Why you should care
Because the heartland has teams too.
A walk and a stolen base, a well-placed double and aggressive base running was all it took to upend New York Mets ace Matt Harvey. Three innings after first baseman Eric Hosmer dove across home plate for the tying run in Game 5 of the 2015 World Series, the scrappy Kansas City Royals won the World Series.
The Royals’ two-year ascent to baseball’s summit, first as the World Series runner-up in 2014 and as the champs a season later, ran contrary to modern trends. In an era of huge payrolls and power hitting, the Royals ranked 16th in payroll and 24th in home runs in 2015. But through perfect roster construction and a contrarian approach, Kansas City captured the flag.
We still dig deep into the numbers. But the biggest advantage is actually understanding players as human beings — knowing what makes them tick.
Theo Epstein, president, Chicago Cubs
Still, market inefficiencies exist to be fixed. Following the title, All-Star utility man Ben Zobrist and pitcher Johnny Cueto signed lucrative contracts with Chicago and San Francisco, respectively. While Zobrist helped the Cubs capture their first World Series in 108 years, the Royals collapsed, missing the playoffs. This year, they look to be more of the same. The Cubs’ title run didn’t just end a drought; it signaled doom for small-market franchises.
There was a brief era when the have-nots were privy to a competitive edge. The publication of Michael Lewis’ 2003 best-seller Moneyball turned the evidence-based interpretation of data known as analytics into one of the most commonly discussed topics in sports. The book chronicles how Oakland A’s General Manager Billy Beane utilized uncommon data to build a 2002 roster of undervalued gems who went 103–59 and made the playoffs.
Two young execs in the San Diego Padres front office studied the Beane phenomenon. Following the 2002 season, Theo Epstein and Jed Hoyer were hired by Boston — Epstein as GM and Hoyer as the assistant to the GM. They, too, used analytics to build a roster that won Boston’s first title since 1918. Then, in 2007, they won again, further popularizing data crunching.
Suddenly, young, Ivy League–educated executives flooded front offices throughout the league. Hoyer took over in San Diego, and Harvard grad Matthew Silverman led the Tampa Rays to an Oakland-esque turnaround. When Epstein and Hoyer reunited in Chicago in 2011 and five years later ended the longest championship drought in the history of major league sports, data was officially mainstream. “In the early 2000s, forward-thinking general managers could spot inefficiencies in scouting and free agency,” says former MLB catcher and minor league coach Erik Pappas. “Today, it’s nearly impossible to find those advantages.”
As analytics have become commonplace, those early disrupters have been forced to adjust their approach. In a recent interview with the podcast Pardon My Take, Epstein noted that, ironically, his current scouting focuses as much on intangibles like personality and competitiveness as on numbers. “We still dig deep into the numbers,” says Epstein. “But the biggest advantage is actually understanding players as human beings — knowing what makes them tick.”
MLB is handing small-market teams some nifty ways to stay afloat. Beginning with this summer’s draft, 14 clubs will be rewarded a “competitive balance pick,” meaning that those teams in both the bottom 10 in revenue and market size will receive an extra draft pick, following the first or second rounds. Hitting the jackpot on one of those picks means a franchise can lock up a potential star for at least six seasons (the length of rookie contracts). After that, of course, most stars dump the franchises that can no longer afford them.
This constant talent turnover has the league worrying about its competitive landscape. Last season, the Cleveland Indians were the only club in the bottom half of payroll and revenue to make the postseason. As payroll monsters like the Cubs and Red Sox widen the revenue gap, they also increase their respective windows for contention. Even in large markets, young stars — knowing that the monetary floodgates will open soon — refuse to sign contract extensions before free agency. Greg Genske, the agent of 22-year-old Astros shortstop Carlos Correa, recently told the website FanRag Sports as much: “Carlos is never going to do an early multiyear contract.” Unlike Cleveland or Kansas City, Houston can likely afford to re-sign their young All-Star.
Now, small-market teams are scrambling to innovate. In San Diego, the tactics of General Manager A. J. Preller mirror those of Epstein’s rebuild in Chicago — load the farm system with prospects while fielding a major league team with little hope of contending. Preller, though, has taken it to an extreme. The Padres enter this season with the second-lowest payroll in baseball ($61 million), down 40 percent from 2016. Three players have never competed above Class A before this season. The Padres are tanking.
Fleeting success, like the two recent seasons in Kansas City, is sure to alleviate the pain of tortured fan bases. But as access to information increases, small-market clubs may be destined for the same fate as day traders — washed out by Big Banks and algorithms. A tactic like Preller’s could pay dividends if successful, or it could land an executive on the unemployment line. As Pappas notes, general managers “usually only get one chance to rebuild.”