Assessing Roster Moves III: Ideal 40-Man

Thus far in the offseason, Brewers GM David Stearns has made moves with 40-man roster implications involving 18 players:

• Selecting contracts of OF Lewis Brinson, OF/1B Ryan Cordell, LHP Josh Hader, OF Brett Phillips, and RHP Taylor Williams.
• Losing RHP Miguel Diaz in the Rule 5 draft.
• Waiver claims of RHP Steven Geltz, RHP Blake Parker, and OF/1B Adam Walker.
• Outright assignments to RHP Yhonathan Barrios, RHP Steven Geltz, RHP David Goforth, C Josmil Pinto, and RHP Ben Rowen.
• Designating 1B Chris Carter, RHP Blake Parker, and 1B/OF Adam Walker.
• Signing free agents LHP Tommy Milone and 1B/OF Eric Thames
• Trading C Martin Maldonado and RHP Tyler Thornburg (returning C Jett Bandy and IF Travis Shaw to the 40-man roster).

The moves seem haphazard at best, especially when one considers the fact that the Brewers will have at least $100 million in unspent revenue between 2016 and 2017, the team improved by five wins in 2016, and the team aggressively used their 40-man roster to provide second-chances and search for big value for the 2016 season. Instead of using the 40-man roster to keep intriguing players like Adam Walker (who could have been optioned to AAA Colorado Springs) and Blake Parker (who would have been a welcome addition to the bullpen), the club opted to waive those players and risk losing them. In terms of non-tendering players, the Brewers roster featured RHP Chase Anderson and Matt Garza, who collectively offer a total surplus of approximately -$14.5 million given their performance and contracts, but it was 1B Chris Carter (and his solid contract surplus) that was non-tendered prior to that arbitration deadline. The best value move thus far is the free agency contract to Eric Thames, who could provide the Brewers with another late-career power explosion.

It is too easy to argue that these moves cost the Brewers nothing; while that is technically true, once players like Carter, Parker, and Walker were non-tendered or waived (or Anderson and Garza were not), analysts can look at the opportunity cost of those moves for the club. Given that a roster spot was used for RHP Adrian Houser, who underwent Tommy John surgery late in the 2016 minor league season and will not pitch in 2017, it is difficult to argue that the 40-man roster did not have room to stash future value plays (like Walker, or Parker). Overall, these moves will not necessarily cost the Brewers anything, and indeed they will ensure that profit is maximized in some cases (such as the unwillingness to sign Chris Carter or keep Martin Maldonado or Tyler Thornburg, for instance). Principal Owner and Chairman Mark Attanasio will continue to return shareholder value through GM Stearns’s rebuilding moves, which promises to once again leave fans wondering when contention and improving the MLB roster at all costs will enter into the rebuilding process (certainly, after recent trials by Boston, Cleveland, and the Cubs, it should not be absurd to suggest that a 73 win club can work its way to contention, especially when it will be graduating top prospects to the MLB and have at least $100 million to spend).

Yet, even if one does not believe that the Brewers are near contending, the 40-man roster moves thus far show a striking lack of imagination and hardly suggest a plan for future values. To demonstrate this, it is worth analyzing each roster asset with 40-man implications, and constructing a “maximal” or ideal 40-man roster. My vision presented is only one; it is crucial to emphasize that this is not the only possible 40-man outcome, but rather an exercise to quantify the lost future value demonstrated by the 2016-2017 offseason thus far.

The following 40-man roster moves are assessed using harsh 30 percent depreciation projections on three-year WARP performances, meaning that a player’s value will be assessed according to declining performance rather than actual performance. This analytical approach is meant to underscore the likelihood that each MLB player depreciates as time progresses, which allows one to judge contracts and reserve rights against worst-case scenarios.

Prospects were assessed using relatively harsh OFP grades, to suggest a low floor rather than the best possible outcome. Miguel Diaz’s shining midseason evaluation is not used for roster analysis; instead, his likely outcome of either missing the MLB or working as a reliever is used. Ryan Cordell is assessed as a bench player.

Total surplus value is meant to reflect the fact that value is production and scarcity. In this sense, when a team reserves a player, they reserve that production and benefit from the capacity provided by an artificially deflated contract (or, they suffer the deficit of a player’s contract that greatly outpaces production). This is an extremely abstract measure meant to monetize a player’s total trade or transactional value (for example, since Jonathan Villar’s total surplus is $88.8 million, the Brewers might benefit from offering him a contract extension anywhere between $30 million and $50 million in order to (a) lock in his production and tools, and (b) land a contract with Villar that maintains some surplus ceiling for potential future trades). So, total surplus does not always need to be used for a trade; it can be used to judge a player’s extension value or contract value.

I started with the position players because this group has been handled by Stearns much more efficiently than the pitchers. The GM’s best moves thus far have been the Thames signing, the Thornburg trade, and not trading Villar or Ryan Braun (thus far). I would not have traded Maldonado, but I understand why that deal was made.

In line with the idea that Stearns has effectively managed the position players, the Brewers have missed only 5.4 WARP in absolute value. This is an abstract number meant to represent the opportunity cost of constructing the current 40-man roster, as opposed to a 40-man roster including Walker and Maldonado. I added Nate Orf as the current 40th man, since the Brewers only have 39 roster spots filled at the moment, and because why not? (As James Fisher said last midseason, Orf is a utility guy that hits!) He’s the type of organizational guy that could benefit from a roster spot on a rebuilding team.

The pitchers are much more problematic than the position players. Let’s cut to it:

Prorated for 91+ years of contract control, the “ideal” 40-man equals $474.0M surplus versus $424.5M surplus. In terms of performance, this is a difference of at least 3.54 WARP. In terms of real value, the opportunity cost 7.07 WARP, and the opportunity cost in terms of absolute value is 11.53 WARP (in production value, contract value, or trade value).

This is extremely problematic even if one removes someone like Diaz or Parker from the equation:

• Right-handed relief margins could have been managed quite differently to maximize value. One must reach deep into scouting reports to consider reasons for keeping Michael Blazek and Jhan Marinez while waiving/outrighting David Goforth and Blake Parker.
• Matt Garza can be considered a sunk cost, since the Brewers will spent at least $15 million anyway on the veteran, and even a trade would require cash to return a prospect of note. Given that Milwaukee is sitting on at least $100 million in revenue, it is unclear why they would non-tender someone like Chris Carter while keeping Garza on the roster. That loses the team at least 2 WARP in total surplus.
• I assume there is a very good labor-related reason for keeping Adrian Houser on the 40-man roster. The club did not place him on the 60-day disabled list when he underwent Tommy John surgery, and I gather Houser will be slated for a full season on the 40-man roster in 2017 for the same reason. Anyway, it is difficult to see a team selecting Houser in the Rule 5 draft for 2017 given his injury, so there must be another explanation for using a roster space on the prospect (I just don’t know that reason).
• Again with the non-tendering, it is difficult to understand why Carter gets a cut, and Chase Anderson or even Carlos Torres stays on the 40-man roster.
• RHP Steven Geltz has the best splitter TAv-against among 62 MLB relievers that have thrown at least 200 splitters (all-time).

So, how does the club recoup nearly 17 WARP in opportunity cost? This will likely happen when players like Lewis Brinson or even Jorge Lopez graduate and produce at a high level, Jimmy Nelson recoups some of his value, or the club makes another solid trade like the Thornburg move. This is the best aspect of the 2017 Brewers roster: there is still plenty of room to cut or waiver players to make room for Lopez, Josh Hader, Brinson, Ryan Cordell, etc., when those players claim their roles. The question is only whether the Brewers could have also held on to additional players while maintaining space for their best prospects to reach the MLB in 2017. For this reason, the Brewers have a roster setback entering 2017 — for a rebuilding club, they have failed to maximize future value.