David Bell Kansas City Chiefs

Chiefs: Using the Thaler Factor, Inside-Out

David Bell April 16, 2019 No Comments

 

 

 

 

Chiefs: Using the Thaler Factor,

Inside-Out

 

by David Bell | April 16, 2019

 

The Golden Opportunity to Prove Thaler

Brett Veach has not had ample time to prove his acuity in picking players in the draft having only one draft under his belt – and well, maybe his influence on John Dorsey (such as with Patrick Mahomes). The 2019 draft offers three opportunities to prove my point about Veach’s willingness to use Thayer’s research as proof in the pudding. I have to explain this for you I am just about sure but the topic is about the Draft and the success rate that accompanies each round.

 

What Do I Mean by Success?

The average NFL player’s career is less than 3.5 years in duration. I do not regard this to be a successful career if that is the earmark. Doubling that gives me 7 years and this as an average is probably very good – but it still entails more players who were journeymen as opposed to above average or better players. You have seen me approach the draft with a somewhat scientific approach – well, it’s true, only somewhat because being able to judge talent is subjective, hence, only quasi-scientific. I have suggested the approach should be inside out. By ‘Inside-Out’ I mean that the approach is to first of all assess the talent on the roster at present and divide it into three categories:

 

1. Top performers: true impact players
2. Average: basic job performers
3. Journeymen and lower rated players

 

Journeymen get the very minimal basics of tasks accomplished but are not much better than lower rated players. When I think of Journeymen, they will likely play in the game longer than the NFL average career length of 3.3 years but they will have difficulty doubling those numbers of years nor will their level of play improve over their basic performance as soon as they began to play a significant number of snaps per game. If I use Seth Keysor’s approach, this means I’m going to use 3 views of all snaps a player has for a season (or a game, or a period of time). When I do this I am going to rate each play as a Win, Loss or Draw.

 

Position Outlook & Rating

Each Position has a basic ranking at the same time, and it is based on the need to obtain a player immediately, or if the existing roster player can get the basic job done at an above a journeyman player’s basic performance, and then rating a third category which is having positions with totally solid performers. Once I have done this, I then evaluate a second factor: do I have sufficient depth for the position? This factor determines how I approach the signing low cost Free Agents and/or using the draft to provide players who can provide the depth from the draft. The former are going to be players acquired at a Vet Minimum or UFA’s of less experience than 4 years.

 

What do I mean referring to the Thaler Factor?

Richard Thaler’s expertise, or metric, is used by myself to determine a value and be able to successfully apply that value to what I am trying to accomplish in the draft based on the approach that I outlined above. it is an impressionistic frame of reference. It is intuitive. It uses the live draft to figure how to select players. It uses in this case, a trade back not a trade up.

 

What he did was research the NFL Draft and determine a success rate for drafting players in the different rounds of the draft – in other words, what is true value not the anticipated value or success of players going to the NFL and having an average career length and or failing to make the grade. He found:

 

  • 30% of all starters were first round picks
  • 30% of all starters in round 2 or round 3 picks
  • 25% of draftees were selected in rounds 4-7
  • 14% of all players who became starters were Undrafted Free Agents (UDFAs)

 

The category which surprises me is the last one. It doesn’t address anything about which group had careers which lasted longer than the NFL Average Career length. I would have to suspect that the top 3 rounds would have a better participation in such careers but I have no proof of this. Thaler’s work and that of others did not address that anywhere that I have found.

 

What does this mean to me? It tells me that if I need to build a team roster, the more picks I can make in rounds 1-3 gives me approximately an equal size pool of players in each of the 3 rounds (1-3) with which to provide starters to my roster. If I use Tiers of Successful players at the same time, and divide Round 1 into two tiers, then have round 2 and 3 be a tier each, then I have 4 tier groups of players. My choice then is to find how to fill positions of need or exposures due to weak performers from existing Free Agents and Draft picks. Brett Veach informed us that he used two boards, one for Free Agents and one for Draft picks to approach the use of a mergered view of available talent and this was how he evaluated players prior to the draft and of course, afterwards, using free agents to finish building a 53 man Roster (plus 10 to the Practice Squad).

 

Thirty Percent is Thirty Percent

I began thinking about this thirty percent value. If I am getting starters to all positions for all teams from the first three rounds and I have Tier position valuations blurred due to NFL skewed position evaluation due to a majority team needs, then trading back into the second round has tremendous value. Teams are drafting this year with a prejudicial view of QBs and a skewed value to the offensive side of the ball (you choose what that is but it exists every draft year).

 

Improving Draft Player Selection Success

  • Factors which will affect how the GM Drafts players should be:
  • Players outside of the skewed value are outside of the blurred line between tiers and thus undervalued in any give year.
  • Selecting players in the draft areas where the the skewed valuation is not occurring brings a greater likelihood of selecting a top starting player and/or a player who will exceed the “doubled” career duration status of 7.6 seasons (years).
  • Trading back makes each position value less costly because I have traded out of round one money. Trading back provides the opportunity to obtain more players in round’s 1-3 and for filling roster needs for starters, impact players and quality roster depth. [Side note: this is why the top 100 players is so important]

 

Other Factors Determining Success

1. Trading Up – when a player in a position category of “must fill” is at a value that trading up will obtain a player of “Impact” level of play, then this is the point where trading up becomes more efficient and necessary. It is best to be trading up for positions that are not in the skewed categories, which was not the case for Patrick Mahomes and hence was a costly pick – plus he was a top 10 pick.

2. Trading for Future Picks – This season Brett Veach traded away $15M in salary cost by trading Dee Ford and obtaining a round two pick in 2020. This is a very good value since it was apparently the judgment of staff that Ford would not fit the role of a 43 DE to any degree of efficiency(and probably more, such as he blew the opportunity for the Chiefs to get into the Super Bowl, or that he had a perceived injury history, or that he was never going to attain a level of consistent performance that was desired of Round one draft picks(the Chiefs have another such player on the roster—Eric Fisher at LOT).
3. Proper Evaluation– proper technical study and evaluation of each player (combine, pro-day, film study, interviews and references)

 

My Approach to the Draft has sound logic which can be applied. The failure on my part will always involve my evaluation of talent whether it’s from studying film, using statistics or metric valuations such as those from the Combine or Pro Day.

 

Monday’s are Mock Days at ArrowheadOne. I did this mock below on Monday, in preparation for this article, with an eye to the Chiefs draft needs and an “Inside Out” view of the Draft and Free Agent Signings. It isn’t a secret that I prefer trading back or that I have thought the roster is stronger than most fans, pundits and experts appear to view it. I also feel that national experts are geared to the old NFL teams and the east and major market teams which means they automatically undervalue the Kansas City Chiefs. In truth, I view each pick as fulfilling needs on the roster as effectively as I am able to do with a single trade back and a comp pick. I had to wait and make the first two picks before I was able to obtain a trade back that I felt offered the most value, so it was pick 31 that was traded.

 

Order of Draft Priority:

 

1. Cornerback
2. Tight End
3. Center
4. Safety

 

 

 

Interesting process for this article. Early on I decided on two positions on offense and defense. Anything else would be icing on the cake but I am using 4 of the five picks in this trade back example for top 100 players who have a 30% chance to start, a similar success rate to that of round one. I noted via this example that even with the addition of Bashaud Breeland to the cornerback crew and having Kendall Fuller, and Charvarius Ward in house, that the CB need remains just that — a need. In this particular draft I ended up selecting 3 players at CB and also a safety. I cover TE, Center, and add a DT at the same time. This mock draft was a particularly fruitful example but note the focus on the weakest framework of the defense for two straight seasons.

 

This is the type of exploitation of Thaler’s Factor and using the strength of the draft to build depth where it is most needed. Here is tweet today by Breeland:

 

 

 

 

 

 

 

 

 

David Bell – ArrowheadOne

 

 

Reference Sources:

1. “Tracking NFL Draft Efficiency and How Contingent is Success to Draft Position.”
2015 Forbes article by Dr. Patrick Rishe, Washington University, St. Louis MO School of Sports Business. Forbes Magazine May 22, 2015.

You can read this article here:
https://www.forbes.com/sites/prishe/2015/05/22/tracking-nfl-draft-efficiency-how-contingent-is-success-to-draft-position/#72895bae7495

“Overconfidence vs. Market Efficiency in the National Football League”; Richard Thaler and Cade Massey – research. You can download a PDF of the study here: https://www.nber.org/papers/w11270

“The Loser’s Curse: Decision Making and Market Efficiency in the National Football League”. April 5, 2005 article by Cade Massey can be downloaded as a PDF here:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=697121

 

 

 

 

 

 

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