Session 1-14 Strategic Analytics 0821 PDF

Strategic Analytics: insights from sport SAIS
Term IV, 2013 Indian Institute of Management Kozhikode Instructor: Deepak Dhayanithy
Title explained
Strategic
Sustainable competitive advantage, capabilities (Mintzbergs pattern) Key (big) decisions
Industry connotation
As in agents with vested interests who could upset equilibrium

economics
Mintzbergs early views as plan, position, ploy
Analytics
Deriving actionable insight from data
Home equity <> jingle mail, loan resolution conversation content, recidivism - impact on borrower/ collateral based resolution approaches
Neither purely deductive, exploratory nor inductive Method agnosticism Analytics in various industries focuses on consumer decisions
Background worldwide, India and at IIMK

HBS, Sloan, UCLA, UK, Australia, Germany More difficult to research Anu Vaidyanathan @ IIMA Significant support over 2 years @ IIMK
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Learning objectives
1. 2. Take a systematic approach, anchored in theory (agnostic), to thinking about important [strategic] decisions Help students identify problems [cognition] and structure solution approaches
Equip with models, metrics which have been discussed extensively in research literature Critical thinking and reflection important
3. 4.
Draw parallels in other sports/ industry settings
Introduce students to the use of statistical and OR, OM methods in thinking about high value decisions
Not about how to build the models but appreciate the scope and important steps involved Provide a glimpse of the analytical methodology at work
5.
Provide exposure to the ways in which the better industry participants have long thought through important challenges they are faced with
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Course format
The course is organized around four broad themes, which are
Policy and design Ratings, incentives and performance Strategic interactions Fans, Society and Sport
From 3rd session onward, groups (of 5) will lead off the discussions Class presentations and term papers are key vehicles for us to achieve the learning outcomes Readings from Scorecasting (TMLW) and Stumbling on Wins (SOW) Other readings: abstract, introduction, literature review, methods, data, results, discussion
very important that each of you get your hands around amap Key for our classes to be interesting! Books chosen for readability in addition to richness of the analytics As managers, you would be in a position to run such projects in organizations/ deal with external consultants/ be one such consultant framing the project
Important to ask the right questions
There are multiple papers for a good number of sessions

Class presentations
Teams of 5 same team for both this and term paper Class presentations (25)
18 TMLW and 9 + 2 SOW chapters Each team to choose at least 1 chapter from each book to present in class, starting from session 3 [June 26th]. Presentation schedule per course outline, sync with Coco and instructor Please discuss presentations with the instructor
Starting at least a week prior to the date of the presentation in class
Presenting groups and the class to contribute in terms of drawing parallels, discussing limitations
Term paper
Teams of 5 same team for both this and class presentations Term paper (35)
Extension of ideas discussed in the readings to other sports, business or experimental contexts Paper to target business or sports management audience Trade publications, sports management conferences grade material is A+ As a collective, showcase sector focus, strategic analytics Shortlisted topics to be discussed with Instructor by 22nd June after mailing a 1-pager on the same
Some thoughts on novelty risks and getting close to potential

Potential
Students make a dent in academic/ trade settings in terms of their superior understanding of SA
On-base % equivalent for batsmen might be of interest to folks at cricinfospeed is important
Drawing parallels to wider business/ management settings

Bases stolenhow big a deal is it really? Sixers versus out caught on the boundary PO costs of all-out sales promotions [intrusive ones] hardly quantified, understood
Both the above have outlets that can be targeted, develop collateral Why the NA sports by and large?
Novelty risk
Keeping communication channels open, n-1, COCO
SAIS Discussions grouped into

Policy and design Ratings and incentives Strategic Interactions Fans, Society and Sport
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Topics
# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression
Topics
# 12 I 13 I 14 I SAIS content area Value of roster flexibility Home advantage Bidding for resources coattail effect
15 F Scheduling 16 F Performance and attendance
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Topics and their wider relevance

# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners P(D) to P(D) + LGD Project incentives, Skill development Taskforce formation High leverage moments Unit to enterprise performance link Taskforce, high value resource mgmt Negotiations Cooperate Compete decisions Executive pay regulation
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# 12 I 13 I 14 I SAIS content area Value of roster flexibility Home advantage Bidding for resources coattail effect Wider business relevance Taskforce composition Conformity bias and Audit functions Understanding bundling Media management Understanding causality
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Topics and their methodology

# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Performance metrics when less is more Matching law Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression Methodology Regression, Spearmans rank correlation Prisoners dilemma game, players Frequency tables, distributions Log transformed regressions Shot level data, probit (binary nonlin) Sub setting Unit to enterprise performance link Runs test Bayesian reasoning Basics of wind resistance, physics Policy analysis, Regression
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Topics and their methodology

# 12 I 13 I 14 I SAIS content area Value of roster flexibility Home advantage Bidding for resources coattail effect Methodology Regression, constrained optimization Multiple Panel regression Optimization Co integration, causality tests
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Damned Statistics but Fans may still be right

Why 4 out of 5 almost surely means 4 out of 6
Stories need to be told (not just in the media!)
Rodriguez v. Halladay
Streaks versus adequate long-run data
Ricky Pontings first test century in India
Observation distance is important? What does irrational or sub-optimal mean when used to describe decisions, especially those made by experts? Why sports?
Transparency Cost of failure The business is easy to understand
Difficult to be in a fools paradise for long
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Challenges, stumbling blocks

Understanding the numbers, stats Past performance Future performance relationship
Rule changes are far fewer in the popular sports, still they may have a significant impact on outcomes
Back-pass to the goalie
How does the market for skills evolve? Victor Valdes Best goaliewith the ball at his feet
Not-interfering-with-play interpretations
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Stumbling blocks contd..

Data Statistical analysis Human being have limited cognitive abilities
are not lightning calculators of utility
Data + common sense

Coin tosses at the Super Bowl What data is about performance, ability and what is noise/ unexplained/ randomness Money well spent/ wasted is a big deal in sports
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Oakland As story
Billy Beane, Moneyball, Michael Lewis Why is the 1999-2002 seasons record worthy? Baseline 1997 John Hakes and Raymond Sauer
Workers paid in line with their expected productivity
What performance characteristics impact wins What teams are willing to pay for the characteristics Are salaries consistent with wins
30 MLB teams, 1999 to 2003 sufficient? Statistical analysis, panel data regressions
On-base % 2x impact on wins as slugging Slugging has a big impact on the salaries of players What happened post 2004?
Recall Ron conversation
National league goes back to1876

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Where does that leave us?

Maybe there is something to learn from the wealth of information + analytics + focus on the big decisions (good and not so good)
162 regular season games + 20 post in MLB 80 odd regular season games + close to 20 NBA
In order to do so, basic understanding of the games is needed

Thankfully (perhaps reason for their popularity), the rules are simple
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Baseball
Like cricket
but you can throw only full tosses Bat is just a club Beamers are illegal here too
9 innings (?) 3 batters per inning Diamond

Home base, 1st base, 2nd base, 3rd base
Run scored when a batter runners over home base Bases loaded difference between a home-run and a grand-slam Strike out (ball the .299 story), caught, walks If a batter hits into fair territory, he runs
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Basketball
Indoor, non-contact sport Duration 4 quarters of 12 minutes each Twos and Threes, free-throws Time-outs
2 100 second [1, 3] 3 100 second [2, 4]
Shot clock 24 seconds Foul trouble and ejection

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SAIS session 2, 06/20/13

IPL Player Retention rules tilt level playing field

Tariq Engineer, Cricinfo [ESPN Cricinfo], Dec 10 2010 Did IPL player retention rules undermine competitive balance? Franchises retaining players will be docked budget $ for the upcoming player auction per the following scheme Salary cap moot [MSD could be getting paid $3M and it wont count against CSK when it goes out to bid for players] What about the ethos of the salary cap? Iconic players were earlier paid +10% of highest bid other player received Salaries of the 12 players retained in the 2010 player bidding process was not disclosed
Player Auction Notional Budget $ per player # Players docked by retained retained (max $9M) price 1 1.8 1.80 2 3.1 1.55 3 4 1.33 4 SAIS IIMK 4.5 2013 1,2 1.13
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How Competitive are Competitive leagues? TMLW - Scorecasting

What does dominance mean across industries
Retail Walmart 11.3% of $3T US Retail market Banking Citigroup (TOBTOF) 3% Airline in US American and SW 14% MLB Yankees 25% of World Series rings
There are 29 teams going at each other in the MLB
But, how do the Yankees dominate like this?

$$$, >$200M payroll compared to Phillies $113M 09 Market size is a big driver Similar pattern in the WSF of previous seasons
Is that all then?

162 game season [IPL is 18] 8 top teams in the playoffs, Best-of-5, Best-of-7 League Championship Series, Best-of-7 World Series (IPL simple knockout) [IPL is 4/9]
Better teams (linked to payroll) win because the system makes upsets that much more difficult
law of large numbers?
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Is it is the same in all sports though?

NFL striving for parity and democracy 16 games per season why? 12 teams in the post-season No best-of series, just knockouts Till 2010, salary caps Bulk of team revenues from league wide television contracts Super Bowl since 1967 18 out of 32 franchises have lifted the Lombardi trophy All but 4 have appeared in the Super Bowl at least once
Its been the same since 1903!
Does market size have a big influence?

Steelers (6) Pittsburg Green Bay Packers (3) Wisconsin [smallest market]
For the betting types, where would you prefer to wager on the world champion?
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What are the important variables that determine whether a league is competitive or oligopolistic? $$$ per team
Is it a policy/ decision variable?
Games/ season # teams in the playoffs One-and-done or playoff series Salary caps Other key elements of the leagues
Free agency Open or closed leagues
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Impact of Free agency in NA pro team sports Maxcy and Mondello (2006) Free agency reintroduced in the 1970s
Concern that the star players would congregate in the big market teams
Rottenberg, Uni of Chicago

1956, games with uncertain outcomes are more likely to be viewed by fans Uncertainty of Outcome hypothesis (UOH) Invariance principle: player talent in a league would move to the team which valued them most, invariant of team revenues
Similar to the Coase (1960) view on resources
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But how do we measure uncertainty or competitiveness? Within season and between season [NBA, NFL, NHL] measures of competitive balance
Standard deviation of winning percentage (SDWP)
Ratio of actual to ideal (adjusts for number of observations more games in some leagues)
Discontinuity of team performance across seasons

Spearmans Rank Correlation Coefficient
Minimal large-market dominance (small-market weakness)

Only attention (per paper date) has been anectodal
NFL, NHL improvement; NBA inverse

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Factors that may influence this balance

Aside: competitive balance (UOH) may be only one of the factors bringing fans to the games Other factors
Rookie drafts Salary caps Alternative revenue sharing practices Imbalanced schedules
Teams with similar previous season records playing each other (NFL)
Due to economic, structural and policy differences more across league (sport) differences than within league differences, over time
Leagues depending more on national television broadcast revenue

Expectation is that NFL fans watch more games involving non-local teams (Monday night football)
Leagues depending more on gate receipts (MLB, NHL) and other local revenue Bottom line, league can be designed to maintain competitive balance at the level where it makes most economic sense for the league But, let us understand the Free Agency Competitive Balance
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Free Agency in MLB

Players with 6+ years of MLB service could become free agents at the expiration of their contracts Some aspects of compensation to franchises losing players have been introduced since CBA between players association and the league includes salary arbitration for players with 2 3 years service Free agency link to higher salaries has been established (eg: Scully, 1974), but link to competitive balance is ambiguous
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Free Agency in MLB

Free agency link to higher salaries has been established (eg: Scully, 1974), but link to competitive balance is ambiguous
4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 MLB NFL NBA NHL
1970 *
1977**
1980
1990
2000
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2003***
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Impact of free agency on competitive balance

NBADWP
Y1, measuring the ratio of actual to ideal standard deviation of win% in the NBA for each year from 1951 to 2004
NBADWP t-1
Equals the lagged value of Y
NBASRCC
Y2, Spearmans rank correlation coefficient each year from 1951 to 2004
NBURSFA
Dummy var = 1, representing the sample years of unrestricted free agency in the NBA (1978 82)
NBACAP1
Dummy var = 1, representing the sample years in which the NBA imposed a cap on team payrolls (1983 1999)
NBACAP2
Dummy var = 1, representing the sample years in which the NBA imposed cap on team payrolls as well as individual player salaries (2000 2004)
NBARIVAL
Dummy var = 1, representing the sample years in which the league faced an economic challenge from a rival league (ABA: 1967 1976)
NBASTRIKE Dummy var EXPANSION Dummy var NBATEAMS number of teams in the league in a season
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Competitive balance model NBA

Constant SDWP t-1 NBAURSFA NBACAP1 NBACAP2 EXPANSION NBARIVAL NBASTRIKE Model I Model II Mean Coefficientt ratio Coefficientt ratio 2.43*** 10.6952.034 *** 5.13 2.636 0.155 1.093 0.1110.458 0.2960.343 0.0930.132 0.2040.06 0.1670.148 0.019-1.207*** 1.2860.393 1.0320.332 0.2930.2 0.4340.068 0.4890.12 -2.759-1.246*** 1.192 1.132 0.51 0.474 0.415 -2.796
rho 0.605 5.5380.508 4.298 ***p<0.01, Adj R sq= 0.059, =0.276 Model I: Y = SDWP t-1 not included, Model II includes the lagged variable in the model [auto correlation] Similar models estimated using SRCC, with and without lagged variables for NHL and NFL seasons as well
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OLS Interpretation pointers

What do the variable coefficients mean? What does the t ratio tell us? What is the var subscripted with t-1? What does it mean when coefficient signs change in alternative model specifications? What does it mean when the significance of a model variable changes (appears/ disappears) in alternative model specifications? What is rho? Interpret the effect of NBAURSFA Does free agency improve competitive balance?
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Discussion of results
For NFL there is an improvement in SRCC
Delta over seasons
NHL shows an improved in it DWP

Cross sectional, within a season
Introduction of the lagged variable in the regressions does not change the results much Direct effect of free agency on competitive balance is ambiguous
Rottenberg, Coase appear to have gotten it right
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Are closed leagues the only way?

Wladimir Andreff ~ 2007, 08 Some stylized facts about closed and open leagues [Walrasian equilibrium model] 1. Definitions
Closed league: entry barrier created by franchise sales
Entry possible by purchase of an expansion franchise on the basis of profit potential of the market
Kochi, Pune
Entry (into the cartel) to be approved by a majority of the incumbent teams Competition to the league from a rival league only (ICL)
Open league: integrated in a hierarchical structure where within the national federation (Serie A, EPL, Bundesliga, etc.) which in turn is within the continental (UEFA) and global federation (FIFA)
Entry and exit by the mode of promotion and relegation Rags to riches is a possibility good story
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Comparisonscontd.
In a closed league, the team enjoys absolute exclusivity over a urban area
If the local area turns unprofitable then the franchise can move 48 relocations in the big-four NA leagues (NBA, NFL, NHL, MLB)
In an open league, mobility is only via promotion or relegation

No territorial exclusivity either
Home ground for Inter and AC is San Siro Derbies very marketable London, Manchester, Catalan, Madrid, Paris (?) East Bengal, Mohun Bagan, Mohammedan Sporting
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ComparisonsCompetitive balance
Labour market regulations is the main instrument in closed leagues While attempted in open leagues, the open-ness addresses some of the re-balancing demands
Recall 2005 CL final (Istanbul)

Steven Gerrards get-out clause
Considerable effort expended in staying-up and promotion as well as in changing the rules
1st division teams see a 20-40% revenue bump on qualifying for CL Relegation sees a drop of 75 80% in revenues Promotion sees ~ 5x in revenues
Internationalization of EPL club ownership

What does Venky, Russian oligarchs, Oil sheikhs and NESN [Boston Red Sox] have in common?? Blackburn Rovers is the only EPL championship team to get relegated!!!
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ComparisonsLabour mobility
Labour market regulations is the main instrument in closed leagues
Monopsony, reserve clause (1879 in baseball)
Anti-trust exemption for baseball
Lockouts and CBA to renegotiate prices/ clauses Free agency status for veterans (1970)
While attempted in open leagues, the open-ness addresses some of the re-balancing demands
Recall 2005 CL final (Istanbul)
Steven Gerrards get-out clause Belgian league versus Jean Marc Bosman Quotas based on player nationality went [where is IPL?] Labor choice rules in the European market
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Bosman Ruling (1995)
ComparisonsRookie draft, cash transfers, CBA and tax
Rookie draft
Reverse-order-of-finish in NA, with roster limits Bosman deregulation and EU competition policy applies player agents role more pivotal
Trading for cash

Forbidden in NA leagues (1960 NFL, 1976 MLB) Cash, loans, barters all possible in soccer
CBA
Player working conditions
no: games in a week
Salary cap to retain competitive balance

Avoid superstar concentration A counter for losing the reserve clause Luxury tax
Degree of player unionization much lower in EU
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Comparisonspooling agreements, ownership, objective function, investment decisions

Pooling Agreements
Closed leagues: TV rights (anti-trust exemption), gate receipts, sponsorships and merchandizing. Only local TV revenue off limits Open leagues: TV rights pooling, others off limits Closed leagues: not public Open leagues: trend toward listed cos since 90s
What is excellent about the Gunners?
Ownership

Objective function
Closed league: struggling franchises objectives turn financial (do NBA teams tank?) Open league: struggling franchises objectives have to remain sporting Tend to under-invest in sporting talent, its development Tend to trigger off arms races
Chelsea, Manchester City in the EPL FCB, RMA in Spain Financial Fairplay implementation and its effects?
Borussia Dortmund
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Investment decisions

Term paper
Teams of 5 same team for both this and class presentations Term paper (35)
Extension of ideas discussed in the readings to other sports, business or experimental contexts Paper to target business or sports management audience Trade publications, sports management conferences grade material is A+ As a collective, showcase sector focus, strategic analytics Shortlisted topics to be discussed with Instructor by 22nd June after mailing a 1-pager on the same
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Key Ideas
Competitive balance
Where else would we be interested in maintaining it? Why?
A complex vendor management problem as the one faced by WHO in its global procurement of vaccines Why maintain competition? How should competition be defined?
Leagues closed and open

What are the issues facing sport, cricket?
Rookie drafts, reserve system Free agency Salary caps SAIS IIMK 2013 1,2 Promotion and relegation
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Avoiding Relegation
From league to club perspective Fairytales are rate Bottom echelon problems are different from Top echelon problems
So are resources
Relegation battles are dramatic Any clues for the clubs in this position?
AIB, Istanbul
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Avoiding Relegation
Table 1: Summary of clubs promoted to EPL 1993-94 to 2011-12
# SEASONS SINCE PROMOTIO N 1 2-3 4-7 10 + Grand Total NOT RELEGA % TED TOTAL RELEG 3 27 89% 2 11 82% 3 11 73% 2 7 71% 10 56 82%
RELEGA TED 24 9 8 5 46
Table 2: Summary of Explanatory variables

PLAYER TRANSFERR ED IN PER CLUB # CLUBS SOURCES SOURCE 6 1.00 12 1.08 17 1.17 23 1.29 38 1.50 TIME TO RELEG EVENT (SEASONS) 1 1 1 4 16 TIME TO NO RELEG EVENT (SEASONS) 1 1.25 3 6.5 11
Min Q1 Median Q3 Max
# PROMOTIONS 1.00 1.00 1.00 2.00 4.00
TRANSFER $/ LEAGUE AVG 0.05 0.38 0.58 0.90 2.86
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Avoiding Relegation contd.

Table 3-a: Cox Proportional Hazards model of time to relegation Cox Proportional Hazards model B SE Wal df d CLUBS SOURCES < 10 (H1) 0.70 0.42 2.84 1.00 CLUBS SOURCES >= 21 (H1) 0.05 0.38 0.02 1.00 PLAYERS PER CLUB SOURCE (H2) 1.18 1.22 0.94 1.00 Sig. Exp (B) 0.09 2.02 0.89 1.05 0.33 3.25
FIRST TIME PROMOTION (0.2 0.34 0.42 1.00 0.52 0.80 (H3) 2) RATIO PURCHASE $ TO LEAGUE AVG (Control) (1.0 0.41 6.13 1.00 0.01 0.37 0)
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Factors that can shift this baseline curve up or down are those of interest to the club management!
Figure 2: Survival (from relegation) at the mean of covariates
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Announcements
Groups
Okay, 1 group to give their choice of topics
Readings choice Term paper

22nd to discuss with instructor, after sending a 1pager
Please discuss your presentations t 1 (24 hours) at least pretty packed classes schedule
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Discussion points
Wider applications of competitive balance discussion
Where to recruit first?
What isnt in the Mitchell report? Doping Dilemma Go for it
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Where to recruit first?
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Mitchell Report
Utility infielders jacking 30 home runs in a season 249/ 274 who tested positive were minor league players Welington Dotel CBA of doping!
Relative likelihood of PEDs use X GDP per capita Age profile of PEDs positive tests Repeat offenders Variance even in US based on ZIP code groups Population ecology of the stigma SAIS IIMK 2013 1,2, 3
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CBA contd.
Positive effect on
Surviving Promoting
More pronounced for baseball athletes from poorer countries Testing protocols matter
Baseball more at the lower levels
Similarities to
Tax filing CV dressing
Dotel, journeyman system or individual?

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Shermer
Doping Dilemma is the same as the prisoners dilemma athletes instead of prisoners
MY OPPONENT'S STRATEGY
COOPERATE (remain silent) M Y
DEFECT (confess)
COOPERATE S (remain silent) T R A T DEFECT E (confess) G

Y
One year in jail (High Payoff)
Three years in jail (Sucker Payoff) Two years in jail (Low Payoff)
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No jail time (Temptation Payoff)
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Model to Reality
Athlete asymmetry
Skill Career stage Economic stakes
Competition structure Who are the players, what are their incentives Are veterans same as debutants
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Willy Voet
Willy Voet, the soigneur, or all-around caretaker, for the Festina cycling team in the 1990s, explained how he beat the testers in his tell-all book, Breaking the Chain: Just in case the UCI doctors arrived in the morning to check the riders' hematocrit levels, I got everything ready to get them through the tests I went up to the cyclists' rooms with sodium drips-- The whole transfusion would take twenty minutes, the saline diluting the blood and so reducing the hematocrit level by three units--just enough. This contraption took no more than two minutes to set up, which meant we could put it into action while the UCI doctors waited for the riders to come down from their rooms.
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Joe Papp
a 32-year-old professional cyclist currently banned after testing positive for synthetic testosterone. Recalling the day he was handed the "secret black bag," Papp explained how a moral choice becomes an economic decision: "When you join a team with an organized doping program in place, you are simply given the drugs and a choice: take them to keep up or don't take them and there is a good chance you will not have a career in cycling."
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Frankie Andreu
superdomestique, or lead pacer, supporting Lance Armstrong throughout much of the 1990s. "Then, around 1996, the speeds of the races shifted dramatically upward. Something happened, and it wasn't just training." Andreu resisted the temptation as long as he could, but by 1999 he could no longer do his job: "It became apparent to me that enough of the peloton [the main group of riders in a cycling race] was on the juice that I had to do something." He began injecting himself with r-EPO two to three times a week. "It's not like Red Bull, which gives you instant energy," he explained. "But it does allow you to dig a little deeper, to hang on to the group a little longer, to go maybe 31.5 miles per hour instead of 30 mph."
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Frankie Andreu
superdomestique, or lead pacer, supporting Lance Armstrong throughout much of the 1990s. "Then, around 1996, the speeds of the races shifted dramatically upward. Something happened, and it wasn't just training." Andreu resisted the temptation as long as he could, but by 1999 he could no longer do his job: "It became apparent to me that enough of the peloton [the main group of riders in a cycling race] was on the juice that I had to do something." He began injecting himself with r-EPO two to three times a week. "It's not like Red Bull, which gives you instant energy," he explained. "But it does allow you to dig a little deeper, to hang on to the group a little longer, to go maybe 31.5 miles per hour instead of 30 mph."
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Patterns of PEDs sanctions in US pro sport

4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 1 2 3 4 5 6 7 8 9 10 0.5% 0.0% 2.0% 1.5% 1.0% 3.0% 2.5%
USADA test/ athlete
Sanction rate
2001 to 2012 70 disciplines, ~15K athletes Age of debut not known

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Some sport-wise numbers

Ex hibit 3 : Te s ts and Sanctio ns , U SA D A 2 0 0 1 -'1 2 , N o : o f athle te s (1 /2 ) Santio n rate * # A thle te s Spo rt te s te d Pre 2 0 0 6 Po s t 2 0 0 6 To tal
A rchery Badmint on Baseball Basket ball Basque P elot a Biat hlon Bobsled & Skelet on * Bow ling Boxing + Canoe & K ay ak Curling Cy cling * D iving * Equest rian F encing * F ield H ockey F igure Skat ing * G y mnast ics + Ice H ockey * Judo K arat e Luge M odern P ent at hlon P araly mp ic A lp ine Skiing P araly mp ic A rchery P araly mp ic Basket ball P araly mp ic Boccia P araly mp ic Curling P araly mp ic Cy cling P araly mp ic Equest rian P araly mp ic F encing P araly mp ic G oalball P araly mp ic Judo P araly mp ic N ordic Skiing P araly mp ic P ow erlift ing 101 50 283 440 6 113 229 67 332 181 124 1,481 104 131 178 148 221 296 186 305 87 71 42 69 25 80 10 19 69 16 14 28 25 15 16 0.0% 0.0% 0.9% 0.0% 0.0% 4.0% 0.0% 2.0% 0.0% 0.0% 4.5% 2.4% 0.0% 2.5% 0.0% 0.9% 0.0% 1.1% 1.3% 4.2% 0.0% 0.0% 0.0% 0.0% 3.6% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.9% 0.0% 0.0% 0.0% 0.0% 3.3% 0.0% 0.0% 3.3% 1.6% 0.0% 0.0% 1.2% 0.0% 1.2% 0.0% 1.3% 0.0% 0.0% 0.0% 6.8% 5.0% 0.0% 0.0% 0.0% 1.9% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.7% 0.2% 0.0% 0.0% 2.2% 0.0% 2.7% 0.0% 0.0% 3.7% 1.9% 0.0% 1.7% 0.7% 0.5% 0.7% 0.5% 1.3% 2.3% 0.0% 0.0% 4.3% 4.0% 1.3% 0.0% 0.0% 1.4% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Ex hibit 3 : Te s ts and Sanctio ns , U SA D A 2 0 0 1 -'1 2 , N o : o f athle te s (2 /2 ) Santio n rate * # A thle te s Po s t Spo rt te s te d Pre 2 0 0 6 2 0 0 6 To tal
P araly mp ic Row ing P araly mp ic Rugby P araly mp ic Sailing P araly mp ic Shoot ing P araly mp ic Sled H ockey P araly mp ic Soccer P araly mp ic Sw imming P araly mp ic T able T ennis P araly mp ic T ennis P araly mp ic T rack & F ield + P araly mp ic Volley ball Racquet ball Roller Sp ort s + Row ing + Rugby Sailing Shoot ing Skiing & Snow boarding * Soccer Soft ball Sp eedskat ing Squash Sw imming * Sy nchroniz ed Sw imming T able T ennis T aekw ondo + T eam H andball T ennis T rack & F ield * T riat hlon + Volley ball Wat er P olo Wat er Skiing Weight lift ing + Wrest ling 18 40 26 6 43 42 124 15 30 164 49 29 166 502 34 182 202 636 299 158 311 29 1,065 76 40 201 190 53 2,837 368 193 115 79 607 292 0.0% 0.0% 0.0% 11.8% 0.0% 0.0% 0.0% 2.9% 0.0% 0.0% 1.4% 0.0% 0.0% 0.0% 1.6% 0.0% 1.0% 0.0% 0.0% 1.9% 3.2% 0.0% 2.2% 1.0% 0.0% 3.1% 0.0% 0.0% 0.0% 0.0% 1.8% 2.8% 0.0% 3.3% 0.0% 0.0% 3.8% 0.0% 0.0% 0.0% 0.0% 5.4% 0.0% 0.0% 2.1% 0.9% 0.0% 0.0% 1.8% 0.3% 0.8% 0.0% 0.5% 0.0% 0.7% 0.0% 4.3% 3.7% 1.1% 0.0% 1.2% 0.9% 0.0% 1.4% 0.0% 3.2% 2.3% 0.0% 2.5% 0.0% 0.0% 7.0% 0.0% 0.0% 0.0% 0.0% 4.9% 0.0% 0.0% 1.8% 0.6% 0.0% 0.0% 1.0% 0.8% 0.3% 0.6% 0.3% 0.0% 1.2% 1.3% 2.5% 3.0% 1.1% 0.0% 2.0% 0.5% 0.0% 0.9% 0.0% 2.5% 2.4%
Grand To tal
1 4 ,7 8 3
1 .7 %
1 .4 %
1 .5 %
SAIS IIMK 2013 1,2, 3
61
Go for it
What is fourth down? What does 3 and 7 mean? What dont coaches go for it (why punt)? Job security Loss aversion Other sporting contexts where loss aversion is key
bubble Keeping the closer for the 9th Keeping Malinga for the 20th
SAIS IIMK 2013 1,2, 3
62

# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Go for it Loss aversion Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners Negotiations, P(D) to P(D) + LGD Project incentives, Skill development Taskforce formation High leverage moments Unit to enterprise performance link Taskforce, high value resource mgmt Negotiations Cooperate Compete decisions Executive pay regulation
63 SAIS IIMK 2013 1,2

SAIS IIMK 2013 1,2
64

Matching Law
Log (B1/B2) Log (B1/B2)
Log (R1/ R2) Matching

Log (B1/B2)
Log (R1/ R2) Over and Under Matching
Log (R1/ R2) Bias

SAIS IIMK 2013 1,2, 3 66
Quasi-experiment
3-pt circle movement gives three eras
1991-94 1994-97 (Brought-in) 1997-00 (Moved out)
X log (3pt scored/ 2pt scored) Y log (3pt att./ 2pt att.) 1991 94
Y = 0.799x + 0.001 [R sq = 0.961]
1994 97
Y = 0.826x + 0.046 [R sq = 0.972]
1997-00
Y = 0.871x + 0.047 [R sq = 0.961]
SAIS IIMK 2013 1,2, 3 67
Quasi-experiment contd.
Mean log relative reinforcement ratios
-1.247 (91-94) -0.797 (94-97) -0.797 (97-00)
Mean log relative response rates

-1.097 (91-94) -0.623 (94-97) -0.760 (97-00)
SAIS IIMK 2013 1,2, 3
68
Other sporting contexts

Cricket
Boundary extent 6s attempted and hit Introduction of T20 impact on ODI scoring
Reinforcement pathway?
Powerplay Direct hits shift from benefit of doubt to Hawkeye
Soccer
Jabulani introduction
SAIS IIMK 2013 1,2, 3
69


# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Go for it Loss aversion Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners Negotiations, P(D) to P(D) + LGD Project incentives, Skill development Taskforce formation High leverage moments Unit to enterprise performance link Taskforce, high value resource mgmt Negotiations Cooperate Compete decisions
71
SAIS IIMK 2013 1,2 Monopsony and salary suppression Executive pay regulation

SAIS IIMK 2013 1,2
72
Hot Hand Fallacy and Gamblers Fallacy

What is the hot hand?
Phenomenon or Fallacy? Gamblers Fallacy
GVT, 1985
Plethora of sports work
Stats Inside views
When soccer goalies will stop anything Hero calls and tells
SAIS IIMK 2013 1-5
73
What mechanisms underpin the hot hand?

Alter and Oppenheimer, 2005 Moldoveanu and Langer, 2002
Prior assumptions about the processes that underlie probabilistic phenomena
Chance or skill?
If chance, frequent changes expected Gamblers fallacy
If skill, streaks
Hot hand
People dont (do) pay much attention to the underlying process when outcomes alternate frequently (infrequently) Greater confidence in subsequent expectations after a series of correct guesses
SAIS IIMK 2013 1-5 74
What mechanisms underpin the hot hand? 2

Moldoveanu and Langer, 2002
Motivational mechanisms
Streaks amplify peoples motivational biases, leading them to predict that helpful streaks will continue and harmful streaks will end (?) Impute meaning to streaks depending on how close they subjectively feel to the desired outcome
Okay, but belief in the hot handgood?

Adaptive behavior Maladaptive behavior
SAIS IIMK 2013 1-5
75
What mechanisms underpin the hot hand? 3

Subjective significance testing
Teigen, 1994
Overestimate the rarity of streaks under the null hypothesis (of randomness) Signal Detection Theory
Hits
Correctly rejecting the nh that data are random
Correct rejections
Correctly retaining the nh that data are random
False alarms
Mistakenly rejecting the nh that data are random
Misses
Mistakenly retaining the nh that data are random
SAIS IIMK 2013 1-5 76
Some points to ponder

Why do people sometimes abandon the tenets of randomness? Individual differences in the way people detect changes in the data pattern Dual process model
Heuristic Systematic
Note that many real world processes are nonrandom/ not purely random
SAIS IIMK 2013 1-5 77
HH and GF in practice
What should be the basis for call routing in a Insurance companys inbound call center with spiraling churn?
Metric for call-type <> agent mapping How real time?
Monte Carlo fallacy How HH impacts a subscriptions business
SAIS IIMK 2013 1-5
78
Nerves of Steel
Two decades of shootouts in the world cup and Euro Stress factors impact on performance
Predictable, anticipated and expected
Crowd, level of the competition, kick sequence
Less predictable anticipated factors

Kick to win or lose
Positive and negative stress factors

Magnitude of impact on performance
Poor decision prospect impacts a soccer players performance

What about emergency workers, doctors, military leaders, CEOs
Pros and cons of using sports data

SAIS IIMK 2013 1-5 79
Nerves of Steel
Tortoises fare better than hares
SAIS IIMK 2013 1-5
80


# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Go for it Loss aversion Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners Negotiations, P(D) to P(D) + LGD difficulty level Project incentives, Skill development Taskforce formation High leverage moments Unit to enterprise performance link Taskforce, high value resource mgmt Negotiations Cooperate Compete decisions
82
SAIS IIMK 2013 1,2 Monopsony and salary suppression Executive pay regulation

SAIS IIMK 2013 1,2
83
Blocked shot
Baskets, assists, blocked shots, steals Are all blocks the same? If not, how are they different? Is the difference only a fine one?
SAIS IIMK 2013 1-5
84
Going for 3
Field goal kicking in football Who is good at field goal kicking? Measures Issues
Difficulty level and success rate Team/ coach/ game situation and difficulty level
SAIS IIMK 2013 1-5
85
Predicting the likelihood of field goal success

Factors affecting field goal success
General
Distance
Environment Situational/ psychological
SAIS IIMK 2013 1-5
86
Predicting the likelihood of field goal success contd.

Environment
Altitude Precipitation Windy Humid Post season Pressure Away game Icing
Situational/ psychological
SAIS IIMK 2013 1-5
87
[Logistic] regression process checklist

Y variable definition Univariate analysis Missing values treatment Flooring, capping of key variables Xs with the most potential
SAIS IIMK 2013 1-5
88
[Logistic] regression process checklist contd.

Binning Automatic selection models Multi-collinearity
Or micro-numerosity?
Sense-making
SAIS IIMK 2013 1-5
89
So what?
Kicker rankings
Difficulty adjusted Added points per attempt
Going back to blocked shots

Dwight or Duncan?
Season effects Stadium effects
SAIS IIMK 2013 1-5
90
So what? contd.
Psychological factors not so important Classifying attempts accurately into hits and misses
Probability cutoff decision Support Vector Machines
Problems
Observational, relatedness of variables Environmental vars at game beginning
Could be more dynamic
SAIS IIMK 2013 1-5
91
Measurement issues
Conditions at kick-off Multicollinearity Only distance?
Now video position tracking is possible
Slim data on high altitude Sensitive to categorization, except pressure
SAIS IIMK 2013 1-5
92
Acquisitions, Credit actions

Acquisitions
To acquire n new accounts subject to say, credit score conditions
Limit exposure
To reduce risk capital by $x Who will default perhaps not enough
Authorizations
Marginal $ to be saved
SAIS IIMK 2013 1-5
93
Model scrutiny
Concerns
Privacy Fair lending Consumer protection
Efficacy
Recall Prof. Choudhurys talk
SAIS IIMK 2013 1-5
94
Cricket
Early mid career selection choices All time lists A dismissal is a dismissal, or?
Opponent batting lineup Home/ away Pitch conditions DRS or not Bowling first, last New ball Bowler type pre or post-Arm extension interpretations
SAIS IIMK 2013 1-5 95
Cricket contd.
Catches Stumpings End of the day question
Would the rankings change with difficulty adjustments? Would our decisions in credit change with difficulty adjustments?
SAIS IIMK 2013 1-5
96
Lets not forget!

SSAC 2014 dates are out Research papers
Every year, the MIT Sloan Sports Analytics Conference Research Paper Competition brings exciting and innovative insight and changes the way we analyze sports. Dates that matter
9/1/13: 10/1/13: 10/15/13: 1/6/14: 2/10/14: Form for submission of interest Deadline for abstracts Notification of advancement Deadline for full paper submission Selection and notification of results
$20K
SAIS IIMK 2013 1-5 97
Lets not forget!

SSAC 2014 dates are out EOS
Presenting at EoS provides an opportunity to present a message, an idea, or a revolutionary thought that could someday change the face of sport. Be Bold *Be Unique *Be Inventive *Be Analytical *Be Concise *Be Respectful *Be Curious *Be Humorous *Be Honest *Be Inspiring Dates that matter
10/1/13: 11/15/13: 1/15/14: Form for submission of interest Deadline for abstracts Selection and notification of speakers
$7.5K
SAIS IIMK 2013 1-5 98
SAIS session 8; 07/25/13

[Logistic] regression process checklist

Y variable definition Univariate analysis Missing values treatment Flooring, capping of key variables Xs with the most potential
SAIS IIMK 2013 1-5
100
[Logistic] regression process checklist contd.

Binning Automatic selection models Multi-collinearity
Or micro-numerosity?
Sense-making Some basic measures and visualization
SAIS IIMK 2013 1-5
101

# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Go for it Loss aversion Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners Negotiations, P(D) to P(D) + LGD difficulty level Project incentives, Skill development Taskforce formation High leverage moments Taskforce, high value resource mgmt Negotiations, Litigation Cooperate Compete decisions Executive pay regulation
102 SAIS IIMK 2013 1,2
Measuring and valuing wins produced Unit to enterprise performance link

SAIS IIMK 2013 1,2
103
Wins produced perspective

Similarities
Wins as function of points scored and conceded Can be tracked to individual aspects Can be assigned to specific players performance?
NFL focus on the QB (RELWP100) versus NBA PAWS48 Significant wins produced stats in both sports? What does it mean?
SAIS IIMK 2013 1-5
104
Authors approach for NBA

Production
Points, field goals attempted, free throws attempted, offensive boards, defensive boards, turnovers, steals, free throws made, blocks, assists
Adjust for production of teammates

Mate48, TMDEF48 (opponent pts from fga, Opp. Fgm, Opp. TO (not steals), TMTO, TMRB
Adjust for playing position Calculate WP48

SAIS IIMK 2013 1-5 105
Authors approach for NFL QB scores

Offense
Acquisition of the ball Moving the ball Maintaining possession scoring
SAIS IIMK 2013 1-5
106
Questions
Implications of assembling a team of players with high PAWS48 Given PAWS48 measures, what are the areas to look into now? Differences between NBA and NFL wins metrics (for QBs)?
SAIS IIMK 2013 1-5
107
Location based Advertising

Mobile Business idea Beta testing Alternative measures
Footfall Footfall + sale
SAIS IIMK 2013 1-5
108
Paired Pitching
Greg Rubin
Average MLB starter faced a batter 2.8 times in the 2009 season
IP x BF per IP / 9 Starting pitching talent is expensive Batters do better once they see the pitcher
Fatigue, release point
Analysis of covariance
Study interaction between TF and RA ANCOVA on RA using TF, BF for a sample of 83 pitchers standardized residuals for each observation 19.9 RA > 24.8 > 25.5 > 13.3 (why low suddenly?) 75% variance in RA explained by variance in TF, BF
SAIS IIMK 2013 1-5 109
Paired Pitching
Greg Rubin
Moving from TF basis analysis to IP basis recommendations Can be used to

Reduce RA Reduce Payroll $ Reduce pitches per season Assemble a pitching team of average talent
SAIS IIMK 2013 1-5
110
Sport application?
Specialists versus bits and pieces bowlers Penalty corners
SAIS IIMK 2013 1-5
111
Elsewhere?
A realtor needs to decide the sequence in which his best salesmen would schedule property inspections with high value customer prospects Salesman problem/ Retail problem
Retailing mixers Of course, the business and the customer has a more congenial relationship
Format in which final offers are expected from a recruiting team

SAIS IIMK 2013 1-5 112
Methodology issues
Endogeneity
Is the n-th play independent of the earlier play?
SAIS IIMK 2013 1-5
113
Stripped down poker v1

Game rules Volunteers
SAIS IIMK 2013 1-5
114
Fundamental theorem of Poker

David Sklansky
Word on probability Games that progress through rounds of revealing cards, of betting Poker
Stud Draw Holdem
Teen patti Pot odds and the fundamental theorem

SAIS IIMK 2013 1-5 115
Discussion points
Is this a fair game? Two ways of making v1 game fair?
Manipulate
Odds Information dynamics
SAIS IIMK 2013 1-5
116
Stripped down poker v2

Game rules Volunteers
SAIS IIMK 2013 1-5
117
Discussion points
Is this a fair game? Two ways of making v1 game fair?
Manipulate
Odds Information dynamics
SAIS IIMK 2013 1-5
118
Applications, isomorphism
Settlement between plaintiff and defendant
Defendant offers a generous (fold) or stingy (bet) settlement
Plaintiff folds (accepts the stingy settlement) or calls (rejects the stingy settlement)
Tax filing and auditing decisions
SAIS IIMK 2013 1-5
119
BargainingInitiating
Tournaments
Increasing blinds and antes
Final table Which processes of bargaining succeed? Who initiates them? Why online tournaments?
SAIS IIMK 2013 1-5
120


# 1P 2P 3R 4R 5R 6R 7R 8R 9I 10 I 11 I SAIS content area Competitive balance, open/ closed league, free agency Doping dilemma Go for it Loss aversion Performance metrics when less is more (basketball rebounds) Matching law (going for 3) Stress and performance Assessing adjudicator decisions Measuring and valuing wins produced Hot hand phenomenon or fallacy Signaling, bluffing and bargaining Peloton analytics Monopsony and salary suppression Wider business relevance Key aspects of designing and managing competition Plagiarism, cutting corners Negotiations, P(D) to P(D) + LGD difficulty level Project incentives, Skill development Taskforce formation High leverage moments Unit to enterprise performance link Taskforce, high value resource mgmt Negotiations, Litigation Cooperate Compete decisions Executive pay regulation
122 SAIS IIMK 2013 1,2

# 12 I 13 I 14 I SAIS content area Value of roster flexibility Home advantage Bidding for resources coattail effect Sports Franchise simulation game 15 F Scheduling 16 F Performance and attendance Wider business relevance Taskforce composition Conformity bias and Audit functions Understanding bundling Competing for franchise, resources Media management Understanding causality
SAIS IIMK 2013 1,2
123
Executive pay regulation

Bone of contention Value creators or selfish risk takers? Should government intervene? Tax payer expectations post a bail-out?
SAIS IIMK 2013 1-5
124
Executive pay regulation what can be learnt from major league sports?
Salaries of sports professionals discussed widely, data available
SAIS IIMK 2013 1-5
125
Executive pay regulation what can be learnt from major league sports?
Executives and athletes pay
Similar in $ amount Significant differences in the pay structure
Executives
Variable pay dominated Bonus, stock grant, stock options, long-term incentive payouts (60 80%)
Athletes
Mainly fixed, small variable component (~25%) Performance linked, extra-ordinary performance linked
SAIS IIMK 2013 1-5 126
Pay regulation in pro-sports

Why regulate players salaries?
Competitive balance Ruinous salary cost escalation
SAIS IIMK 2013 1-5
127


129 SAIS IIMK 2013 1,2

SAIS IIMK 2013 1,2
130
SDP - 2
Team-up and play 10 hands of SDP (with reraising) From 11th hand onward Antes double There are some extra things that the players can do
SAIS IIMK 2013 1-5
131
SDP - 2
Did either of the players negotiate? Who began the negotiation? When did the negotiation begin? Relative position when negotiation began? Was an agreement reached? What were the terms and conditions? Who benefited?
SAIS IIMK 2013 1-5
132
Online Tournament features

Wide range of stakes (buy-in) Typical
~1000 players ~100 in the money finishers 50% of prize money in the final table (7 9) ~25% of prize money for the top finisher
Insane volumes
> 1,246 for 1Q, 1 research, 1 range of stakes, 1 room Average $80K per tournament
SAIS IIMK 2013 1-5 133
Final table deals

Anybody can initiate Anybody can veto
Often before any deal specifics emerge
Play paused to accommodate chat for the deals Aggregators provide player (only nicks of course) stats
Quality, skill level can be researched
SAIS IIMK 2013 1-5
134
Initiating Bargaining
David Goldreich and Lukasz Pomorski, 2011, Review of Economic Studies
Data
Table 1: p. 1303 Only a subset of tournaments played on this single site in 1Q of 2007
SAIS IIMK 2013 1-5
135
Key questions pertain to

Delay in bargaining Identity of the initiator Initiators effect on the completion of the bargaining successfully Imitators effect on the terms of the deal What is conducive to reaching agreement through the bargaining process
SAIS IIMK 2013 1-5
136
SAIS IIMK 2013 1,2
137
Why bargain?
Two players with log utility functions

Two equal skill players occupy 1, 2 spot Negotiated payoff CE of continuing to play
SAIS IIMK 2013 1,2
138
Expected value of the tournament

Independent chip model (ICM)
SAIS IIMK 2013 1-5
139
Expected value of the tournament

Independent chip model (ICM)
SAIS IIMK 2013 1-5
140
When does bargaining occur?

SAIS IIMK 2013 1-5
141
Who initiates bargaining?

SAIS IIMK 2013 1-5
142
Equality and the success of negotiations other measures

SAIS IIMK 2013 1-5
143
Summary
SAIS IIMK 2013 1-5
144
Summary
SAIS IIMK 2013 1-5
145
Summary
Delay in bargaining Identity of initiator Initiators effect on completion of bargaining Deals more likely when initiator in stronger position or experienced/ highly ranked Initiators effect on terms of deal No effect. Leader sacrifice, guy in the middle gets squeezed Characterist ics of the environment conducive to bargaining Larger gains to trade; high risk; equality of outside options; few remaining players; few experienced players
Empirical results
Bargaining occurs with a significant delay or not at all
Initiator typically in weaker position; initiator less likely to be experienced or highly ranked
Theoretical lenses complete information bargaining, cib with learning, cib with biases (overconfidence), incomplete information, dissolving a partnership (Cramton et al., 1987)
SAIS IIMK 2013 1-5
146
SAIS session 14, 15; 08/21-22/13


148 SAIS IIMK 2013 1,2

SAIS IIMK 2013 1,2
149
Does a coattail effect influence the valuation of players in the MLB drafts?
Kevin Whitaker, 2013, 7th Annual SSAC
Coattail effect
In elections In drafts
Schools home to top talent see better draft performance at 6+ rounds But, could simply be that top talent plays in good setups
How do you take care of this? Our friend, the FE model could help
SAIS IIMK 2013 1-5
150
Measuring the Coattail effect
Junior Senior; Senior Junior coattails possible
SAIS IIMK 2013 1-5
151
Measuring the Coattail effect
Junior Senior; Senior Junior coattails possible
SAIS IIMK 2013 1-5
152
11,540 college players, 890 schools, 1984 2003 drafts
2.66 players drafted from a given school in seasons with a possible coattail effect, only .43 otherwise
SAIS IIMK 2013 1-5 153
Value of a draft pick and the coattail effect

Does Coattail effect mean that teams are making costly/ less than optimal decisions though? Y: making it to the major league = f(Round of draft pick, sq, cube, Coattail)
SAIS IIMK 2013 1-5
154
Value of a draft pick and the coattail effect
Assumptions
Teams always choose the player they feel to be the best available prospect in the draft But younger players may have more leverage Sums demanded not known unless deal is done
SAIS IIMK 2013 1-5
155
But players who benefited from the coattail do not
SAIS IIMK 2013 1-5
156
Coattail Conclusion
Six, Seven figure investments inlottery tickets Additional .76 players drafted from a school in a year where there is a top prospect (.43 Avg) Effect seems to have gotten stronger between 1984 and 2003 (?) But players who were teammates with top players actually outperformed Most draft eligible college players recruited through concurrent programs
SAIS IIMK 2013 1-5 157
Where, closer to home, could we see a similar Coattail phenomenon?
SAIS IIMK 2013 1-5
158
The Value of Flexibility in Baseball Roster Construction

Timothy CY Chan and Douglas S. Fearing, 2013, 7th Annual SSAC
Estimate
Likelihood and duration of player injuries through a season
Fielding abilities at secondary fielding positions Robust optimization model to measure degradation of team performance due to injuries Measure difference in performance between teams with and without positional flexibility
SAIS IIMK 2013 1-5 159
Basic Player Position Assignment Model
Player j plays position i with a capability value of vij vij fraction of all innings in a season that player (factories) j is assigned to position (products) i J players, I positions Player j can play up to cj innings per season Each position must be assigned a player up to di innings per season, which can be further divided into L and R Constraints to ensure catchers play at most 85% of the innings per season
SAIS IIMK 2013 1-5 160
Assumptions
Capability values are additive across players Injuries which determine a players capacity values happen before player-innings assignment Innings in which players are injured is controlled by the team - ???
SAIS IIMK 2013 1-5
161
Robust Player Position Assignment Model
Augment basic model to allow an extra decision (by nature) to determine the worst case combination of player injuries I: budget of disruption given to Nature
SAIS IIMK 2013 1-5
162
Value of Flexibility in the absence of injuries
But what is the source of this flexibility?
SAIS IIMK 2013 1-5
163
Position Assignment for LAD w/ wo flexibility no injuries
SAIS IIMK 2013 1-5
164
Value of Flexibility with simulated injuries
SAIS IIMK 2013 1-5
165
Think about resources flexibility in cricket

Bat, Bowl, All-rounder, W-all rounder, fielding IPL: foreign versus domestic players Left Right handed top-3 batsmen <> Left Right handed new ball bowlers Left Right handed slow bowlers <> Left Right handed batsmen How would franchises strategize in various bidding rounds? Early round bidding results as inputs to later roun
SAIS IIMK 2013 1-5 166

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Session 1-14 Strategic Analytics 0821 PDF

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Strategic Analytics: insights from sport SAIS

As in agents with vested interests who could upset equilibrium

Mintzbergs early views as plan, position, ploy

Background worldwide, India and at IIMK

Draw parallels in other sports/ industry settings

SAIS IIMK 2013 1,2

There are multiple papers for a good number of sessions

Some thoughts on novelty risks and getting close to potential

Drawing parallels to wider business/ management settings

SAIS Discussions grouped into

SAIS IIMK 2013 1,2

15 F Scheduling 16 F Performance and attendance

SAIS IIMK 2013 1,2

Topics and their wider relevance

SAIS IIMK 2013 1,2

Topics and their wider relevance

15 F Scheduling 16 F Performance and attendance

SAIS IIMK 2013 1,2

Topics and their methodology

SAIS IIMK 2013 1,2

Topics and their methodology

15 F Scheduling 16 F Performance and attendance

SAIS IIMK 2013 1,2

Damned Statistics but Fans may still be right

Ricky Pontings first test century in India

Challenges, stumbling blocks

Stumbling blocks contd..

Data + common sense

National league goes back to1876

Where does that leave us?

In order to do so, basic understanding of the games is needed

9 innings (?) 3 batters per inning Diamond

Shot clock 24 seconds Foul trouble and ejection

SAIS session 2, 06/20/13

IPL Player Retention rules tilt level playing field

How Competitive are Competitive leagues? TMLW - Scorecasting

But, how do the Yankees dominate like this?

Is that all then?

Is it is the same in all sports though?

Does market size have a big influence?

Rottenberg, Uni of Chicago

Discontinuity of team performance across seasons

Minimal large-market dominance (small-market weakness)

NFL, NHL improvement; NBA inverse

Factors that may influence this balance

Leagues depending more on national television broadcast revenue

Free Agency in MLB

Free Agency in MLB

SAIS IIMK 2013 1,2

Impact of free agency on competitive balance

Competitive balance model NBA

OLS Interpretation pointers

NHL shows an improved in it DWP

Are closed leagues the only way?

In an open league, mobility is only via promotion or relegation

Recall 2005 CL final (Istanbul)

Internationalization of EPL club ownership

Bosman Ruling (1995)