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Mariners blog

Daily coverage of the Mariners during the season and all year long.

August 12, 2010 at 10:43 AM

Who is grading the performance of Mariners CEO Howard Lincoln and president Chuck Armstrong? Jack Zduriencik had best pay attention

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It’s become open season this week on Mariners CEO Howard Lincoln and president Chuck Armstrong. And much of it is deserved in the wake of the firing of Don Wakamatsu, the blunders by second-year GM Jack Zduriencik and what looks to be a second 100-loss season in three years after this team was picked by some to contend.
But what I keep seeing overlooked in all the Lincoln and Armstrong critiques is an understanding of why they continue to hold on to their positions. And if I’m Zduriencik, I’m making that required reading if he doesn’t know it already.
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For me, the big reason is the fact that the team’s majority owner, Japanese billionaire Hiroshi Yamauchi, has never seen a Mariners game live. In fact, after I heard a radio commentator say yesterday that Yamuachi had been to a game, I double-checked with a senior team official and was assured this was not true. In fact, he told me, Yamauchi has not been to the United States since assuming control of the team in the 1990s.
So, let’s work off that assumption. And also, please understand, that Yamauchi transferring control of his assets a few years back was a move done merely on paper, for estate-planning purposes. He is getting on in years and that is something commonly done by people with hefty assets. He is still the top decision-maker for the team. The buck, or megabucks, stop with him.
So, how would his living in Japan and not visiting the U.S. impact team decisions that are made?
Well, let’s be realistic. I heard from a Japanese reporter yesterday that Yamauchi is not pleased with the Mariners this season. Well, OK, join the club. Long line for that one. But to what extent is Yamauchi not pleased? How irritated is he, sitting thousands of miles and an ocean away from the people who are living and breathing this team daily?
Because the distance factor cannot be overlooked. No matter how adept we’ve become at instant electronic communication.
Imagine, for a moment, that Yamauchi had a pad in Bellevue and decided to throw a barbecue for the neighbors this weekend. How do you think the conversation would go? Something along the lines of: “Hey, ‘Rosh, that’s a mean Kobe steak you cook up, but man, does your team ever stink!”
Or, “How could you let Jack Zduriencik get away with canning his handpicked manager four months after an 85-win rookie season? Hey, pass the ketchup!”
And maybe, “Gee, ‘Rosh-Meister, Chuck has been president since back in the days when the Japanese Little League team was losing to the Bad News Bears. The ones with Tatum O’Neal on the team! Don’t you think you oughta’, I dunno, shake things up a bit? Great salad, by the way. Your wife make it?”
Hearing that two dozen times a day, whether at a barbecue, running to the store for a quart of milk, or simply sitting in the owners’ box with 10 or 15 of his closest friends might make Yamauchi a little more hands-on when it comes to his yearly evaluations of who is running his baseball team.
Yes, Yamauchi still gets daily reports. But they are sent from afar. He still speaks to Ichiro once the season’s over and gets a gauge of what’s happening. But that’s going to be seen through the eyes of another. And a player at that. Players aren’t always the best judges of how a team should be run.
These are the cards we’ve been dealt in Seattle. And Yamauchi has put up a lot of money for this team’s yearly payroll. He didn’t “Moneyball” it when that was the trend early on last decade. But the setup here has its limitations and this is one of them.


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Let’s not forget, it was Lincoln himself who brought Yamauchi on board as the majority owner. Lincoln was a shrewd, brilliant business executive in Nintendo’s international division under Yamuachi. A man who helped earn Yamauchi tens, if not hundreds of millions of dollars.
So, do you think Yamuachi is going to pull the trigger on Lincoln over a couple of 100-loss seasons? Especially when he’s not here to witness the Mariners experience or live and breathe it on a daily basis? If you believe that, then you do not understand human nature.
Yamauchi undoubtedly feels a great deal of loyalty to Lincoln for all he has done for him in a lifetime body of work. And when it gets right down to it, Lincoln’s job description really does not involve day-to-day baseball decisions. Lincoln is the money guy here. Or, at least, the No. 1 representative for the top and smaller money guys.
And as far as running a business goes, the Mariners have made money for their investors.
This is a key piece of information that Lincoln critics cannot simply dismiss. In fact, it’s the key to the whole shebang.
Lincoln has taken a Mariners team that was in danger of moving to St. Petersburg, Fla. and significantly upped the value of the franchise. Yes, he had help from taxpayers. As do most sports owners. And as taxpayers, you have a right to be miffed at some of what’s gone on. But put that anger aside for a moment, and pretend you are an owner of this team.
The Mariners have made you a lot of money. Howard Lincoln has made you a lot of money.
We’re not talking about yearly profits and losses here. The M’s like to talk about how not a dime of profit has been put in owners’ pockets since they came on-board. And the team has lost money in many a season, including two years ago.
But think of the Mariners as a condo you’ve just bought in a short sale for $100,000. Let’s say you have a yearly mortagage commitment of $10,000, but manage to find tenants to rent it out to. Some years, you collect $8,000 in rent and cover the remaining $2,000 in mortgage out of your pocket. Other years, you make $12,000 in rent so the mortgage is covered. So, you’ve got an extra $2,000. You could pocket the money, but instead, you put it back into the condo, sprucing up the place with new paint, maybe some comfier furniture.
And you keep renting the place out. Finally, it’s paid off in, oh, say 10 years and, low and behold, the market tells you the place is now worth $300,000! So, you sell, sell, sell and walk away with a nice, tidy sum.
Welcome to how owning a baseball franchise works. Don’t get sidetracked by yearly profit and loss statements. The key is overall franchise value. Sure, that value could erode from time to time. Maybe that $300,000 house value tumbles to $250,000 because of a recession. But that’s still far more than your initial $100,000 investment! And don’t forget, the rent has been covering your mortgage most of the time. Other than the initial downpayment, all else is gravy. We won’t even get into the tax breaks. Leave that for another time.
So, if you’re a Mariners owner, are you going to be looking for Lincoln’s scalp?
Now, the situation with the local owners is a little different. I’ve seen the most-known of those, the media-shy Chris Larson, at games with family and friends. In the clubhouse a couple of times. He doesn’t come over to say hello. That’s the “media shy” part. But I know what he looks like. Had an email exchange with him a couple of years back during our five-part “Rebuilding the Mariners” series. Quite the coup, I’m told.
So, Larson, as a local owner, I’m sure gets an earful about the team from friends, neighbors and everyone else he runs into. But still, he’s a minority owner. Most Seattle baseball fans don’t know who he is. Couldn’t pick him out of a lineup. That would change if he became a majority owner and maybe that will happen someday. But that day has yet to arrive. And for now, Larson gets to hang out at the ballpark, take friends on tours of the field and even the clubhouse. Gets to invite players to his house to see his memorabilia collection. And he gets to sit on an asset that he can cash-out on if he tires of it and walk away with a whole lot more money than he put in.
So, again. Would Lincoln be his first target? Lincoln’s the guy who brought him in on this deal in the first place.
Folks, Lincoln is not going anywhere unless he decides it. Get used to the idea.
Armstrong, on the other hand, is not quite the same.
Because his duties as president, which encompass a wide range of activities that also involve the money-making ability of the franchise, do, unfortunately for him, include baseball-related performance. And if enough owners, big and small, get a little too fed up with a money-making asset that can’t avoid embarrassing them as a baseball-playing entity, then Armstrong could indeed feel some real heat.
In fact, I’d say he’s feeling a lot of it these days. Again, you can’t underestimate the benefits of a quarter-century of relationships Armstrong has built in baseball, as well as the multiple years with these owners and with Lincoln. Nor the four playoff appearances in seven seasons under this ownership group from 1995-2001.
But he is in charge of the baseball product. More so than Lincoln. And Armstrong should be taking heat. He and Yamauchi are not joined at the hip the way Lincoln is with the big boss based on years of previous business ties. Lincoln and Armstrong do go back a long way, but they are not interchangeable.
And unlike Lincoln, the guys looking over Armstrong’s shoulder just could be inclined to step in and enforce real accountability on him. The kind of accountability Wakamatsu just experienced.
So, if I’m Armstrong, I’m not too comfy these days. In fact, I’m probably feeling quite miserable, because unlike Yamauchi, Larson and all the other owners you’ve never even heard of, everyone knows who Armstrong is. And he is hearing it from all of you — and his closest friends — on a daily basis. Bank on it. More importantly, he’s likely going to be hearing it from above.
So, right now, should anyone in the organization be more nervous than Armstrong?
Yes, just one. That would be GM Zduriencik.
Because if Armstrong is starting to feel the heat from above that I suspect he is — not to mention public heat around the city — you’d best believe the GM that put this 2010 mess together is not getting off Scot-free. The tricke-down theory of taking crap from your boss states that Zduriencik should be starting to feel it hit him on the head right about now. After all, he just dumped a load on Wakamatsu and buried him alive.
There’s no one left beneath him. Zduriencik is next on the receiving line.
Armstrong won’t allow Zduriencik to keep hiring and firing managers without burying him up to his eyeballs first. May not even let him completely hire this next manager. A lot of folks assume that Lincoln and Armstrong have meddled in Zduriencik’s business the way they have with prior GMs. I’m not so sure. In fact, until this season went up in flames, we’d all spent the past 1 1/2 years marvelling at how much autonomy Zduriencik seemed to have. Zduriencik has been given a ton of leeway to build the team the way he wanted it. It sure didn’t fit the Lincoln-Armstrong blueprint with GM Bill Bavasi, did it?
Yeah, there might have been some interference in the whole Ken Griffey Jr. fiasco. But then again, Armstrong has always said that bringing Griffey back was Zduriencik’s decision. Both in 2009 and, far more critical, for 2010. Zduriencik has always said it was Zduriencik’s decision, too. And if both men are telling the truth about that, these may be dark days ahead indeed for the team’s GM.
Because it says here that Armstrong isn’t going to allow himself to be buried from above without enforcing some real accountability on the guy down below him. The way Zduriencik just did with Wakamatsu. And hey, it might not be very fair. But this isn’t about fair. Wakamatsu wasn’t fair. It’s just business.
And in the business of the Mariners, Armstrong is not looking nearly as bullet-proof as he has in past years. Which means Zduriencik had best scramble for a vest, before he gets thrown in front of the next shot.

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