Henry on Everything 2002, 2003, and Beyond

10.10.02:  Red Sox Owner John Henry (JH) on WEEI with Dale Arnold (DA) and Bob Neumeier (BN):

DA: Who the heck's going to be the GM of this team?

JH: Beats me, I have no idea at this point.

DA: Are you concerned that guy like JP, and apparently Billy Beane out of the running at
this point?

JH: Would be nice to have a plethora of great GM candidates out there, but it's not a double-digit list of candidates, short list, but I'm not worried about it but am eager to have a GM on board.

BN: LL out there now to make rounds, prioritize?

JH: Larry is great person for that role. Through years been called by other owners b/c they knew he always kept a ranking, rating, list of GM's, quite fortunate to have him leading search.

DA: Who makes final call?

JH: Among the three of us we have a collegial feel among Tom, Larry and I. Even process surrounding the trade deadline. We met every day. A lot of us. A lot of the baseball people. Larry conducted the meeting. Larry's very good at, as I am, in letting baseball people make the decisions. But there are financial issues involved. Strategic issues involved. It's a lot of fun, but more than that, it helps to have a lot of bright people around exchanging ideas. And we can also fan out across the country. Biggest reason we got Cliff F. was because we had Melvin with Omar and Tavares right there while rest were using phone.

BN: Let's say you could talk to Billy Beane, Larry's such a strong personality, we know that, communicates on morning show and answers all questions, wants his thumb on the pie, as you and Tom do as well. Is it conceivable that a guy like BB would say "John I'm interested, but I want to make all the decisions, I don't want to hear from you, or Tom, or Larry" and might that preclude a strong candidate like BB from being in the mix here in Boston.

JH: Well, I don't want to talk about any specific candidate, esp. one that you can be accused of tampering with, but I would say in general, I found in baseball, it's a very small industry. Everyone knows everyone else, everyone has a certain relationship. People in baseball understand LL, his role, his abilities and what I found is that people generally love to work with highly intelligent people, so I think there are a number of GMs out there who would love to work in this organization b/c in addition of Larry, there's Theo Epstein, who is one of the best minds in the baseball industry. And we have fun. I think who you work with on a day-to-day basis really, as you two probably know, determines how much fun it is to come to work. I don't see that as a problem at all.

DA: Is there a perception out there that Theo is the GM in waiting anyway?

JH: I've read that. Theo is still in his 20's. No doubt he will GM when in his 30's. It very well could (be with our team) but that depends on a number of factors.... who the next GM is. You could see something happen like, you mentioned Billy Beane, where they had Sandy Alderson who brought along a young Billy Beane. I don't know how much bringing-along Theo needs, but he will definitely gain from being around an experienced GM.

BN: You bought team, had one year, inherited a lot of things, tell us something you liked about the experience and tell us something you did not like about the experience.

JH: Well we inherited a fan base... and what's not to like about this fan base... when it's cold, rainy, snowy even, the fans are not just at the ballpark, they're sitting in their seats. Sure you could come up w/negatives as to why they're sitting in seats, but in all my years in baseball traveling around the country, I've never seen anything like this fan base and that's the reason, instead of inheriting this, we had to pay for all this stuff :-)... b/c it's just such a valuable fan base, as your ratings show.

BN: What was bad about it? Wished you could have changed...

JH: That's easy. We fell out of the wild card race, in my mind, fairly early... I thought when we tried to make a deal for Bartolo Colon, worked very hard on that, didn't happen. We tried to make a deal for Jim Thome... didn't happen. Worked very hard on those things, but couldn't get them done. We were able to get, what I thought were three significant deals done, esp. the one for Embree, b/c we really had a need in our bullpen. And then when we acquired Cliff, I said "well you don't have to worry about this team scoring runs... two months in the stretch, something like 2-1/2 games out, really thought we had the ingredients to be successful. And the fact is we didn't score runs... except when we were ahead :-)... already by a certain amount, it seems, so that was very disappointing.

DA: Given the amount of money you had invested in this, given the changed economic climate, the new CBA, are you resigned to the fact that a new ballpark is not in the cards in foreseeable future?

JH: No we continually have conversations internally about what are the problems with staying at Fenway, if you talk to the fans, it's the fans who are there every day, the ones we hear from the most, who I think have reservation about the ballpark. Certain things that just have to be done that can't wait very long. One is replacing the concrete under the seating bowl... that has to be done, $15M expense. If you take seats out, how do you put them back in. If you reduce seating, that's problematical, when you're starting at about 33,400 in paid attendance, problematical for long-term season ticket holders "three out of four of your seats exist now"... but there are a lot of issues there that can't really be addressed long-term in this facility. BUT, our preference as you know if to renovate, we believe internally this is a landmark for New England, like saying, 'OK, let's replace the Eiffel Tower" :-)... we can get up to the top with a quicker design, a better design, fans don't think in those terms, but NE in general, passion doesn't decline as you move out even though they're not there as often. They have a certain feeling about being at ballpark and standing where Ted Williams stood at the plate. Sometimes I take a break from work and stand in batter's box and think Ted stood here, Ty Cobb stood here, Babe Ruth, the dichotomy (sp) and free exchange of ideas that go on internally. I can tell you we have not made a 100% decision to renovate Fenway.

BN: Let me take the other position. Perception that you folks spent so much money, given the climate, etc., the fact is the group doesn't have the wherewithal and headaches that go with to build a new park.

JH: I don't think the people thought I had the wherewithal to buy the Marlins... and when I did they said 'yeah, he paid so much money he can't afford to build a ballpark' but I think you have to understand economics from a non-layman's way of looking at things. When you purchase an asset, the first thing you think about is 'what is the asset going to be worth 10 yrs. from now?"... Maybe you don't think about when buying a home, you don't enter into something of this magnitude without having a long-term plan. First priority is the enhancement of the asset. We're I think the third highest revenue producing team in baseball so I can tell you we didn't spend all of our money. If you're prudent, you don't take more than 100% of your assets and invest it. We have partners and we can take on additional partners if we were to seek them in the future, but we don't think in terms of 'gee we don't have enough money to do this, we don't have enough money to do that... we already paid a certain amount of money for ballpark, land, put worth on it all... don't want to put money into an asset that doesn't make sense. Can never afford to put money into something that doesn't make sense. Is that too varied an answer?

BN: Peter Magowan built a park, I've been here forever, feel Park has outlived it's usefulness. I was hoping that darn, they'll change archaic attitudes of previous administration but damn, they're going to build a new ballpark... that was my assumption.

JH: No, no, we were the ones that were going to renovate from the beginning. But I think (probably going to get in trouble for this) that Magowan is an example of doing something that doesn't make sense. To build a park they put together a number of corp. partnerships putting money up front, they are making enormous payments on that ballpark. I don't think it makes sense, especially here, for the next 20 years for that expense, I don't think so. The Giants long-term will have issues with competitiveness as a result of doing something that didn't make that much sense. Easy to look at right now and say 'oh, that made a lot of sense, certainly from one standpoint, but now with recession, they'll have to live with that investment.

DA: Can you give us a ballpark of what your payroll will be next year?

JH:  That's something that Larry and I... laugh not right word, but certain amount of humor... payroll is such a problematical issue in this respect. So many payrolls out there, if you remember all year long we heard the Yankees had $115M payroll, by end of the year, they were talking about a different payroll for luxury tax, suddenly $171M, so one of the problems is. And LL brought it up at league meetings years ago... we need one number for payroll. We need it, the media needs it, nobody knows what it means. The 25-man payroll. The 40-man payroll. There's the payroll that we use for luxury tax benefits, the $171M for instance this year with Yankees that includes benefits, ave. annual value of the salary, once you get past who and what things you're taking into account, there's three other ways of looking at it:

1. Cash Payroll - what is the payroll on the cash basis, very few people use the cash basis. Whatever you see in USA Today is accrued basis.

2. The generally accepted GAP basis accounting principles... I just like to set the record straight... no real answer, depends on which one you're talking about. 40-man PR is more germane. Difficult to talk about when budget includes "what are your signing bonus for the amateur draft?" "How many millions are you going to spend signing players in overseas market?"

If you look at Yankees vs. A's payroll, looks like 3-1 basis. But if look at baseball operation in general, it's more like 8-1, and that's how you dominate a league, as the Yankees have done to some extent, but what are you going to spend to sign the Cuban defector, Contreras, great prospect. Someone we're looking at. Someone the Yankees are looking at. So, I don't mean to go around the question, not the most important. Most important is can you put the team you want on the field and still have enough money in reserve to have something to spend at trading deadline... we prefer not to give up great prospects at the trading deadline, we prefer to take on salary. But can only do that if you have the ability.

BN: Most fans concerned looking at these playoffs, and say hey, the top 9 payroll clubs in baseball are looking at these playoffs not participating in them (JH: amazing isn't it?)... but in your comments to Gordon Edes about your support of revenue sharing position even though it will cost you $35M, we've fantasized about signing Cliff Floyd, signing Roger Clemens, etc. Will you do right thing and make a run or will economics prohibit that.

JH: Economics won't prohibit it. Economics will dictate it. How long do you have Nomar, Manny, Pedro in their prime. We lost all those one-run records, next year those teams do much better, Bill James is someone I place a lot of faith in. One run games function of luck not bullpen, we won 93 games, felt we had the horses, but seemed to me the players didn't execute, we didn't score late, gave up runs late, not a good team after fifth inning. Sometimes just stuck in the mud at the beginning of games, don't know if you had that feeling, waiting for the team to wake up... didn't really happen.

I think with proper leadership on and off the field next year, we should be successful with this core group. We can't afford to sit back and start rebuilding the team at this point, not when you have three players of that magnitude, I think we had four of the top starters, I think, next year, maybe Casey won't be quite as effective in full year as he was in second half. But he still has a great arm, but you had Wakefield who finished fourth in ERA. This is not the time to look to reduce payroll, and we don't have the minor league system as of yet to be starting over. I don't foresee any lack of competitiveness as a result of economics.

DA: Did your manager and coaches give you the leadership you were talking about this year?

JH: I think there was a dynamic, speaking candidly, we brought in a manager late in the game, didn't have his own people, weren't necessarily all on the same page. They weren't on the same page (Grady and coaches) I saw it throughout the year, but I don't believe that had an overriding effect on the season, as I said we won 93 games, we lost close games, Terrance Long catch, too many of those, the 9-8 games at Yankee Stadium, a check swing against a shift, by the time we come to ST,... one thing you should be prepared for, we're going to try to be as flexible as we can with the new payroll, actually got into a little bit of trouble talking with Gordon Edes about this, the new CBA, so let me see how I can put this (nobody's listening anyway)... you'd be surprised, it's amazing how many people listen to this show. We'd like to have some flexibility in ST b/c we think there will be valuable players out there looking for jobs, ala Mr. Sanchez last year, you'll see a larger percentage of players moving forward.

BN: You've got the cornerstone superstars, Lowe breakthrough, looking at 2005, reading comments to Edes, and say no way is he going to sign Nomar, Pedro, Jason Variek, et. all. Can you calm down our fears?

JH: Well it is a two way street, you never know until someone is signed whether you'll be able to sign them whether it's a free agent or someone that's with you, but I think one of the things we probably miss is that the Red Sox have greater revenues, even after revenue sharing, than just about any other team in baseball, so we should be able to afford a greater number of superstars than other teams. If you look at other teams, they all have the same problem, if you look 2005, every club, esp. the ones in playoffs right now, will say 'how are we going to keep this team together?' but I have to be careful what I say, but the economics of baseball is such that things are changing. It may not be as expensive to resign everyone as you think. How many teams can bid on Pedro Martinez?

DA: At any point in the season, were you disappointed with Manny?

JH: I have to say honestly no, Sure when he didn't run to first in Tampa Bay, that was a cardinal sin. But as I said after, if nine Mannys would be playing right now... wouldn't have gone undefeated, but we'd be playing right now. The guy's a monster, I don't know about you, but when he comes to the plate and you're doing something else, you stop, because he's just the best hitter in the AL.

BN: People I know John are tuned into your love for the game, see you in seats, talking to fans, but the attention you pay special attention to players in the minor league levels, tell us more about that.

JH: Well I learned it from Dave Dombroski, he knew every player, GM with Marlins, he knew every player in baseball. If I run into a player on the Internet and I'm looking at the box score of a minor league game and some pitcher for the Reds throws a 3-hit shutout and I send an email to Theo Epstein, he knows exactly who the player is what he projects to be, and so I'm that way with the Red Sox players, you just want to see how they're developing, it's interesting, when you own a franchise, you're rooting not just for the 25 man roster, but they're are about 200 players out there, and it's exciting to see them as they move through their careers, this fellow Hanley Ramirez, on everyone's radar screen by end of this year, I think was the top prospect in two leagues is a tremendous SS, he may be 2B or 3B when develops but he just turned 19, continuing saga every night.

Email: If Theo is such a highly regarded fair-haired boy, why not keep Mike Port, who most think has done a credible job, and wait two years for Theo Epstein?

JH: That may happen. That could very well happen.

Callers:

Question on scalpers "seeing same guy for years" JH: I haven't been involved. I've heard fans say thanks for getting rid of them. Larry has crew on that.

Dakota: How big of a factor does a manager is a manager? 93 was a lay-up with this team? What onus do you put on manager who could have kept us from winning those 93 games.

JH: That's debated in baseball. Would you rather have someone great at strategy or someone who can get production from his players. Tommy Lasorda, friend of mine. Philosophy with perhaps more strategy with lack of DH, manager has to sell players on production: You have to have a manager who can get production out of his players. 162 game marathon. To get them on top of their game every day is difficult.

BN: RE: Manny incident. We hear: manager too soft, inmates still running the asylum. Players run show. Agents, contract, etc. issue with the Red Sox?

JH: To be 100% honest with you as I try to be all the time... there may be something to that. I do think this is a veteran ballclub, we have a manager leaves them to their own devices, b/c that's the type of manager he is. In many ways good thing, but in some ways not a good a thing. That's how I see it.

BN: Grady comment "they'll be changes as to how I operate?" Is that what he's talking about?

JH: I think so, I haven't talked to him. Mostly criticized for not benching Manny. Grady understands Manny better than anyone else. Not the kind of player, sounds tough to hear, but not the kind of player you just punish, try to make him understand. And he did understand, neither fans or teammates will tolerate that.

Email: John Henry is close with Cliff Floyd. Would John Henry allow Cliff Floyd to sign with dreaded Yankees?

JH: Nothing I can do about it, unless we can sign him before Yankees have chance to sign him. I feel strongly that Yankees would like to sign Cliff Floyd. We would too. Can't drive our process here. We have holes to fill, an entire bullpen with the exception of I think Bob Howry, we have to reconstruct, rebuild. Working on signing Alan Embree. We ahve to come up with a second baseman, first baseman, DH... holes to fill, we can't go nuts on Cliff as much as I love him, no one appreciates him more than I having been with him, almost every day for 3-1/2 years. Hell of a hitter.

Caller: Pleasure having owner talk. Looking for a GM, this org. has to be built up in farm system, more of a diverse type of player, talking about speed in general, do more than wait for the big inning, wait for big home run, hasn't worked since 1918. What type of GM are you looking for?

JH: Well one mentioned, Billy Beane's philosophy is that you do wait. Someone asked how he felt about being last in stolen bases, I think two years ago, and he said well "we're doing something right" he thinks that speed is too high a premium (paid) and also for defense, he's mostly about OBP, home runs, first pitch strikes, left-handed starting pitching, he's an extraordinary GM, but he's not the only one, we have same philosophy, Sandy A. has same, JP has same in Toronto. Sometimes drives me nuts at Red Sox games, I say 'we should be bunting here, we need to bunt this runner over, but there's something called Expected Run Value of every situation, for instance when you have men on first and second with nobody out, you have an expected run production value that's higher than men on 2nd 3rd with one out, so bunting that runner over is a bad play, and we generally don't do it. However if you're playing for one run, you have higher percentage chance of scoring one run by moveing that runner over, so late in a game, a close game, it does make sense to do that play.

Too often, same in investing, I had advantage because I didn't think I knew more than the market knew, and I think we look at 100,000 baseball games over a century. Look at percentages and trends that go forward decade to decade and you see things that work and don't work, and you can see that if you don't have, depends on what year it is, at least 73% rate of success at stealing a base, if guy steals 100 bases, but caught 50 times, the more times he tried to steal, the more he hurts club. I know it sounds counterintuitive, but the fact is if you're stealing rate is not 73% success, your outs are hurting the team more than stolen bases.

BN: At any level of your business how much does being a people person play into the success, among fans, players, media, organization. How much value do you place on being a people-person organization:

JH: First and foremost, then you can explain why some things go wrong without having to do the wrong things to make people happy. Have to do what's right day-to-day. Sometimes difficult, but if you bring people into the process, Larry on radio, I try to be accessible to the media via email, if we let the fans, let everyone know what we're doing, why we're doing it... fan friendly, people first gestalt... this is all about people supporting this franchise. Can't have successful franchise without fans paying for it.

Dale on GM: have Red Sox asked permission to talk to anyone yet?

JH: We asked permission to talk to JP Ricciardi, (denied permission?) yes. We asked of Omar Minaya, but he hasn't called us back :-) but did get permission. Not sure we've asked on anyone else. We have not asked on Billy Beane. Not on Sabean, obviously... could have asked. Gene Michael, no, haven't asked. Timing is one thing. Don't necessarily call someone on day they are eliminated from playoffs. We're early in process, haven't set up interview schedule, but will be. Larry in charge of this process, coming up with list, something we're all looking forward to, etc.

Caller: This year terribly, terribly disappointing. You think breaks will even up next year. Bob Ryan put season the way it was. Swinging at first pitch, we're not going to catch up in one run games. Something needs to be done. Detriment to get Beane or high profile, if have to check with Larry, has to check with you, can't get them.

JH: Hit nail on head with plate discipline. Need it to get into bullpen. Love parks with pitch counts on scoreboard. Yankees good at getting into bullpen. Important not just to face starter and closer. Need to get into mid relief where the weakness is. A lot of stats show PD have longer careers. We need that.

BN: John already said that Lucchino's influence or Henry's is not an issue.

JH: No GM quit on Larry. His making baseball decisions is way overblown. He's a facilitator. Stronger GM he has, stronger his is, and happier he'll be.

JH: We need tremendous production at first. Big priority. But pitching, if we can come up with another strong #2, somebody as effective as Roger Clemens or Jamie Moyer, might not be those two, but people who have had similar success.

Caller: Mr. Henry thanks to making yourself available to media and fans.

JH: Maybe I'll get my own show :-)..

Caller: Disability seating. Closer, better option.

JH: Reaction time. If hit with foul ball traumatic exp. I go to hospital sometimes, we have head injuries. I'm most concerned about, won't let my daughter sit in front row. You can be in danger. There are issues we grabble with and haven't resolved. Take all into consideration.

BN: Would you rather win or make money as owner?

JH: No owner gets into baseball team to make money, used to. Jeremy Jacobs you mentioned. I don't know history of Bruins, he's a tremendous fan and can't function when they're playing. Maybe he's a more bottom-line oriented guy than I am, but winning is everything. In Florida I was losing #20-25mil a year. Willing to lose that to build organization.

Dale: If Clemens interested would you be?

JH: Ooooh, that's tough. Hard to imagine any Yankee in Boston uniform. I'd ask others. How do you two feel?

BN: Ability wise, stud pitcher at his age, within framework of your payroll. Roger over Wake, Burk, or Fossum in key game? Damn right I would. Bring him on if fits into budget?

JH: Are you talking about a one or five year contract? :-)

JH: That is the question (bang for buck). I don't know what history would have been. How would fans have felt about Boggs coming back. So tough to win, have to do the right things every day. Some might not be that popular, that would be one.

Neumy asked listeners if would they would rather see Clemens or Floyd signed (email us). Way more said Clemens.

JH: Just odd b/c I have image of him as Yankee on the mound. I don't think of him as Red Sox. I saw Gretsky in LA, but didn't look strong at end.

George and I get along famously. Makes it hard to hate him. Unfortunately. (BN: he took shot at end). Yeah, what was that about?  I never predicted demise of the Yankees.