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Which Teams Get the Most For Their Money?

Today marks the beginning of the NHL free agency period and I though it would be interesting to take a look at the NHL version of marginal wins. The basic concept is easy enough to understand: what team receives the greatest return from the money they spend on player salaries? Now you might think that the simplest thing is to simply divide each team's NHL standing points by the total amount they spent on salary but unfortunately that is not appropriate because no NHL owner can spend $0 on player salary. There is a minimum amount that any NHL franchise must spend to field a team, so the best appraoch is to look at what sort of a return each team gets for the money they spend beyond the minimum.

Even a cheap owner like Bill Wirtz must field a roster of 20 players for each game and with injuries and call ups most teams end up paying for more than 20 player salaries each season (For the minimum team I assumed 23 rosters spots at the lowest available market price). In theory an owner could ice a team composed of nothing but players making the league minimum salary and offer the fans the Cheapest Team of All Time. This Cheapest Team will serve as our benchmark for comparison. (Note: under the new CBA their is a salary floor that prevents any owner from putting out something like the Cheapest Team of All Time so this cannot happen in the real world anymore.)

How would the Cheapest Team of All Time fare? What if we had a roster of nothing but young prospects, AHLers and washed up veterans playing out the string? Hmmm, that sounds a lot like some NHL expansion teams. If we take a look at expansion teams we see that the Thrashers and Sharks each collected just 39 points and the Ottawa Senators finished with 24 points. But the all time low was established by the expansion Washington Capitals who earned just 21 points in an 80 game season. Based on the Senators and Capitals examples I'm going to say that the Cheapest Team of All Time would only win about .25% of their games. Last year in the NHL the average team earned 91.4 standings points and so our Cheapest Team would have only earned approximately 23 points.

OK now that we have figured out what the minimum NHL roster would fare we can move on to the rankings. In order to rank the teams we need to calculate marginal points. The formula for marginal points is the following: (Team salary minus minimum salary) divided by (Team points minus minimum points). In plain English what I'm doing is looking how much each team spent beyond the minimum and how many points they earned above what the Cheapest Team would have earned. What this does is give us marginal points which tells us how many points that particular team gained for each additional dollar it spent beyond the absolute minimum required.

Pre-Lockout Rankings 1996-2004
Now I calculated marginal points rankings for a 10 season period between 1996-2007 but first I am going to present the results for the eight year period before the lockout and then show you the post-lock out rankings. In the table below each team is ranked based upon their combined standardized marginal win efficiency for the seasons between 1996-1997 and 2003-04. I have also listed the number of playoff appearances and years in the league and the percentage of years in the league. The last column lists the GM of that team for the 2003-04 season.

I would like to thank Andrews Stars Page and Irish Blues Salary Cap page for making the payroll data available that I used for this study.
Team Name Marginal Points Efficiency Playoff Appearances Years in NHL Playoff Percentage Team GM 2003-04 Season
NAS 12.8 1 6 17% D.Poile
OTT 12.5 8 8 100% J.Muckler
MIN 11.3 1 4 25% D.Risebrough
EDM 10.8 6 8 75% K.Lowe
CGY 3.7 0 8 00% C.Button
BUF 3.0 5 8 63% D.Regier
NJD 1.7 8 8 100% L.Lamorielllo
BOS 1.7 5 8 63% M.O'Connell
CBJ 1.1 0 4 00% D.MacLean
NYI 1.1 3 8 38% M.Milbury
ATL 1.0 0 5 00% D.Waddell
TBL 0.2 2 8 25% J.Feaster
PIT 0.0 5 8 63% C.Patrick
PHO -0.2 5 8 63% M.Barnett
VAN -0.9 4 8 50% B.Burke
CAR -1.6 3 8 38% J.Rutherford
ANA -2.0 3 8 38% B.Murray
FLA -2.8 2 8 25% R.Dudley
LAK -2.8 4 8 50% D.Taylor
STL -3.0 8 8 100% L.Pleau
MON -3.5 4 8 50% A.Savard
SJS -3.5 6 8 75% D.Lombardi
COL -3.7 8 8 100% P.Lacroix
CHI -3.9 2 8 25% M.Smith
DAL -3.9 7 8 88% D.Armstrong
TOR -3.9 6 8 75% P.Quinn
WAS -4.0 4 8 50% G.McPhee
DET -4.8 8 8 100% K.Holland
PHI -5.0 8 8 100% B.Clarke
NYR -11.7 1 8 13% G.Sather

Now if you look at this table that ranks the 30 NHL teams based on their marginal wins we see that some teams are much better than others in terms of getting points out of the money they spend on players salaries. The Rangers are at the bottom (hardly a shocker) while thrifty teams such as the Wild, Predators and Senators occupy the top spots.

But the other thing this table shows us is that getting the most for your money didn't necessarily matter in the old NHL. If we divide that list into thirds, the teams that are the most efficient in terms of getting the most out of their money only made the playoffs of 53% of the time. The teams in the middle third made the playoffs 47% of the time. The teams at the bottom third of the marginal points list made the playoffs 70% of the time. That is one reason the league was not healthy pre-lockout, teams that managed their money smartly were not rewarded. To put it bluntly the big spending teams were playing a different game than the poorer clubs. The Detroit Red Wings could make a Uwe Krupp sized mistake ($16 million over four years, 30 NHL games played over those four seasons) and still make the playoffs with ease. For other franchises an Uwe Krupp sized mistake would have killed their playoff chances for several seasons.

The new CBA ushered in an era when every team needs to become adept at getting the most for their money. All 30 teams are required to have a payroll between the floor and ceiling which puts a premium on getting the most out of every dollar. How would the formerly big spending teams adapt? Would the teams that were good at managing their money thrive and even dominate under the new system? Let's take a look at how each team did under the new CBA.

The following table is set up to allow for easy evaluation of how a team did pre-lockout (column 1) and post lockout with both season combined (column 3) or each post lockout season individually (columns 6 and 8). I also provide the names of the team GMs that assembled those rosters (columns 5 and 7) and list how many times the team made the playoffs the last two seasons (column 4).

Marginal Pionts Ranking 1996-2004 Team Name Marginal Poinst Post Lockout Ranking Post Lockout Playoffs 2005-06 GM Marginal Points 2005-06 Ranking 2006-07 GM Marginal POints 2006-07 Ranking
1 NAS 1 2 D.Poile 2 D.Poile 2
6 BUF 2 2 D.Regier 1 D.Regier 4
3 MIN 3 1 D.Risebrough 4 D.Risebrough 7
16 CAR 4 1 J.Rutherford 3 J.Rutherford 18
22 SJS 5 2 D.Wilson 5 D.Wilson 9
17 ANA 6 2 B.Burke 11 B.Burke 3
2 OTT 7 2 J.Muckler 7 J.Muckler 8
28 DET 8 2 K.Holland 8 K.Holland 5
25 DAL 9 2 D.Armstrong 9 D.Armstrong 6
18 FLA 10 0 M.Keenan 6 M.Keenan 17
27 WAS 11 0 G.McPhee 12 G.McPhee 11
13 PIT 12 1 C.Patrick 30 R.Shero 1
30 NYR 13 2 G.Sather 10 G.Sather 13
5 CGY 14 2 D.Sutter 13 D.Sutter 16
15 VAN 15 1 D.Nonis 23 D.Nonis 10
7 NJD 16 2 L.Lamorielllo 15 L.Lamorielllo 20
21 MON 17 1 B.Gainey 16 B.Gainey 22
23 COL 18 1 P.Lacroix 21 F.Giguere 19
12 TBL 19 2 J.Feaster 20 J.Feaster 21
10 NYI 20 1 M.Milbury 26 G.Snow 12
11 ATL 21 1 D.Waddell 24 D.Waddell 14
26 TOR 22 0 J.Ferguson 22 J.Ferguson 23
4 EDM 23 1 K.Lowe 14 K.Lowe 25
20 STL 24 0 L.Pleau 29 L.Pleau 15
14 PHO 25 0 M.Barnett 17 M.Barnett 29
19 LAK 26 0 D.Taylor 19 D.Lombardi 26
9 CBJ 27 0 D.MacLean 25 D.MacLean 24
29 PHI 28 1 B.Clarke 18 B.Clarke 30
8 BOS 29 0 M.O'Connell 27 Choarelli 28
24 CHI 30 0 D.Tallon 28 D.Tallon 27

What happened when the NHL entered the salary cap world? Well we see that some of the thrifty teams continued to excel in that area (NAS, BUF, MIN, OTT) while others did not (EDM, CBJ, BOS, NJD). We also see that a number of the big spenders made the necessary adjustments to the new rules and continued to thrive (SJS, DET, DAL, ANA) but others continued their pre-lockout pattern of receiving a poor return on their salary investment (CHI, PHI, LAK, STL, TOR). Other teams have combined strong season with poor ones (CAR, PIT, VAN, NYI). Some teams appear to have taken longer to adjust to the new NHL but made big improvements in their second try at it. The most improved teams are the Penguins, Canuks, Blues, Thrashers, Islanders and Anaheim. The list of backsliding teams who did worse their second year includes the Hurricanes, Panthers, Montreal, Edmonton, Coyotes, Kings, Flyers

Perhaps the most important thing for the health of the league is that intelligent use of money is now strongly connected to getting to the playoffs. A team that signs a player to a stupid contract is much more like to pay the penalty in on-ice performance. You cannot spend your way out of mistakes as was the case in the past. In fact, it is nearly impossible to make the playoffs without smart spending (the NJ Devils being the one exception the last two years--it is a good thing for them Brodeur is vastly underpaid). The top 10 post-lockout teams made the playoffs 80% of the time (The Florida Panthers spent wisely but just didn't spend enough to get into the post season). The middle third in the post-lockout marginal ranking made the playoffs 65% of the time, while the bottom third just 15% of the time. Intelligent allocation of payroll money is an absolute requirement for team success if the new NHL. The less on of the last two season is that if a team makes sound decisions with player salaries they have a strong chance of being in the playoff hunt and getting into the post-season.