endeavors (law firms, military strategy, franchisors, auto repair shops, family farms) there are handfuls of behaviors that make most individual operations fall into similarity clusters. As in baseball, there are a few extraordinary Larry Burrights or Rob "Oxymoronic" Deers or Buzz Arletts but a majority of individual operations that have survived will have succeeded because of a set of talents that express themselves as a group with a set of similar behaviors.

But there's no evidence to support Beltrán will end up in the same batting heavens as Ted Williams or Mickey Mantle, because players don't hit for 10 consecutive years the way they did for the four years leading up to their age 27 year.

Here are some of Beltrán's hitting stats over his major league career (and then we'll look at some most-similar players to see what happened to their careers after they turned 28):

 1998 KAN 58 12 16 5 3 0 7 3 12 3 0 .276 .317 .466 .783
 1999 KAN 663 112 194 27 7 22 108 46 123 27 8 .293 .337 .454 .791
 2000 KAN 372 49 92 15 4 7 44 35 69 13 0 .247 .309 .366 .675
 2001 KAN 617 106 189 32 12 24 101 52 120 31 1 .306 .362 .514 .876
 2002 KAN 637 114 174 44 7 29 105 71 135 35 7 .273 .346 .501 .847
 2003 KAN 521 102 160 14 10 26 100 72 81 41 4 .307 .389 .522 .911
 2004 KAN 266 51 74 19 2 15 51 37 44 14 3 .278 .367 .534 .901
 2004 HOU 333 70 86 17 7 23 53 55 57 28 0 .258 .368 .559 .926
 Career   3467 616 985 173 52 146 569 371 641 192 23 .284 .353 .490 .844

Lots to recommend it, especially his season split last year with Kansas City & Houston. At 38 homers, his best season ever, and split between two parks that weren't particularly generous last year. His stealing ratio makes him one of the rare individuals in the 21st century who steals a lot of bases at such a very high success rate that his stealing actually has solid value in helping his team score runs. And no stats to support his fielding, but like Mays and Mantle and DiMaggio, his stats argue he's a very good outfielder.

According to Beltrán's profile at Baseball-Reference, these are the Most Similar batters to him at his current age:

Similar Batters through Age 27

  1. Andre Dawson (947)
  2. Bobby Bonds (943)
  3. Dave Winfield (938) *
  4. Jack Clark (936)
  5. Gus Bell (928)
  6. Shawn Green (925)
  7. Harold Baines (923)
  8. Reggie Smith (923)
  9. Gary Sheffield (921)
  10. Johnny Callison (919)

Dawson and Winfield and Baines played into their 40s (as Boras asked his antagonists to imagine Beltrán would). The rest of the retired ones made it into their middle 30s. Dawson is the closest to Beltrán; let's take a quick look at his final totals. As Boras said, Beltrán if he got to age 40 would project out to 3,208 hits, 523 homers, 673 steals. Andre Dawson lasted until he was 41, and finished with 2,774 hits, 438 homers, 314 steals. But if you had projected out Dawson's age 24, 25, 26 and 27 seasons out another 10 years, Dawson would have finished with numbers comparable to Boras' MSP for Beltrán: 3,110 hits, 419 Homers, 626 steals. The same numbers in more tabular form look like this:

  Hits HRs SBs
Beltrán at 27 - Actual 985 146 192
Dawson at 27 - Actual 978 133 184
Beltrán at 40 - Boras Est. 3,208 523 673
Dawson at 40 - Boras Est 3,110 419 626
Dawson at 40 - Actual 2,758 436 314
Dawson Actual v. Boras -11% +4% -49%

His last six seasons, he didn't have a single season that was as good as his career average. This is a key point. Dawson was a remakably gifted athlete, and he still had his last season that lifted his career averages at age 35, the age around which similar dudes, Bobby Bonds, Gus Bell, Reggie Smith and Johnny Callison retired.

Dawson's career was exceptionally good, but his career trajectory, the shape of his output, is normal, with the late 20s peak, more home run power, a tail off in speed-based accomplishments, and a decline to retirement.

Here's the same table for Dave Winfield, another similarity buddy, but with a more-acknowledged career that got him into the Hall of Fame.

  Hits HRs SBs
Beltrán at 27 - Actual 985 146 192
Winfield at 27 - Actual 980 134 153
Beltrán at 40 - Boras Est. 3,208 523 673
Winfield at 40 - Boras Est 2,866 446 370
Winfield at 40 - Actual 3,110 432 218
Winfield Actual v. Boras -8% -3% -41%

Winfield is transcendant. His rigid Boras projection almost dovetails with his career actuals. In his last six seasons he did have one season, his 1988 season at age 36, that was better than his career average. While I think Beltrán's skill set more closely approximates Dawson's at the same age, Winfield makes for a great MSP argument, and you can even show the rubes Winfield's projections to support the idea that a player can have 13 consecutive seasons pretty much like his age 24 - 27 seasons, and a trip to Cooperstown when he does.

If I was Beltrán's agent, I'd make that Winfield argument. Boras has chosen DiMaggio and Mays and Mantle, a big reach based on a rigid formula.

Before a serious negotiation, I try to analyse and build my antagonist's MSP. If I was sitting across the table from Boras, I wouldn't bite. I would have an instant alert that his initial stance was outside the range of "Supportable", a good indicator that he either was ignorant (which he isn't) or looking for a win-lose deal (he gets at least as much satisfaction from having the feeling he's pulled one over on me as he does getting to a good end result for himself).

In your own negotiations, you can use the Michael Schatzki model to excellent use. The wonderful thing about his book is that his techniques are not complex or difficult to understand. You still need to do your homework, study and understand people and control your own impluses, but the basic tools for success are right there. I can't recommend his book strongly enough for managers who don't have any serious negotation training.

And if you end up across the table from Scott Boras or one of his cognitive cousins, you'll have your own MSP and MAR in pace and won't wake up one morning, like Tom "Other People's Money" Hicks and the all-time record 10-year contract on your hands.

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