Wall Street Journal: There's Reason to Be Optimistic About the Mets

January 3rd, 2011

Wall Street Journal


There’s Reason to Be Optimistic
Will Three Proven Lieutenants in the Mets’ Front Office Lead to Better Decision-Making or Chaos?

JANUARY 3, 2011

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Early in the summer, Paul DePodesta read a book that intrigued him. Its title was “Chasing Stars.” Its author was Boris Groysberg, an associate professor at Harvard Business School. Its thesis had a practical application that had yet to reveal itself to Mr. DePodesta.

It did in November, when the Mets hired Mr. DePodesta to be their vice president of player development and amateur scouting. In accepting the position, Mr. DePodesta was reunited with Sandy Alderson, the Mets’ general manager, and J.P. Ricciardi, a special assistant to Mr. Alderson.

Dating back to the time each of them had spent in the Oakland Athletics’ front office, the three men shared close ties—Mr. Alderson as a mentor, Messrs. Riccardi and DePodesta as friends and peers—to A’s general manager Billy Beane, whose methods for building a winning major-league team on a limited budget were documented and dramatized by Michael Lewis in the 2003 book “Moneyball.”

More, Messrs. Alderson, Ricciardi and DePodesta had developed strong personal and professional relationships among each other. Now, they and vice president/assistant general manager John Ricco—the most significant front-office holdover from Omar Minaya’s tenure as GM—are charged with shaping the Mets into an elite baseball club again.

And based on the quartet’s backgrounds and their interactions so far, the most telling template for how they might return the Mets to prominence isn’t necessarily Mr. Lewis’s bestseller but Dr. Groysberg’s examination of how businesses and organizations can create environments where talent can flourish.

In his research for “Chasing Stars,” Dr. Groysberg looked at the careers of more than 1,000 analysts from Wall Street investment banks—professionals, he said in a phone interview, who “could not care less who they worked for” and can easily relocate. He found that, on average, even the best analysts (the “stars”) who moved from one firm to another underperformed in their new positions—and underperformed for as long as five years.

“If you look at this brain collecting as a strategy in moving from one organization to another, it doesn’t work,” he said. “What makes some of those people successful are the organizations they work for, at least partially.”

That conclusion doesn’t sound encouraging for any company, firm or, in this case, baseball franchise that has just hired three executives and charged them with turning around its fortunes. But Mr. DePodesta was more interested in and encouraged by the upshot of Dr. Groysberg’s findings: The author could map out general conditions under which “stars” would thrive in new organizations, and two of those factors would seem particularly relevant to the Mets’ new brain trust.

First, those analysts who moved from “low-rated firms to high-rated firms” improved their performance, for they were surrounded in their new jobs by more plentiful and useful resources. The Mets, with a 2011 payroll that’s on course to exceed $130 million in spite of a relatively dormant offseason, represent an upgrade in that regard for Messrs. Alderson, DePodesta and Ricciardi. From 2006 to 2009, Mr. Alderson, as chief operating officer, and Mr. DePodesta, as a baseball-operations executive, collaborated in running the San Diego Padres, whose payroll never topped $74 million in any of those years, according to Cot’s Baseball Contracts, a website that tracks major-league players’ salary information.

And after working under Mr. Beane in Oakland, Mr. Ricciardi became the Toronto Blue Jays’ general manager before the 2002 season; in seven of his eight years there, the team’s annual payroll was less than $82 million.

“I’ve never been in a market where the ownership was totally driven to win, and that is so energizing,” Mr. Ricciardi said over his cell phone recently. “In Oakland, we were always limited, even though we won.…When I was in Toronto, we were owned by a big corporation, [Rogers Communications Inc.]. Winning wasn’t a driving force behind Rogers. It was not as high on their list as maybe it is some other places. The exciting thing from my end is that ownership wants to win here, and we have resources we’ve never had.”

Second, “stars” who moved to new organizations in teams or “packs” performed better than those who moved individually, for their relationships with each other made it easier to replicate the conditions that had made them successful in the first place. Dr. Groysberg called such connections “relationship human capital.” And for Mr. DePodesta, 38, who regards “Moneyball” as a treatise not on how to evaluate athletic talent but on how to exploit “stagnant systems,” “Chasing Stars” represents another opportunity to test business theories and principles in what might at first seem an unorthodox setting.

“It’s somewhat intuitive,” said Mr. DePodesta, who was the Los Angeles Dodgers’ GM in 2004 and 2005 and is, like Mr. Alderson, a Harvard alumnus. “When you do have that working trust, it can come together a lot quicker. You know where you can count on people. You know where people’s strengths and weaknesses are. It’s easier to create a staff that fills in the gaps that all of us inevitably have.”

Mr. Alderson has held true to his reputation for encouraging recommendations and ideas from a variety of people within a baseball organization, according to team officials who have sat in on meetings with him.

At Major League Baseball’s winter meetings earlier this month, as many as a dozen Mets representatives gathered each day in a seventh-floor suite at the Walt Disney World Swan and Dolphin resort. The group included several of the organization’s scouts and insiders—some newly hired, some holdovers from Mr. Minaya’s staff—and expanded or contracted depending on the time of day or the topic at hand.

“There’s a lot of communication, and sometimes things become more project-oriented than job-oriented,” Mr. Alderson said.

Messrs. Ricciardi’s and DePodesta’s roles will be relatively specific: The former is in charge of pro scouting; the latter, amateur scouting and the Mets’ farm system. But once the franchise’s ownership group had settled on Mr. Alderson as GM, and once Mr. Alderson in turn hired two of his protégés, it became natural to wonder what Mr. Ricco’s role in the Mets’ new hierarchy would be.

As it turns out, Mr. Ricco’s duties won’t differ much from those he had under Mr. Minaya, and he already had forged a professional relationship with Mr. Alderson when the two of them worked together in the commissioner’s office in the late 1990s and early 2000s. He will be responsible for the administrative aspects of running the front office—payroll and budgeting, human resources, the rules of contract negotiations, medical matters—and will offer input on player-personnel issues. “You have to be in lockstep with the GM all the way,” Mr. Ricco said.

He is also the bridge to the Mets’ recent past—the man most familiar with the shortcuts and shortcomings that contributed to the team’s losing records in 2009 and 2010. And the new front office hasn’t had time to correct all those flaws. Despite Mr. Ricciardi’s enthusiasm for the franchise’s bountiful financial resources, the Mets’ ownership group still has to shake its reputation for meddling too much in the baseball-operations department’s decisions, and nowhere in “Chasing Stars” does Dr. Groysberg explain how relationship capital will help the Mets score runs against the Philadelphia Phillies’ dynamic starting rotation.