February 25, 2004
Birdhouse Interview Series with Jeff Luhnow
Part One: The Job and Fantasy Baseball
By Brian Walton
In October, Jeff Luhnow, 37, was hired from the business world to fill a new position with the St. Louis Cardinals, entitled Vice President of Baseball Development. At that time and since, no one has known for sure what Luhnow’s (pronounced Lew-no) role would be and how prominent it would become. At the time, the team said, “…Luhnow will oversee the design, development and implementation of systems and tools that will be used in strategy, scouting and player development as a means to aid the team in its evaluation of players at all levels including the Major Leagues, Minor Leagues, amateur and international levels.” (link)
Regular Birdhouse readers are aware that Luhnow recently hired noted sabermetrician Ron Shandler and his firm, Baseball HQ. In Ron’s words, “…Jeff wanted me to help him create an advisory board. This board would be comprised of five or six people, each with a pocket of analytical expertise in a specific discipline. There would be one expert in run creation, another in pitching, another in minor league scouting, another in fielding/defense, and so on…” [more]
Last week, I interviewed Ron Shandler to get his perspective. (link)
Next comes Jeff Luhnow to provide the story straight from its source. In fact, Jeff was so giving of his time that I have broken this interview up into four installments. Check back this week for more words from Jeff centered on the major themes noted below.
Today: The Job and Fantasy Baseball
Part Two: Success, Run like a Business and Relationships
Part Three: Systems and the Advisory Council
Part Four: Player Evaluation
When this series is complete, you should have a lot better idea about how the team off the field has clear plans on how to improve the team on the field in the future. And it’s a lot more than just sabermetrics.
BW: How did it come about that this position was created and you were the one to get the job?
JL: It is a wonderful opportunity for me. I am an outsider from baseball in the traditional sense of the word. I haven’t worked in the industry until last year. Baseball is going through a lot of changes right now, between the new collective bargaining agreement, the changing economics, the changing landscape, higher contracts, etc. I think every team in major league baseball is looking at how to configure their front office to be more effective in the changing environment. Give a lot of credit to the Cardinals. They have been thinking about doing something different for the last couple of years and weren’t really sure what path they were going to take. I had, through my previous experience as an entrepreneur, come in contact with the DeWitt family. So, they knew me through that and I knew they were involved in the Cardinal organization.
BW: Did this develop through Archetype (Luhnow’s previous company), or...?
JL: Through Archetype and as well as in my prior life as a management consultant. I worked for McKinsey and Company out of Chicago. So, I knew some members of the family and we had been keeping in touch over time. And we really started conversations last summer about whether or not it made sense to bring someone from the outside who had more of a business perspective and a technology perspective and more of an analytical view about the game into the Cardinals organization and how we would do it. We toyed around with idea of bringing in someone as an advisor, a consultant, etc. and together sort of realized the best way to do it was to make it a real part of the organization, make it a core competency of the Cardinals. And that is essentially what Bill DeWitt and Walt decided to do by bringing me in.
BW: Are you in this alone or do you have assistance in the organization?
JL: The gentleman you just met works in my group in the Cardinals front office. His name is Mark Johnson. He’s a PhD in applied mathematics from Princeton and mathematics undergrad from Indiana University. He is a big sports fan and worked for Bobby Knight as a team manager, student manager, for the basketball team. He is going to be helping our group build a lot of the analytical tools that we’re going to build to evaluate the players at all levels. That’s a pretty exciting piece.
BW: And the Baseball HQ team?
JL: Adding Ron, Deric (McKamey), John (Burnson) and Doug Dennis to our advisory board is a big step in the right direction because these four gentlemen all have expertise in different areas. Doug’s, in pitching, particularly relief pitching, and you just saw Deric’s expertise on minor league players and Ron has expertise across the board in all the different areas. I think a lot of the work that fantasy baseball enthusiasts and analysts have done in the last 15-20 years, since that really got started, is very relevant to major league baseball. (Note: John Burnson developed the Expected Batting Average gauge, which creates a batting average level based on the component parts of contact, power, speed and line drive propensity.)
BW: You mentioned that you played fantasy baseball yourself. National League or American League or mixed?
JL: I started my National League only in 1987, I think, and then brought in the American League only in about 1993. So, I’ve been doing both of them. That has actually been my #1 way of getting to know about players and so forth.
BW: Did this start with friends or at school?
JL: College. I started with it in college and it just went on. It’s also become a great way to get together every year with old friends who live around the country. Come to one place somewhere and make a weekend of it.
BW: Are you still playing?
JL: No, I gave it up now. Better to stay away from that while working in major league baseball.
BW: How does fantasy baseball relate to your job?
JL: When you’re an owner of a fantasy baseball team, you operate within a certain budget, you have to produce certain outcome and you’re competing against other teams for those players. It’s all about how you evaluate one player versus another and who’s more valuable for your team. In some ways, that is similar to the environment that we operate in. We have budget constraints. Now, granted in rotisserie, everybody has the same dollars to spend and in baseball, that is not the case; not the case at all. (laughs) However, we’ve seen that teams with much more limited budgets still can be successful, and the same thing happens in rotisserie. Some people spend their money wisely and some people don’t.
BW: How is it different?
JL: Defense isn’t a part of rotisserie generally speaking, though that is a huge part of major league baseball performance. We’re not optimizing against five or ten statistics. We’re optimizing against wins and making the playoffs and making money. The formulas are somewhat different but the fundamental philosophies that someone like Ron brings, which is to look behind the numbers; look at the skills indicators as opposed to the results. Those are things that I believe and have believed for a long time. Those are things that the Cardinals are beginning to think more seriously about in terms of how to evaluate players. Clearly there are other teams in major league baseball that have taken steps in that direction. We’re not the first. But it’s time to not only catch up but go beyond. That’s our goal here.
Note: Look for Part Two of this four-part interview tomorrow.