Predicting Rick Smith's GM Decisions Using the 20/70/10 Philosophy

[Brisco_County]

I was going to post this in the Whitney Mercilus thread in response to posts concerning the retention of Barwin, but I realized that this deserves a broader conversation as it maps exactly how Rick Smith will be making his personnel decisions going forward.

Smith just said in a recent interview with Peter King that he adopted the personnel philosophy of former GE CEO Jack Welch, described as 20/70/10.

...the top 20 percent of your employees are standouts and must be nurtured. The majority, the 70 percent, are the working class -- needed but still able to move if the right situation arises. The lowest 10 percent have to be churned and replaced, because a company always is looking for ways to get better by importing new blood. "If you have a 53-man roster, maybe you've got 10 or 11 core players,'' Smith said, "and then 25 to 30 roles players, and then you're always looking to churn the bottom of the roster.''

This site describes how the philosophy is applied to a football roster, so it seems to be an accurate reference for Rick Smith's GM tendencies.

So in a nut shell, Welch encouraged GE’s businesses to identify and categorize their senior executives into one of three distinct categories.

* A (the top 20%) the Producers
* B (the middle 70%) those Vital to group as they make up the majority
* C (the bottome 10%) the Non Producers

Welch surmised your top 20% (A players) were the “best of the best” and all resources/top compensation should be thrown their way. The middle 70% (B players) were a vital part of operations, the core of your workforce. You should continue to motivate and train your B’s to eventually move into the A category and push other B’s down a level. The bottom 10% (C players) should be immediately replaced. Some call it the “rank and yank” method.

Relating it to Roster Building

For football purposes the “ranking” evaluation MUST be based entirely upon ability & production as evaluated by your personnel staff(coaches/scouts), then handed over to salary cap administrators for proper contract structuring and negotiation via market values (not the other way around).

By this logic, if Conner Barwin fits into group A --which I believe he will-- then he will be offered a competitive contract by Smith. This is based on the assumption of a reasonable demand/free market appraisal (as explained in the bolded paragraph), and I doubt he'll attract Mario Williams money when the sack opportunities in the Phillips defense will be spread among every one of the front seven.

This is why I believe Brown and Barwin are in no danger of being lost to the market. They fit into the top 10, and Smith has proven that he will cut or renegotiate contracts on any roster spot in group B in order to retain his top producers. The model accurately makes sense of the contract decisions on Foster, Demeco, Winston, and Walter.

So if every contract were up for renegotiation right now, I would expect the following contracts to be solidified:

1. 1 - Andre Johnson
2. 2 - Arian Foster
3. 3 - Duane Brown
4. 4 - Brian Cushing
5. 5 - Conner Barwin
6. 6 - JJ Watt
7. 7 - Jonathan Joseph
8. 8 - Daniel Manning
9. 9 - Brooks Reed
10. 10 - Matt Schaub*
    

It is expected that many of you will suggest a different top 10, but I'm sticking with this one for the sake of argument.

The asterisk is for players in danger of sinking into group B, and as the article above explains, these players are a burden on the GM. You would expect either a contract renegotiation, early expiration, or trade if they allow their value to slip into group B.

Right now, based on what I've observed, I am concluding the timeframe for qualifying value to be at least two years, but may be dependent upon special cap situations and team needs from year to year. Regarding Schaub, I would expect him to reverse his decline in value if he can remain healthy. But if he misses significant time this season, I do expect to see a contract renegotiation.

So the questions that will arise every offseason will be: Who fits into the top 10? Who is falling into group B? Who is overpaid in group B? Accurately answering those questions will be the key to predicting the contract status of each player.

[BaylorTXN]

Great find. Also like your top 10. Personally, I would replace Reed with Myers, but that is neither here nor there. Its a great approach to take for business and football. Enjoyed the read.

[ObsiWan]

This philosophy was touched on in one of badboy's threads from last week about team depth. This was/is my take....

Our "twenty percenters" are...
1. Foster
2. Duane Brown
3. A.J.
4. Schaub
5. J. Joseph
6. Watt
7. Myers
8. Cushing

Edit:
since Smith went with 10-11, I added a couple more

9. Wade Smith (I'm betting his replacement is being groomed right now)
10. D. Manning (although we did okay when he was hurt)
11. Owen Daniels (if a second WR emerges from this new bunch, we may see fewer two TE sets and O.D. may become expendable - pass catching, not blocking, is his strong suit)

Everyone else is a role player, a "project", or on his way out

Unless Mercilus and Crick turn out to be duds, Antonio Smith might be allowed to walk when his contract is up unless he takes a pay cut.

Schaub may not get a huge payday when his contract comes due if Yates or Beck become proficient in this system.

Like I said in the Rick Smith thread, Cushing may end up wearing a different jersey if he wants a mega payday like Mario got because I'm not sure Wade needs Cushing's caliber of stud to play ILB in his system. Sure he'll want him - who wouldn't? But, like Mario, I don't think they'll want to pay him that kind of dough. It's the same reason that DeMeco was "over-priced" for this system. Wade spends his bucks on pass rushers - DEs and OLBs. And CBs. Any defensive scheme can use stud CBs.

One of the Barwin/Brooks/Mercilus trio could fall into this "20%" category. But since that's a 3-man rotation at OLB, Wade can probably find someone in the draft to coach up to replace any of the three that might desire crazy, stud pass rusher money.

In my mind, stud, cover CBs, superior RBs like Foster, or Duane Brown quality LTs are harder to come by than fast OLBs who can be taught Wade's system.

[Brisco_County]

Originally Posted by ObsiWan

This philosophy was touched on in one of badboy's threads from last week about team depth. This was/is my take....



One of the Barwin/Brooks/Mercilus trio could fall into this "20%" category. But since that's a 3-man rotation at OLB, Wade can probably find someone in the draft to coach up to replace any of the three that might desire crazy, stud pass rusher money.

In my mind, stud, cover CBs, superior RBs like Foster, or Duane Brown quality LTs are harder to come by than fast OLBs who can be taught Wade's system.

The three man rotation does dilute some value, but not enough to prevent at least two of the three from breaching the top ten. I don't think it would be strange to see all three in there. Each of those guys were 2nd and 1st round picks, so it's expected that they be top performers.

On Chris Myers, I don't think he was in Smith's A group. I say this based on how they handled his contract this year. Myers said Smith didn't seem interested in negotiating, and he let him talk to other teams. It could've had to do with his agent, but based on what we've seen, there is a proactive effort to retain anyone in A group.

[Brisco_County]

And agreed on Antonio Smith. I think he's at the top of B group right now, but unless he improves over last year, he's getting a pay cut or he'll walk.

[SheTexan]

Does that mean that Demeco, Mario, Winston, Briesel, and Dressen were in the 10%?? They were nothing but scumbags in RS eyes, so it's bye-bye losers?? Geeezzzzz! RS is an idi*t and couldn't manage the 20/70/10 concept if his life depended on it! JMO!!! Dont' throw the "cap" issue at me either. That's RS fault also!

[buddyboy]

Originally Posted by SheTexan

Does that mean that Demeco, Mario, Winston, Briesel, and Dressen were in the 10%?? They were nothing but scumbags in RS eyes, so it's bye-bye losers?? Geeezzzzz! RS is an idi*t and couldn't manage the 20/70/10 concept if his life depended on it! JMO!!! Dont' throw the "cap" issue at me either. That's RS fault also!

There are times when you need to temper your fandom of players and realize we're a fan of the *team*. You seem personally against Rick Smith and unable to see any reason as far as football operations go.

No, those players were not in the bottom 10%. If you think Rick Smith thinks that, you're deluding yourself. If you don't think he thinks that, I don't know why you're insulting the man.

No, the cap is not (completely) Rick Smith's fault. There comes a point where you CANNOT maintain talent on a team if you continually improve. If you draft well and pickup quality free agents who overperform their contracts (which is what has been happening here), then you MUST continue to draft well and sign quality free agents who overperform their contracts.

Could he have managed the contracts better? Probably. Does that mean he is at fault for losing Mario/Briesel/Dreesen? No, I would disagree with that. Those three were in line for a huge raise, and they got it. They were paid more than we were willing to pay for them, and I applaud R.S. for that. To have confidence in your team and your young players to fill those spots without having to panic mode overpay means we are in a good position.

Demeco was and is a tough loss. But for me, that loss is only on a intangible level. His leadership and play style will be missed. But his play on the field, however amazing his off the field stuff was, has steadily been on the decline ever since his rookie year. If we're going to whine every time a player we like gets cut, then we're in for a hell of a lot of whining.

Winston's release is the only real headscratcher. I don't know if it was completely necessary (it may have been, I'm not 100% on our cap situation). But I think we have the peices on this roster ALREADY to replace him. No use crying over losing a player that we've been grooming replacements for.

[Brisco_County]

Originally Posted by SheTexan

Does that mean that Demeco, Mario, Winston, Briesel, and Dressen were in the 10%?? They were nothing but scumbags in RS eyes, so it's bye-bye losers?? Geeezzzzz! RS is an idi*t and couldn't manage the 20/70/10 concept if his life depended on it! JMO!!! Dont' throw the "cap" issue at me either. That's RS fault also!

Mario, despite his injury, was in Smith's top ten. The Bills simply put the bidding in another orbit.

I believe that Winston was in group A, but fell to B. As the article explains, A-listers falling to list B are the heaviest burdens on the GM. Those contracts require action. The only source explaining Smith's decision was Winston himself:

“Basically, they told me they were up against it (the salary cap) and didn’t want to insult me by asking me to take a pay cut.”

Winston --probably in an effort to keep his market value high-- never confirmed whether he would've rejected a pay cut.

Briesel and Dreessen were typical B group: Core players who are vital to your operation, but cannot demand resources reserved for group A. I'm not sure if allowing these two to walk was justified, but I do believe that we won't suffer so many departures of core players like this in future offseasons. This year was special due to several abnormal factors.

Demeco was another special case. He --like Winston-- had dropped from group A to B, and action was required. Smith knew that Demeco would not take a pay cut, and the situation required delicate handling. Peter King did a follow up report on this issue that offered more details:

• A few of you got the impression -- probably advanced by the way I wrote my section on the Texans in MMQB yesterday -- that GM Rick Smith is some ruthless, unfeeling executive looking solely at the bottom line in building his team. If I left that impression, let me even it out a bit here. Smith is smart, and he knows there comes a time when the plug needs to be pulled on every player. But I don't think he does it callously. He had to pull the plug after the 2011 season with two important defensive pieces, Mario Williams and DeMeco Ryans, as I explained in the column yesterday. Williams was going to be far more costly than the Texans would have agreed to pay; that was a relatively simple decision. When Smith was about to trade Ryans to Philadelphia, he asked to have dinner with him. Smith explained exactly why he wanted to make the deal -- that Ryans was more of a pure 4-3 middle linebacker who was going to come off the field on third downs in the 3-4 scheme of defensive coordinator Wade Phillips, and that Ryans would be a perfect fit with the Eagles, who needed a middle 'backer. "Our relationship demanded that,'' said Smith. "I realize how much DeMeco has meant to the team and to the organization, and we want to be sure we did this the right way.''

Link

I think the most predictable aspect of this GM'ing philosophy is how it spurs action on contracts for players falling out of group A. But I don't think we will see this often, and I'm more optimistic about player retention going forward now that we have players that fit the system and salary caps around the league are closer to equilibrium.

[ObsiWan]

Thanks for the follow-up on Peter King's piece. I knew there had to be more background to this story than the Texans callously trading DeMeco out of hand.

[Texan_Bill]

Originally Posted by ObsiWan

Thanks for the follow-up on Peter King's piece. I knew there had to be more background to this story than the Texans callously trading DeMeco out of hand.

YUP!! Same thing here. There was obviously more to the trade than "Rick Smith hates DeMeco rumor so let's get rid of him"!!!

I think some folks need to slow their role and understand the "business" of football. DeMeco, Marion, Dreessen didn't make good financial sense for the team..... The Texans..

And in the long run, isn't more about the name on the front of the jersey AND not the back????

[wolf123]

Originally Posted by SheTexan

Does that mean that Demeco, Mario, Winston, Briesel, and Dressen were in the 10%?? They were nothing but scumbags in RS eyes, so it's bye-bye losers?? Geeezzzzz! RS is an idi*t and couldn't manage the 20/70/10 concept if his life depended on it! JMO!!! Dont' throw the "cap" issue at me either. That's RS fault also!

Did RS run over your puppy??? Geezzzzz......

[Lurvinator11]

Originally Posted by SheTexan

Does that mean that Demeco, Mario, Winston, Briesel, and Dressen were in the 10%?? They were nothing but scumbags in RS eyes, so it's bye-bye losers?? Geeezzzzz! RS is an idi*t and couldn't manage the 20/70/10 concept if his life depended on it! JMO!!! Dont' throw the "cap" issue at me either. That's RS fault also!

OMG SheTexan. I've heard of seeing the world through a different lens, but this is ridiculous! It seems for the past straight month you have just bashed Rick Smith on every oppertunity you can and given him none of his due credit. Look, I was upset about some of the cuts, but I could see why the cuts were necessary. You honestly think that times were better BEFORE he got here? No they weren't! Smith has made his fair share of blunders, but over the past few seasons, he has really done some great things. Signing Smith, Joseph, Manning, and even Foster off of the undrafted circuit. He even made the Schaub trade to bring him here. Whether you like it or not, he has, without a doubt, turned this team around with the business model he is taking. It is like I said in an earlier post, had you asked me if I liked Smith after the 08 season, I would have said no. But now, he has done enough for me and every other Texan fan to have faith in him. Not too much faith, but enough. You need to realize that on the grand scale of things, this team is still young as an organization. We are trying to find a way to catch on, and I believe Rick Smith is heading in that direction.

I also mentioned earlier that we could have had Matt Millen. GM for nine years with the Lions. Dude had the worst nine year span in NFL History going 31-97. The way you talk about Rick makes me believe we have Matt as our GM. None of it is warranted. Finally, if you are a true Texans fan, you wouldn't hold so much of a grudge against the guy who makes our business decisions every day. We live and die as fans by his overall decisions. Unless if it is clear that he needs to be fired, then we as FANS should support him, cause I can tell you from my standpoint, he has done NOTHING to warrant a resignation letter from Mr. McNair. I'm sorry if any of this offends you, but I am tired of you bashing on OUR Gm when it honestly isn't warranted. Be a fan and support him. I doubt any of this will change your opinion, but I just wanted to let you know as a fellow fan how I feel, and what I assume, a majority of our fanbase feels as well.

Finally, I'd like to point out that all of the players you listed are recoverable.

Winston- Had to be the worst of our O-Line, doesnt mean he was bad, it just means compared to everyone else, he was the weakest link with a big payday. Had to cut.

Briesel- FA loss. No way we were going to match the offer that the raiders gave him. Too expensive. Once again we can recover.

Dreesen- Good TE, but not our starter. Not only do we have Casey as a back up, but also have Graham in the wings. He left on FA also, even though we gave him an offer, he chose the other team. It's the nature of the beast.

Mario- FA loss. He was good, sometimes, but no way would we match the offer from Buffalo, and I think the coaching staff knew they could recover without Mario. I mean, we did play the majority of the season without him.

Demeco- I know, I know. Everyone loved him. Great player. I was sad to see him go. But when you don't play well in a 3-4 and you only play every other down, you gotta go. That would be like the highest paid employee showing up for two days of work out of the week. Would you think that's fair? I know I wouldn't. So send him somewhere where he gets better production. At least we got value for him, and we don't know how he would have bounced back from the Achilles injury as well. CND made points that the first year is the best and then there is a drop off.

So really I don't see any problems with the moves Smith has made. Sorry for the long post, I just wanted to get all of that off my chest. I just hope you will give credit, where credit is due.

[Marcus]

Originally Posted by Texan_Bill

YUP!! Same thing here. There was obviously more to the trade than "Rick Smith hates DeMeco rumor so let's get rid of him"!!!

I think some folks need to slow their role and understand the "business" of football. DeMeco, Marion, Dreessen didn't make good financial sense for the team..... The Texans..

And in the long run, isn't more about the name on the front of the jersey AND not the back????

There are some (not mentioning any names) who don't care about even trying to understand the "business" side of football. And therefore, blind sentimentalism and "loyalty" override common sense.

[Thorn]

Originally Posted by Marcus

There are some (not mentioning any names) who don't care about even trying to understand the "business" side of football. And therefore, blind sentimentalism and "loyalty" override common sense.

We're fans, venting here on this message board is what we do. If we were really that football smart, we'd be doing it for a living. All of us here have a vested interest in the Texans and want to see them win. How they win, and with what players and coaches, is something we'll debate and argue over forever.

[Brisco_County]

I understand SheTexan's passion on the subject. While I may not agree on her perception of Rick Smith, I understand why she feels that way and how much she loves these players. No one can knock her for that. She is also the perfect example for why Texans tailgaters are the best in the country.

[The Pencil Neck]

I'm with Brisco on this. Personally, I think Rick Smith's done a great job since he's been here. I think he's put together a young team loaded with talent and given us more hope than we ever had prior to his being here.

BUT.

This is a message board.

SheTexan's the type of fan that gets emotionally connected with the players. She's upset that several of her favorites aren't with us anymore and she's pissed off that Smith let them get away or sent them away or whatever. Although I think she's going overboard with her Smith bashing, if that's the way she feels about it and needs to vent... this is the place to do it.

There's a fine line between threads/posts that are about numbers and facts and what you can deduce from them and the threads/posts about how you feel about things. With numbers/facts threads, you can argue about what they mean and about who's interpreting them correctly. But with feeling threads/posts, it is what it is. You can't argue someone out of how they feel. Badboy's ticked off because we drafted players he thinks were substandard and when he posts about his feelings on the draft, he's posting his feelings. Can't tell him he doesn't feel that way. Same with SheTexan. She's posting her feelings and you can't tell her she doesn't feel that way because... she does.

My feeling is that Dreessen and Brisiel leaving hurts. We may be able to improve that guard spot but we might not. I don't have the same confidence with Casey and Graham replacing Dreessen, which is why I wanted to draft Fleener. My other feeling is that losing Winston, Demeco, and Mario won't hurt us at all and we may actually have improved at those positions.

[Rey]

I understand the point of the thread, but ultimately I think it's meaningless.

Your top ten players could change on a year to year basis. Really there are probably a top 5 that you can mark down as must keep type players (and even that is subject to change). The other half of the top ten are players that you'd really really like to keep, but if you lose one or two of them you aren't crying in your pillow at night.

But good teams find ways (for the most part) to hold on to their top talent through the best parts of their careers.

[GP]

What should be talked about more is this:

Philosophies can go out the window when money is free'd up or in short supply.

Our particular cap situation demanded a hard look at the roster. In other years, there might have been room to retain DeMeco and Dreessen and Brisiel.

We just happen to be in a unique era whereby we had little cap room BUT we are riding a good wave right now with having the ability to replace (confidently) those we had to let go.

Circumstances will always rule the day.

[SheTexan]

Originally Posted by Brisco_County

I understand SheTexan's passion on the subject. While I may not agree on her perception of Rick Smith, I understand why she feels that way and how much she loves these players. No one can knock her for that. She is also the perfect example for why Texans tailgaters are the best in the country.

Thanks! I've never denied the fact that I'm sentimental. I simply cannot imagine being a football fan and NOT being sentimental. I've been a fan of the NFL for the better part of 60 years, long before the Oilers came to town, soooo, this is not my first go round with dealing with the loss of favorite players. It will happen again and again, for as long as I remain a fan of this game.

I use to feel comfortable logging on to TT and venting my frustrations, some due to ignorance of the in's and out's of the way the NFL has changed over the years, but, that's not the case anymore. I'm truly not argumentative, I just read the board, do some research on my own, and depend on some of my favorite posters to keep me straight. But, as the game has changed over the years, so has the Internet, and so has TexansTalk. It's all good, and I'm not offended by negative comments about my feelings concerning Rick Smith.

Time will tell! I'm a TEXAN fan, and if the changes RS has made in our team pays off, I will be the first to say, I WAS WRONG about him! In the meantime, I think I'll just keep my opinions to myself. I enjoy reading this board, appreciate each individuals opinion, and consider this a means of learning more and more about our team. I DO have an open mind, and will try to have positive thoughts about our GM!

[beerlover]

The key to 20-17-10 is how well RS executes timing in locking up the 20%. There has to be some manipulation of the numbers for salary cap purposes alone. Its difficult for a layman like myself to watch the number one pick leave just when things turnaround, with minimal compensation but guess those are the breaks. Overall when looking at my list Rick Smith seems to have done a nice job retaining a core that should continue with these players as well.

Also since Andre, Foster, Daniels, Myers, Joseph & Manning are locked up for a while I would fudge my list a bit & not include them in my top 10. Instead I would focus on key, younger players who already have established themselves as core in future of this teams success.

#1. Brian Cushing - Must lock him up early.
#2. Duane Brown - Deserves top 5 LT money.
#3. Matt Schaub - His durability is a concern but his importance to this team is undeniable. I list him lower because of his age, hence future productive seasons ahead.
#4. Connor Barwin - With Mercilus it lessons his need to sign him to a big contract, something with in reason or possibly trade?
#5. Glover Quinn - This is where it really starts getting sentimental for me. My desire to see him remain a Texans probably out weighs his actual worth.
#6. JJ Watt - It's never too early to ensure a stud like him remains locked up as Texan long term.
#7. Brice McCain - Yes I include him as the nickle back. He has the best speed in secondary & is proving himself invaluable.
#8. Brooks Reed - Texans would like to remain deep & talented @ OLB.
#9. Shaun Cody - Much as I hate to admit it the guy fits Wade Phillips system & keeps players around him free to make some plays.
#10. Antonio Smith - Out of respect earned, & contributions to this organization through some lean times, he should receive some serious consideration for his leadership & work ethic.