Not all sports businesses are created equal - monetary resources, location, and ownership, among other factors, combine to give some franchises pronounced advantages. But some teams that appear challenged beat the odds and find success. We looked at both the standings and payrolls to find out which teams did the most with the least in the four major U.S. pro sports. Previously, we looked at MLB, where the Rays reigned supreme. Next up: the NHL.
Hockey doesn't have the reputation other sports do for analytics-based, Moneyball-type tactics to succeed with a lower payroll. The analytics movement in hockey isn't as developed as it is in baseball (even proponents disagree among themselves on various issues). Advanced stats don't lend themselves quite as easily to a flowing, inter-connected sport such as hockey. And the NHL salary cap (and salary floor), ensures a more even playing field.
But the movement exists in hockey, and teams all over the NHL are working to exploit every small advantage they can. One of those teams earned our choice as doing the most with the least money in the league.
Over the past five years, the St. Louis Blues have compiled a 208-127-41 record, including three straight playoff appearances, despite payrolls that ranked in the bottom 10 of the NHL. (Note: for the purposes of this article, we analyzed NHL regular-season standings over the past five seasons. Payroll data through the 2011-12 season was culled from USA TODAY, while data from the last two seasons came from capgeek.com.)
How does St. Louis do it? We talked to the team's general manager, Doug Armstrong, to find out. Our Q&A is below.
Q. How do the Blues find an edge with relatively low payrolls?
A. The first thing is your amateur drafting. Lower-payroll teams are usually based off younger players, players still in their entry-level deal, and we have a number of players like that. They'll transition into what we call the bridge contract, or second contract, and I think a mid-market team like St. Louis is very careful on extending players, giving players the longer-term, high-dollar-level contracts with a short history of work.
Now, there's a caveat to that in our system, and that's Alex Pietrangelo, who we did bypass the second contract on and give him that elite dollar status for seven years, but that's the exception to the rule, not the norm.
Q. Can the Blues sustain their payroll of this past season (which was higherthan for the preceding seasons)?
A. I think when you look at the payrolls [from previous seasons], a lot of it is - we use the term "money outside the system." Meaning: in the old [collective bargaining agreement], you had teams that would do contracts with the understanding that the players wouldn't perform the last few years of those deals. [This was perhaps the most infamous of those contracts.]
I think the new CBA is going to really reflect the dollar values of the players' contracts, the cap values are going to reflect the dollar values more than they have in the past. You're not going to have players making $10 million or $11 million with a $5 million or $6 million cap hit.
I think our payroll should continue to stay at its current level. Players are no longer in that entry level [contract], they're entering where you have to pay them more than what you perceive as market value. I would say mid-market teams have less of an ability to get out of a bad contract, as far as absorbing money, because of our market size and our revenue. We have to be diligent in how we spend [relative to] the cap.
Q. How does your front office use analytics-based techniques?
A. We're heavily involved in analytics. When I was managing the Dallas [Stars](Armstrong spent six years as Dallas GM), we were one of the teams that got in on the ground floor [of the analytics movement], and brought that to St. Louis. We believe in analytics as a tool to use to determine someone's value. [But] it's only a tool to be used, not the one solution [for] all people.
Q. What changes might the Blues have to make to get deeper into the playoffs? [They lost in the first round for the second straight season, losing a 2-0 series lead both times]:
A. We've done our mourning period, as they call it, and our focus is now charting our plan moving forward. As you look forward, you always look backward to find trends, and [one] trend is that free agent signings, [which start] July 1, are usually inflationary. And when I look at the ones over the last couple years, they're not having a great effect on the playoffs each year.
So you want to make sure you're doing something that holds value past the initial press conference [to announce] signing the player, that holds value for the term of the contract. I think most would agree that the majority of core players on a team are signed prior to free agency, the players are usually comfortable in the markets they're in - they're going to get paid market value and they're not looking to move. The number of players that get to free agency [who are] at the upper-tier level isn't maybe what it was when we first had free agency. I think both players and the teams realize the grass isn't always greener, and they work to try and keep their core players.
[Also] when you look at the number of trades being made in our league, there's not an abundance of trades made [involving] top-tier players. So you have to get creative to find a way to improve your team via trade - maybe improve by 4 or 5 percent. Our belief in St. Louis is that you get better by 5 and 6 percent at a time, not at 20 percent at a time. Those days I think are gone, where you're going to bring in an impact player who's going to change the fortunes of your franchise. [So] you have to be able to make solid drafts, and you also have to make solid trades.
Q. Can you discuss the difficulties of assembling a team that can make a deep playoff run on a tight budget, and the similarities - or lack thereof - between the Blues' situation an that of the Oakland A's in baseball?
A. I read Moneyball, [but] I think the analytics of baseball - the entire play might last five seconds or less, then you start again. Hockey is not like that, so it's very difficult to build a team with the formula that they used for baseball. Hockey's more free-flowing - analytics have to be used as guidance, but not the final answer.
With regards to the teams you see winning championships: in our sport, they seem to have gone to the valley and ascended to the top. And going to the valley means being able to draft a player like [the Penguins'] Sidney Crosby [first overall pick in 2005] or Evgeni Malkin [second overall pick in 2004], a player like [the Blackhawks'] Patrick Kane [first pick in 2007] or Jonathan Toews [third pick in 2006]. [The Los Angeles Kings have] drafted very high in Drew Doughty [second overall pick in 2008], but I think [Kings GM] Dean Lombardi has done an excellent job - probably the best in the league - of going out and making good player trades. He's done a fabulous job. Peter Chiarelli in Boston, too - they've made great trades.
The teams with top players - when everything else is equal and you have a top-end, skilled player: that might be the guy that puts you over the top. You can win without it, but all things being equal, the Jonathan Toews, the Patrick Kanes score the game-winning goals when [the Blackhawks] win Stanley Cups, because they're the top-end players.