Baseball for the Thinking Fan

Login | Register | Feedback

btf_logo
You are here > Home > Baseball Newsstand > Baseball Primer Newsblog > Discussion
Baseball Primer Newsblog
— The Best News Links from the Baseball Newsstand

Thursday, December 22, 2011

Harvard Business Review Blog: Business Model Innovation the Red Sox Way

Major league owners are famously reluctant to release franchise-specific financial information. However, Forbes estimates that the value of the Red Sox has climbed from about $500 million in 2002 to $900 million in 2011 — an impressive 7% annual growth.

Companies seeking to revitalize seemingly stagnant businesses can take three lessons from the Red Sox success:

1. Question orthodoxy. Of course you can’t put people on top of the Green Monster. Or host a hockey game in Fenway. Or can you?

2. Systematically evaluate business model options. A business model describes how an organization creates, captures, and delivers value. Consider all of the different levers at your disposal to create growth.

3. Look to the peripheries. Cable broadcasting and fan clubs aren’t obvious places to look for growth. Growth often comes from carefully examining the edges of your current business.

Just because a business is mature doesn’t mean there isn’t room for growth. If the Red Sox can find growth in an almost 100-year-old stadium, surely corporations can find growth in products and services that seem to have leveled off.

Lowry Seasoning Salt Posted: December 22, 2011 at 06:39 AM | 6 comment(s) Login to Bookmark
  Tags: business, history, products, red sox, special topics

Reader Comments and Retorts

Go to end of page

Statements posted here are those of our readers and do not represent the BaseballThinkFactory. Names are provided by the poster and are not verified. We ask that posters follow our submission policy. Please report any inappropriate comments.

   1. Darren Posted: December 22, 2011 at 02:14 PM (#4021694)
I was just thinking the other day about the 2002-ish debate over getting rid of Fenway or upgrading it. I recall Gammons and other writers writing off the upgrade plans as unrealistic dreams of hopeless romantics. I'm thankful the Sox didn't listen to that and that they didn't try to get a taxpayer-funded megapark.
   2. Jose Can Still Seabiscuit Posted: December 22, 2011 at 02:36 PM (#4021697)
I'll freely admit I was in favor of a new park then. They have done excellent work on the upgrade though. I wish the seats could be modernized but it's a small price to pay for staying in the same park with the history it has.
   3. AROM Posted: December 22, 2011 at 02:48 PM (#4021703)
"Major league owners are famously reluctant to release franchise-specific financial information. However, Forbes estimates that the value of the Red Sox has climbed from about $500 million in 2002 to $900 million in 2011 — an impressive 7% annual growth."

Is this actually impressive? Seems par for the course in franchise appreciation. Arte Moreno bought the Angels about the same time and has seen more growth than that on a percentage basis. Though my guess is 900M for the Red Sox current value is a bit low, they would probably fetch 10 digits.

Anyway, bragging about a team's business acumen because of franchise value increases reminds me of the common folk 6-7 years ago who boasted about how smart they were because of their latest house appraisal.
   4. Matt Clement of Alexandria Posted: December 22, 2011 at 02:52 PM (#4021705)
Anyway, bragging about a team's business acumen because of franchise value increases reminds me of the common folk 6-7 years ago who boasted about how smart they were because of their latest house appraisal.
Franchise appreciation doesn't look like a bubble to me - the cartels guarantee profits through revenue sharing and the restriction of competition. It's a great little money-making vehicle, and on top of that it's obviously just gobs of fun - these rich folks love owning ballclubs and there will continue (up until the revolution, o'course) to be rich folks who want to buy your ballclub and get to make a tidy profit while having the time of their lives.

Franchise appreciation looks to me like a classic case of the ultra-wealthy creating the structures to shield themselves from the actual effects of a free market. That's proven itself a sustainable model over the last several decades.
   5. Bob Tufts Posted: December 22, 2011 at 06:40 PM (#4021966)
Typical Harvard bias.

The stadium and business side is being discussed and Larry Lucchino's name (Princeton '67) is left out?
   6. valuearbitrageur Posted: December 22, 2011 at 10:08 PM (#4022182)
The stadium and business side is being discussed and Larry Lucchino's name (Princeton '67) is left out?


This is an article on the GOOD management skills, not EVIL management skills.

You must be Registered and Logged In to post comments.

 

 

<< Back to main

BBTF Partner

Support BBTF

donate

Thanks to
Randy Jones
for his generous support.

Bookmarks

You must be logged in to view your Bookmarks.

Hot Topics

NewsblogOT:  2014 College Football pre-season thread
(81 - 2:19am, Aug 31)
Last: JAHV

NewsblogDodgers Use Wall of Infielders
(25 - 1:49am, Aug 31)
Last: Traderdave

NewsblogOT: NBC.news: Valve isn’t making one gaming console, but multiple ‘Steam machines’
(771 - 1:24am, Aug 31)
Last: DJS and the Infinite Sadness

NewsblogOT: Politics, August 2014: DNC criticizes Christie’s economic record with baseball video
(6260 - 1:10am, Aug 31)
Last: greenback calls it soccer

NewsblogMasahiro Tanaka shut down with 'general arm soreness'
(7 - 1:10am, Aug 31)
Last: DFA

NewsblogDavid Justice Says Put Barry Bonds in Baseball Hall of Fame Despite Steroid Use Late In Career
(164 - 12:51am, Aug 31)
Last: Jimmy

NewsblogOrioles Acquire Kelly Johnson
(8 - 12:42am, Aug 31)
Last: andrewberg

NewsblogOMNICHATTER 8-30-2014
(95 - 12:26am, Aug 31)
Last: cardsfanboy

NewsblogWhat's Wrong With Baseball?
(47 - 12:22am, Aug 31)
Last: Curse of the Andino

NewsblogSullivan: Why Mike Trout -- and the rest of the league -- is having trouble with the high stuff
(3 - 12:19am, Aug 31)
Last: Dog on the sidewalk

NewsblogOT: The Soccer Thread August, 2014
(889 - 10:58pm, Aug 30)
Last: ursus arctos

NewsblogOrioles Acquire Alejandro De Aza
(2 - 10:56pm, Aug 30)
Last: Der-K and the statistical werewolves.

NewsblogOT: The NHL is finally back thread, part 2
(970 - 10:06pm, Aug 30)
Last: Howie Menckel

NewsblogWatch a Japanese baseball player try to hit a 186 mph fastball (Video)
(27 - 9:48pm, Aug 30)
Last: Arbitol Dijaler

NewsblogAmaro: 'Status quo' with Gillick as interim Phillies president
(2 - 8:49pm, Aug 30)
Last: JRVJ

Page rendered in 0.1512 seconds
53 querie(s) executed