Article: Twins Payroll Really is Resource Allocation

[Doomtints]

The triple constraints are important to understand for any organizational effort. They are:

 

1) Cost - In this case, player salaries

2) Time - The 2019 season

3) Scope - What do they want to accomplish? (This has to be more granular than "win the division")

 

Stakeholders typically pick one constraint as the most important. We know which one that is for the Twins.

 

This is called the triple constraint because changing one will always affect at least one of the others. In the case of the Twins, a cost constraint limits the scope of what they can do.

 

There are still things the Twins can do on the scope side if the cost side sucks, but they have to focus on small things. Improving defense across the board. Improving OPS at certain positions. Higher OBP at three positions, more lefties, whatever.

 

The Twins have to figure out exactly what they want to do, because that time constraint isn't changing. Note that punting on the year doesn't help. The primary constraint for this organization (cost) will still be there next year and the year after. There's no point in punting, they have to be creative to make it work with what they've got.

 

This organization has to focus on small improvements and hope everything aligns the right way at the right time at some point down the road, and yes be very careful with 1-year deals as they will shoot themselves in the foot unless they decide to change that cost constraint. The only issue with long deals is the cost constraint takes them off the table, they're not actually "bad."

 

Give credit to Ryan for understanding this, but keep the demerits by his name for not executing on it. And you didn't REALLY believe it when Pohlad said Ryan was mistaken in this, right?

Edited January 18, 2019 by Doomtints

[saviking]

 

I've read on this site, on multiple occasions, that the Twins ownership/management (one or the other or both) cap expenditures at some percentage of revenue and excess profit is not carried over to next years budget. Correct me I'm wrong, but if true...

 

Setting a target budget based on percentage of revenue is good business. It's the refusal to use the money saved by coming under budget I find infuriating. It's an arbitrary rule that handicaps the team's ability to compete.

 

Normal people don't budget that way. I have no problem financing an expensive vacation next year by staying home this year, or driving an old vehicle a couple extra years in order get a better ride when I finally replace it. I think the fans would be fine with a couple seasons on the low end of the salary range to finance a Machado signing. That, in my opinion, drives all the anger over the Twins budget. It's a one way ratchet that can come in millions low season after season but will never go 1 dollar higher.

 

Given the refusal to carry over money year to year and the taxpayer funding of Target field the Twins, in my opinion, have a moral obligation to spend up to their self-imposed maximum each year. If it costs them an extra $20,000,000 to win an additional home game at least they gave their best shot at entertaining the fans who funded the stadium. And who knows, maybe that extra win puts the team in the playoffs.

 

The argument that there's no use spending the money because the team is not in position to contend is BS. If the ownership doesn't see it that way they can refund the tax money and set the budget as low as they want. Once you take the citizens cash you have an obligation to put the best team you can afford on the field. Forfeiting the season while you pocket an extra 10 or 20 million is no longer an option.

 

My point is, fiscal prudence only makes sense in the long term. If saving money this year does nothing to improve next years team it's just ownership screwing the fans, again.

 

 

 

I also agree with using a percentage of revenue on players but also agree any unspent money should carry over to the next year. The main reason is talent (provided the money is spent wisely) raises revenue which raises the amount of money you can spend on talent .. =SA=

[Mike Sixel]

The core had a great year in 2017. The twins made no long term signings to supplement the core. All those holes exist again this year. Why do people think if the core is great this year, it will be any different?

 

This is who they are. A team that does not spend money over the long term. Mauer was the exception.

[ashbury]

I also agree with using a percentage of revenue on players but also agree any unspent money should carry over to the next year. The main reason is talent (provided the money is spent wisely) raises revenue which raises the amount of money you can spend on talent .. =SA=

Although the team has repeatedly said they don't do this, let's explore the "should" aspect of it. Suppose they aim for $130M a year, but this year end up spending only $100M. Do they add $30M to the pot next year and spend $160M? They acquire a couple of expensive guys, and let's say they do well. What happens after that? Suppose the team as a whole does well with this expensive roster, makes the playoffs and even wins a round in the postseason before bowing out. Now the budget needs to go back down to $130M. Talented guys will be disposed of, in one form or another. What kind of PR will that be?

 

I disagree with any excess money being pocketed, for a variety of reasons, but simply carrying over the money has its problems.

 

I'd personally like to see un-used payroll headroom be applied to different ways of making the team strong, such as acquiring prospects. Unfortunately MLB has successively moved to limit the ability to do that, with hard caps on draft spending and likewise punitive policies on international signings past a certain threshold.

 

It's nice to say money should carry over, but the devil's in the details.

[Dman]

 

IIRC, the Cubs did sign Lester after a 72 win season, although I guess they still had room to spend more later.

I do wonder, though, if these teams were able to do this because their "rebuilds" went so well. If Correa turned out like Buxton, maybe Houston signs a big FA to help things along? Same for Bryant turning out like Sano for the Cubs? (And Cleveland fans might argue that their team hasn't yet spent enough to support the talent they've developed...)

 

Agreed and I am not saying the Twins shouldn't spend up to 130M this year just that I am OK if they don't.  A Machado or Harper Deal Should be good for the team long term as they are young proven star players.  At some point the Twins are going to need to go long term with their best players.  The Question I have for this team is exactly who is that right now?

 

I agree the builds went much better for Houston and the Cubs the Indians seemed to have some stops and starts with theirs as well.  The Twins have room for a big contract but I can see why they might want to wait as well.  If their core doesn't perform I don't think they can buy their way out of that mess.  They will have to wait for the next wave and that is three to four years away IMO.

[mazeville]

 

Your assumption is where this goes wrong at the outset. Team officials have stated on multiple occasions that they do not do their payroll planning this way whatsoever.

 

Link? I have not seen anything that suggests they wouldn't do this. 

 

In any event, if they don't, then as I said that the bottom of the comment that I'll be pretty furious. 

[Tomj14]

 

Are you suggesting that the Twins will look much better supplemented with a proven bat?

If you are, this is exactly what they did this offseason:

 

2018 numbers:

 

Machado: 122 OPS+, .377 wOBA, 141 wRC+
Harper: 133 OPS+, .376 wOBA, 135 wRC+

 

Nelson Cruz: 135 OPS+, .361 wOBA, 134 wRC+

 

Slice it any way you want, and Cruz's bat in 2018 (a down season for him btw) was pretty close to that of Machado and Harper.  The commitment is not, allowing them to spend extra money for other needs (pitching).  Plus his clubhouse influence I suspect will be better than that of a Machado.

I agree.

I like the Cruz signing, but adding another proven bat in their prime for the duration of their "prime" means one less hole to fill for the next X amount of years.

I am not seeing a lot of FA's next year that I like, unless the twins want to pay for Bogaerts or a 31 year Rendon.

[Dman]

 

But we aren't even doing a rebuild, we're just wallowing in mediocrity.

 

Yep I get that and it makes me sad thinking about it.  The thing is if we don't have a group of consistent performers we essentially haven't completed the rebuild.  If we never complete this rebuild then we might have to do it over again.

 

It doesn't mean the Twins can't spend 130M per year I can just see why they might not want to just yet.

[Dman]

 

I agree that the priority should be to extend our core, if they ever show up.  However, we have control on these guys for multiple years. We could easily pick up a couple of players on 2 year deals and not affect that plan.

 

I agree with you they can spend to the limit now. Never hurts to add talent and if you get them on short term deals it won't hurt the long term plan.  All I was trying to point out is they have a strategy that is in line with what made other teams successful and those teams didn't really spend to the upper limit until they had a solid core.  I don't see that the Twins have that just yet so I can see why they might not want to spend to the upper limit just yet.

[ahart10]

If unspent money was going to be spent in later years Twins could sign Machado and Harper for whatever they wanted.

Edited January 18, 2019 by ahart10

[Ebby Calvin Laloosh]

 

It isn’t about dollars, but rather about sense.

 

Great line!

[S.]

 

I agree with you they can spend to the limit now. Never hurts to add talent and if you get them on short term deals it won't hurt the long term plan.  All I was trying to point out is they have a strategy that is in line with what made other teams successful and those teams didn't really spend to the upper limit until they had a solid core.  I don't see that the Twins have that just yet so I can see why they might not want to spend to the upper limit just yet.

The issue is that we don't sign big FAs, we don't trade any of our highly rated prospects for established players, and we haven't been successful developing many of our prospects for ages. It makes it challenging to build a solid core when your team isn't doing any of the things that would lead to said solid core. They seem to be operating under the hope that maybe one year all of our prospects will pan out at the exact same time, and also all of our bargain bin deals will work out that same year too. But with all the short term deals and no real established players, even if your team does decently 1 year (see: 2017), then the next year is just another crapshoot. They can talk about the long term plan, but lets be honest, what is the long term plan? To me, it just seems like hoping and praying and not actually doing any of the work to acquire players that would constitute a solid core.

[twinkiesfan11]

What is so hard to understand? The core sucked ass in 2018 and if they don’t rebound this team is trash and will need to rebuild yet again.

 

2019 is about determining if this core can rebound and lead the team to contention. Falvine has supplemented the core with bounce back candidates and an established veteran bat on short term contracts. If the core and the new acquisitions all perform as hoped this team will win the central and will likely be supplemented at the deadline as needed. In that case 2019-20 would be the off-season to make a big free agent splash.

 

If they all repeat 2018 Falvine has a built-in eject button with short term contracts and trade assets. Given the circumstances this is the ideal plan. They need to give this core another chance, but if it doesn’t work out a full on fire sale and tankathon will be called for. Why give aging free agent relievers multi-year contracts if you’re not a clear contender right now?

[Mike Sixel]

What is so hard to understand? The core sucked ass in 2018 and if they don’t rebound this team is trash and will need to rebuild yet again.

 

2019 is about determining if this core can rebound and lead the team to contention. Falvine has supplemented the core with bounce back candidates and an established veteran bat on short term contracts. If the core and the new acquisitions all perform as hoped this team will win the central and will likely be supplemented at the deadline as needed. In that case 2019-20 would be the off-season to make a big free agent splash.

 

If they all repeat 2018 Falvine has a built-in eject button with short term contracts and trade assets. Given the circumstances this is the ideal plan. They need to give this core another chance, but if it doesn’t work out a full on fire sale and tankathon will be called for. Why give aging free agent relievers multi-year contracts if you’re not a clear contender right now?

That might be true. But, in 2017 the core was good. The Twins did very little in terms of adding to the team long term. They did add some short term deals, but no big names at all. So, I hope you are right, but fear you are not.

[S.]

 

What is so hard to understand? The core sucked ass in 2018 and if they don’t rebound this team is trash and will need to rebuild yet again.

You say "rebuild yet again" but when was the last time we did an actual rebuild? The last decade plus has just been various flavors of, "we're going to be competitive in 2-3 years once our prospects get here" and then 2-3 years later, those prospects don't pan out and we hear the same thing. They never actually rebuild.

[jkcarew]

Funny how the masses don't want to rely solely on drafting and player development to jump-start the franchise...

 

...after the better part of two decades of horrible drafting and player development.

[Vanimal46]

Funny how the masses don't want to rely solely on drafting and player development to jump-start the franchise...

 

...after the better part of two decades of horrible drafting and player development.

There needs to be a balance for sure. TD member gunnarthor took the time to calculate how players were acquired on recent playoff teams, and the Twins. The playoff teams had a pretty even split 33% draft, 33% free agents, 33% IFA/Trades. The Twins rely on draft picks for over 50% of their MLB roster. It's simply not healthy to rely that much on draft and development.

[S.]

 

Funny how the masses don't want to rely solely on drafting and player development to jump-start the franchise...

 

...after the better part of two decades of horrible drafting and player development.

Trust us though, this batch of prospects that are going to be coming up in 2022 are the real deal this time and not like all the other failed prospects of the last 20 years, so start planning the parade!

[ashbury]

Link? I have not seen anything that suggests they wouldn't do this.

You ask a fair question, and a quick bit of web-searching didn't turn up the particular interview I was thinking of. Such articles are sometimes hard to find if you don't remember the exact phrase that would identify it. I was hoping someone else might have spoken up with a link they found, but so far, no luck. Russia, if you are listening, I hope you're able to find the links I am thinking of. Until such a link is found, please amend my previous statement with "I believe" - since I still do.

[twinkiesfan11]

That might be true. But, in 2017 the core was good. The Twins did very little in terms of adding to the team long term. They did add some short term deals, but no big names at all. So, I hope you are right, but fear you are not.

Sano and Buxton are the keys and both have suffered from injuries and regression since 2017. It would be unwise to assume a return to All-Star level performance for either. 2018 was too much of a disaster.

 

I for one am going to cross my fingers that they do, but it doesn’t make any sense to invest heavily in multi year contracts until the core prove themselves.

Edited January 19, 2019 by twinkiesfan11

[John Bonnes]

 

Sano and Buxton are the keys and both have suffered from injuries and regression since 2017. It would be unwise to assume a return to All-Star level performance for either. 2018 was too much of a disaster.

I for one am going to cross my fingers that they do, but it doesn’t make any sense to invest heavily in multi year contracts until the core prove themselves.

 

But of course, they didn't really need to invest heavily in multi-year contracts. They could have added any number of solid relievers or starting pitchers with a one or two-year commitment. 

 

It may be that they tried and failed, similar to a roto owner realizing he has way too much of his budget leftover and very few desirable players left. I don't know if screwing up is better than being cheap, but a sub-$100M payroll is just embarrassing for a team whose core players are not into their arbitration years. 

 

[Mike Sixel]

Sano and Buxton are the keys and both have suffered from injuries and regression since 2017. It would be unwise to assume a return to All-Star level performance for either. 2018 was too much of a disaster.

 

I for one am going to cross my fingers that they do, but it doesn’t make any sense to invest heavily in multi year contracts until the core prove themselves.

My point was, they already proved themselves in 2017. Or do we think they need to be good two years in a row? In which case, they wouldn't try next off season either

[twinkiesfan11]

But of course, they didn't really need to invest heavily in multi-year contracts. They could have added any number of solid relievers or starting pitchers with a one or two-year commitment.

 

It may be that they tried and failed, similar to a roto owner realizing he has way too much of his budget leftover and very few desirable players left. I don't know if screwing up is better than being cheap, but a sub-$100M payroll is just embarrassing for a team whose core players are not into their arbitration years.

They have 4 veteran pitchers, each potentially with some upside left and a slew of young starters worthy of a shot. Corbin wasn’t coming here and no other starters were worth the investment and/or blocking a younger, cheaper option in an evaluation year. Expensive Free Agent Relievers are a bad investment, unless you are a bonafide contender. I for one would rather see them sit back and wait for a Brad Brach type to fall to them on a good deal.

 

I don’t get the obsession with an arbitrary payroll figure. Would you like to see them spend money just to spend it? Again, they need to see what they have. Why waste roster spots on mediocre veterans when you have young players that need to be evaluated?

 

I don’t mean to be argumentative but there seems to be this strange outrage this week out of Twins fans and bloggers over payroll and the timing seems to relate to Ottavino and Allen signing elsewhere. Neither of those two is going to move the needle this year.

Edited January 19, 2019 by twinkiesfan11

[Hosken Bombo Disco]

 

Link? I have not seen anything that suggests they wouldn't do this. 

also, radio  

[twinkiesfan11]

My point was, they already proved themselves in 2017. Or do we think they need to be good two years in a row? In which case, they wouldn't try next off season either

How about one full, healthy, productive season out of either one of them. Neither has accomplished that yet.

[Major League Ready]

 

There needs to be a balance for sure. TD member gunnarthor took the time to calculate how players were acquired on recent playoff teams, and the Twins. The playoff teams had a pretty even split 33% draft, 33% free agents, 33% IFA/Trades. The Twins rely on draft picks for over 50% of their MLB roster. It's simply not healthy to rely that much on draft and development.

 

Is it relevant how the most productive players were acquired vs the lower performers on the roster. What counts is the difference makers right? It would be far more meaningful if the acquisition method for the top 10 most valuable players was measured or all of the players with a given level of WAR.

 

It also makes no sense to lump all trades together. Were they acquired as minor league players or before they were established ML players or were they established ML players. One strategy is the antithesis or the other.   

 

I posted an analysis of the players from the mid market teams who made the playoffs last year. The vast majority of their WAR was from players who were drafted or acquired before becoming established MLB players. 

[Rigby]

 

Funny how the masses don't want to rely solely on drafting and player development to jump-start the franchise...

 

...after the better part of two decades of horrible drafting and player development.

 That's why the FO's first call last week should have been to Brian Bridges and Roy Clark.

[Regular Sized Rudy]

 

They have 4 veteran pitchers, each potentially with some upside left and a slew of young starters worthy of a shot. Corbin wasn’t coming here and no other starters were worth the investment and/or blocking a younger, cheaper option in an evaluation year. Expensive Free Agent Relievers are a bad investment, unless you are a bonafide contender. I for one would rather see them sit back and wait for a Brad Brach type to fall to them on a good deal.

I don’t get the obsession with an arbitrary payroll figure. Would you like to see them spend money just to spend it? Again, they need to see what they have. Why waste roster spots on mediocre veterans when you have young players that need to be evaluated?

I don’t mean to be argumentative but there seems to be this strange outrage this week out of Twins fans and bloggers over payroll and the timing seems to relate to Ottavino and Allen signing elsewhere. Neither of those two is going to move the needle this year.

But.... the thing is, adding an Ottavino-type reliever or two would have moved the needle. Every single one of the middle- to upper-tier relievers that were available this offseason have track records and/or recent performances better than most of the Twins' current relievers. And none of those relievers ended up signing contracts that would prove to be a bad investment for the Twins with the incredibly flexible payroll situation they find themselves in. Obviously, though, there is still some offseason left for them to make some moves.

[ahart10]

Wondering how many teams outside the top 1/3 of payroll have won the WS in recent years. Off the top of my head; Royals, White Sox?, Marlins, Angels? Not many. Payroll isn’t the end all be all money can’t buy happiness, but it sure is a good down payment.

[scottz]

 

....

 

Setting a target budget based on percentage of revenue is good business. It's the refusal to use the money saved by coming under budget I find infuriating. It's an arbitrary rule that handicaps the team's ability to compete. 

 

Normal people don't budget that way.

 

...

 

Not to be argumentative, but most “normal people” in the U.S. carry large amounts of burdensome debt. I’d guess that the Pohlads and others who do not spend beyond their budgets only carry debts that are advantageous to their overall financial picture.