- The Washington Times - Friday, November 8, 2002

They are brilliant, creative and dynamic men (and almost all are men), innovative and energetic, wise, tough and a bit lucky. You have to be all that to create and build and sell, to sit atop corporate boards, to gain power and influence and learn how to use it, to acquire the vast capital needed to purchase a sports team.

Which is where the trouble starts.

Many of them, all unqualified successes in their chosen fields, painfully learn that team ownership is a different ballgame altogether, so to speak, with failure on the field or in the books, or both, the result.

Suddenly, what got them here no longer applies. They think it does, but guess what? The rules have changed. Or, they forgot what got them here, choosing instead to follow a new path that sometimes leads to a dead end, or the end of a cliff.

"You have a lot of owners who have made hundreds of millions or billions of dollars, who have been extraordinarily successful and have come to the point of their lives where they want to pursue a passion other than their business ventures," said Dean Bonham, CEO of the Bonham Group, a sports and entertainment marketing firm that lists several professional clubs among its clients.

"Quite often, that passion is sports," Bonham said. "But that passion tends to alter their better business judgments."

Or their better judgments, period.

"Some fans who become owners believe they know more than they know," said lifelong New York Knicks fan Howard Schultz, who moved to Seattle, built a little coffee company into Starbucks and now owns the NBA SuperSonics and the WNBA Storm.

It used to be sports fans would argue about who could play, coach and manage, or who couldn't. Now there is a new topic bad owners; owners whose teams lose and/or drown in red ink; owners who consistently raise ticket prices or even charge to watch training camp; bottom-line, bean-counting owners; owners who meddle.

What's astounding is that all of these people, for no other reason than their past accomplishments, should know better.

"A lot of people become sports owners because they feel they have the freedom to operate sports teams without the restrictions of normal business," said University of Missouri-St. Louis history professor Chuck Korr, author of a new book, "The End of Baseball As We Know It." "They really thought they could have the kind of freedom they didn't have anyplace else."

Korr has focused on baseball's well-chronicled economic problems, its out-of-control spending by well-meaning but misguided owners. He said he was struck by what he believes to be a shared characteristic among many owners, which he calls "the arrogance of unchecked power."

"They think sports is different, that there's sort of the Alice in Wonderland mentality, and that they can act differently," Korr said.

Bonham disagrees somewhat.

"I have to tell you, in the many years I've been in this business, I've really run across few owners who are arrogant," he said. "But their confidence is at an extraordinarily high level because they've gone out in the business world and achieved anything they wanted to achieve.

"You combine that confidence with extraordinary passion, you have the potential for disaster."

Carl Pohlad, once a highly respected pillar of the Minneapolis-St. Paul community, has been vilified for his role in the planned (and aborted) contraction of the Minnesota Twins. Tom Hicks, owner of the Texas Rangers and a bedrock of the big-money Dallas-Fort Worth business establishment, became a poster boy for fiscal irresponsibility for signing Alex Rodriguez to a $250 million contract in 2001, after which his team has lost and attendance plummeted. On the other hand, many Boston fans are frustrated with Bruins owner Jeremy Jacobs, whose name you can't read without the adjoining phrase, "penny-pinching."

Then there are the owners who like to, um, get involved. Can anyone not ascribe the swift and steep decline of the Baltimore Orioles to Peter Angelos, perhaps the nation's foremost litigator, who has run off capable managers and general managers, presided over the erosion of a farm system and bankrolled the purchase of costly free-agent busts?

Since he bought the team in 1999 after building a billion-dollar marketing business from scratch, Redskins owner Dan Snyder has raised ticket prices, charged admission to training camp, fired two coaches, a solid general manager and more than 100 employees, and busted his salary cap, all the while making draft and other personnel recommendations, including the signing of rogue quarterback Jeff George. Because of Snyder's brazen, arrogant image and persona, real or not, the Redskins have bull's-eyes on their backs; they are a team people love to hate.

But before Snyder there was, and is, Jerry Jones in Dallas (some have called Jones a Snyder role model), whose team won three Super Bowls in the early and mid-1990s, but has lately fallen on hard times, during which Jones named himself general manager. And then, of course, there was, and is, the Boss, George Steinbrenner, who seems to have started the trend of owners being something more than passive lords of the manor.

The fact is, sports is a different world. But not like many owners imagine. Some learn faster than others and adapt. Others don't. For example, most moves and decisions either initiated or approved by the owner are revealed almost immediately, and any failure results in just-as-immediate public criticism. Meanwhile, as we know only too well, what goes on in the corporate and business world occurs privately, secretly, behind double-locked doors.

Credit (or blame) Steinbrenner, who seems to have written the owner's manual for many owners.

"There's no question that the publicity George received by being in New York and running the most visible sports franchise in the world spawned a group of owners who coveted publicity beyond what they would have otherwise received," said Marc Ganis, president of SportsCorp LTD, a sports marketing firm.

"But what many didn't recognize, and this is what I tell prospective owners, is that they have to be prepared for the onslaught of negative publicity. It doesn't take very long for many of them to believe it's not worth it, and they want to revert back to being private individuals. But once the genie is out of the bottle, they can't do that."

Yet Steinbrenner might also serve as the model of an owner who now "gets it." Although his authority over all things Yankees remains unquestioned and absolute, there is little doubt he has backed off, leaving on-field matters mostly in the capable hands of his baseball people.

"I think the Steinbrenner textbook is one of how to do it right, and how to do it wrong," said Korr. "When Steinbrenner realized there were people who knew more than he did about baseball and gave them free rein, that's when he became a success."

Other owners, however, never seem to get it.

"The thing that surprises me is how people come in from other businesses and think they can be an expert in the sports industry immediately," Ganis said. "There was a guy from Pillsbury who became part-owner of the Vikings, and he used to show up at training camp with a whistle and a stopwatch. For some reason, sports brings out that kind behavior."

One reason, if not arrogance or even confidence, is ego. Even though, "for 99 percent of them, they are out of their element," said Jerry Colangelo, principal owner of the NBA's Phoenix Suns and baseball's Arizona Diamondbacks.

"Many who were successful in their business careers find that there are components to this business that are very emotional, that the support of your business is dependent upon an emotional response by people who buy tickets and read newspapers and watch television, and whose psychology is of identifying with winners and not losers," said Colangelo, the only major pro sports owner to also have worked as a head coach and general manager.

Putting it another way, Bonham said, "When you sell widgets, you have a customer base that may be loyal and appreciative of your product, but when you sell sports you have customers who not only buy your product but are extraordinarily passionate about it.

"With that passion comes a great deal of responsibility, and with it a great need of expertise in handling that customer."

Often, the owners themselves are victimized by their own passion, as well. For every Rupert Murdoch, whose Fox company bought the Los Angeles Dodgers and placed corporate suits in baseball positions they knew little and cared even less about, there are owners whose inherently competitive juices bubble and churn and cause them to act irrationally. These people who patiently built their businesses one step at a time yet, as owners expect instant gratification.

"There are numerous examples of owners who have made unreasonable decisions, both for their team and for their league, purely because of their passion for sports and passion to win," Bonham said. "And they don't necessarily make the best decisions."

Some owners, however, do seem to get it. At the top of Bonham's list is Stan Kroenke, who owns the Denver Nuggets, Colorado Avalanche, the arena in which they play (the Pepsi Center) and 40 percent of the St. Louis Rams. It is perhaps to Kroenke's credit that he is known as "Silent Stan."

"He does what all owners should do," Bonham said. "He runs his business like a business. He capitalizes it well, but he doesn't get involved in day-to-day decisions so that he's making emotional decisions."

Among others, Bonham also likes the Sonics' Howard Schultz and Ted Leonsis, owner of the Capitals. In fact, talking to Schultz and Leonsis, vice-chairman of America Online, is like talking to the same person. They use words like "fan-centric" and "synergy." And even though they know the sports business is unlike any other, they generally are sticking to what worked before.

Leonsis: "For me, sports is very analogous to AOL. In that, it is about consumers, and bringing consumers in through marketing. And once they were in, have them fall in love with the content. In this case, we needed to be family-friendly, we needed to be affordable, we needed to listen to the fans, we needed to reignite passion, we needed to entertain them off the ice. And in five years, we needed a team that could compete for the Stanley Cup, a team that is younger, bigger and faster and would improve through the draft, through trades and free agency."

Schultz: "The way I see the world is through Starbucks. Through the eyes of the customer. I think it's important to recognize that success in sports and business is not an entitlement. It has to be earned. A family if four is gonna come to a game and spend a real amount of money, and it has to be a real value. Our plan is clearly defined: Five years. And I think we can do that. We have completely rebuilt from scratch and people have noticed."

Both Leonsis and Schultz, and other owners, too, say they keep out of the basketball and hockey operations, other than to voice an opinion. Even Mark Cuban, the loud, visible and often controversial owner of the Dallas Mavericks, knows his place within the team hierarchy.

Schultz did, however, get into a public spat with his star point guard, Gary Payton, after Payton missed the team picture day and threatened to skip training camp after his request for a contract extension was denied. But Schultz said the fans' interest comes first, and here he thought the fans were being shortchanged. This, he said, did not contradict his philosophy: "Great businesses hire great people, and stay out of the way."

Said Leonsis, "I didn't play professional hockey. So if I think I know more about hockey than the coach or the general manager, we're in trouble."

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