10 April 2016

The One Thing Every Owner Needs: Sound Management


Guest Post by P.Lumbean

When my plan to win the Powerball on a weekly basis comes to fruition, one of the things I am going to do is to go about purchasing a team in either the NBA, MLB, NFL, or NHL (this is after I’ve addressed issues like world hunger, poverty, and colonizing space). When I purchase my team, I know exactly the first hire I am going to make and I know what my long term vision for that hire is going to be. I know this because I’ve seen my plan work in real life, and I’ve seen what happens when choosing another course of action doesn’t work so well.

Before I begin, can we all agree on the following? From an historical perspective, are the following teams successful from both a business and won\loss perspective: Cowboys (NFL), Stars (NHL), Spurs (NBA)? Can we also agree that the following teams have, for the most part, a futile history with in-the-arena success and\or on the balance sheet: Buccaneers (NFL), Canucks (NHL), Clippers (NBA)? If we’re in agreement up to this point, then please read on. If not, I may have no prayer of getting you to understand my perspective and consequently you are not a candidate to become a member of my organization so thank you for applying, but we’re going to go in another direction.
The Cliff Notes version of my plan: The first, and one of the only, significant actions I will take as owner of my new franchise will be to hire someone that I will from that point on refer to as “Team President.” This will be someone who is relatively young (ideally 35-45), extremely intelligent and personable, and someone that I could contentedly go out for a beer with. That’s it. Well, that’s not really it, I suppose I would have a job description for them, and the job description would look something like this paraphrased one for Rick Pych, the President of Business Operations for the San Antonio Spurs (NBA). Pych:

. . .leads the business operations for all four sports franchises owned and operated by Spurs Sports & Entertainment which includes the San Antonio Spurs (NBA), the San Antonio Rampage (AHL Hockey), the San Antonio Silver Stars (WNBA), and the Austin Toros (NBA Development League) as well as the operations of the AT&T Center … includes marketing, corporate partnerships and ticket sales, finance and administration, communications, corporate development, community relations, and facilities management as well as all corporate business and player planning and new initiatives on behalf of the organization and ownership.

Something tells me that Rick doesn’t spend a lot of time wandering around the office trying to keep himself busy. Here’s the deal with Pych. He’s been with the Spurs organization since 1993 and has steadily moved his way through the organization until reaching the point where he is right now sitting at the right hand of the throne of Spurs Sports and Entertainment owner Peter Holt. Pych has held his current role since 2008. He has been a consistent presence as the Spurs have gone about their business of being one of, if not, the most dominant franchises in the league. I agree with the website basketballinsiders.com that wrote prior to the start of the season,
Over the years, we’ve seen how a great front office can be critical to a team’s success. Oftentimes, a great front office can be overlooked since much of the attention goes to the franchise’s star players or head coach. But in reality, it’s the front office that puts together all of the pieces to make a team great.
One of the first teams that come to mind when discussing sustained success in the NBA is the San Antonio Spurs. They have a great organization from top to bottom. It’s no surprise then, that they have had very little change over the years.

They then though go on in the article to give credit to Spurs General Manager R.C. Buford. Buford, like most franchise executives with the title “General Manager,” is only responsible for player personnel decisions. That’s not fair because it sounds as though I am belittling Buford’s success. Obviously, the man knows full well what he is doing, as does Coach Popovich, Tim Duncan, and the rest of the folks directly related to the playing of the game on the court. But I would suggest that none of this is possible without guys like Rick Pych and more specifically the relationship between guys like Pych and owners like Holt.

Holt, who bought the Spurs the same year that Pych joined the organization, presumably had a direct hand in bringing Pych to San Antonio. Holt’s loyalty to Pych is apparent, and it would appear as though Pych is equally loyal to those below him on the corporate ladder as well (Buford has been with the organization since 1994).
Loyalty seems to be a thing with the Spurs.

Heading north from San Antonio up I-35, we find a different kind of loyalty in the person of Dallas Stars (NHL) President and CEO James R. Lites. Like San Antonio’s Pych, Lites has general oversight of the Stars. With the exception of four years working for the NFL’s Giants, Lites has been with the Stars steadily since 1992. In that time, he has worked for three different owners. What’s notable here is that it may be hard to find anyone who has been more consistently loyal to the Stars since they moved from Minneapolis to the Lone Star State. Given the significant role he has played in the development and maintenance of the team, he certainly deserves a lion’s share of the credit for their on ice success. Since Lites first joined the organization, they have had three different owners, five different general managers, and seven different coaches. In that same time, however, they have managed a .589 franchise point percentage total (that is to say that they have won 59% of the points available to them during the regular season). This ties them with all-time leader Montreal.

Probably the smartest move Stars owner Tom Gaglardi made when he bought the financially distressed team in 2011 was to bring Lites back to Texas after his stint in New York. Gaglardi gets a lot of credit for saving hockey in Dallas , but his hiring and keeping the clearly capable Czar of the Stars Jim Lites is a big part of that success.

Lites (L) Gaglardi (R)

Before leaving Dallas, I’d like to make our way west from downtown Dallas a little ways to say “Hello” to everyone’s friend Jerry Jones whose franchise presents, for the purposes of this piece, a tale of two franchises: The Dallas Cowboys of Tex Schramm and the Dallas Cowboys of Jerry Jones. The Schramm Cowboys ran from 1960 to 1989 and the Jones Cowboys from 1991 to the present day. For the purposes of this piece, Schramm’s Cowboys were the prototype of the kind of front office structure that I am advocating. Schramm was an old school “General Manager” who oversaw all aspects of the operation of the Cowboys. He answered to only two owners (Clint Murchison and H.L. “Bum” Bright) and had only one football coach (Tom Landry). They key here is that both Murchison and Bright left all operations of the team to Schramm and Schramm obviously did a marvelous job of oversight of the Cowboys, an expansion team when Schramm took the job. During his tenure, Schramm took a fledgling franchise and turned it into “America’s Team.” Three paragraphs in The New York Times obituary for Schramm sum up my perspective of his being a jack-of-all trades kind of general manager:

"The Cowboys were losers their first five seasons, then managed to reach the .500 mark in 1965. Finally, Schramm's insistence on building through the draft paid off handsomely. Players like defensive tackle Bob Lilly, defensive back Mel Renfro and wide receiver Bob Hayes formed the nucleus of a team that got to the championship game in 1966, losing to the Packers. Eventually, the Schramm-Landry Cowboys played in five Super Bowls, winning two."

Schramm did not coin the term America's Team, but he loved it. It had a dashing connotation with the Lone Star on the helmet, and it became the title of the Cowboys' 1968 highlight film, which helped brand it on the public consciousness.

In 1972, he introduced the Dallas Cowboys Cheerleaders to pro football. They formed a touring troupe that took them around the world.

Talk about a leader who had an enormous influence in all areas of the team’s operations! Now, to be fair, Schramm was an extraordinary man who had a huge influence not just in Dallas and on the Cowboys but on the league as a whole. He was perhaps destined for greatness in whatever he did and wherever he did it, but the point for me is that owners Murchison and Bright had the foresight to do all they could to keep Schramm in his position and that consistency of leadership, as much as anything else, kept the Cowboys on top of the league both financially and on the field for so long.

Then along came Jones. Or should I say “Along came Joneses.”

Current Cowboys owner Jerry Jones bought the franchise in 1989, promptly fired long-time coach Tom Landry, and Schramm resigned two months later. Jones philosophy on his role as owner was quite different from Murchison and Bright’s. He and, subsequently, his family were to be in charge and a visit to the Cowboys website makes it all too clear that the Cowboys are a Jones Family endeavor. Jerry is Owner, President, and General Manager and his three children hold the top three front office positions in the organization. On the one hand, this guarantees a certain kind of consistency in the front office and to this point, I have been advocating consistency. However, I have only been advocating consistency when and if the positions are held by capable individuals. Pych in San Antonio, Lites in Dallas, and Schramm of the earlier Cowboys clearly demonstrated an ability to handle the job of overseer. The jury seems to be out with regard to Jerry Jones. His success financially is undeniable. As Patrick Rishe points out in Forbes, “with a currently estimated team value at $4 billion for a team he purchased for $150 million in 1989, and a beautiful sporting facility in AT&T Stadium which has generated millions in revenue for his team’s brand and the region at large by attracting non-Cowboys events to North Texas, his business acumen is undeniably shrewd and forward-thinking.”
He has, however, committed certain public relations blunders (read Greg Hardy) in recent years and his teams have not excelled on the field the way many fans might have hoped.
In short, the leadership of the Cowboys has been consistent if not necessarily particularly competent.

The Tampa Bay Buccaneers also have four folks from the same family ostensibly overseeing the franchise. The differences, however, between the Bucs and the Cowboys are rather pronounced as any casual fan of the NFL will attest. The Buccaneers do in fact have one Super Bowl title to their credit, but their franchise history is dominated by a lot more losing than winning. Since 1995, the Glazer family has owned the team. Currently, three Glazers (Bryan, Edward, and Joel) serve as co-chairs of the organization, and their job descriptions are remarkably similar on the team’s website. It’s a bit difficult to discern who, if anyone, is ultimately in charge of day to day operations of the team. Where Jerry Jones has clear oversight in Dallas and his children have clearly defined (but subservient) roles to his, the Glazers seem to be intertwined. Below them are the usual suspects in charge of on the field efforts (player personnel types) and business operations (marketing, community involvement, etc). My point here is that there is not one clearly defined role for one specific individual responsible for franchise oversight. I contend that this has been part of the problem for the Buccaneers as an organization.
Looking back over the history of the Buccaneer organization, one finds that they have gone as long as seven years without a Chief Operating Officer (presumably leaving those duties to one of the Glazers?). They’ve also had seven different general managers and six different owners. This does not paint a picture of consistency and stability.
Taking a diagonal trip across the continent from Tampa Bay, we land in Vancouver to take a quick look at the Canucks who, for all intents and purposes have a pretty rough history behind them: since the organization’s inception in 1970, they have appeared in the Stanley Cup Finals three times (losing all three). In 3572 games played, they have amassed only 49% of the points available to them, ranking them with the likes of the Lightning, Blue Jackets, and Panthers. If the pattern holds, we should see that consistency of leadership at the top has been in short supply. The pattern holds:

• Prior to 1987, the team went through six general managers (responsible for the hockey aspect of the franchise). They then had a ten year period of stability with one GM (Pat Quinn), but since 1997, they have had five different GMs\Presidents of Hockey Operations.
• On the business side of things, they have in fact had the same Chief Operating Officer (Victor de Bonis) since 2007 but in the ten years leading up to that point, they had three separate Presidents\Chief Operating Officers.

One wonders how the franchise might have fared over all these years had they had the consistent leadership like that of James Lites in Dallas.

Finally, I likely don’t need to say much here about the Clippers and their inconsistency in terms of leadership and owner\management relationships. The words “Donald” and “Sterling” when put together likely tell the reader all he or she needs to know about the Clips and their futility and inept ownership over the years. At the heart of their troubles, however, beyond the obviously incompetent owner, was a leadership structure that never allowed for consistently defined roles. In 2000, Sports Illustrated wrote a lengthy piece about Donald Sterling and among many other indictments, wrote:

• Few Sterling hirelings utter a word--much less a discouraging one--about their boss.
• When it comes to pinching pennies, Sterling is an embarrassment of riches. Old NBA hands still talk about how he reportedly tried to cut costs during his first season by asking coach Paul
Silas if the players really needed a trainer and if Silas would mind taping them before games.
• "To have a decent team you need to keep a core of players together and let them grow," says Los Angeles Lakers guard Ron Harper, a survivor of five Clippers campaigns. "Sterling doesn't
do that. He's not a builder, he's a meddler."
• The most frustrating part of being G.M. was the lost opportunities. Sterling didn't trust his own basketball judgment and wasn't prepared to accept mine. I'd call him about a trade I wanted to pursue, and he'd say, 'Let me get back to you.' He'd never get back to me. So nothing would happen." – Former Clipper GM Carl Scheer
• "I don't know how important winning is to Donald," says Scheer. "He seems more concerned that his books are balanced, that he runs one of the few NBA franchises with no debt, that he can bring his friends to games."

Sterling bought the team when they were the San Diego Clippers in 1981 and initially, he was directly involved in oversight of all operations a la Jerry Jones in Dallas. In soon became apparent though that he was in no position to have any success in this regard. In fact, when he commented that he publicly acknowledged that he would prefer it if his Clippers finished in last place so that they could draft the highly coveted Ralph Sampson, the league promptly fined him $10,000. His attempt a few months later to strong arm the league into allowing him to move the team to Los Angeles prompted an investigation by his fellow owners that almost lost him his franchise. In perhaps one of his only wise moves as an owner, Sterling relinquished some of his duties to someone with a bit more expertise in this regard (Alan Rothenberg), and he and the Clippers were back in the league’s good graces. More or less. Still not content in San Diego, Sterling moved the team to Los Angeles and incurred a $6 million fine from the league.
Rothenberg sat in the president’s office during the move from San Diego and until 1989. His was not a particularly pretty era on the balance sheet, and it was particularly gruesome on the court.

As bad as the Clippers teams were during Rothenberg’s reign as President of the Clippers, keeping him might have been the wiser move for Sterling. Instead, he went back to having general oversight of the franchise and thus continued its unprecedented futility. Some examples:

• In 1990, players went to Sterling in an effort at getting coach Don Casey fired. Sterling referred them to general manager Elgin Baylor who ostensibly was only responsible for player personnel decisions
• The 1991-1992 team had three different coaches
• Between 1983 and 2010, they only had two winning seasons
• They have two 17-game losing streaks, one 19-game losing streak, and one 20 game losing streak to their “credit.”

By 2010, things had finally begun to turn in a positive direction for the Clippers. Not surprisingly, Sterling had turned over the business reigns to a competent businessman and had also improved management of their player personnel department (Elgin Baylor, an amazing player on the court, but a disaster as a GM was gone), and wise draft picks were being made. And most importantly, from the perspective of this piece, a President had been brought in who was fully responsible for the business side and shared player personnel decisions. Andy Roeser had been with the Clips in a front office capacity since 1984 and had been promoted to team President in 2007. It wasn’t until 2012 that he began to have significant input in player personnel decisions, but clearly, there was an effort being made by someone (Sterling?) to consolidate front office power. Not surprisingly, the Clippers fortunes on the court and at the box office began to soar.

Then Donald Sterling did and said what Donald Sterling did and said, and poor Roeser went down with him.
Now the Clippers have a new owner who has decided to split team management duties between a business oriented executive and a player oriented general manager. Time will tell if this return to a decentralized system of power will work for the Clippers, but I wouldn’t be very optimistic for the long term strength of the organization if I were a Clipper fan.

The Spurs, Stars, and pre-Jones Cowboys have a history of success. They also have a history of front office executives who were loyal to their owners and who had general oversight for all aspects of the organization.

The Jones Era Cowboys are difficult to assess in this regard as their owner is the hands on executive and I’m not really sure what to make of him. He’s making lots of money for the team, but can his team, during his tenure, be considered a success?
The Canucks, Bucs, and Clippers have long and ignominious histories of futility and I contend that this is because they have had inconsistent administrative leadership, with unclear job descriptions, and a diffusion of power that leads to disorganization and a failure to progress.

Next month when the Powerball comes up with my numbers, my first calls will be to Texas: “Hello, is your team President looking for a job?”



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