Does the strategy of maximizing value deviate from maximizing wins? One would think that "value" and "wins" mean the same thing for a sports franchise.
The Knicks' decision to re-sign Jeremy Lin could be an example of where the a rift occurs between the two factors.
Competing against an overinflated free-agent market, the Knicks may pleased that they are about to sign unproven point Jeremy Lin for $28 million contract for four years (with the last year as a team option).
After all, Goran Dragic—another unproven guard who had 14 strong games as a starter last year—just signed a four year, $32 million contract with the Phoenix Suns.
The Knicks can advertise that they brought "Linsanity" back to New York. This kind of hype will lead to added value in the Knicks' marketing profits.
(Whether the acquisition of Lin's back-loaded contract hurts the Knicks when 2013-14 luxury tax penalties kick in is another matter).
However, beating the market doesn't necessarily translate to winning basketball games.
In his two months as the starting point guard for the Knicks, Lin's performance regressed dramatically during the latter half. Teams adjusted their defenses for him, and in March, Lin averaged a mediocre 14 PPG and six APG on 40 percent shooting. He also averaged four turnovers a game.
Yes, the Knicks' acquisition of the 23-year old prospect still compares well to the market. But all money aside, will Lin help lead the Knicks past the first round of the playoffs?
Lin is not the only potential example of teams' market value obsession, even if its at the cost of long-term winning.
Perhaps the only complete center in the free-agent market is Roy Hibbert, who had a very nice regular season where he averaged 12 points, nine rebounds, and two blocks a game.
However, his inside game against the Miami Heat in the second round of the playoffs was anemic. Notably, the Heat were missing Chris Bosh for the entire series.
None of these statistics would seem to indicate that Hibbert is deserving of a max contract. However, because Hibbert's relative market value to other centers is high, the Pacers will extend such a deal to him next week.
In an NBA where stories are increasingly focused on sports agents and business owners, there is increasing pressure mounted on both parties to make decisions that look like they have strong value.
Fans can only hope these owners' value considerations don't deviate too far from the optimizing those Xs and Os on the court.