Odds Do Not Favor Getting Anyone Good with #10
I hate to pop the bubble of expectations, but sometimes it's better to pull the bandage off the wound quickly. The odds are not as bad as Grant humorously put it in his post recently on McCovey Chronicles - 95% that the first round pick won't work out - but they are not that good either.
So I will discuss the odds surrounding the 10th pick overall from a number of different angles - 10th itself, Top 10, and picks 6-10, picks 11-20 plus I'll throw in the Giants usual 21-30 range - because factors other than talent, in particular signability but also bonus size, factor into the selection and thus talent sometimes fall later in the first round than it should have had the picks been done strictly on talent and potential. This will give a good range of results to help set expectations on what type of talent is typically available at the 10th pick, with the caveat that many people have said that the amount of talent in this draft is less than the past five drafts. Plus, obviously talent level goes down the further you get into the draft.
First off, for those who never saw my original study, here's some definitions. While I think most of the terms are intuitively understood by baseball fans, I'll give a quick rundown on what I used exactly for the data collection. A star hit over .295 or had an ERA under 3.30 (these were the only two rate stats available from my source for easy data collection, else I would use OPS for the hitters). Think Bonds and Schmidt. A Good player hit from .275 to .295 or had an ERA from 3.30 to 4.25. Think Winn and Morris. I will sometimes refer to the two categories together because with batting average as the criteria, I would bet that there is some Good who should be Stars and some Stars who should be Good, so grouping them together covers that type of error, whichever way it falls.
A useful player was useful enough to play more than 3 seasons worth of games (only other stat available for each player for easy data collection). Think Tucker and Tomko. A Marginal player has played 0.5 to 3 seasons worth of games but is not a star or good player. Think Kurt Ainsworth and Ryan Jensen. The rest has played less than a half season and most will never make the majors. Think Tony Torcato and Erick Threets.
Starting with just the 10th pick, here is the distribution of talent for the years 1986-1998:
- Star 15%; Good 15%; Useful 38%, Marginal 8%, Rest 23%.
A more useful look would be to look at the distribution for the first 10 picks because teams often pass up on a player due to non-talent reasons. So the talent showing up at 10th one year might be not be there another because a player falls down that far but normally would have been drafted early, like Stephen Drew and Jered Weaver. So looking at the talent for those rounds as a whole would be a better representation of the actual talent distribution available at the 10th pick.
In addition, this gives much more data points, with 130 draft picks vs. just the 13 for the 10th pick, which is a small sample, there could be random luckiness affecting just that one pick.
Overall, I htink this would give us a better feel for the talent available to a team like the Giants picking in the 10th spot:
- Star 11.5%, Good 21.5%, Useful 25.5%, Marginal 12.5%, and Rest 29%.
An even better perspective would be to look at the distribution for picks 6-10 and picks 11-20 because the top 5 picks are usually that much better in terms of obtaining Star or Good players, mainly because of the first pick, and sometimes a good player is bypassed by the 10th picker - I threw in later picks so that one can see the steep decline in talent as the draft goes on:
- For the first 5 picks overall: Star 14%, Good 29%, Useful 31%, Marginal 7.5%, Rest 18.5%
- For the 6-10th picks overall: Star 9%, Good 14%, Useful 20%, Marginal 17%, Rest 40%
- For the 11-20th picks overall: Star 6%, Good 10%, Useful 25.5%, Marginal 11.5%, Rest 47%
- For the 21-30th picks overall: Star 1.5%, Good 9%, Useful 21%, Marginal 17.5%, Rest 52.5%
This means that teams picking in the 6-10th picks overall found a Star once every 11 years, a Good player once every 7 years, a useful player once every 5 years, and 57% of the time they got nothing. And the odds drops a lot for the next 10 and the next 10 after that, with a lot less top players and more useful players drafted per draft pick. So it does not look like much talent falls to the picks right after the 10th pick, though I do see a little spike in the 11 and 12 spots, but again the data set for that is small and I would hesitate to say definitively that there were talent that fell that low, though definitely Drew and Weaver did the year they were drafted. I think that this gives the best view for what's available when the Giants pick 10th, as sometimes the 10th pick benefits from talented players being passed on by higher picks and sometimes not.
And as one can plainly see, the odds of picking up a Star or Good player drops significantly as the draft progresses, which is intuitively understandable but this makes it a more tangible how bad the draft gets as the first round gets down to the lower picks. In addition, as a side note, the first pick overall is far better than any other picks, with only 1 player of little value and 12 being either Star, Good, or Useful.
Martin, You Got Sum 'Splaining To Do
Now hopefully I have driven home the point that picking 10th is no sure deal to getting a good player. Around 50-60% of the players generally available at the 10th pick don't amount to anything, or about that of flipping a coin. And around 10% become stars, about 15-20% become good players, with the rest of the 40-50% being useful. But who cares about a useful player when you are picking 10th, you expect more for a 10th pick, a useful player picked 10th is like kissing your sister/brother.
What this all means is that the most likeliest case is that your #10 pick will amount to nothing more than a quickee call up at best, and that only if you are either lucky or good, you will get a good or star player with that pick. For that privilege, you will pay anywhere from $2 to $4 million in bonuses and salary for that contract, with the high end happening if a top talent falls to that spot - Stephen Drew and Jered Weaver both got $4M deals and could have been picked 10th that year plus Luke Hochevar, who could fall to 10th, was asking for $4M and Sabean has gone on record saying that they are going to draft the best available player, signability issues be damned.
That is a key dimension that most analysis of the draft misses when discussing draft picks, the financial aspect of it. People seem to think that there's this bottomless pot of money somewhere that every team can dip into to pick up a player or a draft pick. Sure, there is player value related to each draft pick. But does it make economic sense to make that pick?Decision Making 101
So what IS the cost of obtaining a good or star player. At $3M probable bonus for the 10th pick and about a 25% chance of picking up a Star or a Good player, that means that to get ONE Star or Good player - after all, who's looking to get an average player from the draft - it could take around 4 picks at #10 (that is, 4 years of a season like the 2005 Giants) to get one Star or Good player (and that is only on average, it could take many more just to get that one player from the draft). And that means that on average it costs a team around $12M in bonuses paid for every ONE Star or Good player picked from the #10 draft spot overall. Now depending on how good your drafted players are, that is $12M well spent or a sink hole of sunk costs. What that averages out to is $2M per pre-free agent year for that one Star or Good player.
That sounds like pretty good payoff, whether hitter or pitcher, at today's free agent signings. For example, Lowry signed a 4 year/$9.25M contract covering the rest of his arbitration years. That plus his $0.7M salary for his first two years work out to approximately $10M for his 6 years of pre-free-agency. Plus the $12M or so paid out in bonuses for the players drafted who didn't do well, on average, that works out to $22M for 6 years or about $4M per year average. That is the going price for a useful (i.e. mediocre) starter - that's about what Tomko got as a free agent from LA this past off-season - but the assumption is that you got a good/star player with this pick so you are saving a lot of money with the player.
What About Sabean's Habit of Punting Draft Picks?
Now lets take a look at a pick in the 21-30 overall range (which is just before the Giants 33rd pick). Bonuses there are in the $1.0-1.5M range. And as we saw above, there is a 1.5% chance of getting a Star and a 9% chance of getting a Good player. That's 10.5% chance of getting at least a good player with a pick in the 21-30 range of the first round, which means it takes 9 years of drafting in the 21-30 range, on average, to get a Good or Star player. That works out to about $12M in bonuses paid out to 9 draftees, on average, to get that one Good or Star player. Using my analysis in the last paragraph, that works out to around the same $2M per pre-free agent year for that Star or Good player. Again, that is a good price to pay for a Good or Star player today.
Sabean Not Losing Much
So on average it is good to draft a player in the first round, as there appears to be only be about a $2M per year cost related to each pre-free-agency year you have control over your draft pick once they make the majors plus whatever you are paying your player in the contracts covering his pre-free-agency years. But how does that reconcile with Sabean's strategy of converting 1st (and later) rounds of the draft into a free agent that costs the same as the amount of the bonus the Giants would have payed the players picked?
The key thing that people miss here is the distribution. Look at how much easier it is to find a Good or Star player in the early part of the 1st Round versus the later part of that round. There is an exponential difference in the number of Stars you find (14% vs. 1.5%) and a four-times difference in the number of Star and Good players you find (43% vs. 10.5%). Look at how many players who never make it as a major league regular in the later part of the round: 70% who never amount to anything, 89.5% who are not a Star or Good player.
Basically that means that on average it takes 10 years of drafting in the 21-30 pick range overall to find ONE Star or Good player though there are 2 who are useful. And because you can just buy a useful player off the free agency market for a cheap price, so why pay an unknown prospect the bonus, that means 9 out of every 10 picks can be considered busts. Thus the odds are very much against you finding a Star or Good player with that one pick, 90% of them are never going to become a Star or Good (from this point on, I will refer to this pair as a "good" player; I'm tired of putting both in).
Hence Sabean can forgo a single draft pick with very little consequence, the odds are that 90% of them will not be a good player. And even if he was a good player, it would take him 2-6 years to finally develop and be an MLB regular player. Whereas you can get a useful player for the same cost immediately.
Paying the Piper
However, the Giants cannot continue this practice without severe consequences to their long-term success with their farm system even if they can execute nearly flawlessly their past strategy of identifying players who can become major leaguers in the later rounds more than others. Applying the binomial theorem to it, with 10 picks and 10% chance of success, there is a still a 73% chance that after 3 years of forfeiting a pick in the 21-30 range of the draft - which is what Sabean did from 2003 to 2005 - you end up with nothing. There's about a 24% chance of finding one good player and less than 3% chance you find more.
However, should he continue this practice into future years, there could be serious consequences where Sabean would pay the piper for such a strategy, even if he is successful in finding MLB players later in the draft. At 5 years, there is still a 59% chance of nothing, but 33% chance of 1 good player and slightly over 8% chance of more. At 7 years, it is the tipping point where more than half the time you get more than 1 good player. You don't get a good player almost 48% of the time, but get 1 player 37% of the time, 2 players 12% of the time, and 3 or more about 3% of the time, for a total of 52%. That's a coin flip. And at 10 years, nearly two-thirds of the time you get at least one good player, only 35% of the time do you actually end up with nothing. So should Sabean continue this practice much further than he has, he risks strong odds of losing out on some good players.
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