110 II. ON-GOING TEAM
OPERATIONS IN TERMS OF PLAYER COMPENSATION
111 A. DIRECTLY RELATED TO PLAYER COMPENSATION
1. Change the traditional model from employer/employee or
management/union to team/senior executives. Any in corporate America
in this rarefied atmosphere are in a different category. Players
need to be placed between the owners/coaches above them and
the various staff and other operational positions, etc., which would be
2. This follows practices common in American business, and is used
as lures by executive recruiters. Its also common practice for the
team of executives to interact, even while maintaining enough separateness
so as to not micro manage.
NOTE: GEs Jack Welchs genius was to turn
his managers loose and leave most of the day to day to them, although
he set policy and met with them regarding strategies, unlike the parallel
roles played by club owners such as Jerry Jones and Daniel Snyder, who
are constantly interfering with their coaches or operations executives.
As the old saying goes, you cant have a business if you dont
run it like a business.
3. If there are multiple owners, they would serve as part
of the Board of Directors, along with others who are not owners (investors,
others appointed by the owners), which would hire a Chairman, CEO, and
COO (one or more of which may or may not be an owner). The team
would be run like a business.
NOTE: This avoids the kind of stalemating that has occurred with
multiple owners, as seen in the case of the Devil Ray owners of MLB.
4. This model is recommended as the best way to maximize profits,
maintain cost containment, and offer the fan an experience that will not
be prohibitive due to cost, which would drive fans to other sports.
5. To get players to agree to this new model, first explain
to them that they need to do more than just work for money; they need
to make their money work for them, and then, secondly, show them how to
make their money work for them by combining the two traditional salary
categories and, then following the patterns of corporate America, add
10 new salary categories, 2 of which are non-tangible, non-material, which
will make their money work for them. This makes a total of 12 categories.
The 12 salary categories are:
Unconditional: to offer players in exchange for the rest of the
package: a graduated scale, with both a specified low and high,
with the eventual amount to be negotiated with each player. Seek
a league wide scale. Pay less than mega amounts current today.
Unconditional: maintain current system with whatever changes are
negotiated. Establish with union a league wide minimum
wage or floor (by all or by position).
Golden Handcuffs (Stay For Minimum Amount Of Years To Vest In Retirement
Conditional: a separate, potential income pool, with contributions
made by team, which could be options in a separate tracking stock or a
bonus or set of bonuses, to be paid at given out years. Forfeited
if voluntarily leaves for another team. Not forfeited if cut or
.Golden Parachutes (1-2 Year Severance Pay If Receive Play
Ending Injury, any time, or Are Cut after four years)
Conditional: a separate income pool, to be received if the player
receives a career ending injury or is let go of by the team. Forfeited
if players leave for another team before four years. For career
end or career ending injury, package includes career transition consulting
and support. This helps to reduce upfront signing bonuses.
Participation In Profit Pool (As Consulting Firm Partners And Law Firm
Conditional: team profits are placed into a separate pool, with
specified percentages for the investors, the owner(s), the coaches, and
the players, with the latter two percentages based on incentive contributions
and years of playing for the team.
Player stock option pool: current discussions in various cities often
overlook one of the easiest ways to finance debt and pay off the stadium:
structure levels of stocks and options that would give to players a piece
of the team later on when such options would be exercised, because with
a new stadium, the team will be worth many millions more, which will happen
regardless of whether the owners wish to sell or not. Adding players
to the financial picture helps both: lower salaries and signing
bonuses, with any difference put into the stadium, which could be publicly
or privately owned and have publicly traded non-voting stock, with the
players getting options which will be worth significantly more later on.
ESOP's: another option is to use Employee Stock Option Plans as
invented by Louis Kelso and used in many corporations. This would
reduce the need for as much up front dollars and provide back end dollars
Conditional: contributions from both players and team, to begin
at dates complimentary to retirement plan law; requires specified time
period to vest (3-5 years); amount is lost if voluntarily leave under
free agency auspices.
Personal Affairs Assistance And/Or Management.
Conditional: financial planning, with bookkeeper to pay bills and
other areas to cover not handled by agent; assistance in planning post-
professional future after playing days.
126 10. Tangible
and Intangible Perks: Special Events For Players And/Or
Families (Spouse And/Or Kids)
Unconditional: intangible includes such events as the
annual cookout during Training Camp; holiday celebrations within two weeks
after the teams last game of the season. A player social
handbook listing all of the organizations that meet player interest,
compiled after surveying team, on their interests, like and dislikes,
and desire parts of their new beginnings, for both married
and single. Provide an environment that emphasizes the positive
side of life and living, love, and relationships. Included in the
intangible is the inclusion of a higher percentage of Black coaches and
Black office/support staff. As reported in USA Today, December 11,
2000, p. 2C, quoting Chris Colinsworth: The fact that you
only have three African-American coaches in the league really shows how
far removed these white owners are from their predominantly African-American
locker rooms. Tangible includes specific
revenue generating projects. One such project could be an exercise
video/DVD, starring players and coaches' wives and daughters, as well
as wives and daughters of key friends of the team. The members of
the family would share in the profits. They could designate a portion
to a favorite charity of the team in the community. We have a complete
program and proposal for doing so as well. A second one is to provide
writers to write the autobiography of any player wishing to have one written.
We can also provide that A third is to provide an identification web site
for the player, on which is the players record, stats, pictures,
etc.,, as well as items for sale, including autobiography and memorabilia,
with links to companies with which the players has endorsements.
Net Intrust can provide that.
127 11. Internal
Unconditional: Provide FYI packets for players: covers
all of the above, which serve to continually recruit the player
for staying with the team as long as the team desires them, to add to
the above to make them feel special, even if the team feels it is in the
teams best interest to trade or release a player.
Special off-season breakfast or lunch or dinner as a team
Regular special C.O.AC.H. inspirational breakfasts (weekly
Pre-season kick-off for players and families
hosted by the owner, plus one at mid-season and post-season.
A luxury box suite for their families at home games (note:
even at Supreme Court sessions, a front row is reserved for the spouses
of the Justices).
128 12. Newsletter
Unconditional: provide comparisons of current or past negative and
positive experiences of players who put themselves up for free agency
(players who wind up earning less), and financial status at careers
end (the number that go bankrupt, and have not prepared for post-playing
days life). Use a calibration showing what has happened to other
players: exposure to not coming back, not getting as much, playing
on a worse team, causing stars and non-stars to earn less, worse environment
for family, and a coach or system that doesnt take advantage of
their skills, etc. Each departed player could be diagramed in that
way. Also: baseball a couple of years ago saw many free agents
drop from significant 7 figures to low and middle 6 figures. Outline
both tangible and intangible reasons for staying. Salaries cant
continue to increase at the front end. The trend will eventually
kill the goose that lays the golden eggs. Players wanting more money
for ego reasons, be it to be highest position player or highest player
of all, poisons the goose, is not in the best interest of the business,
makes for poor entertainment, drops in TV ratings, fans leaving for other
sports, etc. Players as partners would be paid on a partnership
basis: as a percentage of profits, fluctuating with the market based
on their performance which often determines whether fans will buy tickets
or watch on TV.
6. Two old movies give us two famous song questions:
Whats it all about? and Is that all there is?
This Compensation Package Plan helps players transcend the dollars to
find meaning in all of the adulation and attention they will receive in
order to put it in perspective such that it becomes a source of power
to achieve good and not just a distraction nor a road to some kind of
personal destruction. And with the 12 part compensation package,
players and owners can better exercise stewardship of their responsibilities,
the first of which is to the game, and then to their fans, their team,
and then to themselves.
7. Bottom line: its about league/team/individual
survival. The key to survival: the Fan!