October 2008 - Posts

  • Talking Payroll Structure Part II or Why Giving CC A Big Contract is Dangerous

    A while back, I took a rudimentary look at the Brewers payroll structure in terms of the implications of contracts that take up a large percentage of the total payroll. There is recent news that the Brewers may be looking to offer CC Sabathia something in the range of 4 years and 100 million dollars. Given the rising cost of the young hitting core and the few multi-year contracts on the books at the moment, that means that the Brewers would almost certainly be committed to having to support a 90+ million dollar a year payroll in the next 4 years if they plan on competing. They have talent in the minors, but not so much that they could afford to go all Florida Marlins and start dumping most players the minute they hit arbitration and aren't working for slave wages.

    The Brewers, as an organization, are particularly tied to their ability to draw people to the park to sustain payroll. Like every other team, the Brewers do get money from MLB from it's overall TV contract, MLB.com and, like all small market teams, they get some revenue sharing. Where they fall very short of many (all, in fact) other teams, is they have the worst TV contract in baseball through 2012. That's right, the worst. Without a big fat cushion of guaranteed TV money to fall back on, the team has to draw fans to the seats to sustain payroll. What's more, the fact that they play in a small market means that even when they are drawing fans, they cannot squeeze as much revenue out of the fans as their competitors. The fact that they had the 21st most expensive ticket prices in 2008 (and 28th most expensive overall park experience) is great news for fans trying to take a family to the park, but limits the amount of money the team can raise.

    One thing about attendance is that fans are fickle when it comes to supporting their team. People who are interested enough to be reading this will probably get out to the park much more than most of their neighbors anyway. We all know, however, that when a team is doing well, a lot of people who wouldn't be there otherwise start showing up. Those people go away when the wins start going away.

    So what does this mean for the Brewers? In short, it means they would not be able to afford any bad luck what-so-ever without feeling a major budget crunch should they decide to give CC that money. As talked about in part I, signing CC would mean that the Brewers would have a lot less room to do other things. They would have to cut the budget significantly in areas like the bullpen and the bench to make ends meet, which means a lot of "ready or not" guys from the middle levels of the farm system filling in key roles because there wouldn't be money to pay much more than major league minimum. Basically, they would have to get a big number of wins over replacement (different than the traditional "win-loss" record for pitchers) from CC Sabathia because they're going to have a hard time finding money to buy them elsewhere.

    If that works out, then the Brewers will almost certainly be a perennial contender in the NL Central for the life of the contract. If, however, Sabathia begins to feel the effects of being pitched very heavily the last two years and having pitched a large number of innings at a tender age overall, then the Brewers will have a very big problem because they will almost certainly have trouble competing.

    This brings us back to the consequences of not being able to compete in a given year. If the team is counting on needing to compete to remain financially solvent (as would almost certainly be the case should they take on CC's contract) then they cannot afford to not compete. That means that if a situation calls for taking a step back in say 2011 or 2012 and reloading for 2013 and 2014, they will almost certainly not be able to make that decision and instead probably be forced to do things like trade prospects for marginal players to try to eek out every extra win possible to contend or even just maintain the illusion of "trying to win now." A situation like that would almost certainly not only fail to produce wins in the short term, but also limit the ability to win for several years down the road as a result of giving up prospects out of necessity.

    Most Brewer fans rightly seem to realize that giving a contract to Sabathia would represent a big risk. It's important to realize just how large a risk that really is, especially when you consider that the current state of the economy makes any large commitment of money particualrly risky. Of course, it is probably no more than an extreme long shot that CC comes back at anything close to those terms anyway. Still, the organization's willingness to at least consider the possiblity says that they have a good amount of gamble in them. Hopefully they are going into this with their eyes completely open.

  • The Case For Keeping Mike Cameron

    Very shortly, the Milwaukee Brewers will have to make a decision on whether or not to pick up Mike Cameron's option for the 2009 season. The option itself is for 10 million dollars, but because there is a 750,000 buyout, the Brewers decision on the option is really whether or not to take on 9.25 million in additional salary.

    A good place to start when trying to figure what to do would be to figure out whether or not it would have been worth it to have had Mike Cameron last year at 10 million. Cameron is not a high batting average player as anyone who has seen him play can attest. He also racks up a good number of strikeouts. Those things, however, are what he doesn't do and it is a mistake to focus solely on what players do not do at the expense of what they do well.

    Mike Cameron, despite having trouble keeping the batting average up, does draw enough walks that he posted a .331 OBP, which is exactly what the average OBP was in the National League last year. The fact that he is so good at drawing walks lead to his finishing 5th in the NL in pitches seen per plate appearance at 4.21. That pays off by getting into opponent bullpens faster and seeing more middle and long relievers, generally the worst pitchers on a pitching staff. Where Cameron really excels, though, is in slugging the ball. In 444 AB's, he racked up 212 total bases (25 HR, 25 2B, 2 3B). Cameron finished 14th in the NL in ISOP (a measure of power) and 24th in the NL in BB/PA, which perfectly sums up where is value actually lies on offense.

    Defensively, Cameron is no longer the player he once was and a few late season gaffes have left an impression with many that he really wasn't that good. A look at some of the advanced metrics developed by people at places like Baseball Think Factory (Cameron Defensive Runs Saved +2.8) and Baseball Prospectus (RAA +1) show that he is slightly above average in terms of getting to balls and making plays at this point in his career.

    All in all, Mike Cameron gets on base enough to basically break even, and then derives his considerable value from his ability to hit the ball very hard when he makes contact. He does this playing a defense-first position at about a league average level. Going back to that Baseball Think Factory evaluation, he was 43rd in the national league in their "Offense Plus Defense" ranking at a +12.9. Going forward, the people at Baseball Think Factory who do the ZiPS projections see his numbers holding pretty steady next year in most areas, especially his hitting line which they have pegged at .246/.333/.446/.779 (compared to the .243/.331/.477/.808 he actually hit in 2008). It's just a projection, but it's based on the historical record of similar players and how they did at this point in their careers, so take it for what it's worth.

    It's very hard to argue that Mike Cameron didn't add good value to the Brewers in 2008 when all the facts are on the table. The question remains, is that value worth the cost of spending another 9.25 million to keep him for 2009? Well, the people at fan graphs seem to think so:

    ....When you combine average to above average center field defense with a bat that’s worth 1.5 wins over an average hitter, you have a +4 win player. Based on Cameron’s 2008 performance, he was worth between $15 and $20 million on the free market, or more than twice what he actually made. Toss in the team option that now looks like a no-brainer, and Cameron was truly one of the best signings of the winter.

    Just take a look at his nearest comparable, Torri Hunter of the Angels.

    Hunter: (.278/.344/.466/.800) 257 TB in 551 AB

    Cameron:  (.243/.331/.477/.808) 212 TB in 444 AB

    Hunter gets a big advantage in BA, a small advantage in OBP and falls short in SLG (and is even further behind in ISOP). Then consider that Hunter is in the first year of a 5 year, 90 million dollar contract that payed him 16 million last year and it becomes very difficult to argue that 10 million for Cameron is anything but below market level for his abilities.

    While the Brewers do have some underlying OBP issues on the team, and would benefit from getting a high OBP leadoff hitter to take over in CF, the problem is that those guys just aren't on the free agent market this winter. Mark Kotsay, Jay Payton and Jim Edmonds certainly wouldn't fill that need. So if the Brewers are going to get that sort of player, they're going to have to trade for him. If they count on doing that, they'll have to turn down Cameron's option and leave themselves open to the possibility that they may not get that guy for a reasonable cost. They may well end up giving away more than they get back just to break even in CF next year.

    In the end, the Brewer have the ability to pick up a player who was well above average in terms of production last year for something below true market value. If they turn that down, they are going to have an uphill battle to find someone who brings as much to the table as Cameron does. In spite of his flaws and the fact that he is "more of the same" on the Brewers team, it is going to be difficult for the Brewers to do better than him and for that reason it makes sense to pick up his 2009 option.

    (Thanks to Badger80 and FunDmentals for posting some of these links on the Brewer Message Board)

  • Talking Payroll Structure

    Excellent Brewers beat writer Adam McCalvy mentioned this bit of intelligence from inside the Brewers inner sanctum in reference to a question on the possibility of keeping CC Sabathia in the fold:

    According to someone familiar with the Brewers' front-office strategy, who spoke on condition of anonymity, a team generally wants its top-salaried player to account for no more than 15 percent of the total payroll, and the top three players to account for no more than 25 percent. Obviously, this is only a guideline; special players could prompt a team to bend the rules. Teams with a disproportionate number of so-called zero-to-three-year players making the league minimum or close to it may also be tempted.

    He goes on to break down on the obvious problems this would present for signing Sabathia given what he is likely to command on the market this year and the other commitments they have on top of that.

    It may be tempting to call CC Sabathia a "special player" along the lines of what it would take to violate this guideline, because he was so utterly dominant in his time in Milwaukee this year. A look at the rest of his career, however, suggests a very good player but not generally elite. Also, it is important to remember that pitchers are subject to a higher rate of injury than position players, both that keep them out of games and that hurt their effectiveness.

    The Brewers a few years ago would have been in the category of teams with a "disproportionate number of so-called-zero-to-three-year-players" because so many of their starting players in 2006 and 2007 were pre-arbitration. Of course, now JJ Hardy, Prince Fielder, Corey Hart, Rickie Weeks are all headed to arbitration and will be in for substantial raises so they can't really use that excuse to justify signing CC. Besides, Sabathia would require at least a 5 year commitment and probably more, so this would be a long term issue that would dominate the payroll for a long time and unless the team plans on completely dumping nearly all of the current "young core" to be replaced by players now in the minor leagues and are as yet undrafted. Remember that they have Braun under contract through 2015 and that within a few years his salary will push him into the top 3 players salary wise on the team.

    A team in the Brewers position market wise has limitations to how much it can make in revenue. They can fill the seats every year by having winning teams, but they won't be able to push ticket prices up as high as some markets because they are not drawing on as large a pool of potential buyers as most markets and thus demand will never equal that of the Cubs or Red Sox. More importantly, the TV revenue is always going to be a fraction of the big markets because they have more potential viewers than Milwaukee. Knowing this, the Brewers have to operate under a fairly conservative estimate of potential revenue when planning long term contract spending.

    As long as the Brewers farm system is producing talent (and it will have to if they want to be competitive) they are going to have more flexibility than most in terms of pushing those 15% and 25% numbers up a bit. If they have 3 or 4 key players in pre-arby years and another 3 or 4 key players under cost controlled arbitration or signed to below market level "buyout" deals, they will have a sizable portion of the payroll available for the rest of the roster.

    Still, what it comes down to from a decision making perspective is does a team want to:

    1. Spend an enormous portion of that leftover money on one player, meaning that many bench, bullpen and back-of-the-rotation players will have to be drawn from whatever the Brewers can scrape up in their back end of their farm system and off the no-cost scrap heap.
    2. Use that money to fill in gaps in the roster on more short term deals. For example, while the team is producing a catcher they have the money to sign a Jason Kendall instead of just rushing up a minor league player who isn't ready.
    In the end, one has to think that the Brewers are going to rightly value #2 too much to offer a deal that would leave them totally committed to perpetually having an extremely young team with little true veteran presence. The only way I can see them offering a deal that would truly qualify them in category #1 would be if they were sure it would be turned down.
  • Thank You Jack Zduriencik

    The inevitable finally happened on Wednesday, one of the principal architects of the Milwaukee Brewers revival Special Assistant to the GM and Scouting Director Jack Zduriencik was hired by the Seattle Mariners to be their new General Manager.

    Most Brewer fans probably don't need a reminder of all of his accomplishments, because in the last few years his profile with the team was boosted by increasing attention paid to the farm system by the various beat writers who recognized his good works. The writer of the linked article did a pretty good job listing the current Brewers drafted by Jack Z (though Manny Parra and Matt LaPorta probably merit a mention as well) and one has to also remember that there is quite a bit of talent still working it's way through the system that will one day also be credited to his draft resume. He was the first non-general manager to win Baseball America's Executive of the Year Award last year.

    Of course being a good scouting director is no guarantee of his being a good general manager so we'll have to wait and see how  Zduriencik does before we're sure that this was an astute move. Anyone who saw the FSN feature on the Brewers 2008 draft, however, is going to have a pretty good impression of his skills as a manager of people and a process and is probably going to be inclined to give him the benefit of the doubt.

    As a practical matter, this isn't the best time for Zduriencik to be leaving the Brewers. At the moment, the front office is busily looking to hire a new field manager and that search is going to dominate until that decision is made meaning that this is going to probably be relegated to the back burner. The Brewers would be well advised to at least look at the scouting staff in place first to see if there is an appropriate replacement in-house. Unfortunately, the scouting staff has already had a few guys graduate to jobs as SD's in recent years, so the "low hanging fruit" as it were, has already been plucked. Further complicating matters is the fact that Zduriencik will probably also be looking at the staff he knows from Milwaukee to fill in his scouting department, so there may well be competition for some of these guys. If the right man for the job isn't already in house, Melvin will need to go out and find him, which will take time and probably require more adjustment from the guys already on the staff.

    The bigger picture isn't much better, because whoever is tabbed to run the Brewers draft in 2009 is going to presiding over an important one for the franchise and he will be doing so either as his first draft or (if they hire an experienced SD from elsewhere) their first time working with this scouting staff. The Brewers will likely have at least a few extra picks in the early rounds and may even have more (and better) extra picks than they did in 2008. Those assets don't come along every day and it is important to take advantage of them when you get them.

    At least Brewer fans can rest easy knowing that the scouting staff that Zduriencik put in place is a capable one and that his replacement will at least have that going for him. It's a bittersweet thing to see an important piece of the organization move on, but it is a natural and unavoidable result of success.

    I think I can speak for Brewer fans everywhere when I say "Thanks a million Jack."

  • Decision Time

    So the Brewers are making decisions left and right at the moment, with more big ones on the way.

    First off, General Manager Doug Melvin gets a three year extension though the 2012 season. Owner Mark Attanasio did what he needed to do in locking Melvin up after overruling Melvin on the firing of manager Ned Yost with 12 games left. This gives Melvin the public backing of the owner he needs going forward. It also puts to rest concerns that Melvin would view 2009 as a "must win" situation to save his job if he didn't have the extension.

    In that same article it was announced that interim-manager Dale Sveum would not be returning as manager. Sveum is always going to hold a special place in the hearts of Brewer fans as the man who some how managed to salvage a season that looked to be going up in smoke. That being said, Sveum has never even been so much as a top candidate for a major league job before. Giving him a shot now would have been nothing but an act of faith and Melvin appears to be looking for someone with a longer track record of success.

    Of course hiring a manager because they had success in the past is no guarantee of future success. I'm a firm believer in the notion that, in the long run, a manager is just about as good as the players they have to work with. Not to say that it doesn't matter who manages a team, because, of course, a manager can do things that will harm a team's long-term fortune, like hurting a young pitcher or stunting the growth of a young position player by poorly allocating playing time. The most important asset the next manager of the Brewers needs to possess is the good sense not to fool around too much with what is working, like the power oriented offensive nature of the team, while finding ways to improve areas that need work, such as situational hitting. They also need to know when to pull the young pitchers that are going to be so important to the future of the franchise. Davey Johnson seems like a good choice on both counts, at least by reputation.

    Finally, word is out that Melvin does plan on making an offer to keep free-agent-to-be CC Sabathia. It remains to be seen how legitimate that offer will be. It would seem that the opening offer would need to be within shouting distance of the 6 year, 137.5 million dollar deal that the Mets gave Johan Santana last off-season. Sabathia isn't quite in the class of Santana when you consider more than just 2009, but he has the ability to be a free agent now, as opposed to Santana who was negotiating with a year to go before he could hit the open market. So will Melvin make a Carlos Lee type offer, where Melvin offered what turned out to be about half of what Lee ended up getting? Or, on the other hand, will it be more along the lines of what Fransisco Cordero was offered, which was close to market value but a little bit low?

    The Brewers are at a point where, to keep Sabathia in the fold, they would probably need to give him over 1/4 of the total yearly payroll for 6+ years, barring some major shift where the Brewers fly by the 100 million dollar a year mark for annual payroll. Considering the heavy workload that CC has shouldered since coming to the majors and the even more staggering amount of abuse the Brewers heaped on him down the stretch in 2008, there is a significant chance that CC will have trouble living up to that payday and become a drag on the team's fortunes sooner rather than later.

    Does Melvin have that kind of gamble in him?

More Posts Next page »