Baseball Economics 101: Strategies When Resource Constrained

This post was inspired by my agitation with a caller into KNBR's SportsPhone 68 on Thursday night, May 3rd.  He complained that the Giants philosophy towards hitting must be greatly flawed because it has generated hitters who are greatly flawed - the old bugaboo, being aggressive and swinging at pitches outside the strike zone - and therefore Sabean and Bochy must be fired, either because they hew to such a strategy or that they are so flawed to always find such players.

I find the reasoning that Sabean Naysayers find  to try to justify firing Sabean laughable, mainly because they rarely see the whole and/or the big picture.  It is like the tale of the blind men holding the various parts of an elephant and trying to describe the elephant accurately.  They complain that the mighty elephant is a hoax because all they can feel is the tail, when, if they would bother to examine all the evidence that is currently available - which is easily findable via a more extended search of available evidence - they will find that the elephant is much stronger than the wimpy tail in their hands.  They leave a whole body of research and evidence that would show them the way, if they would only seek it instead of being bullied by the groupthink that pervades most Giants blogs and outposts.  This post is basically contained in my baseball team business plan (link on this page), but addressing specifically this question of why the Giants hitters are so flawed.

Baseball's Resource Scarcity

The MLB biggest resource scarcity is baseball talent, plain and simple.  Secondary to that, but very important too is the revenues available to the franchise to spend to obtain baseball talent.  Given this, it would behoove teams to construct a strategy balancing these scarcities so that they maximize their chances to win the World Series.

Playoffs focus vs. World Series focus

I see the wrong choices made all the time on discussion boards, when it comes to the decision of what is better, to prepare to win it all, i.e. the World Series, or to plan to win to get to the playoffs, because without getting to to the playoffs, you can't win the World Series.  That latter's logic makes perfect sense and yet is the wrong way to see it.

Of course you can't win the World Series without making the playoffs.  But if you don't set up your team to maximize your chances to win the World Series, then you just made the same mistake that Barry Bonds made:  you wished for the wrong thing (upon losing the World Series in 2002, his wife noted that his dream came true, he dreamed of making it to the World Series, and he did).

Current research shows that teams that have great defense - starting pitching, closer, bullpen, and fielding - maximizes their chances of going deep into the playoffs and winning the World Series.  Both Baseball Prospectus and The Hardball Times had research (using different methodologies to tackle the problem) and came to that same conclusion:  strong defense wins in the playoffs, while offense, no matter how good it is, has very little effect in the playoffs.  I've tried explaining that many times but few seem to understand this conundrum that offense don't really matter in the playoffs.

Given this research results, the only strategy that makes sense for a team is to focus most of their resources at obtaining and developing great starting pitching, great closer, good bullpen, and good fielders, while trying to cobble together the offense so that it can score enough to win to make the playoffs.  For, what is the use of making it to the playoffs, if you then have to hope that you luck into winning the World Series.  By focusing on the core competencies of strong pitching, strong closer, and strong fielding, you maximize your chances of winning once you get there.  You just have to trust the process that it will also yield a playoff berth as well.

Resource Constraints and Scarcity

The reason you can't just build strength in all areas is that there are resource constraints and scarcity at play in the MLB.  That includes talent and available payroll.  This is something that affects all teams, though the Yankees and Red Sox generate enough revenues to lessen the constraints, in areas such as free agents, international free agents, and the draft (and probably both L.A. franchises too, with their new or soon to be signed huge TV contracts that sends $150M their way on top of everything else).

A huge area of resource constraint and scarcity is in the area of the amateur draft.  There is very few players who are good enough to be a sure thing, even most #1 picks overall are a crapshoot, let alone the picks a playoff contending team gets in the last third of the first round and thereafter.

The Sabean-Tidrow Giants strategy towards the draft was clearly to find good pitching primarily and position players secondarily.  Modern day business theory says that a business must focus on their core competencies for success in their field while outsourcing other business functions that prove to be what are called hygiene because a business cannot be a success in all areas that it can, it must focus their scarce resources on those functions that bring true competitive advantage.  As I noted briefly above, defensive excellence, as defined by great starting pitching, closing, and fielding, are the functions a team that hopes to win the World Series must focus on.

In addition, my research on PQS in the playoffs showed an overwhelming amount of data in only a few years to convince me that I didn't need to go that far back in time to make the point that pitchers who throw a PQS 4 or 5 game in the playoffs give their team a huge (around 3 to 1) advantage in winning games.  That fits in with the strategy towards building a great rotation that enables maximizing the number of PQS games one can expect to get in the playoffs.  Having a rotation of pitchers who can keep their DOM% high every season ensures that you have a rotation of pitchers who can keep their DOM% high in the playoffs, maximizing your chances to win it all in the playoffs.  It does not ensure it, as the Phillies found out last season, and teams with poor staff PQS do win it all, as the Cards found out last season, but that is due to the randomness of the baseball gods:  generally, if you want to win regularly in the playoffs, you have a staff of high DOM% starters to throw at the other team.

Truth and Consequences

Clearly, the first order of a logically and rationally built team is to build up great pitching - starting, closer, and bullpen - then mix and match to get good fielding as well as good enough hitting, enough to win with your great pitching, while outsourcing (in baseball, signing free agents) to fill in your needs on offense/fielding.     And you cannot always rely on free agency to supply you the good pitching (though you can jump on it when it is available, like the Braves picking up Maddux), so you need to focus on getting it via the draft while cobbling together the offense with draft scraps and free agency.

However, in the draft, there are no easily identified major leaguers, just relative talent.  My research found that teams had roughly a 45% success rate in finding and developing a good major league hitter with a Top 5 overall draft pick.  The success rate falls roughly in half for picks 6-20, and half again by picks 21-30, which are the picks that a playoff contending team normally ends up with.  After that, the success rate fall quickly to 5% and below, meaning that any non-first round pick is pretty much a lottery ticket, sometimes you get lucky and win, but the vast majority of the time, you got a prospect who never even makes the majors for a cup of java.

And it is not like football, where you can identify a need and then pick someone who could be a starter for you immediately.  In baseball, the success rate is much, much lower, and not only that, you must wait at least two years for your best prospects, and often 4-6 years before that prospects becomes a good starting player for you.  So you must have a strategy and plan for your team.

The most logical plan is to use your best chances of success - your first round pick - to build up your pitching staff.  You hopefully find that great starting pitcher, but if not, then maybe he can be your closer.  Or if not that, he can be a good reliever.  This strategy helps in a number of ways in allowing you to flexibly potentially fill a number of positions on your team with that pick.

Therefore, you also focus most of the draft picks that you do have on pitching as well.  Draft picks are a volume business, you have to kiss a lot of frogs before finding the Prince.  So the more pitching you select, the greater the odds that you find the pitching you need.

Meanwhile, you still need to field a team at every minor league level.  And they have to be good enough that your pitchers experience winning in the minors.  So you can't just draft pitchers with every pick.  But you can over emphasize the number of picks that you do devote to pitching.

The consequence of a strategy like the above is two-fold for developing position players.   Talent is already hard enough to find and develop, period.  By focusing your best bullet, your first round pick, on pitching (where success is exponentially better), that means that you are really not picking up the best of talent on the hitting side, even if you devote a good number of following picks on hitting.  Secondly, and on top of that, by over emphasizing the pitching overall in the draft, that means you have a smaller core set of hitters to promote and develop, and clearly a less talented set.

Thus, a team following such a strategy will eventually build up a great rotation and bullpen, and hopefully closer among the bunch, but end up with a lineup of farm hands who mostly are a band of misfits and not so great hitters, who have a lot of flaws, particularly swinging and missing at bad pitches.

Giants Following Logical Strategy Plan for Baseball Franchise Success

The Giants followed the above plan.  And people seem to misunderstand me, thinking that I love Sabean, and thus love what he does.  I started out much like many other Giants fans:  he's a good trader, but leaves a lot to be desired in the draft and free agency.  Over time, however, I realized as I picked up bits of baseball truisms and facts, and did further research, that the strategy that Sabean and the Giants have followed was a logical and optimal strategy to follow given the business conditions that exist in MLB baseball.

So the Giants don't have hitters who don't know how to hit just because they have a systematic problem understanding how to find good hitters - though clearly John Barr does know how to find them better - but mainly because of a number of factors and strategies that they followed.  First of all, until John Barr arrived, the Giants mostly spent their first round picks - yes, Shankbone, when they had them :^) - on pitching.  That automatically reduces the amount and quality of talent that the Giants had in hitters.  Second of all, they had and continue to have a lot more picks devoted to pitchers - pitchers make up less than half the 25-man roster, yet more than 50% of their picks overall are spent on pitchers.  That further reduced the amount and quality of talent that the Giants had in hitters.

Third of all, despite what a lot of Giants fans think, the Giants do care about walks and not striking out.  Don't blame the Giants if the hitters they got are not talented enough to get walks and not strike out too much, blame it on the strategy that yielded Lincecum, Cain, Bumgarner, Wilson, Romo, Hembree, Vogelsong.  And among free agent signings, if you want high OBP and good hitters, that will cost you.  If you are running with a lower payoff due to dead weight in the payroll (which began with Benard, then Nen was a huge black hole that probably cost us re-signing Kent, then various signings after that), you end up with the bottom of the barrel in free agent signings, and unless you are signing superstars, the hitters will be flawed, WILL be.

If the Giants did not care about taking walks and avoiding strikeouts, as an overall organizational philosophy, then why did Bowker and Schierholtz improve both ratios as they worked their way up the farm system?  If that was the philosophy, then both players would not have bothered to try to improve both, they would have just continued to swing at bad pitches and be aggressive, as per the rantings of the radio call-in commenter.

In addition, the Giants management would not openly say in interviews that OBP is good (which I've heard plenty of times, whether in lineup construction, free agent signings, or just in general), they would be just saying the aggressive hitters stuff that is currently cheesing off the #FreeBelt crowd (which is being incited by one media member, which I find deplorable, playing up to the angry mob, that just reminds me of the worse evening hosts of SportsPhone 68, pandering to the audience).

The problem is that a lot of people don't understand that just because a hitter can take a walk does not mean that he's a good hitter.  These saber wannabes just automatically think that a walk is automatically good.  However, it might also mean that he's letting good pitches go by that he could mash a long way - extra bases, maybe a homer - if he would only be aggressive and swing at the good pitches early in the count, instead of falling behind and getting slop or heat thrown at you, ending with a strikeout or poorly hit ball.  And a high strikeout rate could be a sign of that.

Contrary to Saber Opinion, Teddyball Not Promoter of Walks

Contrary to sabermetric opinion, Ted Williams was not focused on walks and OBP as a hitter, though clearly he got a LOT of them.  He is first and foremost a hitter, and an aggressive one at that.  His philosophy was to go for the homer, insisting on an upper-cut swing path in order to maximize your chances of hitting a home run or at least getting an extra-base hit.  If more people would only read his book, "Science of Hitting", it would greatly improve the dialogue of conversations at baseball cyber watering holes.

They just assume that, because he had high OBP all through his career, he was a OBP hitter.  That high OBP was a consequence of his hitting philosophy:  don't swing at balls, heck, even don't swing at strikes where you can't do much with it.  He would love the heat maps that can be generated today, as it would guide him as to where in the strike zone he should swing and where he should avoid, based on the hot and cold.  The walks was a consequence of him maximizing his chances of 1) getting a hit and 2) more importantly, getting a home run or secondarily an extra-base hit that can drive in a run.  He was all about scoring runs.

He would take strikes as long as it was not in the part of the strike zone where he felt he hit the best, though obviously, the count will affect that strategy when you get to two strikes.  He routinely took strikes in his first PA in order to see more of the pitcher's pitches, to see what he's got working and what is not working, and for timing.  He was about getting a pitch that he can hit for a long way, preferably outta here.

Because that is the way you score runs.  Sure, getting on base is important too - he did, after all, get a lot of walks to go with his hits - but he realized that getting hits is how a team scores more efficiently and effectively.  If all a team did was walk, it would take 3-4 walks just to score a run.  Whereas he could generate a run with a swing of his bat.

Aggressive Can Mean Different Things, Depending on the Prospect

So when you hear that a batter is being told to be more aggressive, it is because their team thinks that he's letting pitches go by that he by rights should be mashing into McCovey Cove.  Taking balls to get walks is fine is you have a great eye at the plate, but if you are still striking out a lot even while walking a lot, that suggests that perhaps the hitter isn't good so much at getting walks as just taking pitches in hopes of getting walks.  When a hitter is passive like that, he will let a lot of balls go by, but he's also letting pitches go by that he could be mashing (as evidenced by the high strikeout rate; and even then, the coaches need to qualitatively see that he indeed is a good hitter when the pitch is in the strike zone, and not going to pop up the pitch even if the ball is in the hitter's wheelhouse).

It is like all the research on training kids and dogs:  if you reward bad behavior, they will continue to do it.  You reward good behavior only, you deny them stuff (like a spot in the lineup) if they do bad behavior.  If Belt is truly not being aggressive enough, if he does have the ability to do more with strikes than he has been doing (it is one thing if he is doing all these bad habits but still hitting like Sandoval; another if he is doing all these bad habits and hitting like Bocock while striking out a lot), it would behoove the Giants not to reward his bad behavior by putting him in the lineup full-time, as the #FreeBelt crowd thinks.

Let's take, for example, Belt's recent hits that did not end up with him getting the start the following day.  I think we can all agree that a hitter can get a hit even though he's not doing what he is suppose to be doing at the plate.  Luck does happen with balls in play.  Perhaps the Giants did not think that he followed good behavior and batting mechanics in getting those hits.  Rewarding him because he got lucky would not do him good, if they are trying to modify his behavior.

It is like they are trying to tame a wild horse.  If Belt continues to ignore advice - Baggs recently noted that Belt has been told to stand further back in the box, as well as other things, to improve his hitting but have not been doing them - then it would be folly to reward him by making him a starter, damn the consequences, he'll get better if they just put him in the lineup and make him all touchy-feely all inside.

Fans seem to forget that they swing wildly in emotions about a player.  Randy Winn was a great example, fans loves him when he first joined the team and hit like Bonds, then hated him when he signed the big contract and then scuffled the following year due to an early season injury, then loved him again as he returned to career norms, before hating him again once he finally hit his career's last decline.  The #FreeBelt movement will change to the #BeltBelt movement if he gets his chance to start and he don't deliver, and why, maybe because he still has his bad habits that got rewarded by starting.

I think that would be wrong too.  He clearly has talent to hit, and to hit for a LOT of power.  It is a matter of developing him to get that out of him.  So far, he's only showing it in the majors sporadically.  And really, also in AAA as well, as seen by his poor contact rate there.   I am relying on the Giants to do the right thing. They should be the experts, plus they are in there, able to judge what Belt is feeling, hear what Belt is saying.   Not that they couldn't make mistakes.  But what I've seen and heard so far does not suggest yet that mistakes are happening.

Change Can Come Slowly and Fitfully, Past Behavior is no Guarantee of Future Behavior

He's resisting the changes that the team suggests would fix his problems at the plate.  His lack of success in the majors plus inability to avoid strikeouts in AAA should be telling him to follow their instructions, yet, as the saying goes, you can lead the horse to water, but you can't make him drink.

Some say that it does not make sense that he's not changing now since he changed before.  Circumstances have changed greatly however.  Before, he had no success, he was termed an overdraft by some.  He perhaps felt the need to change.

However, once he had success, maybe he thinks those wax wings will let him fly in the majors and he's not changing one bit what made him a top prospect, forgetting, perhaps, that it was the Giants who guided him there in the first place.  So it is natural for him to resist, this is what made him a top prospect, why would he want to change that as easily?

Unfortunately, though, no hitter suddenly figures it all out and now knows everything there is to successfully hitting in the majors.  There are adjustments that need to be made along the way to reach success.  And sometimes, what made you successful in AA makes you vulnerable in the majors, because in the majors, you don't get the mistakes that you see so often in AA that you can mash.  The pitchers are much much better.  The hole in your swing that maybe only 20% of the pitchers in AA could exploit could now be exploited by 80% of the pitchers in the majors.

But if we can agree that I'm only guessing here, then we can also agree that the #FreeBelt'ers are also guessing as well.  At least I've provided a logical framework for what the Giants may be doing.  The #FreeBelt's stance has basically been this:  I know he's a good hitter, he'll hit once he gets put in the starting lineup under no pressure to perform.

That's not true.  Hitters don't always adjust, some never figure it out.  Baseball history is littered with top prospect hitters given the chance and yet could not seal the deal.  Or they could take years to figure it out, like Weiters.

And what if the Giants are right?  What if he needs to make these changes in order to be successful?  We sure as heck know right now that whatever he has been doing has not been successful, unless you were expecting 700's OPS from him with low ISO.  So that suggests to me that maybe the Giants know what they are talking about.  At minimum, they knew what they were talking about when he got him to make the changes to get to where he is today, a top prospect.  Maybe they know what is best for him now.