The impact of GM job security on decision-making in the cap carryover era

The job description of an NFL general manager lends itself to contradiction. On one hand, a GM is responsible for keeping both the present and future of the franchise in mind when making decisions. But GM’s know that if they aren’t successful today then they won’t be around for the future.

This past offseason, six teams—the Eagles, Falcons, Bears, Redskins, Dolphins and Jets—either hired a new GM or rearranged front office roles to effectively put a new GM in place. And this wasn’t an anomaly. Of the 30 GM’s who don’t double as team owners (the Jones’ in Dallas and Mike Brown in Cincinnati), only seven have held their position prior to 2010.

There’s no Expected Contract Value—a tool that places a numerical value on a players future job security based on the analysis of past data—for general managers. Still, it’s safe to say decision makers know when their seat is getting warm, and this can lead to a conflict of interests.

This concept of an NFL GM’s entwinement in a catch-22 is not new. However, the analysis involved when making football decisions became more complicated as a result of the 2011 CBA, and this change may be hurting the franchises who employ GM’s on the hot seat.

Prior to 2011, the league operated under a “use it or lose it” set of rules, meaning teams were unable to carryover cap space from year to year. Assuming that the best players cost the most cap dollars, achieving maximum “roster-construction efficiency” in the pre-cap carryover era entailed using as much available cap space as possible from year-to-year. GM’s still had to balance the present and future—prorated contracts and future guarantees still impacted a teams ability to operate in future years the same way it does today. But if a team had extra cap space and could acquire a player without impacting its future, it probably made sense to do so.

Today, teams can carryover cap dollars from one year to the next. Clearly, this should alter the decision-making process of someone who’s supposed to consider both the present and the future impacts of their moves.

For example, look at the trade the Lions made for Haloti Ngata this past offseason. Detroit traded fourth and fifth-round picks to Baltimore in exchange for Ngata and a seventh-round oick. Ngata was set to make an $8.5 million base salary in 2015, will take up $8.5 million of the Lions’ 2015 cap space, and is a free agent after the season.

Before cap carryover was allowed, the Lions front office would have evaluated this trade by comparing how the following would impact their chances of winning in both 2015 and beyond (note that the Lions made this deal about a week into FA, so most difference-making free agents had already signed new deals):

Ngata + 7th round pick

vs.

(3rd round pick) + (4th round pick )+ (Ngata 2015 replacement (and cap costs associated w/ replacement))

The ability to carryover cap $ adds an extra element to the evaluation. Today, the analysis consists of weighing the present and future impact of:

(Ngata) + (7th round pick)

vs.

(3rd round pick) + (4th round pick) + (Ngata replacement (and cap costs associated w/ replacement)) + ($8.5 mil in future cap $ (minus cost of Ngata replacement))

Whether or not for this trade was worth it in both the short and long term requires further analysis (such as looking at Ngata game-tape). But I question whether Lions GM Martin Mayhew was able to objectively analyze the decision. Despite an 11-5 record in 2014, the Lions haven’t won a playoff game in Mayhew’s 6-year tenure. If Detroit regresses in 2015, it’s certainly possible Mayhew gets fired. Ngata probably won’t lead the Lions to a Super Bowl, but he could help Detroit win an extra game and consequently help Mayhew keep his job.

Mayhew is not the only one. There’s Texans general manager Rick Smith, the NFL’s fifth longest tenured GM who is 11-21 in the past two seasons. This past offseason, he signed the aging Vince Wilfork to a free agent deal and then converted JJ Watt’s $10 roster bonus into a prorated signing bonus in order to free up spending money. It’s tough to envision the winner of the Ryan Mallet/Brian Hoyer quarterback battle helping the Texans compete for a title in Andrew Luck’s AFC South, but it’s possible the money Smith spent will help the Texans sneak into the playoffs. And while this might hurt Houston long-term, a 2015 playoff appearance could save Smith’s job.

And then there’s the Giants Jerry Reese, whose been described by Grantland’s Bill Barnwell as having a “propensity for giving replacement-level talent meaningful money” over the past two offseasons. Had Reese’s lone playoff appearance over the last 6 seasons not ended with a parade through Manhattan, he might already be gone. He’s undoubtedly feeling the heat after back-to-back losing seasons, and it’s fair to wonder whether Reese is irrationally spending money as a result of his own job security.

Weighing choices against both the present and the future is an obstacle decision-makers in any business face. But few industries are as cutthroat as the NFL, and this fact may be preventing the NFL franchises from making the right decisions in an era where salary cap dollars can be carried over.

Andrew Cohen
@ajcohen03
ajcohen3@gmail.com
  • Ben Fitzgerald

    The NFL’s approach to firing/hiring is in contradiction with what they want to achieve often (win superbowls). I believe Mat Waldman has written about this a few times in the past.

    • jack_sprat2

      You are laboring under a false premise. Winning is secondary to most (all) NFL owners. What matters is maximizing revenues. (Profit is a given, considering the TV contracts and a favorable cap regime. In any case, franchises are VALUED mostly on their revenue streams.) When seen in that light, it should be apparent that the risk management issue that’s central to ownership’s oversight is the prospective impact of personnel moves on those revenues.

      Variable areas of revenue which are unique to the individual franchises include luxury boxes, seat licenses, stadium signage, stadium naming rights, local radio rights, game tickets, concessions…. The extent to which these may be impacted by additional wins and losses, championships, featured TV game coverage, national press coverage, general notoriety, etc., is franchise specific, in any case, and likely difficult enough to guesstimate that owners, or club presidents, doubtless keep consultants on speed dial.

  • eddiea

    So,basically you’ve got to spend to win,but if you have no chance of winning you’re supposed to save money for the guy replacing you b/c you lost? Yes,that’s a contradiction. Even if i said it wrong. Reese is most likely safe for a couple more yrs,2 SB wins in last 8 yrs will do that. The other GMs well bye bye. That job is why Rolaids,Tums and slka Seltzer were made. Since,you never know if what you did or who you drafted/signed will work out.

    • McGeorge

      >>So,basically you’ve got to spend to win,but if you have no chance of winning you’re supposed to save money for the guy replacing you b/c you lost?

      Yes.

      The GM (CEO) is ‘supposed’ to run the team in it’s best interests, not to save his job. Obviously few GMs will do that. Jerry Reese of the Giants is a good example. The Giants have not drafted well as of late, and Reese threw a bunch of money at players to buy himself more time. It hasn’t helped the teams long term prospects.

      This is where the Owner (Board of Directors) is supposed to step in.
      If a GM is over paying or spending wildly to buy themselves more time the owner needs to evaluate the GMs performance.

      A good owner (most are not) reasons – we are rebuilding and there is no reason to spend $$$ on these guys, lets roll the excess unspent cap money (above the floor) forward in the anticipation (hope) that in a few years we will have some good players to use that money on.

      Maybe not many owners are willing to do that. If you are the GM for an impatient owner you are in a bad situation. Spending to raise your team from 4-12 to 6-10, or 6-10 to 8-8 doesn’t gain you anything. But saving that money so that in 4 years when Russel Wilson wants to get over paid, you have that extra cap money ready.

      “Spend it all now” is the mark of a poor owner and a bad GM, with the exception of a super bowl team that has a good chance of another super bowl.

  • ToreBear

    I see your point about the added value of less future cap in regards to Ngata, but you lack the understanding of where the Lions are talent wise and roster wise. FYI The Ngata deal was made 15 minutes before the start of free agency, not a week later. There was no better DT talent on the market either.

    You should also remember that Mayhew took over a team without much talent, and with a lot of expensive early draft picks weighing down the cap. That, combined with the Ford families patience means Mayhew is not anywhere near being on the hotseat.