How Much is Sabermetrics Worth to a Team?

From SABR member Phil Birnbaum at Sabermetric Research on October 19, 2011:

How much can a more sabermetric approach *today* benefit a team, compared to, say, the typical team’s sabermetric approach? For instance, how much did Billy Beane really mean to the A’s?

A couple of weeks ago, Tango did a study to figure out which teams did better or worse than expected, given their payroll. The A’s were the team that outperformed the most over the last decade — about 7 games per season, it looks like. That’s a lot, but there’s probably a whole bunch of luck there, since we’re cherry-picking them as the best of the lot. Also, it’s possible that much of their outperformance came in the early years, when, as many critics of “Moneyball” hype have pointed out, they had three underpriced ace starters.


Anyway, with the Cubs signing Theo Epstein, we now have a market estimate for what sabermetrics might be worth today. Epstein’s new agreement is for about $4 million per season. He still had one year to go on his contract with the Red Sox, for which they will receive some sort of compensation from the Cubs. Let’s say that compensation will be worth $1 million. So Epstein’s value is around $5 million. I don’t know how much a … replacement level GM makes, by comparison. To be conservative, let’s say it’s $500,000, although it’s probably more than that. That means that Epstein’s excess value is $4.5 million, exactly what it costs in free agent players to gain one extra win.

It looks like that’s what Epstein is worth: one win per season.

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Originally published: October 21, 2011. Last Updated: October 21, 2011.