Nba nerd

Should Success change the Sixer's Plan?

Tanking is not a strategy. Tanking does not have a built-in reward. We've beaten this into the ground, but no one is listening. Over at ESPN, they've written a lot about tanking, and almost all of it is built on the premise that the NBA rewards teams for tanking by giving bad teams high lottery picks. But this is simply not true. The NBA rewards tanking with a 25%-at-best-but-probably-a-lot-lower chance at the number one pick. That reward, frankly, is about as awesome as the goat you get when you pick the wrong door in Let's Make a Deal. It's not a reward. Any management that chases this on its own as the means to "rebuild" is quite simply incompetent.

Today on ESPN's Truehoop, another writer seems to have missed the forest for the trees, when he claims that early success shouldn't change the Sixers' plan:

They’re not even close to contending with contenders. But as currently constructed they’re not finishing at the bottom of the standings, either. Not with Spencer Hawes and Thaddeus Young draining 3-pointers, Evan Turner attacking the rim and rookie point guard Michael Carter-Williams putting up historic numbers. As strange as it seems, this roster might be too good -- and more importantly, too well-coached -- to lose 50-plus games.

Eric Goldwein

Unless the author is trying to be ironic and its flying way over my head, I find this whole article bizarre. This is quite simply ridiculous logic. As I pointed out in my 76ers preview, and as you'll hear in the podcast soon, there is a monumental difference between not caring if you win and trying to lose. Clearly, the Sixers should not hesitate to move Spencer Hawes and maybe Evan Turner if they can get more than those players are worth, even if it means the team gets worse now, because they shouldn't care about winning.

Let me repeat and rephrase that because it feels like no one is paying attention: The goal is not to lose. The goal is to get above fair value because you are WILLING to lose. Frankly, I do not think this distinction is really all that subtle, but some folks seem to gloss over it. I repeat: Losing in itself is not going to help the rebuilding process.

Sixers GM Sam Hinkie is in a great position; if Hawes keeps playing like this, some playoff team that thinks it needs "that one more piece" might offer way too much in future assets for him. If that happens, great! Furthermore, some team might trade the family farm for Evan Turner. If that happens, great! Evans is 25 and although he might become a star, his salary after this year is likely to be fair, and teams like Philly want to be in the business of having unfair contracts (read: rookie contracts and superstars making the max).

But there's no reason for Philly to dump either piece for chump change just to lose lots of games, as this piece implies. Their draft pick is nowhere close to being "their most valuable asset" (frankly, that would be the Pelicans' pick that they acquired). NBA lottery picks are very much like real-world lottery tickets: they are kind of a tax on the poor teams. Poorly managed teams make poor draft picks, and then pay more for them than well-managed teams who get players like Kenneth Faried and Kawhi Leonard on much lower pay scales. You can argue that if the pick isn't top 14, they have to give it to Miami, but that's true in 2015 too. So the plan is to just lose forever to spite Miami? Really?

This brings us to the real reasons that tanking in the NBA is a problem, and it isn't because "the strategy works," no matter what Jared Dudley thinks. Tanking is, as we've discussed, a strategy for idiots. But, as I am sure many employees in Minnesota, Charlotte, and Sacramento can attest, it turns out that there are a lot of idiots working in various NBA management offices. In the real world, this would lead to companies that go bankrupt, like it does in European Football. Due to promotion and relegation, if you are the worst manager in the English Premier League, then it's very likely that you'll find yourself managing in The Football League in the following year. And if you still stink compared to the managers in that league, in another year you'll be a manager in Football League Two; and so on until you're fired. Oh, and along the way, most of your sponsors will abandon you, so all your money will be gone, too.

But in the NBA, if you are the worst-run franchise in the league...well, not much happens. The rest of the owners let you stick around, and you won't lose a lot of money doing so. Exhibit A: the Maloofs, who bought their 53% share of the Kings for $156 million in 1999, ran it about as well as Ken Lay would have for 14 years, then sold it for $287 million (which would have been $331 million if the NBA owners' relocation committee cared more about money than about making it hard to move teams). In other words, one of the worst-run franchises in the league nearly doubled in value over fourteen years. The Maloofs made more money for running their team into the ground than most NBA players get for playing basketball. Needless to say, this is a tad problematic.

And therein lies the issue. The problem with teams that lose on purpose has never been that there is an incentive for losing. The problem is that there is no consequence for management incompetency. You couldn't fix that even by giving the #1 draft pick to the NBA champions.

Good read. As a Sixers fan who frequents both this site and wages of wins, I'm curious as to your first impressions of Michael Carter-Williams who was seen as the Sixers only misstep on draft night over at WOW. What have you seen from him early on? Do you still consider him a likely bust? Great work, guys
First impression based on small sample: HOLY COW we were wrong.

Ask again after 20 games or so :)
I think this post is chalk full of rainbows and bunny rabbits
"Their draft pick is nowhere close to being "their most valuable asset" (frankly, that would be the Pelicans' pick that they acquired)" - You picked the Pelicans to finish 29th.

You do know their draft pick is top 5 protected until 2020 (when, in the unlikely event the Pelicans get a top 5 pick every year, it turns into a second round pick)? Right?

The 2014 Draft looks deep, very deep (how deep depends on who you believe). Obviously Wiggins is the prize, but even if you miss him, those next 3 or 4 picks look like they hold much higher value than in any draft for the past 10 years. I think if you were to offer any team in the game the 3rd pick right now they would bite your hand off (even knowing Wiggins would be gone).

Obviously this is important because all teams want a top 5 pick. Whether they are aiming to deliberately get one or not. The Pelicans pick has 0% chance of landing (the Sixers) one of those coveted top 5 picks, the Sixers' own pick has as much as 25% at landing Wiggins and an almost guaranteed chance of landing a top 5 spot (assuming they finish 30th. Which I agree with your assessment; I don't think they will either). But still, even if they are "just" a lottery team and your prediction of 11th is correct, they still have a shot at a top 5 pick. The Pelicans pick still has 0% chance of being a top 5 pick.

If you were the GM of another team (any team) and you were offered an unprotected Sixers' pick, or a top 5 protected Pelicans' pick, would you pick the Pelicans? I'm assuming not, so the Pelicans' pick isn't the most valuable asset they have!
Again, guys, worst record is worth a guaranteed top-4 pick. That's worth a lot more than just a 25% chance at the top pick.

That said, you guys got the incredibly important distinction between intending to lose and being willing to lose. I've been saying this over at WoW: tanking properly isn't about trying to get rid of everyone productive, it's being willing to get rid of marginally productive guys in exchange for potential future value.

The compensation you get for losing (early picks) is worth more than a decent but expensive player like Thad Young His contract isn't terrible, but he's not going to improve, and since your team isn't yet ready to compete in the playoffs, you'd rather get some future assets (picks, young players, increased chance of high picks) than keep him on the team.

The basic calculation is this: the extra wins (let's say 6) that a player like Young can produce for your team are not worth very much to a team that's going to win 30-odd games. Trading him away, even for less than he's worth to a team 'on average' is still a good proposition, because those 6 wins aren't the difference between a first round sweep and beating 4 playoff teams, so whatever his value is to the average team, he's worth less than that to a non-competitor.

A properly tanking team should seek to rid itself of good peak and post-peak players on fair contracts, and should seek to get back younger assets. The downside risk is minimal, because there's not much difference between being a 35 and a 32 win team (if the parts you get back don't turn out to be as good as the guy you traded). But the upside is that you're spending less money and taking chances on enough young players that you should be able to find a capable replacement.
Pretty sure that Carter-Williams is their top asset at the moment.
Doodoojump, trading thad young for picks is essentially the same thing that was said in the post. He just happens to be their most productive player.
Nick,

I've replaced your comment with some text that makes you seem like less of a jerk.
"Pretty sure that Carter-Williams is their top asset at the moment." - For sure, I doubt they're looking to cash in though :)
I think it is hilarious that any of you think a guaranteed chance at a player that isn't necessarily Andrew Wiggins (and that is only IF you finish with the worst record, not for example, 5th worst) is worth tanking and losing possibly tens of millions in revenue due to attendance + playoff revenue.

Consider that Philly is way under the cap. It's not like they are paying top dollar to make the playoffs.

Adade,

My point is that the Pelicans will probably finish worse than the Sixers.
DooDoo Jump,

Nowhere do I argue that they should keep Young no matter what. I am only arguing that sitting him or replacing him with a bad player to, for example, win 6 fewer games does absolutely zero to further their cause.

Trading good players away for "less than they are worth" is not, by the way, is absolutely not how bad teams go from bad to good. That is a terrible strategy. The point is to get MORE than they are worth because some other team is a) desperate to win or b) desperate to get rid of salary.
Let's MCW is a superstar. That's twice in a row that the Wages of Wins formula has missed out on someone. Drummond being the first. Drummond IS crazy good.
Patrick, players don't have an absolute value league-wide, even if we assume that their production remains the same regardless of the team they play on.

A good player in toward the end of their peak is worth more to a contending team than they are to a lottery team. Now, I thought Thad Young was 29 years old already, so he's not a great example (he's only 25). But Okafor (31), say, isn't worth that much to the Suns right now. As they improve over the next 5 years, he's going to get worse and worse. Which means that even if they'd produce more wins next year with Okafor than with, say, the Mavs' first round pick, he's not worth as much to them now as that pick is, because that pick could turn out to be a capable player who produces 5 years down the line, when the team has a chance to actually compete.

Now, the Mavs might not have a first rounder next year, the salaries don't match, the Mavs aren't really contenders, whatever. The thing I'm trying to get across is just that a good player nearing the end of their productive career is not worth as much to a lottery team as they would be to a contending team, because you need players who fit your timeframe. And therefore, it's worth trading them for a riskier young asset whose expected value isn't as high as the outbound player, but who has a longer productive window. So if you could trade Okafor for an expiring contract and a late first round pick, EVEN IF your expected WP on the pick are lower than Okafor's current production, you should. You get a better chance at high first round picks by weakening your team in the short term, you get back more chances at finding a more productive player who fits your timeframe, and bonus, you save some cash.
bballpants:

I'm not sure we agree on what "in a row" means, unless you think "twice in a row" just means....twice.

Did I miss the part where we said Austin Rivers would suck and that Thomas Robinson was a bust?

By the way, we missed way more than that.
I agree with most of that, DooDoo, but I don't think much of it is in opposition to anything I wrote.

The ESPN piece implies that the Sixers would be better off benching Young, Hawes, and Turner, just to lose; that losing, in a vacuum, is better than winning for their team.

That is pure nonsense.
I don't understand all the negativity. I thought that WOW was wrong about MCW from the beginning (and this is too small a sample to say for sure that they were) but I don't see that as an indictment of the process, or the people who created it. And, again, I am not an impartial observer, but an emotional fan. The logic that created these analytic tools is sound, you have to have respect for the process of refinement and come to it in a positive way. What's the point of being nasty about basketball?
Bballpants,
Curious on even the "miss part". Dave' original work said roughly 40% of pro-performance could be explained by college numbers. Arturo's draft models have about a 40-50% "hit rate"

We accept that being "perfect" in the draft is impossible. Beasley with the #2 pick was a no brainer. Years later it looks silly. Calling us out for "missing" ignores the research that says "Hey, in the best case scenario, we'll do a little worse than a coin flip." Now, give Arturo a team with 3-4 draft picks though...
Wait a sec, didn't you guys create this website to have every prior misstep or little mistake taken out of context and thrown in your face?
Patrick,

I don't think I'm arguing with the piece, but I do think that we'd disagree about what constitutes a fair return for a given player.
Writing about "tanking" writ large is always frustrating, because there's a wide range of practices that could be described as tanking and they vary a lot in terms of their cost (to both a team's bottom line and future performance). Improved lottery position isn't worth nothing; it just isn't worth much, so you shouldn't give up much for it.

But if you're a team that's already organically bad, and you're well into the season and out of the playoff picture, there are low-cost things to do to improve your draft position. If you have a good player who's going to need surgery eventually, send him for it now. If you have an ok player on an expiring contract who's going to be overpriced as a FA, go ahead and cut his minutes or trade him away for whatever he commands as a rental. Give your bench guys and young players some more minutes to see if they can improve or show you something you didn't expect. You'll be worse, and your attendance might dip a little, but it was probably already bad. You won't be an attractive spot for free agents, but that was already true.

It's never a good idea to take on bad non-expiring contracts to tank, or to trade away good players on good contracts. But I'd like someone to explain why it's necessarily bad for a bad team to tinker-tank late in the back half of a losing season.

RutherfordBCray,
I was nodding my head with you comment. At the end of the day it's about generating value. Tanking by clearing assets or taking on bad contracts is not a good idea but the scenarios you describe are valid strategies to help your rebuild.
"The goal is not to lose. The goal is to get above fair value because you are WILLING to lose."

I don't think this is right at all. The goal is to obtain players and other assets that will be valuable to you in X years when you expect to contend. To get such players and assets, you are willing to give up current players who may be currently valuable (that is, help you win games this year) but who are expected to be worth less in X years (either because they will leave as free agents, or their talents will decline due to age, or because they are expected to get cap-killing contracts).

Applying this to the Sixers, they didn't resign Wright and traded away Holiday (2 of their 3 top contributors last year) because they didn't expect those players to be valuable in X years - probably because Wright is now almost 28 and will be in decline in a few years, and because Holiday's contract will be a cap killer in a few years.
The NBA rewards tanking with a 25% chance at the number 1 pick but the value of that pick is actually lower than that. Although he is being insanely hyped, there is no guarantee Wiggins will be much better than Harrison Barnes. So what teams are really doing are tanking for 25% chance to buy a lottery ticket that may or may not cash in a winner.
"Exhibit A: the Maloofs, who bought their 53% share of the Kings for $156 million in 1999, ran it about as well as Ken Lay would have for 14 years, then sold it for $287 million."

To be fair, that's a TERRIBLE return - less than 5% per year CAGR. And we aren't even accounting for inflation, nor are we accounting for any money the Maloofs would have had to put into the team over the years to fund operating losses. If the Maloofs were interesting in making money, they should have just stuck their $156 million in a CD in a bank - it would have been a much better investment.
@Poochman - but there is also value in the #2 pick and the #3 pick.

The general point is that teams that don't expect to contend this year and only expect to begin contending in X years should be willing to trade away players who will be less valuable in X years to obtain assets (draft picks or players) who will be more valuable in X years.
Al_S,

Thanks for the post on the return on investment. I did the same calculation. To be a little more complete the return would have been 4.5% on the sale of $287M or 5.5% if they had been able to sell for $331M not accounting for inflation. I applied the Consumer Price Index to the numbers and got the real return (accounting for inflation) of 2.1% on the sale of $287M or 3.1% if they had been able to sell for $331M. You are correct. This is a poor return. They would have been able to do much better just putting that investment it in AAA Corporate bonds.

However, I think Patrick is going over the top when he said that they made a lot of money for running their team into the ground. The first seven years of the Maloofs' ownership the Kings had a winning record. It has been in the latter half of their tenure that has colored our perceptions of the Kings.

The point of all this is that the Maloofs were poor stewards of their team and they got correspondingly poor returns on their investment, but they did not actually lose money on the purchase because they did have some success. I fail to see any problem here.
Al_S,

bills0 touches on this but here is the thing:

5% is a poor return on an investment, but only because investors expect to AVERAGE a bigger number. They average this number because some investments hit big (you bought MS in 1995 or Google when it went public), and some bust (you bought Krispy Kreme in 2002, and then later it turns out they were fixing their books, and OOOPS there goes all your money), and some just plod along (blue chips, etc).

If I had a portfolio where my worst investment, a firm run by a bunch of incompetents, returned 5%, then I'd be making 50%+ year over year.

In normal markets, businesses run by idiots over 14-year periods tend to have negative returns (or go completely bankrupt). They don't just underperform with 5% returns.
RutherfordBCray,

Re: 'Writing about "tanking" writ large is always frustrating, because there's a wide range of practices that could be described as tanking'

Thanks for bringing this up. It saved me from having to do it.

Patrick's post is largely a straw man argument. He acts as if everyone is talking about the same thing, picks a definition that he wants to argue against, makes his argument, then claims that he has proved that conclusions that he has reached are valid universally.

This is a known problem on the WoW site. They do the same thing for other concepts, such as “competitive balance” as well, such as “competitive balance”, as well.


Note: this is a replacement for my previous comment with the de-scrambler on this time.

RutherfordBCray,

Re: 'Writing about "tanking" writ large is always frustrating, because there's a wide range of practices that could be described as tanking'

Thanks for bringing this up. It saved me from having to do it.

Patrick's post is largely a straw man argument. He acts as if everyone is talking about the same thing, picks a definition that he wants to argue against, makes his argument, then claims that the conclusions he has reached are valid universally.

This is a known problem on the WoW site. They do the same thing for other concepts, such as “competitive balance”.
BTW, I agree with RutherfordBCray and bills0 that the definition of "tanking" that is being employed in this post is not correct - I posted the correct (IMO) definition above, at least insofar as we are discussing it at this point in the season.

As far as I can tell there are exactly ZERO teams that advocate losing "in itself". They all have a plan for improving the team. Plans simply don't always work out.
Although Patrick argues that tanking is not helpful in rebuilding, he alludes to the biggest incentive that small-market teams in particular have to 'tank'. Unfair contracts.

Small markets have lower budget constraints than other teams due to the soft salary cap, and have fewer valence benefits (marketing money in NY or LA) for superstar players. The only way to keep a long-term unfair contract in a small market is to get him there early (preferably by draft) and then hope that his status-quo bias (ie, his preference to stick with the familiar) makes it more costly to move to a larger market than to stay. The new CBA intensified this effect by allowing the team with the Bird Rights to sign their own player for more than another team, giving the player even more incentive to stick with the status quo.

A point that Patrick makes about the draft lottery being a tax on bad franchises is sort of negated by the argument later that the value of a franchise will go up regardless of bad management. In my mind, the draft lottery is a tax on high-risk players entering the draft before they have established NBA skills. The people really hurt are players who have the potential to make a great living playing in the league, but get drafted by a team like Charlotte.

Basically, I think that Philly would be idiotic to still try to tank because they are a solid franchise that can develop players, and its not worth developing a losing culture when they may have some big time players on their roster already. However, I don't think that tanking is the wrong strategy in every case.
The hell is a 'losing culture'? Ain't that what the Cavs had in 2002? The Celts in 2006? The Clippers pre-Blake? The Sonics pre-Durant?

Attitude isn't anything. Some teams are crappy (THE BOBCATS) but they're crappy because their management makes poor decisions almost without exception. Draft the wrong guys, trade the wrong guys, sign the wrong guys, and you wind up terrible. It's not surprising. But getting two really good players can suddenly bump your team up 10-20 wins (Thunder, Timberwolves, Pacers, Warriors, Heat, etc.). Is there a culture of mediocrity that develops when a team is stuck at 40 wins? How about a culture of dominance when you've been contending for titles for 5 years (The 2012-13 Celtics may be instructive here...)?


Each example you've cited gained a franchise changer, which there is hardly ever more than 5 in the league at any one time. I agree that with that kind of addition, losing culture can be overcome, but I totally disagree that 'attitude is nothing'. Clippers still lost until they got CP3.

It's sort of pointless to argue about whether bad franchises make bad draft choices or don't develop them. We will never get to see what would happen if Durant was drafted by Charlotte and MKG was drafted by San Antonio. I personally think that there is evidence to suggest that bad franchises can draft talented players and fail to develop them. It seems like experts have given Sacramento good draft grades because they've drafted guys like Cousins and Tyreke high on draft boards, but then they keep on losing. I'm a believer that those guys would have won games in a better franchise.

Clearly, attitude and culture isn't everything, but I think there is evidence that it makes a difference and therefore, I think it is worth it to avoid developing one.
Did any of you actually read the post I linked to?

Or Arnovitz follow up today?

Those posts are either mind-bogglingly poorly written to obscure their real point, or they are VERY MUCH arguing that losing in and of itself is preferable to winning.
I am more or less with Patrick on this one. It's not a strawman if a ton of NBA writers believe it. There are countless articles premised on the idea that tanking is a big, big problem. But if teams only did the things we all agree make sense - trading peaking assets for future assets, making low-cost/low-risk moves to improve draft position in an already-doomed season - it's hard to see how that kind of panic would be warranted.

The argument you see all the time is that if you aren't "contending" then you ought to tank, because otherwise you'll be on the "treadmill of mediocrity." That's the premise that's wrong and is worth refuting.
"It's not a strawman if a ton of NBA writers believe it."

That's not right at all. All it means if a ton of NBA writers believe it is that there are a ton of NBA writers tilting at windmills. Which is, I think, mostly the case.

The only thing that matters is if TEAMS are actually losing merely for the sake of losing. As opposed to exchanging current assets for future assets.

Patrick,

Re: “In normal markets, businesses run by idiots over 14-year periods tend to have negative returns (or go completely bankrupt). They don't just underperform with 5% returns.”

Surely you see the problem here. You assume that the Maloofs are idiots then see that they make +2.1% real return on their investment and conclude that there is something wrong with the NBA.

Maybe the problem is with your assumption that the Maloofs were idiots. The Kings had a wining record for 7 of 14 years, I don't think it would be hard to find any number of true idiots that could improve on that failure rate, say 10 of 14 years of losing basketball, or even 14 of 14 years.

Their performance was not good but I still do not see that their return is out of line with their performance.

BTW: If you are correct that the Maloofs ran the franchise into the ground then the real idiot is not the Maloofs but the guy who paid them the $287 million for it.
"The argument you see all the time is that if you aren't "contending" then you ought to tank, because otherwise you'll be on the "treadmill of mediocrity." That's the premise that's wrong and is worth refuting."

THIS, THIS, THIS.

The point of my article is that NBA managers ARE NOT INCENTIVIZED TO LOSE ON PURPOSE. They are SOMETIMES incentivized, as Al put it very well, to trade present assets for future assets (I'll probably quote you in a future article, Al, well put). THIS IS NOT THE SAME THING AS LOSING ON PURPOSE. The losing is a symptom/consequence of such trades, but not the goal.

So, frankly, I am sick to ****ing death of NBA mainstream writers claiming that the latter, not the former, is the incentive.
@ all those hyping MCW, Can I just say that Brandon Jennings looked like a God about 10 games into his rookie seasons and people where hyping him over, oh say Steph Curry? How's that worked out :)
Patrick: Thanks for your response to my article on TrueHoop.

I want to clarify a couple things.
2. You say "The ESPN piece implies that the Sixers would be better off benching Young, Hawes, and Turner, just to lose; that losing, in a vacuum, is better than winning for their team."

Perhaps I wasn't clear enough, or you didn't make it to the end of my article. In the piece, I discuss a strategy where the Sixers would sacrifice regular season wins in exchange for ping-pong balls AND assets. The latter is key; nowhere do I say that they should give them up for nothing. In fact, I specifically point that Evan Turner/Spencer Hawes/Thad Young might be sell-high candidates who could bring back value. Particularly Turner and Hawes, whose contracts expire after the season anyways.

What's a better: 32 wins and the 10th most pingpong balls? Or 25 wins, the 3rd most pingpong balls, and one/two low first-round picks? If Turner and Hawes really are irreplaceable - and they're not - they are both likely available to sign in the offseason.

2. You say that tanking is a strategy for idiots. I'm not convinced: http://hoop76.com/wages-wins-tanking/

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