Moneypuck - The New NHL Management Model

If you’re reading this you are probably aware of microstats and you’re probably somewhat familiar with Moneyball;  Michael Lewis’s tale of Billy Beane, the Oakland Athletics, and their efforts to incorporate a system of objective metrics into Major League Baseball.  Years before Beane could refine The Art of Winning An Unfair Game for the Athletics, Bill James, a non-descript fan of baseball, was hard at work creating the metrics that Beane would later use to build a winner on the cheap in Oakland.  Similarly, in our harsh world of cold ice and vulcanized rubber, a group of hockey bloggers has done work just as rigorous as that done by Bill James many free-agent signing periods ago.  What these bloggers need now is a Beane to their James and a team to be their Oakland Athletics.  We here at Copper and Blue are convinced that the Oilers would be well served to take up the mantle just as the Athletics did.  Indeed, if they reject the tidal wave of objective statistics and measures that is rushing towards the NHL the Oilers can expect many more years of embarrassing losses to marginal teams.

Though James and the hockey bloggers have labored for the love of different sports, their goal has been the same – to best quantify what it takes to win in each respective league.  James’ work took on increased importance as the economics of baseball shifted in the 1990’s.  The salary discrepancy between the haves and the have-nots increased exponentially and seemed to preclude small-market franchises from competing with their big-market opponents – that is, until Billy Beane brought the statistical rigor of Bill James to America’s National Pastime.  Almost immediately after becoming GM of the Oakland Athletics, Beane set out to eliminate insufficient and inefficient subjective forms of player evaluation.  Traditional scouts and club-house managers balked as Beane drastically moved his organization from one that favored "toolsy" prospects, as had been standard across the league for generations, to one that preferred players who simply would not make outs, regardless of build, stature or pedigree.  He did this because Bill James and his math said to.  By going for this sort of player, Beane was able to accurately evaluate talent and acquire players with the skillsets that correlated to winning.  That is, Beane was able to extract the maximum amount of value for each dollar spent.

As teams have begun to approach free-agents, and in particular free agent goalies, with the sort of austerity not seen since Greek budget negotiations, it appears GMs might finally have the same level of trust in math as some coaches had in it way back in the 1970s.  Whether the correction in the goalie market is a result of league-wide understanding of hockey’s sabremetrics (I have my doubts) it has become even more important that the Oilers adopt a microstat-centric view of the game.  Much like the Greeks, fiscal responsibility has been forced upon the NHL.  Every team will be looking for value, and for the Oilers to succeed they must understand True Talent and have a greater ability to find it at closeout prices than the rest of the league.  They have an opportunity now - and one that must not be squandered- thanks to the wealth of talented young players in the organization.  It might not seem that they’ve got such great expectations at the moment because the only things the NHL club has in greater abundance than future-NHL’ers  are roster holes and cap space and that is not a combination that makes for much success.  But the young players offer Edmonton a unique shot at value.  Their entry level contracts are bargains, and often times the following contract is cheap as well. The Oilers GM, be it Steve Tambellini or otherwise, must resist the knee-jerk impulse to overpay free agents in order to fill roster holes.  He must not pay for fickle boxcars, he must pay only for consistent success as proven by the underlying numbers.  With young and improving forwards like Taylor Hall, Jordan Eberle, Magnus Paajarvi, and Sam Gagner on the roster with established and successful veterans like Penner and Hemsky up front, he needs to acquire bargain players who move the puck forward and out-chance the opposition to fill in the holes that remain. 

His emphasis must always be on value, and acquiring players who can outperform their salaries.  After all, with a level playing field the greatest GM is the one who allocates scarce resources most efficiently and microstats have proven to be the best tool to do so.  It is that group of players, those microstat outperformers that are still vastly underrated, under-pursued and under-valued by the current group of GMs.

As the recent success of NHL teams with players on ELCs shows, value is of the utmost importance in hockey just as it is in baseball, but for a different reason. At one time the NHL was on the same path as the MLB.  The economics of the sport were giving an unfair advantage to the teams located in large markets.  It took a lockout to resolve the NHL’s payroll parity issues and by the time the teams resumed play they did so under the weight of a hard salary cap.  In The New NHL teams are forced to make difficult decisions not because they lack the dollars to spend, but because they lack the cap-room to spend.  As a result, all NHL GMs are faced with the same problem that plagued Beane.  Every dollar spent on one player precludes a dollar from being spent on another.  Unlike baseball the playing surface is level.  No team can spend above the cap, and as the Devils learned attempts to circumvent it will be met with resistance by league officials.  There are no shortcuts, there is no way to game the system.  There are no easy fixes available to the team who fails to retain a worthy player and there are no take-backs available to the team who hands a large contract to an unworthy one. For better or worse, this is a fair game. If a team is going to dominate in this league, it can do so only by getting value from every player under contract.

And what is the best way to extract value from a contract?  As Beane has shown with deed and James and the bloggers have shown in theory, the best way to accurately judge talent and therefore garner the greatest reward for each dollar spent is by eschewing subjective evidence in favor of objective metrics.  After all, who are you going to believe, the math or your lying eyes?  What the bloggers’ math has shown us that perhaps lying eyes have not is that certain things correlate closely to winning and hold predictive value. 

These things, moving the puck forward, possessing the puck, getting close to the net, and shooting the puck, are the objective.  Players, regardless of build, stature or pedigree, who have the ability to achieve these objectives, regardless of method employed to do so, are to be valued.  Conversely, a goalie’s save percentage, though vitally important to winning, is erratic and somewhat unpredictive of future results.  GMs should proceed with caution when handing out big-money contracts to goalies.  Likewise, a player whose shooting percentage deviates wildly from his mean on his path to posting excellent boxcars should also be viewed with caution.  Lying eyes might say the hot goalies and high-scoring players have value, but the math might tell a completely different story.  And as Beane has proven, when the lying eyes and the math disagree it is the underlying math that must be trusted.

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