Administrative · Contracts · Oklahoma City Thunder · Uncategorized

Outperforming Contracts: An Oklahoma City Thunder Case Study (Part 2)

Fellow Baseline Jammers, you were very missed!

The previous post examined how much an organization expends to generate a single win share from a specified individual player. However, this data is slightly meaningless without a benchmark to compare to. In this post, we will compare each player of the Thunder’s starting lineup with other starting players in those respective positions. Before we do so, I had inquiries regarding potential flaws in this methodology of evaluating contracts, so I want to outline some of this methodology’s shortcomings:

  1. Intangible benefits of a contract aren’t taken into consideration. For instance, let’s examine Carmelo Anthony. Carmelo has a decent fan-base. In today’s era, a large portion of the NBA fans follow players rather than teams. Thus, even though his contract (and the amount the organization expended for him to generate a win share) was relatively huge, this method doesn’t take into account how much TV viewership revenues; converted Thunder fans; jersey sales; etc that Carmelo was responsible for. More so, locker room chemistry isn’t captured.
  2. Rookie contracts and vet minimum contracts aren’t taken into consideration. Quite often, they’re the cheapest contracts an organization can afford. For instance, Ben Simmons was on a rookie contract but still generated roughly 9-10 win shares, similar to Russell Westbrook, who is on a max-contract.
  3. When looking at traded players, we are examining the total win shares that the player generated the whole season for both teams. For example, Blake Griffin played 33 games for the Clippers and generated 3 win shares while he played 25 games for the Pistons and generated 1.9 win shares. The total amount he’s attributed with for the season is 4.9 win shares. It helps that the contract value is carried with Blake Griffin from Clippers to Pistons but the shortcoming occurs when there are two separate contract values. For instance, Marco Bellinelli was paid by the Hawks for nearly $6 million dollars, then was bought out and signed by the 76ers for roughly $700,000. To reconcile the two contract values, I took a weighted average, but I’m not so comfortable with utilizing a weighted average.
  4. I examined starting lineups because that’s typically where an organization invests much of their salary cap into. However, a more accurate assessment is examining the whole 13-man rotation.
  5. A more thorough analysis would have been capturing all the starters; instead I chose 10-12 comparable starters.
  6. Finally, I decided to not look at extrapolated win share values as I did in part 1. Unfortunately, injuries occur and an organization has to take that into consideration when offering a contract. It may be difficult to forecast injuries, but it’s a critical component that we can’t turn a blind eye to. If this was a manufacturing company, a company’s output can be severely diminished by equipment breaking down and a profitability analysis would obviously include that. You want your assets to be fully operational. Thus, we did consider Andre Roberson’s actual win shares instead of his extrapolated win shares.

That said, lets delve into comparisons.

Comparison basis:

  1. Russell Westbrook: I compared Russell’s contract to the top 10 PGs in regards to generating win shares (excluding rookies) for the 2017-2018 season:

Russell Westbrook v Top Win Share PGs

(Excluding Rookie Contracts i.e. Ben Simmons)

Russell Westbrook

$28,530,608 10.1 $2,824,813

Damian Lillard

$26,153,057 12.6

$2,075,639

Chris Paul

$24,599,495 10.2

$2,411,715

Kyle Lowry

$28,703,704 10.2

$2,814,089

Stephen Curry

$34,682,550 9.1

$3,811,269

Kyrie Irving

$18,868,625 8.9 $2,120,070

Kemba Walker

$12,000,000 8.9 $1,411,765

Darren Collison

$10,000,000 7.6

$1,315,789

Spencer Dinwiddie $1,524,305 5.7

$267,422

Eric Bledsoe $14,500,000 5.6

$2,589,286

Average

$2,090,783

Average

(Excluding Dinwiddie)

$2,318,703

Profit Gain/Loss $ (734,030) Profit Gain/Loss

$ (506,110)

Compared to the average amount that an organization paid to generate one win share among its point guards, the Thunder front-office paid $734,030 MORE to generate one win share.

2. Andre Roberson: I compared Andre Roberson to 11 other starting shooting guards of his caliber. It was difficult to choose those comparisons: Roberson is obviously an elite perimeter defender but a far below average offensive player. Thus, comparing him to a Klay Thompson or a James Harden, didn’t make sense. I’d say from this list, Roberson is more in the Kent Bazemore or Danny Green camp (probably better defensively than the two but can’t shoot as well as the two).

Andre Roberson v Similar-Caliber, Starting SGs Win Share

(Excluding Rookie Contracts i.e. Donovan Mitchell)

Andre Roberson

$9,259,259 2.2

$4,208,754

Evan Fournier

$17,000,000 3.3

$5,151,515

JJ Redick

$23,000,000 6.6

$3,484,848

Danny Green

$10,000,000 2.9

$3,448,276

Kentavious Caldwell Pope

$17,745,894 5.3

$3,348,282

Kent Bazemore

$16,910,113 2.2

$7,686,415

Wesley Matthews

$17,884,176 2.6

$6,878,529

E’Twaun Moore

$8,445,024 4.4

$1,919,324

J.R. Smith

$13,760,000 1.4

$9,828,571

Reggie Bullock

$2,500,000 4.2

$595,238

Courtney Lee

$11,747,890 3.9

$3,012,279

Tony Snell $9,821,429 2.4

$4,495,049

Average

$4,495,049
Profit Gain/Loss

$286,295

Compared to average amount that an organization paid to generate one win share among its shooting guards, the Thunder front-office paid $286,295 LESS to generate one win share. This was very surprising, considering Roberson played less than half of a season. This is also is a good indication that the league is probably overpaying its shooting guards. For example, Allen Crabbe’s contract is roughly $23 mil/year. Of course he benefitted from when the salary cap spiked a few years ago combined with NBA Front Office personnel believing the trend to continue moving forward, but still SGs as such are vastly overpaid.

3. Paul George: Similar to Russell, I compared Paul George to the top 10 starting SFs in regards to generating win shares for the 2017-2018 season. Once again, rookies like Jayson Tatum were ignored.

Paul George v Top Win Share SFs

(Excluding Rookie Contracts i.e. Jayson Tatum)

Paul George

$19,508,958 8.9 $2,192,018
Lebron James $33,285,709 14

$2,377,551

Giannis Antetokounmpo

$22,471,910 11.9

$1,888,396

Kevin Durant

$25,000,000 10.4

$2,403,846

Jimmy Butler

$19,301,070 8.9

$2,168,660

Otto Porter

$24,773,250 8.1

$3,058,426

Joe Ingles

$14,136,364 7.6

$1,860,048

Khris Middleton

$14,100,000 6.9

$2,043,478

Robert Covington

$16,698,103 6.1

$2,737,394

Bojan Bogdanovic

$10,500,000 5.4

$1,944,444

Average

$2,275,805
Profit Gain/Loss

$ 83,787

Compared to the average amount that an organization paid to generate one win share among its small forwards, the Thunder front-office paid $83,787 LESS to generate one win share. I think one of the interesting things to keep an eye on going forward is that Paul’s contract starting next year has a massive spike (roughly $30 mil/year). He’s going to have to generate a few more win shares than he currently is to justify such a contract. Once again, this is strictly speaking from a productivity standpoint. There’s no doubt that the Thunder should have offered him such a contract to get a second star in OKC, but Paul is going to have to step it up a notch.

4. Carmelo Anthony: “Hey P, they said I have to come off the bench.” It’s tough comparing Carmelo Anthony to starting PFs because it’s not his natural position (in my opinion, but open for debate). In picking comparable players, I picked smaller PFs (because he’s more of a SF, who played a stretch-4 role last year). Thus, I didn’t look at Anthony Davis, Lamarcus Aldridge, etc (who have the capability to stretch but also have a more conventional big-man post game).

Furthermore, the natural joke here is that Carmelo scoffed at the idea of Patrick Patterson starting. I decided to include in the analysis a scenario of Patrick starting and playing roughly 27 MPG. I calculated an extrapolated win share value to see how productive Patterson could have been. I also decided to do the same with Jerami Grant. With Grant, I decided to allocate 22 MPG because that’s how many minutes he was getting near the end of the Jazz playoff series (when Donovan finally realized that Grant was more productive in that series than Carmelo). I looked at Grant’s 2017 contract value and then I looked at Grant’s recent 2018 contract signing. In all scenarios, the numbers looked far more favorable. So, in forecasting next season, the starting lineup may look more cost-efficient, ceteris peribus (all other things being equal or identical to status quo).

Carmelo Anthony v Similar-Caliber, Starting PFs Win Share

(Excluding Rookie Contracts)

Carmelo Anthony

$26,243,760 3.7

$7,092,908

Marvin Williams

$13,168,750 5 $2,633,750
Kevin Love $22,642,350 6.4

$3,537,867

Dirk Nowitzki

$5,000,000 4.8 $1,041,667
Blake Griffin $29,727,900 4.9

$6,066,918

Draymond Green

$16,400,000 6.1 $2,688,525
PJ Tucker $7,590,035 3.9

$1,946,163

Thaddeus Young

$14,796,348 5.5 $2,690,245

Tobias Harris

$16,000,000 6.7

$2,388,059

Kelly Olynyk $10,607,169 5.5

$1,928,576

Al-Farouq Aminu

$7,319,035 4.2 $1,742,627
Serge Ibaka $20,061,729 5.1

$3,933,672

Average $2,781,643
Profit Gain/Loss

$4,311,265

Patrick Patterson

Assuming a starting role with 27 MPG (Melo had 32.1 MPG), then win shares extrapolated would equal 4.5

$1,633,034

Jerami Grant

Assuming a starting role with 22 MPG, then win shares extrapolated would equal 5.8.

[2017 salary]

$2,518,832

Assuming Grant starts next year with recent contract signing and similar win share extrapolation

[2018 salary]

$1,289,746

Compared to the average amount an organization expended to generate a win share, the Thunder Front office spent a whopping $4,311,265 MORE for Carmelo. As mentioned, the numbers look far more favorable for Patterson or Grant starting. For example, assuming the benchmark average is the same, and Grant has a similar productive year as this year, the Thunder would be spending $1,289,746 LESS compared to the benchmark average to generate a win share.

5. Steven Adams: Similar to Russ and PG-13, Steven was compared to the top 10 starting centers in regard to win shares. Clint Capela was excluded due to the fact that he was on a rookie contract, along with Joel Embiid.

Steven Adams v Top Win Share Cs

(Excluding Rookie Contracts i.e. Joel Embiid & Clint Capela)

Steven Adams

$22,471,910 9.7

$2,316,692

Andre Drummond

$23,775,506 10.3

$2,308,302

DeAndre Jordan

$22,642,350 9.4

$2,408,761

Rudy Gobert

$21,974,719 8.1

$2,712,928

Al Horford

$27,734,405 7.8

$3,555,693

Enes Kanter

$20,566,802 7.6

$2,706,158

Jonas Valanciunas

$15,460,675 7.6

$2,034,299

Dwight Howard

$23,500,000 6.8

$3,455,882

Hassan Whiteside

$23,775,506 5.3

$4,485,945

Marcin Gortat

$12,782,609 4.9

$2,608,696

Average

$2,919,629

Profit Gain/Loss

$ 602,938

A far more than welcoming sight for OKC Thunder fans. Even with a contract extension, Steven outperformed other centers, so the Thunder organization paid $602,938 LESS to generate a win share compared to the benchmark league centers.

Now, let’s examine a “profitability analysis” based on each player’s benchmark comparison. In other words, how much did the Thunder overpay/underpay for their starting lineup in 2017?

Oklahoma City Thunder Starting 5 vs Select Other Starters

Russell Westbrook

$ (734,030)

Andre Roberson

$ 286,295

Paul George

$ 83,787

Carmelo Anthony

$ (4,311,265)

Steven Adams

$ 602,938

Total (Gain/Loss)

$ (4,072,275)

Unfortunately, the Thunder Front Office spent $4,072,275 MORE than they should have for the 2017-2018 starting lineup. A bulky amount of that is from Carmelo Anthony–hence you can see the offseason necessity to unload his contract via trade. Keep in mind though, that this methodology doesn’t cover intangible benefits. Bringing Carmelo on-board was a long-term strategy–it was to show Russell Westbrook and Paul George that the Front Office is willing to do what it takes to win. The front-office sacrificed short-term “profits” for a long term investment strategy–Paul George and Russell re-signed to have at least 3 years together.

Just for fun, this is what the profit analysis would have looked like if Patrick Patterson or Jerami Grant started last year.

Oklahoma City Thunder Starting 5 vs Select Other Starters

(If Patterson started)

Russell Westbrook

$ (734,030)

Andre Roberson

$ 286,295

Paul George

$ 83,787

Patrick Patterson

$ 1,633,034

Steven Adams

$ 602,938

Total (Gain/Loss)

$ 1,872,024

Oklahoma City Thunder Starting 5 vs Select Other Starters

(If Grant started w/2017 contract)

Russell Westbrook

$ (734,030)

Andre Roberson

$ 286,295

Paul George

$ 83,787

Jerami Grant

$ 2,518,832

Steven Adams

$ 602,938

Total (Gain/Loss)

$ 2,757,822

This analysis began with assessing the effectiveness of the Thunder’s front-office. 2017 was a rough year compared to the benchmark starters: there were far cheaper alternatives but those alternatives carried large uncertainties/risks regarding whether Paul George would have re-signed. Now that Paul George has re-signed, this analysis needs to be done for the next three years to determine if that initial investment of $4,072,275 was worth it. I, for one, am excited to keep track!

Thanks for reading this two-part series!

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