Spending & winning are not the same

In the vast majority of cases, the answer to the question anyone is asking is, “Follow the money.” The bottom line is almost always the bottom line. My favorite line from press conferences where athletes sign big contracts is, “It isn’t about the money.” Translation: “It’s all about the money.”

However, there appears to be one metric in sports, especially in the NFL, where the answer may not be to follow the money. That statistic – and it’s the most important one in sports – is winning. Money can buy a lot of things, but it will not necessarily buy a championship – or even a winning record – in professional sports.

My colleague Michael Lombardi aptly described the importance of prudent and targeted spending Thursday in his column about the Buccaneers. According to a report from Jason La Canfora of NFL Network showing all the cash commitments in the NFL from 2004-2008, the range of spending goes from the Cowboys at $567 million to the Bucs at $449 million, a range of $118M, or approximately $30M per season in disparity between the highest- and lowest-spending clubs.

Although I have numbers that are slightly different, the point is the same: Spending big and winning big do not correlate. Indeed, having managed player costs at the Packers during that time frame, we were third lowest in the league at $457M – about $114M average per season -- and were an overtime away from the Super Bowl in a year (2007) in which we were the second lowest-spending team in the league.

Cash – not cap -- numbers are the key numbers to focus on with teams and spending. Cap spending is something that teams manage in different ways; it does not reflect how much money teams are actually paying players. One of the biggest misperceptions that fans have about teams’ willingness to spend is that if they have a lot of cap room, they are not spending. That can be very far from the truth. A well-managed cap with plenty of room can coincide with having spent liberally to improve. I know that firsthand.

The lack of correlation between winning and spending is not a novel concept and one that has been proven for years. The proper way to build success in the NFL is to assemble and develop young talent that proves worthy of core contract extensions, ensuring continuity of key players at key positions on the roster. Selective and targeted acquisition of free agents is necessary to complement the existing talent base. However, continued spending on free agents, driving up player costs and pushing out players who have been coached and developed, is not a sound way to put together a team.

A large amount of spending league-wide is done in early March during the opening days of free agency. That’s when teams “make a splash,” when owners acquiesce or even encourage finding that “missing link” that will put the team over the top. It’s a time when contract research is thrown away, as bidding by multiple suitors creates unprecedented levels of pay for top-echelon position players. This year alone, Albert Haynesworth, Bart Scott and Jason Brown set new benchmarks for their respective positions at defensive tackle, linebacker and center.

Free agency can work if there’s a plan and a clear vision for the player. The problem with free agency in football compared to baseball (where players hit, pitch and catch) and basketball (where players’ athleticism creates competitive advantages) is that football requires schemes and interdependency among 11 players on every play. It’s not that easy to put a new piece into the mix as it is with other sports. That’s one reason why results from free agency are sketchy. Usually, teams that make noise in March do not make noise in January.

Free agency is also the price paid for not drafting well. In Green Bay, I remember having to chase and sign Hardy Nickerson because our draft choice slated for middle linebacker, Torrance Marshall, was not working out. I chased and signed Charles Woodson because our two high picks from two previous years, Ahmad Carroll and Joey Thomas, did not pan out. Look at any big free-agent signing and chances are he’s replacing someone the team had high hopes for at some point in the recent past.

As mentioned above, the four-year spread between the highest-spending team, the Cowboys, and the lowest-spending team, the Bucs, is less than $30M a year. In contrast, the New York Yankees are spending more than $200M on their 25 players this season, while the Florida Marlins – playing in the same professional sports league – are spending $36M. That’s a spread of $164M between the highest- and lowest-spending teams in baseball! And, as we all know, money hasn’t bought much for the free-spending Yankees in recent years (although that fact doesn’t seem to stop them).

The baseball situation above is what can happen without a salary cap. While there are year-to-year differences in spending between NFL teams, there is a self-regulating effect of the NFL salary cap that will not allow teams to have top-of-league spending every year (the Redskins have been big spenders in 2005, 2007 and 2009 but have had normal spending in the other years).

Bud Selig – a member of the board of directors of the Packers -- would shake his head when he listened to my cap and cash presentations, knowing that there was no regulatory mechanism like a cap in baseball. Baseball teams have their own “caps” – budgets – but the inequality in spending was and is a problem in baseball. Selig loved the fact that the Tampa Bay Rays were in the World Series last year with a $44M payroll, proving the theme again that sound management rather than money buys championships.

The disparity in spending in baseball can be a cautionary tale for owners and players in football. Without a cap, there is neither a ceiling nor a floor on spending. There could be teams playing the role of the Yankees and Red Sox and teams playing the role of the Marlins and Rays. Time will tell, and that time may be coming.

Cash is king, and the cash numbers are out. What they show are two things: One, for the overriding goal of winning, sometimes you can’t just follow the money. And two, the disparity in spending is a fraction of that of baseball, a potentially ominous statistic as we stare down the barrel of a year without a salary cap in 2010.

Enjoy the holiday. Happy birthday, America!

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