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Article
Publication date: 14 December 2015

Jon Landry, David Edgar, John Harris and Kevin Grant

This paper aims to investigate, through the lens of the principal–agent problem, the relationship between payment of National Hockey League (NHL) salaries and player…

Abstract

Purpose

This paper aims to investigate, through the lens of the principal–agent problem, the relationship between payment of National Hockey League (NHL) salaries and player performance during the period of 2005-2011 and explore the inherent issues within the NHL player compensation and incentive structure.

Design/methodology/approach

The research adopts a pragmatic philosophy with deductive reasoning. This paper focuses on the NHL season 2005-2011 and undertake analysis of historical player contracts and performance data of 670 players across 29 clubs to undertake liner regression analysis.

Findings

This paper quantifies potential inefficiencies of NHL league contracts and defines the parameters of the principal–agent problem. It is identifies that player performance generally increases with salary, is higher in the first year of a contract and despite decreasing over the life of the contract, will usually peak again in the final year of the contract.

Research limitations/implications

The research is based around figures from 2005-2011 and secondary statistical data. The study captures quantitative data but does not allow for an exploration of the qualitative perspective to the problem.

Practical implications

Entry-level or first contracts are good for all teams and players because they provide incentive to perform and a reduction of risk to the team should a player not perform to expectations. The same can be said for players at the other end of the spectrum. Although not typically used much, performance bonuses for players over the age of 35 allow clubs to “take a chance” on a player and the player can benefit by reaching attainable bonuses. These findings therefore provide contributions to the practicing managers and coaches of NHL teams who can consider the results to help shape their approach to management of players and the planning of teams and succession planning for talent.

Originality/value

The paper presents a comprehensive and current perspective of the principal–agent problem in NHL and extends the work of Purcell (2009) and Gannon (2009) in understanding player performance enhancement.

Details

Management Research Review, vol. 38 no. 12
Type: Research Article
ISSN: 2040-8269

Keywords

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Article
Publication date: 10 January 2018

Kenneth M. York and Cynthia E. Miree

The purpose of this paper is to measure the effect of the National Hockey League (NHL) collective bargaining agreement (CBA) of 2005 between the NHL owners and the NHL

Abstract

Purpose

The purpose of this paper is to measure the effect of the National Hockey League (NHL) collective bargaining agreement (CBA) of 2005 between the NHL owners and the NHL Players Association, to determine whether competitive balance in the NHL increased after the CBA.

Design/methodology/approach

Competitive balance in the NHL was compared between 11 seasons before the NHL Lockout Season in 2004-2005 and 11 seasons after, with a new CBA and a new revenue sharing plan. Competitive balance was measured in multiple ways, within seasons, across multiple seasons, by the margin of victory in individual games, by the concentration of teams winning and playing in the NHL championship, in the correlation of winning percentage of a season with subsequent seasons, and the number of consecutive winning or losing seasons.

Findings

There was greater competitive balance after the Lockout Season and the new CBA than before on all of the measures of competitive balance. The NHL has found a management solution to the effective management of a common pool resource and avoided a tragedy of the commons.

Practical implications

While this research builds on previous work which examines the presence of competitive balance in the NHL, it encourages those engaged in labor policy to consider not only the merit of design when negotiating labor policy, but also to explore the impact of policy on organizational outcomes over time.

Originality/value

This paper combines perspectives and insights from multiple disciplines including economists’ ideas about competitive balance in a sports league, ecologists’ ideas about effective management of a common pool resource, and strategic management ideas about management solutions to a sustainability problem.

Details

Sport, Business and Management: An International Journal, vol. 8 no. 1
Type: Research Article
ISSN: 2042-678X

Keywords

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Article
Publication date: 11 January 2018

Joel Maxcy and Pauline Milwood

The purpose of this paper is to focus an empirical investigation on the financial ramifications of regulatory policies on American professional team sport leagues, while…

Abstract

Purpose

The purpose of this paper is to focus an empirical investigation on the financial ramifications of regulatory policies on American professional team sport leagues, while at once including the inseparable effects on the outcomes of contests. The authors conduct a comparative analysis of the impact of alternative regulatory mechanisms adopted by American professional team sport leagues, and their implications for the league performance.

Design/methodology/approach

The paper conducts a comparative analysis of ten years of financial and contest data from Major League Baseball (MLB) and National Hockey League (NHL). Using relative measures of payroll and profits for the two leagues, the authors test hypotheses on the impact of the market-based payroll taxes of the MLB with the strict payroll limits imposed by the NHL and their relationship to both financial and contest outcomes of the two leagues.

Findings

The comparison of MLB and NHL shows that market-based tax incentives are more consistent with the league financial objectives than strict, enforced mandates, suggesting that comparatively higher profits are associated with the MLB’s approach when compared to the strict bounds imposed by the NHL. Conversely, the comparison of player costs in the NHL and MLB reveal no distinguishable features based on the alternative regulatory methods.

Originality/value

This paper provides an initial, valuable assessment of different regulatory mechanisms on the on- and off-field (-ice) performance of MLB and NHL. Given that MLB has adopted market-based tax incentives to regulate payroll (the competitive balance tax), and the NHL has imposed strict payroll limits (hard salary cap), the authors at once consider MLB’s innovative revenue-sharing system alongside the NHL’s more conventional and restrained method of revenue redistribution, and their implications for performance.

Details

Sport, Business and Management: An International Journal, vol. 8 no. 1
Type: Research Article
ISSN: 2042-678X

Keywords

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Article
Publication date: 13 March 2017

Kim Trottier

The purpose of this paper is to establish the optimal decision-making style in a fast-paced, complex, and dynamic environment.

Abstract

Purpose

The purpose of this paper is to establish the optimal decision-making style in a fast-paced, complex, and dynamic environment.

Design/methodology/approach

Three decision-making attributes are explored: the use of intuition vs analysis, the proclivity to heuristics, and susceptibility to bias. The intuition/analysis is tested with a questionnaire that has been validated in prior research, while information on the two other dimensions is from an exploratory survey designed for this purpose. Responses to the survey questions provide some insight into the differential decision-making style of elite NHL hockey coaches’ vis-à-vis amateur coaches and news reporters.

Findings

The data suggest elite decision makers have no preference for intuitive or analytical settings, but exhibit a significantly higher perception of their ability to perform in both. While current literature shows sports athletes to be more intuitive, it appears coaches excel on the analytical dimension instead. This study finds that while elite hockey coaches have fewer biases overall, they tend in particular to be overly optimistic in comparison to amateur coaches and news reporters.

Research limitations/implications

The main limitation in this paper is that the survey on heuristics and biases is exploratory, making these results less robust than the findings on intuition and analysis.

Originality/value

This paper is first to extend the decision-making literature to coaches, and among few papers that obtain insights from NHL coaches directly. The findings are likely to extend to corporate leadership as well, increasing the relevance of the results.

Details

Sport, Business and Management: An International Journal, vol. 7 no. 1
Type: Research Article
ISSN: 2042-678X

Keywords

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Article
Publication date: 31 May 2007

Jiri Strouhal

Year 2004 was influenced by the strike in the National Hockey League. The reason of this strike was the option of adoption of the wage ceiling for the NHL players. The…

Abstract

Year 2004 was influenced by the strike in the National Hockey League. The reason of this strike was the option of adoption of the wage ceiling for the NHL players. The paper stresses the attention to the problem how to account and measure the possibility of the players’ contracts with options in the new model. We are dealing with the following hypothesis: “Is possible to use the experiences of valuation of financial options not only to ROA (Real Options Analysis) but also for valuation of players’ contracts with option?” The modified Black‐Scholes Formula is one of the possible solutions how to measure the value of the option clause.

Details

Journal of International Trade Law and Policy, vol. 6 no. 1
Type: Research Article
ISSN: 1477-0024

Keywords

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Article
Publication date: 10 June 2019

Peter M. Tingling, Kamal Masri and Dani Chu

The purpose of this paper is to investigate National Hockey League (NHL) expansion draft decisions to measure divestment aversion and endowment effects, and analyze bias…

Abstract

Purpose

The purpose of this paper is to investigate National Hockey League (NHL) expansion draft decisions to measure divestment aversion and endowment effects, and analyze bias and its affect on presumed rational analytic decision making.

Design/methodology/approach

A natural experiment with three variables (age, minutes played and presence of a prior relationship with a team’s management), filtered athletes that were exposed or protected to selection. A machine learning algorithm trained on a group of 17 teams was applied to the remaining 13 teams.

Findings

Athletes with pre-existing management relationships were 1.7 times more likely to be protected. Athletes playing fewer relative position minutes were less likely to be protected, as were older athletes. Athlete selection was predominantly determined by time on ice.

Research limitations/implications

This represents a single set of independent decisions using publicly available data absent of context. The results may not be generalizable beyond the NHL or sport.

Practical implications

The research confirms the affect of prior relationships on decision making and provides further evidence of measurable sub-optimal decision making.

Social implications

Decision making has implications throughout human resources and impacts competitiveness and productivity. This adds to the need for managers to recognize and implement de-biasing in areas such as hiring, performance appraisal and downsizing.

Originality/value

This natural experiment involving high-stakes decision makers confirms bias in a setting that has been dominated by students, low stakes or artificial settings.

Details

Sport, Business and Management: An International Journal, vol. 9 no. 3
Type: Research Article
ISSN: 2042-678X

Keywords

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Article
Publication date: 19 July 2011

Peter Tingling, Kamal Masri and Matthew Martell

The purpose of this paper is to examine the effect of order on the quality of outcomes when making sequential decisions and test the widely‐held belief that choosing…

Abstract

Purpose

The purpose of this paper is to examine the effect of order on the quality of outcomes when making sequential decisions and test the widely‐held belief that choosing earlier is preferable and results in better outcomes than choosing later.

Design/methodology/approach

Quantitative performance from the sequence of athletic decisions made by the teams of the National Hockey League (NHL) at the annual amateur entry draft is longitudinally analyzed using a participation threshold of 160 games.

Findings

Analysis indicates that earlier choice does result in outcomes that are significantly and substantially better but that this effect is muted beyond approximately the first 100 decisions, after which there is no discernable advantage.

Research limitations/implications

The dichotomous performance measure excludes more qualitative or stratified assessments of performance and does not include context of the individual decision choices. The results may not generalize beyond the National Hockey League or other human resource situations.

Practical implications

The research suggests that sequential decision processes are suboptimal in the presence of large amounts of information and choice. Recommendations include reallocating the amount of confirmatory attention spent on highly‐ranked candidates.

Originality/value

The paper exposes limitations to the widely‐held belief that choosing earlier is preferable to choosing later.

Details

Sport, Business and Management: An International Journal, vol. 1 no. 2
Type: Research Article
ISSN: 2042-678X

Keywords

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Article
Publication date: 18 June 2021

Brandon Mastromartino and Michael L. Naraine

The purpose of this study was to examine the effectiveness of social media strategies of sport organizations when an unexpected absence of relevant content occurs. The…

Abstract

Purpose

The purpose of this study was to examine the effectiveness of social media strategies of sport organizations when an unexpected absence of relevant content occurs. The study explored the typologies of Instagram posts of NHL teams and measured engagement of social media content that was not planned in advance.

Design/methodology/approach

A mixed methods approach was utilized through a content analysis of 12 NHL team social media feeds. 502 (n = 502) posts were examined from the period of March 12 – May 26 during which the NHL season was suddenly paused due to the COVID-19 pandemic. Typologies of posts were identified through a qualitative coding process and ANOVA tests were conducted to examine the effectiveness of each typology in engaging consumers.

Findings

This study found that social media strategies of the sampled NHL teams is evidence of disinnovation with digital, as opposed to the previously conceptualized innovative properties that these activities bear. Therefore, in order to achieve the consumer engagement outcomes sought to build stronger relationships with fans and deliver on the expected leveraging capabilities for sponsors, sport marketers must reconsider their current, imbalanced approach and whether the more inherently interactive content should be balanced with entertaining content that requires organic consumer engagement.

Originality/value

This study offers a unique application of UGT, highlighting that social media in a sport context is not just about gratifying consumers, but preventing diminishing engagement and exploitation of users through overuse of sponsorship-laced content.

Details

International Journal of Sports Marketing and Sponsorship, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1464-6668

Keywords

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Article
Publication date: 14 March 2016

Kevin Snyder, Steve McKelvey and William Sutton

Building on prior research in interactions between sales and marketing departments, the purpose of this paper is to investigate departmental alignment among professional…

Abstract

Purpose

Building on prior research in interactions between sales and marketing departments, the purpose of this paper is to investigate departmental alignment among professional hockey teams. By using a single industry sample, the authors are able to identify high and low performers, along with structural antecedents that lead to higher alignment (Rouse and Daellenbach, 1999). Expiring inventory, customer knowledge, and volatile demand enhance the need for alignment and suggest opportunities for innovative mechanisms to share information among departments (Mullin et al., 2007).

Design/methodology/approach

Through the usage of Kotler et al.’s (2006) survey instrument, the authors survey NHL Vice Presidents of sales and marketing to assess levels of structural alignment. The authors further explores strategies for alignment through qualitative interviews of select team executives.

Findings

The authors find examples of high alignment, achieved through structural elements of proximity, cross-functional tasks, financial incentives, and new technologies. The qualitative interviews provide insight into how organizations attempt to create high levels of alignment.

Originality/value

These results help advance the literature by identifying high performers and going inside organizations for the source of a competitive advantage, thus following Rouse and Dallenbach’s (1999) approach for theory development. The authors also contributes by identifying strategies for practitioners to apply as they attempt to design optimal work structures.

Details

Sport, Business and Management: An International Journal, vol. 6 no. 1
Type: Research Article
ISSN: 2042-678X

Keywords

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Case study
Publication date: 20 January 2017

James Shein and Scott Kannry

This case explores the turnaround and corporate renewal of the Chicago Blackhawks professional hockey team, which transformed from one of the worst-run organizations in…

Abstract

This case explores the turnaround and corporate renewal of the Chicago Blackhawks professional hockey team, which transformed from one of the worst-run organizations in all of professional sports in 2007 to one that won the Stanley Cup (the National Hockey League championship trophy) in 2010. W. Rockwell “Rocky” Wirtz was faced with making critical decisions shortly after inheriting the team from his father, who was the individual most associated with the organization's decline. The team faced financial trouble and had narrowly avoided missing payroll; the previous customer relations strategy (which included refusing to televise home games or to conduct effective marketing) had resulted in significantly diminished brand value; and management and player personnel were devoid of effective leadership. At its nadir, the team was named “The Worst Franchise in Professional Sports” by ESPN in 2004. After assuming control, Rocky embarked on an ambitious corporate renewal strategy that included the following components: leadership: install a new management team with clear goals and creative ideas about how to turn around the organization; culture: reward players for accomplishing their goals and establish a performance-based culture; financial: seek new corporate sponsorships and increase ticket prices once the team established a winning record; and brand and marketing: send a clear message that the team was intent upon winning the championship and design a customer-focused marketing strategy.

After analyzing the case, students should be able to: recommend strategic, financial, and operational changes needed to turn around the organization, and identify key leadership qualities that enable execution of a turnaround plan.

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