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MIT’s second annual Sports Business Conference, held on February 9, was sold out, and not because Benjamin Watson, the New England Patriots’ tight end, was an attendee–that fact was actually omitted from the event’s press pack. It was sold out because sports analytics is a hot topic in the professional sports industry.

Industry leaders and business students filled the classrooms of the Stata Center last Saturday to hear key figures–including Wyc Grousbeck, owner of the Boston Celtics; Bill Polian, president of the Indianapolis Colts; RC Buford, GM of the San Antonio Spurs; and Bill James, the pioneer of statistical analysis, who’s currently the senior baseball operations advisor for the Boston Red Sox–converse on the future of sports.

Topics ranged from ticket sales to managing salary caps and scouting talent. There were talks on the market value of teams, player trades, and how on-field decisions in football are made.

Grousbeck, the keynote speaker, started his address with an intense, 60-second clip of the Celtics in action. He conceded that, while he had bought the team on 80 percent emotion and 20 percent objective data, the key to being successful is to find a balance between the two. “You should let analytics support and drive your decision making, but do not hide behind it; find a blend,” said Grousbeck. He added that, while he is not a “data junkie” (he hires number crunchers), objective data is a useful tool in decision making, and that the Celtics use analytics “24-7.”

In a panel called “Defending the Title,” Polian, Buford, Jed Hoyer (the assistant GM of the Boston Red Sox), and Brian Burke (the executive vice president and GM of the Anaheim Ducks), along with moderator Peter Gammons, an ESPN analyst and writer, discussed the challenges and benefits of being a defending champion, and how it affects business.

“Football is a systems-driven sport, and the decisions you make on topics on and off the field are critical to success,” said Polian. “The Sox do everything right, from player-fan relationships to ticket sales and trophy presentations; we copy them.”

The Red Sox have been at the forefront of making their organization an innovative business, and not just in their use of statistical analysis to evaluate players that best fit their roster needs: Hoyer said that they take into account such questions as, can a player play in Boston, a big market with a distinct fan culture?

Buford said that it is “eyes, ears, and the numbers” that drive decisions, and if teams don’t try to incorporate the numbers, they will be making a big mistake.

Panels on baseball, basketball, and football analytics were filled with interesting conversations on marketing the teams and making player decisions. One overarching theme in player performance was evident in each panel: more analytical models must be created for things like player character, intelligence, and durability–the likelihood of injury. The use of analytics in football and basketball is still in its infancy, so panelists were reluctant to give any details on their methods. (See “Analytics in Football.”) On the other hand, the baseball panel was full of quantitative talk, mostly led by James.

The conference ended with a discussion on the future of professional sports, moderated by conference cochair Daryl Morey, also the GM of the Houston Rockets. Panelist Rick Carlisle, an ESPN analyst and former NBA player and coach, suggested widening the NBA rim and using a point system for NBA standings to increase the entertainment value of the game. James, also part of the panel, discussed the issue of late-night baseball games but said that he did not have a clear solution to the problem.

At the end of the day, it’s about the money, said Randy Vataha, founder of Game Plan, a consulting and investment-banking service to the sports and entertainment industry. There is competition for people’s time and attention, and it is hard for small market teams to get that, he said. Vataha also said that there should be a salary cap on all professional expenses, including coaches’ and GMs’ salaries.

Carlisle said that football has the best business model on things like salary cap, guaranteeing players contracts and bonuses, and being able to cut players when coaches see fit. Vataha agrees and said that “the NFL is by far the most successful league.”

What initially seemed like an unlikely gathering at MIT turned out to make sense: it’s all about the numbers.

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Tagged: Business, analytics, sports

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