October 26, 2009
Driving To The Net
The Matrix Revisited

by Timo Seppa

If you happened to take Intro To Marketing in college, then the Boston Consulting Group (BCG) Matrix should look familiar to you. The BCG Matrix views product life cycle in terms of market share and market growth, splitting products/businesses into four categories: Stars (high market share, high growth), Cash Cows (high market share, low growth), Question Marks (low market share, high growth) and Dogs (low market share, low growth). Simply put, it’s a model for visualizing where a business stands today and where it’s projected to stand tomorrow. Seems like a similar model could be made to fit a hockey team, eh?

Two simple metrics for estimating a team’s current ability and future potential are its scoring level––which can be measured in Relative Goals For (RGF=Team’s GF minus NHL average GF)––and its average age. In the spirit of the BCG Matrix, we can identify the NHL’s own Stars, Cash Cows, Question Marks and Dogs using these metrics. That categorization then indicates how management should best tackle strategic team-building, towards the goal of developing a championship-caliber squad. Generally speaking:

• Stars (high scoring, young team) are competitive and they stand to be for years to come. Nevertheless, optimal long-term performance for Stars results from properly timing the transition between developing a skilled, young core and peaking to championship form by picking up select veterans.
• Cash Cows (high scoring, old team) are positioned for repeat playoff appearances. Over time, they require calculated veteran turnover and select organizational reinforcements to remain postseason contenders.
• Question Marks (low scoring, young team) should start with a singular purpose: to gather skilled young players. Effective drafting is essential to developing a talented, young nucleus; gathering additional draft picks can help in this endeavor. They will continue to flounder out of the playoff picture if the right choices aren’t made.
• Dogs (low scoring, old team) need to be stripped down to start over with a new core, with management avoiding temptations of quick retooling.

Since we can only project 2009-10 scoring levels––and to some extent, the ultimate age of teams––let’s examine how we would have classified the 30 teams for 2008-09:

Scoring level and average age, 2008-09

Stars (high scoring, young team)

Team	      RGF  Age	  Seed
Boston	     +35   27.1	  1
Washington   +33   27.1	  2
Chicago	     +25   24.3	  4
Philadelphia +25   26.4	  5
Pittsburgh   +25   27.1	  4
Toronto	     +11   27.2	  -
Vancouver     +7   27.5	  3

Cash Cows (high scoring, old team)

Team	      RGF  Age	  Seed
Detroit	     +56   30.6	  2
Atlanta	     +18   27.9	  -
San Jose     +18   27.9	  1
Calgary	     +15   28.3	  5
Buffalo	     +11   27.5	  -
Montreal     +10   28.4	  8
Anaheim	      +6   28.1	  8
New Jersey    +5   29.8	  3
Carolina      +0   28.4	  6

Question Marks (low scoring, young team)

Team	        RGF  Age    Seed
Edmonton        -5   26.7   -
St. Louis       -6   25.7   6
Columbus       -13   26.2   7
Minnesota      -20   26.9   -
N.Y. Rangers   -29   26.7   7
Phoenix	       -31   25.9   -
Los Angeles    -32   26.0   -
N.Y. Islanders -38   27.3   -

Dogs (low scoring, old team)

Team	        RGF  Age    Seed
Florida	        -5   28.1   -
Dallas	        -9   27.7   -
Ottawa	       -22   28.0   -
Nashville      -26   28.0   -
Tampa Bay      -29   27.8   -
Colorado       -40   28.5   -

Teams categorized as Stars in 2008-09 had an average age of less than 27.4 years and a non-negative RGF (corresponding to 238 GF or more). Among last season’s Stars, Boston (age 28.2), Washington (age 28.1), Pittsburgh (age 27.9) and Vancouver (age 28.5) have transitioned into Cash Cows in 2009-10. This makes intuitive sense – previously young teams on the rise, this quartet now involves veteran, win-now teams. In other words: time to cash in before you get too old or too expensive. VUKOTA’s number one team, the Chicago Blackhawks, continues to be the shining Star of the NHL, predicted for an even better performance while still having the youngest roster in the league. Improving Philadelphia is also considered as a Star, though this season’s Flyers are nearing league average in age. Finally, VUKOTA wisely predicted a big drop in scoring for the Maple Leafs, from 250 GF (11th in NHL) to 229 GF (22nd in NHL). Unless Phil Kessel is superman, Toronto looks like a Dog – a Dog without draft picks, that is.

Last season’s Cash Cows had an average age that was over 27.4 years and a non-negative RGF. President’s Trophy winner San Jose was a win-now team in 2008-09 at slightly higher than league average age; the Sharks have treaded water age-wise and remain a Cash Cow in 2009-10. Stanley Cup finalist Detroit has wisely shaved a year off last season’s oldest squad; they are now looking to compete for the Cup with the 2nd oldest squad. Anaheim and Calgary also slightly decreased their age, while making key veteran additions such as Saku Koivu and Jay Bouwmeester, respectively. Rolling the dice with veterans, Carolina and New Jersey now have the NHL’s 1st and 3rd oldest rosters; it’s a high wire act, as they’re Dogs if things go wrong. Montreal retooled and took some age off of their lineup. With preseason potential to cross the axis into Star territory, the unfortunate loss of star D Andrei Markov puts a positive RGF in doubt. The Canadiens’ long term strategy is dubious though, as there is little core to build around. Buffalo, like Montreal, stands to be nearly league average in age and RGF, also raising concerns about their long term plan. Atlanta may be the most interesting of last season’s Cash Cows, looking like a Star for 2009-10 by getting marginally younger. With one of the top farm systems in the NHL, they may be best served by continuing to get younger instead of making a major investment in Ilya Kovalchuk.

Perhaps the most care is required for the Question Marks, teams with an average age under 27.4 years and a negative RGF. The general manager of a Question Mark needs to continue to stock the system with quality youngsters, holding off until the right time to begin picking up key veterans. Los Angeles were the poster boys of this approach, taking a hit in production while slicing a full two years off their average age last season; the Kings set themselves up to become Stars in 2010-11, if not already in 2009-10. Columbus joins LA as the Question Marks that are maintaining their young age while continuing to develop excellent prospects; the Blue Jackets are also potential Stars. On the other hand, one of the youngest teams in 2008-09, St. Louis will increase in age by nearly two years to nearly league average; fortunately, the Blues still have the NHL’s deepest group of prospects, giving them a shot at developing into Stars. Phoenix and Edmonton will also be significantly older this season; time will tell if they have traded off too much age for early results. On paper, the Rangers are also close to league average in age, but with a pipeline of young talent that may change over the course of the season. The decision of Minnesota and the New York Islanders to get older is puzzling; both look like Dogs for 2009-10.

Dogs, teams with an average age over 27.4 years and a negative RGF, require nothing short of an overhaul. Surprisingly––or perhaps not surprisingly––only one Dog, Colorado, has significantly decreased their age; with their early success, the Avs can dream of the possibility of becoming a Star in the near future. Dallas, Tampa Bay and Florida hover just below league average age for 2009-10; they have a smattering of young talent that gives some hope of short-term improvement. Nashville puzzlingly is getting even older, though their excellent farm system may possibly save the Predators from themselves. Ottawa remains an older team; while their results are likely to be better in 2009-10, their win-now aspirations are reminiscent of the fool’s gold that Toronto is chasing.

Clearly, some teams are following sensible strategies while other teams are not. There is a natural progression that ownership and management should follow within the matrix:

• Dogs should try to rebuild, getting younger instead of better first (see: 2008-9 Kings); trying to retool by acquiring veteran free agents is foolhardy as a long term strategy (see: 2009-10 Senators). Dogs should aspire to be Question Marks.
• Question Marks need to focus on building a quality young core without jumping too quickly into the free agent market (see: 2008-9 Blues), keeping the roster young until enough talent is gathered in the system. Question Marks should pick the right time to become Stars.
• Lesser Stars should attempt to stay young in the short run (see: the alternate universe 2009-10 Leafs), but greater Stars should increase their postseason chances by diving in headfirst into the free agent market (see: 2009-10 Blackhawks and Marian Hossa), eventually transforming into Cash Cows.
• Cash Cows can retool with additional impact free agents (see: 2008-9 Red Wings, 2009-10 Sharks), but need to weed out lesser veteran players to control their average age in order to maintain their dominance. Cash Cows should try to remain Cash Cows, but should rebuild instead of retool when their run is over.

Applying proper team-building strategy is simple once a team’s positioning within the matrix is understood – and accepted! The real difficulty may be in getting management and ownership to admit where their team stands as far as its true ability and potential.

Timo Seppa runs the statistical hockey site Ice Hockey Metrics.

Timo Seppa is an author of Hockey Prospectus. You can contact Timo by clicking here or click here to see Timo's other articles.