Small Market Draft Strategy

[Robideaux]

Jim Callis answered a question in a chat on ESPN.com about draft slot money:

 

Jim, you mentioned Coomley would not be afraid to go over slot now that he is with a club. If that happens, what is stopping every other team from ignoring slot recommendations? If the person that was in charge of coming up with those guidelines is not going to follow them, why should anyone else?

Jim Callis: Coonelly didn't come up with the guidelines . . . I think Sandy Alderson did. Coonelly's job was ot enforce them. But yes, there are more teams asking that question. Not just because of Coonelly's comments but because of seeing two over-slot guys be the key to the Cabrera/Willis trade and the Red Sox and Yankees build up their farm systems by being aggressive. I've said this many times, but it's silly not to go over slot in the draft. The way the system works, good players will fall to you. And by investing $7 million or $8 million in the draft, as compared to the average of $5 million, you can rake in a disproportionate amount of talent. Just silly not to do that, especially for non-contenders. Most teams can't compete with the Mets, Red Sox and Yankees for free agents, but everyone can compete with them for draftees.

 

I've always been puzzled by teams like the Brewers passing on talented players because they won't sign for "slot" value. It seems like you put yourself at a competitive disadvantage because you are trying to save a couple million dollars--which is peanuts in today's baseball marketplace. If you throw an extra $3 million into the draft to "reach" for a couple talented players who happened to drop for sign-ability reasons all you need is one out of 3 of your reaches to pan out to make it financially advantageous. The only way for small-market teams to be competitive these days is to have the perfect storm of prospects come up together and all be playing on their rookie/early arbitration contracts. Any thoughts?

[snyttri]

An expensive draft pick, on average, might bring more wins than a quality utility infielder with the same initial expense. I suspect that peer pressure among owners to keep the price of draft picks in line is the difference in some decisions.

[twobrewers]

I've tried to harp about this before.

 

I like the idea of paying slot. I think the slot pay should be increased. (I believe it actually went down 10% last year?) And I think everyone should be FORCED to pay according to slot - similar to the NBA.

 

The only advantage built into MLB for smaller market teams is the ability to build through the draft. If the Yankees and Red Sox are able to outspend everyone, they will end up with the top prospects every single year - regardless of where they are picked. The players will just hold out knowing that the Yankees or Red Sox will pay more.

 

I think the Brewers are afraid to pay over slot because once we do - everyone does. And if everyone does, there is no competitive advantage. All it does then is drive up the price of the players for everyone. Only the players win.

[colbyjack]

First of all, it's hard to complain too much about how the Brewers have approached the draft since they used it almost exclusively to build the team they currently have. For every player you can point to and say shoulda/coulda/woulda, there's likely a player or more that exceeded expectations, and then some, from that very same draft.

 

Second, I don't like the idea that a few million dollars is nothing in today's sport. While in totality that may be true, $3 million bucks to the Brewers means significantly more to them than it does to the Mets. $3 extra million they spend on the draft may be money taken away from their big-league team and vice-versa. Or it could be money taken away from their improving presence in Latin America, or in the past, money taken away from their efforts with the draft and follow process. The team has an operating budget to adhere to, as that kind of money just isn't going to magically appear without some other area taking a hit.

 

I do understand the arbitration ramifications, but when you talk about hitting on one out of three, you're probably talking about a span over three different drafts, and in doing so you're probably missing out on a player the team selected with one of those proposed picks.

 

For instance, what would have happened had the Brewers taken Luke Hochevar or Mike Pelfrey in 2005 instead of Ryan Braun? I remember a few people being upset that the Brewers passed on those pitchers, citing that the team was cheap, but clearly the team got a much better player with that pick.

 

And yes, I would gladly take Jered Weaver over Mark Rogers or Ian Kennedy over Jeremy Jeffress, but even so, you win some, and you lose some, and even then, the Brewers haven't completely lost yet with those two players.

 

And even if the team does increase their draft budget by $3 million, what happens next year? Are people going to expect them to raise it $3 million more?

 

I'm sorry, but I just don't understand people complaining about the Brewers and spending money. While they have adhered to slot values, they've never gone the opposite route, they've spent a lot of money on DFEs (they made a huge statement when they signed Parra and never really let up using the process as well, if not better than, any other team in baseball), they're starting to spend more on foreign players (starting with Pascual a few years ago and continuing through last fall with a couple of notable, big money signings), and they always manage to sign a late rounder or two to well above slot value (Scarpetta and Zarrage from last year being the most recent). And to be honest, I never thought the Brewers big-league payroll would approach $70 million, at least not this quickly.

 

While I'm not a big fan of the pre-determined slot values, they're not there just because the commissioner's office thinks all of the teams are way out of line with their spending. The majority of teams want the commissioner's office to do something about the signing bonuses since they don't want to see them continue to get out of hand. And teams that don't adhere to the suggested slotting amounts don't exactly get penalized, as anyone has had the opportunity to spend more if they want, that secret wasn't just revealed, but the commissioner's office may take their sweet time to try and impress onto the team's owners why they should or shouldn't move forward with a deal that may be on the table.

 

Keep in mind that ownership plays a big part of this, beyond just day-to-day baseball operations that the general managers oversee. Quite often an owner will step in and dictate that his team can't spend more than X amount of dollars on a certain pick. The owners for the most part are definitely aligned with the commissioner's office on this one.

 

Sorry if it seems as though I'm going off on this subject, but I just think it's one area that shouldn't receive much criticism given the work the Brewers scouting department has done. I realize they could be doing even more with more money, but again, they've done just fine adhering to the "rules."

[logan82]

How often does a drafted player make it to the big leagues?

[snyttri]

I like the idea of paying slot. I think the slot pay should be increased. (I believe it actually went down 10% last year?) And I think everyone should be FORCED to pay according to slot - similar to the NBA.

That solution to equalizing the draft sounds good, but the MLB player's union is the strongest and they might not want to bargain away any aspect of the free market for more guaranteed money when revenues are going up fast.

[Robideaux]

colby,

I understand what you're saying--I don't mean to criticize the job that Jack Z. and Co. have done. Regardless of the resources that they have been given in terms of allocable money to spend on draft picks, they have been brilliant in terms of player evaluation in the draft. I'm more talking about the general mindset behind the draft/farm system. I would argue that an extra $3 million tossed into every draft would ultimately be better spent than $2-3 million spent on the 24th player on your major league roster-- say, someone like Mota or Vargas. You're telling me that in a perfect world you wouldn't rather have had Doug Melvin non-tender Estrada and throw Mota's salary into the draft? Sure every over-slot guy won't pan out, but if in every draft you take a late 1st round guy who would have gone earlier or a 2nd rounder who would have gone in the 1st if not for fiscal responsibility, given Zduriencik's track record, don't you think the Brewers would benefit in the long run?

 

Ultimately, where in the entire baseball operation, from players to scouting to stadium upkeep, do you want to see that last $3 million invested? I say skimp on the 24th or 25th man, use minor leaguers or guys making the minimum who will probably be just as good as your worst 2-3 million dollar bench players.

 

I understand the reality of the situation--commissioners office putting pressure on teams to pay only slot money--but since there is no real penalty, isn't it foolish to let our rivals exploit the system while we sit idly by and bemoan the fact that the rich clubs are getting richer through a flawed system. We can't compete with the Mets or the Cubs for free-agents, but we could compete for draft picks.

[biedergb]

To add to Robideaux's points, here is an article from Yahoo! Sports. This article used to Brewers as an example of using the draft to build a competitive team (also the Rockies). But also had something to say about slot value.

 

Article

 

"The next step deals directly with the draft: ignoring the slotting recommendations designed by MLB to keep a lid on signing bonuses for early-round draft picks. Some teams, such as the Houston Astros, heed MLB's scale - and now they have perhaps the worst farm system in baseball.

By failing to sign top prospects, teams miss the chance to capitalize on the single lowest-cost source of future major league talent - the draft. The Detroit Tigers, habitual slot ignorers, have gone over slot for Cameron Maybin and Andrew Miller (who netted them Miguel Cabrera and Dontrelle Willis), and in June chose Rick Porcello, the right-handed high school pitcher compared to Josh Beckett, with the 27th pick. Porcello slipped because of bonus demands. Detroit didn't blink and paid him $7 million to sign.

If Porcello ultimately develops into even a No. 4-level starter, he will save the Tigers millions of dollars. "

[colbyjack]

Robideaux, yes, in theory I would prefer that the team spend an extra $3 million on the draft than they do on Guillermo Mota. I wish it were that easy.

 

Also, any story that is comparing the Houston Astros to the Detroit Tigers is comparing two far extreme ends of the spectrum and doing so for the sake of making a point while ignoring teams that have adhered to slot value that have thrived. The Astros have a lot more problems going on than just adhering to slot value. Having one of the worst farm systems in baseball goes a lot deeper than that.

[Tbadder]

Just because the draft seems to be working for the Brewers doesn't mean that the system isn't bankrupt, and it is. I'd like to see a system whereby players can declare for the draft (and by players I mean all players including foreign players) once every four years. No slot values, nothing. Every player can try to get as much as they want, any team can pay as much as they want, but it's four susequent years of unsignability if a contract can't be hammered out.

[twobrewers]

That solution to equalizing the draft sounds good, but the MLB player's union is the strongest and they might not want to bargain away any aspect of the free market for more guaranteed money when revenues are going up fast.

While you are correct that the MLB players union is very strong - you have to remember that the players being drafted are not members of the MLB players union. So the more teams pay draft prospects, the less money remains for players who are part of the MLB union. (Players already with contracts) So you could argue that a draft slot/cap would actually create more money for MLB players.

 

However, everything I have read states that the union isn't willing to give into anything that resembles a salary cap. They don't want to be subject to later arguements such as "The draft has a salary cap - why can't the MLB teams?"

I would argue that an extra $3 million tossed into every draft would ultimately be better spent than $2-3 million spent on the 24th player on your major league roster-- say, someone like Mota or Vargas.

For one or two years I completely agree. However, the whole "slot" process is really a nod & wink agreement between the owners. They all agree to keep paying slot - and prospects salaries are kept in check.

 

Plain economics tell us that in the long run contributing an extra 3 million per season wouldn't help the Brewers. As I stated before, if we do - everyone will start doing it. And if everyone is paying an extra 3 million into the draft no one has an advantage. The teams just cost themselves more money. Hence, the owners all agreed to keep salaries under control by paying slot. (With the obvious exceptions of a few teams)

[DrWood]

to me, the only guy you'd go above slot for is a guy that you felt was worth it. to say, "we're going to go above slot this year" is foolish if the players available when you pick aren't worth it. Let's say your slot is $2.5 million bonus. You have a choice to pick a guy who won't sign for less than $7 mill or a guy that will sign for $2.5. Is the guy worth the higher cost? Even if he's a slightly better prospect, he might not be worth the cost.

[logan82]

As coldy stated, I believe, draft picks fail at an incredibly high rate. Nothing is guaranteed with any pick. It is safer to spend the money on a proven player. Not to mention, at any point in the draft there are many comparable players available.

[samwise]

Are there slots for picks past the 1st round?

[colbyjack]

Are there slots for picks past the 1st round?

 

Yes, slots are recommended for the first five rounds I believe. Every pick after the fifth round is recommended to not sign for any more than what the last pick in the fifth round signed for, or something in the $125,000 range.

 

And this IMO is where some really good players could be had, as $125,000 is a good chunk of change that is really hard to pass up, especially if you're a 44th round pick like Shawn Zarraga (who landed nearly twice that much IIRC).