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January 27, 2010

Hot Stove U.

Red Sox are the Best Farmers

by Kevin Goldstein

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The Setup

Sure, the Boston Red Sox are one of baseball's Daddy Warbucks teams with a nine-figure payroll that is consistently among the highest in the game. They're in the running for nearly every top free agent, and they will have six players on their roster this year making more than $10 million. Yet, one look at their depth chart shows a roster filled with home-grown talent. Arguably the best right side of the infield in baseball, Kevin Youkilis and Dustin Pedroia were both draft steals. Three starting pitchers originally signed with the Red Sox, as did most of the bullpen.

Sure, they have the ability to spend freely in the free agent market but, at the same time, they've had the most successful player procurement system of the last decade, and it comes down to focusing on aggression, intelligence and, at times, sheer volume.

The Proof

It's no surprise to see the Red Sox as one of baseball's busiest franchises in the international talent market. Be it adding big-league players like Daisuke Matsuzaka, or a slew of million-dollar, high-ceiling talents from Latin America, few teams add more talent from outside the country than the Red Sox, who are under the direction of former big-league infielder, Craig Shipley, an Australian who runs their international scouting program. However, with 50 rounds each year, it's the draft that provides most of the talent to any team's player development system, and no team takes advantage of their picks more than Boston.

It seems at times that one of baseball's great secrets is that the draft represents the biggest bargain in the game. While the industry and especially the people in Major League Baseball's central office wail and gnash their teeth over draft bonuses that in the grand scheme of things represent pocket change, the Red Sox recognize that the potential payoff for these bonuses eclipses anything in the game by a wide margin. For example, look no further than Stephen Strasburg, the top pick in the 2009 draft. His deal with the Nationals shattered all bonus records, and Washington added arguably the best pitcher in college baseball history. Yet, in pure dollars, his deal is nearly equivalent to what the Cubs will pay run-of-the-mill center fielder Marlon Byrd for three years.

Let's take a quick step back. It's important to note that while there is a slotting system for the draft, it's not etched in stone. It's merely numbers that are suggested by the powers that be at MLB, and if a team is willing to have some people from central office yell and claim it is ruining the game via a few phone calls, a team can skirt the suggestions whenever it wants. Money, as much as talent, defines the draft order. Can you imagine Kevin Durant or LeBron James dropping to the end of the first round, and therefore to what is already a good team, because those drafting early fear their contract demands? It happens all of the time in baseball, and no team takes advantage of this more-or better-than the Red Sox.

The idea of upgrading picks is nothing new. Some say Pat Gillick was the first to truly utilize it as a strategy while GM of the Toronto Blue Jays in the late 1980s and early '90s, but the Red Sox have taken it to a new level. Taking a look not at the pick, but just the bonuses, shows how aggressive they've been over the last four years:

Year/Bonus $1M+ $750-999K $500-749K
   2009      2      2         1
   2008      3      1         1
   2007      0      1         4
   2006      2      3         2  

So, by taking advantage of the situation presented to them, the Red Sox, who are always drafting towards the end of the first round, and often losing first-round picks due to free-agent compensation, have been able to pick up the equivalent of seven first-rounders in the past four years, while adding 15 second-round talents, if we go purely by bonus. That's why the system is always so loaded, as this year's squad at Triple-A Pawtucket will be filled young, big-league ready talents should the need arise via injury, while the lower levels of the system have some of the most intriguing high-ceiling prospects in the game.

And there could be even more, as the Red Sox are by far the most aggressive franchise in this aspect of drafting. They've identified numerous future stars/top prospects to make a run at but ultimately fail to sign. It goes back as far as 1998, when they tried to sign third baseman Mark Teixeira in the ninth round from a Maryland high school. Later unsigned picks included Pirates top prospect Pedro Alvarez and young Indians slugger Matt LaPorta. Even as recently as 2007, the club selected first baseman Hunter Morris (third round) and catcher Yasmani Grandal (27th), both of whom will be likely first-round selections come June. The point is that the Red Sox focused not only on talent, but on trying to pull the pick upgrade as often as possible, knowing that just one hit can return, in terms of baseball value, 10-20 times the investment, the kind of multiplication found nowhere else in the game.

Beyond the team's willingness to spend in the draft, even when they've selected round-appropriate talent, the Red Sox's success rate is nothing short of stunning. One could argue that nobody, including the Red Sox, saw Dustin Pedroia (second round, 2004) or Kevin Youkilis (eighth round, 2001) becoming the stars they've developed into, while closer Jonathan Papelbon (fourth round, 2003), was seen as more as a future set-up man than someone capable of delivering 40 saves annually. Great scouting, plus pure aggression, tends to equal a great system.

The Conclusion

While it might be hard to match the Red Sox in pure scouting acumen, when it comes to the practice of pick upgrading, any team can play. Finances might prevent a small-market club from competing with them when it comes to bidding on high-priced free agents, but the relatively paltry amount of dollars that go to even top picks makes exploiting the draft available to all. Some small-budget teams, such as Pittsburgh, Kansas City, and Oakland, have already begun to play the game. Those that don't will fall further behind in each year's organizational talent rankings. That is, until Major League Baseball comes up with its next provisions to "fix the draft," which will assuredly create more problems than it solves.

A version of this story originally appeared on ESPN Insider Insider.

Kevin Goldstein is an author of Baseball Prospectus. 
Click here to see Kevin's other articles. You can contact Kevin by clicking here

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