Is A Savvy General Manger Enough?

by JD Sussman on Jul 12, 2011 8:01 AM EDT in Economics of Baseball

 Following the success of Theo Epstein after his hiring in 2002,  recent general manager vacancies have been filled with analytical minds who attempt to exploited market inefficiencies and develop young inexpensive talent. After the success of  Mr. Epstein[5] and the 2004 Red Sox baseball has seen the hirings of Jed Hoyer, Alex Anthopoulos, Jon Daniels, and Chris Antonetti[6]. Time will tell if this recent trade will pay long term dividends, but the early returns have been promising[7].

Currently the aforementioned general managers have been aggressive in either the Rule 4 Draft, the international free agent market, or both. Some have jettisoned aging veterans, bad contracts, and recognized sunk costs. But, at what point does the abundance of intelligent individuals in baseball front offices yield diminishing returns?

The Astros may be able to hire a comparable strategist to operate their organization. But, will the system that general managers exploit today continue to possess the same market inefficiencies as ownership groups adapt their hiring? Certainly the Rule 4 draft will see an overhaul, leaving the IFA system as the sole dynamic market for cheap amateur talent. But, international expert Ben Badler of Baseball America has already called teams' spending at this year's July 2nd deadline "out of control," which includes the immense spending of Jon Daniel's Texas Rangers. The current system that savvy general managers have dominated may be changing, forcing teams to become leaders in innovation.

Below I have listed a few potential advancements teams could make outside of the open market to maximize the return on their current strategies:

• Injury prevention and expedited rehabilitation - It is amazing how much value is lost by a player's injuries. The one feature I appreciated that Will Carroll wrote at Baseball Prospectus was his calculation of how much money a team has lost in a given year due to injuries. I have no idea how accurate those calculations were, but they at least illustrate the point that limiting injuries can have a significant impact on team's success.
• Player development - Spending an excessive amount of money on the draft isn't enough to fully take advantage of it's spoils. Teams need to be successfully develop the players they draft. Beyond the Boxscore's Scott McKinney details how often a Baseball America Top 100 Prospect bust at an alarmingly high rate. However, if teams were able develop players more effectively, they could gain a distinct advantage over the competition while cutting costs. While the lack of complete data has prevented me from doing the research, I would be Andrew Friedman's Rays have had great success in this area.
• Biomechanics[8] - To an extent biomechanics ties into the previous sections, but it should be mentioned on its own. An increased study of a pitcher or hitter's biomechanics can help prevent injuries and develop skills
• Mental Evaluations of Players- I believe I've read this bullet point suggested most often by John Sickles of SB Nation's MinorLeagueBall.com tying it into player development. If teams were able to figure out what character trait or mindset contributed to a player's success they could focus their attention to it on draft day.

Clearly this isn't an exhaustive list, but I think you get the point. As the amount of savvy teams increases, teams' ability to take advantage of incompetent organizations (or market inefficiencies created by incompetent organizations) will decrease forcing general managers to come up with creative non-market solutions to get ahead.

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[1]The Astros job may actually be more enticing to Friedman than many believe. While, Friedman and owner Stuart Sternberg have revamped the Rays into the ideal small market franchise the constrictions placed upon the front office are taxing. Extremely limited payroll, stadium and fan base issues, and the strength of the AL East would not be a concern in Houston. Oh, and Friedman is a Houston native. (To read a counter point of view, read Jason Collette's piece)  There were rumors that his father was apart of a group of investors interested in buying the team, but then Jim Crane was awarded the exclusive right to negotiate with current owner Drayton McLane. Though, I'd suggest everyone who is interested in that saga to read Maury Brown's piece on Crane on Forbes. Its possible that the controversy surrounding Crane could open the door for Mr. Friedman. 

[2] I don't write these words maliciously. The Astros are actually my second favorite team in all of baseball.

[3] After the Vernon Wells trade, there is a fair argument that Tony Riggins is the worst General Manager in baseball. Sure, he has drafted well but that doesn't matter when you allow your field manager to destroy your prospects at the major league level.

[4] Was there anything better than the amount of draft picks Friedman was able to acquire for the 2012 draft?

[5] One could argue Billy Beane's successes were more notable, but I wouldn't. Bringing a championship to Boston is bigger than anything Beane did. Given the resources, it certainly wasn't as difficult but I'm talking about public awareness here.

[6] Don't forget what the Mets have done as well hiring Sandy Alderson, J.P. Ricciardi and Paul Depodesta.

[7] The jury is still out on Alex Anthopoulos, Jed Hoyer and Chris Antonetti, but Friedman and Daniels have both brought their teams to the World Series.

[8] Public plea: If you weren't trained in the field of biomechanics or have studied it extensively, please bite your tongue on the topic.