The NFL's New Moneyball: Recruiting Lessons from the Gridiron
For football fans, Tuesday's 30-minute Twitter outage was something like an oxygen deprivation. The NFL's free agency period -- when players not under contract are free to sign with any team -- was about to begin. Panic set in. Circumstances appeared dire. But then Twitter bounced back, and fans resumed the important work of tracking their favorite teams and players on one of the biggest recruiting days of the year.
Now that the first day of the free agent period has passed, one clear trend is clear: Teams no longer want to invest heavily in the running back (RB) position. Once a star-laden, highly compensated role deemed vital for any high-functioning offense, RBs are now viewed as a commodities worthy only of league-average salaries.
Instead, football teams are catching on to what smart small-business leaders have known for years: When it comes to cost-effective hiring, your main goal is not filling a position; it is creating a positive business outcome. This, of course, is a tenet of "Moneyball" -- specifically, gaining a competitive advantage by finding bargain employees who can outproduce superstar (i.e. highly compensated) employees.
By devaluing the RB position, football teams have now hit on a Moneyball strategy of their own. They've learned to steer clear of paying big money to RBs, since any link between superstar RBs and winning games is tenuous at best.
Paying for Outcomes, Not Names
What does all of this mean for your business? HubSpot founder and CTO Dharmesh Shah beautifully articulated this Moneyball tenet -- paying for outcomes, as opposed to names or titles -- in a blog on LinkedIn. To explain the concept, Shah paraphrased a chat he'd once had with an entrepreneur:
Shah: What do you need?
Them: We need to build a management team.
Shah: No, what do you actually need right now?
Them: Well, right now we need a VP of Engineering.
Shah: What for?
Them: Well, we need someone to head up our product development effort.
Shah: No, you actually need to write code and release a product. You need to respond to customer issues. You need to iterate quickly so you can learn quickly. You don't need a VP of anything, you need a doer of stuff that needs to get done. Don't think about buying titles -- think about buying outcomes.
In both baseball and football, the desired outcome -- what teams are hoping to buy -- is winning games. In business, it might be something else, but in most cases it's probably related to sustained growth, brand, or profitability. In the same way a startup shouldn't splurge on a VP of Engineering when what it needs are coding workaholics in the trenches, football teams have learned not to splurge on RBs.
The Demise of the Running Back as a Marquee Role
How do we know, for sure, that football teams have stopped spending on RBs? For one thing, not a single RB got a major deal on March 11. If anything, the day belonged to left tackles: Branden Albert (Dolphins), Eugene Monroe (Ravens), Rodger Saffold (Raiders) and Jared Veldheer (Cardinals) all received multi-year deals with a combined value of more than $160 million.
Defensive backs also did well: T.J. Ward (Broncos), Donte Whitner (Browns), Vontae Davis (Colts), Aqib Talib (Broncos), Alterraun Verner (Bucs), Sam Shields (Packers), Malcolm Jenkins (Eagles), Antoine Bethea (49ers), Mike Mitchell (Steelers) and Jairus Byrd (Saints) all got major deals.
By contrast, some of the best RBs on the market -- Ben Tate, Knowshon Moreno, Maurice Jones-Drew -- were left hanging. Arguably the best available RB, Darren McFadden, signed a remarkably reasonable one-year, $4-million deal to stay with the Raiders. Other potential starters (Donald Brown to the Chargers, Rashad Jennings to the Giants) signed for peanuts.
On top of this, not a single RB went in the first round of the 2013 NFL draft. It was the first time in 50 years that this happened. And plenty of experts believe it could happen again in the 2014 draft.
You could argue we're witnessing a sea change in football history: Namely the demise of the RB position, which was once made great by legends like Jim Brown, Walter Payton, and Earl Campbell.
Clearly, teams have decided that acquiring talent at left tackle and defensive back is more essential to winning than is acquiring big-name RBs.
What the Analytics Say
As a lifetime football fan, I found this news hard to believe. Could it possibly be that the position made heroic -- nay, immortal -- by legends like Payton and Campbell was now a fungible commodity? My heart didn't want to believe what the salary numbers were clearly saying.
I even wondered if the RB position was now becoming too undervalued. And, if so, was it not possible that a smart NFL team could gain a competitive advantage by buying bargains at the RB position?
I posed my thesis to the team of experts at Football Outsiders (FO), who perform advanced analytics on player performances -- including each athlete's contribution to a successful team.
Their answer? A firm no. "It isn't that running backs are 'undervalued,' it's that they are 'properly valued,'" explained FO's Rivers McCown. "Teams are realizing that running back performance tends to be a very fragile thing -- especially as RBs tend to get into their late 20s -- and they are planning around needing at least two backs."
In other words, RBs are low-priced for a reason: They don't exert much influence over wins and losses. When it comes to RBs, teams have already learned their big Moneyball lesson: Don't overpay for talent at an injury-prone position that doesn't necessarily correspond to wins.
According to McCown, there's little tying a team's running attack to wins beyond its pure volume of rushes. Which is to say, how often you rush matters more than who is doing the rushing. In which case, why does it matter how much you pay the player who is doing the rushing?
Moreover, even this statistical correlation -- between the volume of rushes and winning games -- is more of a lagging indicator than a leading one. That's because the team that amasses more rushes is usually the one that is already ahead in the game, anyway. They are, essentially, "running out the clock," to use the football cliche.
So if your favorite team is still coming up thin at the RB position this offseason, fear not.
They have more important things to worry about it.
And so do you.