Drafting for a rebuild requires consistently making high-volume, high-value draft selections to increase the potential amplitude of several waves of prospects.
The Draft
The National Hockey League (“NHL”) uses a league-wide amateur dispersal draft to equitably distribute the playing rights of emerging young hockey players across the league. NHL teams use the currency of the NHL Draft, draft picks (“picks”), to consummate trades, replenish players under contract within the organization and provide future value as banked currency. Each team receives a yearly set of draft pick currency, one pick per round in a seven-round draft where pick order is determined by where each team finished relative to each other in the final league standings for the season. Teams can use these picks as currency, borrowing from themselves in future years to pay exchange rates in the present.
In the NHL, trades involving draft picks act as currency speculation. Draft picks diminish in value the farther picks get from pick number one. The higher a team finishes in the standings, the lower the relative value of their picks. A group that views itself as in contention for the Stanley Cup can exchange these future picks for present value to bolster its chances. If they are successful, they have reduced the value of their own draft picks by improving their position in the standings. A team with a poor outlook on their ability to win the Stanley Cup (“the cup”) can do the inverse, trading away players that represent value in the present in exchange for picks representing future value. This type of trade diminishes their team's quality and improves their picks' value in the process.
One example of this is the St. Louis Blues 2018 offseason. St. Louis had missed the playoffs in the 2017-2018 season, and their pick, previously traded to Philadelphia, was 14th overall (“OA”). The Blues moved their 2019 1st-round pick and a prospect selected with their 2016 1st-round pick as part of a deal for immediate assistance. Having won the cup the following season, their 1st-round pick diminished in value from 14th the previous year to 31st OA as the Stanley Cup Champion in a 31-team league.
This value exchange is the difference between a “contending” posture and a “rebuilding” posture in successful organizations. Teams in contention for the cup should be exchanging future value for the present, and rebuilding teams should be doing the opposite: exchanging today’s value for tomorrow’s potential value. Like other forms of currency speculation, savvy management can exploit this market. Just like with currency speculation, inexperienced or heedless management can be exploited.
”Getting Worse To Get Better”
For successful clubs, there is a push-pull relationship between the strength of the organization competing with the strength of the on-ice potential of the current team. “Getting worse to get better” is a strategy for contenders and rebuilding clubs. Managing where and when to weaken your organization by trying to improve it is the art of owning and general managing in the NHL.
“Getting worse to get better” is primarily associated with rebuilding. “Tanking” is a term that describes trying to make the on-ice product as uncompetitive as possible to improve one’s draft positioning. Essentially making your team as bad as possible to secure a top prospect. Because the best, most likely NHL players are available at the top of the draft, the odds that your first pick will be a good one or perhaps even a great one increase the worse your team performs in the standings. For some, tanking is the ultimate example of getting worse to get better. For fans and media alike, tanking can have a tantalizing, if embarrassing, quality to root for. This temptation should be avoided at all costs.
Tanking is ancillary to rebuilding and sometimes directly in conflict with it. “Getting worse to get better” can quickly escalate to “getting so bad it’s difficult to recover.” The NHL is littered with historical examples of organizations that have confused tanking with rebuilding. One such example is the Edmonton Oilers. Not having a 2nd-round or 3rd-round pick in either the Draisaitl or McDavid draft years has already cost that organization significantly and will continue to do so well into the future. Four more bodies in that resonant wave of prospects would have been massive for a roster with all the top-end talent necessary but lacking cheap and effective organizational depth.
Not having those picks, let alone a surplus of picks in those rounds, is the difference between a Blackhawks or Penguins-tier rebuild success and an organization struggling under the burden of its superstars.
The danger and conflict with tanking as it relates to rebuilding are that the right prospect can propel you out of the rebuilding stage through the impact of their talent alone. The Oilers’ draft pick deficit before drafting McDavid is magnified by their inability to accumulate draft capital after he’s drafted due to his immense talent propelling the Oilers into the competitive sphere.
The best rebuilding strategies minimize the luck factor of the draft as much as possible. Remember that rebuilding is as much about the number and duration of picks as their quality. The less discussed aspect of “Getting Worse to Get Better” is understanding organizational strength and the cost to compete and contend. Turning that abundance of pick quantity into quality on the ice.
Trading a 1st round pick makes the material condition of your franchise worse. Not just in the short term but potentially 5 to 10 to 20 years out. The cost to the St. Louis Blues to complete the above trade is now proving astronomical, with Tage Thompson exploding in production and value. This season, the Blues are struggling mightily, and the addition of Thompson and that potential draft pick would look very good on a team transitioning between an older core and a younger core. However, I don’t think anyone on the St. Louis management team would take that trade back if it meant giving back the only Stanley Cup in that franchise’s history.
St.Louis had the capital necessary to complete that trade and, with no shortage of luck, had the ultimate payoff for their gamble. They won, and they won big by sacrificing long-term value for immense short-term value gain. The opportunity cost made that the right trade, but the risks in asset dealing are steep, as the explosion of Thompson illustrates with such lustre.