There is no doubt that Phillies, as they stand on July 24, 2014, are an organization in desperate need of change. Over the last 10 years, Philadelphia sports fans have invested a considerable amount of their resources in this baseball team, in capital both emotional and financial, from inflated cable bills to allocated tax dollars to purchased merchandise and tickets.
With 2 months remaining in a third consecutive dreadful season, the Phillies possess the fifth-worst record in the majors, on pace for 69 wins, which would be their worst finish since 2000, 3 years after David Montgomery replaced Bill Giles as team president. They are projected to finish the season with their lowest attendance total since 2003, their final season in Veterans Stadium. This will be the third straight season that they finish without a winning record. With a franchise-record $180 million payroll, the third-highest in baseball, they are one of the most underachieving teams in the history of the sport, and they are facing an immediate future whose level of ugliness threatens to equal the level of glory enjoyed by the recent past.
But to suggest that the failures of the last three seasons are a product of simple human error is to absolve the environment that allowed the human to err. It is like suggesting that the bulk of the Phillies' offensive struggles should be blamed on a first baseman with a .682 OPS and a $25 million annual salary instead of a general manager who decided that it was a good move to sign him to a 5-year, $125 million contract extension 2 years before the expiration date of his existing contract. That is not an argument that the first baseman should remain in the starting lineup. But the logic of our aforementioned chorus suggests that removing the first baseman without removing the person responsible for his presence will merely lead to a future in which the overpaid, underperforming player is not named Ryan Howard. And if that logic is valid, then we must extend it to the person responsible for the presence of the underperforming general manager. Thus, we arrive at the president's office, and the ownership group responsible for Montgomery's presence there.
One of the weaknesses in the arguments put forth by those who desire an immediate dismissal of the general manager is their suggestion that a whole lot has changed since Amaro replaced Pat Gillick in November of 2008. In fact, one of the reasons the Phillies tapped Amaro for the job was their desire to perpetuate the status quo. At the time, such a desire was understandable. The Phillies had just won their first World Series in 28 years. Gillick was hailed as a hero. Amaro was Gillick's right-hand man.
Yet Gillick's expertise always lay in his feel for undiscovered talent. While he deserves all of the respect that he is afforded, we tend to mythologize the man, and ignore the fact that, before Raul Ibanez, Cliff Lee, Roy Halladay, Roy Oswalt, Hunter Pence and, yes, Jonathan Papelbon, there was Adam Eaton, and Freddy Garcia, and Geoff Jenkins. In baseball's most competitive marketplaces, Gillick displayed the same aversion to uncertainty that his successor possesses. The Phillies needed X, and Y was the best available, and so they made their best offer, a practice that would result in the waste of millions of dollars in salary and years of below-market-price production. That should not diminish what Gillick accomplished, particularly with his ability to maximize all 25 roster spots with the likes of Jayson Werth and Greg Dobbs and Chad Durbin and J.C. Romero.
But when Montgomery defended Amaro to the Inquirer last month by saying that the current decision-makers are the same ones who were present when the Phillies won the World Series, he had a point. Gillick and Amaro are still the two most valued voices in baseball operations. Even Ed Wade, the man who built the bulk of the talent base that Gillick would later augment, is back in the fold. Only their titles have changed.
Gillick earned a spot in the Hall of Fame by way of his proficiency for identifying talent, and that proficiency helped the Phillies build a deep roster that allowed role players to blossom into the perfect complements for a once-in-a-generation core drafted by Wade's regime. But the rest of the sport adapted. While the laws of scarcity forced other organizations to innovate ways to improve the efficiency of talent valuation, the Phillies, flush with cash and minor league talent, were able to outspend them. The result was three more division championships, two more league championship berths, and one more World Series appearance.
But a funny thing happened while the Phillies were maintaining the status quo. The business of baseball changed and, just like most companies with significant legacy components, the Phillies needed a leader who possessed a firm understanding of the sport's new economic order. In the new order, the science of decision making and resource allocation is just as important as - if not more than - the art of evaluating physical talent. With longtime baseball men like Montgomery and Gillick and Wade and Amaro and Dallas Green and Charlie Manuel all on the payroll, the Phillies are rich in institutional knowledge, an entity that might soon become a market inefficiency itself given the ironically shortsighted disregard with which many children of the new order treat it. But institutional knowledge is often rich with conventional wisdom, and conventional wisdom is, by definition, static. And if it is not continually checked against the fluid reality of the present, it threatens to mire an organization in the past.
All of this suggests that any real argument for the kind of organizational change that the Phillies need should begin with the man bestowing the titles. Montgomery deserves plenty of credit for the dramatic transformation that occurred on his watch during his first 10 years as club president. The level of respect that Montgomery garners from his employees and from his community is indicative of a man that any organization would be wise to keep as an asset. Baseball the Game, Baseball the Pastime, is one that Montgomery continues to serve well. But the only way for the Phillies to maximize their fan base's enjoyment of those two Baseballs is to master Baseball the Business.
The Phillies now find themselves scrambling to catch up to organizations that have spent much of the last decade improving their technological expertise and infrastructure, building proprietary computer programs that help identify value, and quantify defensive performance, and project the outcome of investments. The Phillies like to boast of a four-person analytics department, but one of those people is a longtime member of the scouting department, and another is a person who inputs play-by-play data and announces line scores during games.
Meanwhile, the Cubs have their own research and development department, led by a director with a Ph.D. in psychology and neuroscience from Princeton whose graduate work, according to the team's media guide, "focused on computational methods and machine learning, which he applied to both baseball and brain science," and who spent 3 years in the financial sector building algorithmic trading strategies. Their director of professional scouting has a business degree from MIT, and their director of baseball operations has an economics degree from UCLA. Assistant general manager Shiraz Rehman, who has an MBA from Columbia, "oversees the development of the club's evaluation technologies, departmental resource allocation, and the club's analytics effort."
The Mets' vice president of player development and amateur scouting has an economics degree from Harvard. The Nationals have an assistant GM who graduated with a double major in mathematics and statistics.
None of that should be interpreted as a slight to the abilities of members of the current regime. But the vast majority of them are cut from the same cloth: longtime baseball men who cut their teeth in boots-on-the-ground scouting rather than economics or computer science or statistical analysis. The evaluation of talent is still an important part of baseball, but just as important is the valuation of that talent, and the projection of how that talent fits with other pieces in an economic framework. In order to maximize its resources, a modern baseball organization needs a firm grasp of probability theory, and game theory, and risk allocation.
In order to obtain those capabilities, the Phillies need a leader who knows what he is looking for. The suggestion here is a dual-president structure like the one the Cubs employ, with Montgomery retaining the title of CEO while hiring a president of baseball operations with a track record in modern organization building, and giving that hire full control to formulate and execute his strategy for returning the Phillies to relevance. If Montgomery is unwilling to do so, then the suggestion here is that the ownership group do it for him.
On Twitter: @ByDavidMurphy