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Monday, January 25, 2010
What the Pirates owner is saying
If I’m following along from this great exchange:
Q: I understand that the opening-day payroll figure can increase as the season goes along but, at the same time, it’s probably going to end up down from the $48 million of last year.
What went into your thinking?
A: First of all, I think it’s never going to be about the total dollars we spend as much as how effectively we put them to use.
Part of the reason for the payroll level is that we have young players, and it is normal, expected and natural that, as those players mature, those dollars are going to have to come up. That certainly is my expectation.
But I think we’ve shown good discipline in building this 2010 team, in that there is lots of flexibility that Neal still has. He’s building the team that he thinks will perform best for the coming year but also can still succeed going forward.
Q: So, Neal can spend more than what we see right now?
A: Absolutely.
Q: Why not, some might say, just take some heat off yourself and have a $50 million-$55 million payroll?
A: Well, what I really believe is that we’ve put in place an orderly, systematic plan, and the last thing we can do is divert from that plan or change it, as I’ve seen done before in Pittsburgh and with other clubs. I believe that the decisions being made are giving the team the best opportunity to compete this year, as well as going forward. I don’t want to do anything that handicaps that.
Read more: http://www.post-gazette.com/pg/10025/1030840-63.stm#ixzz0deezXCrx
He’s saying that every dollar spent has to have a positive ROI. The Pirates could, for example, spend an extra 20MM$ on payroll by acquiring 20MM$ worth of free agents for a price tag of 20MM$. Instead, he’d prefer paying 20MM$ for 30MM$ of non-free agent talent. I agree with him. Therefore, the focus should not be on the payroll budget itself, but rather on the entire baseball operations budget.
And, if Huntington has extra money left over, is the Pirates owner letting the GM roll that money over into the following season, or is it the classic use-it or lose-it budget setup?
I’m still waiting for someone to explicitly state: We had X budgeted for payroll and we’re 20 mil under that. We’re not going to spend the 20 mil. We’re going to put 25% of it on top of our player development budget and draft aggressively, we’re going to add some brilliant new staff/compensate our poorly paid scouts better, and we’re going to set aside a good 65% (13 mil) of that money in investments for use on a future payroll. So if we get a 6% return that 13 mil is 13.78 mil next year that we can spend ON TOP of what we budget.
Honestly, that looks like what the Pirates did/are doing. They’ve changed their draft profile after the Moskos debacle, they hired a new stats guy, and now they’re talking about not wasting their money...presumably with the goal of using it on a worthy piece in the future.