When you boil away the externalities and personalities of any CEO, their role is to increase the company's value. And by that measure Roger Goodell has done a good job with the NFL. When he took over the league in 2006, an analysis by WR Hambrecht pegged the league’s valuation at $898 million; at the end of the 2010 season that number had grown to $1.022 billion.
Not bad. Some will likely (rightly) argue that too many outside factors can claim credit for much of that hundred-plus million under Goodell’s name: an American culture increasingly obsessed with violent sports, baseball seeming boring by comparison, the NBA’s continuous player PR problems, the NHL strike, etc. Like a president presiding over good and bad economic times, you never know quite how much to attribute to policy versus how much to attribute to the ecosystem those policies exist within. Essentially, nurture versus nature.
So then to continue evaluating Goodell’s job, you’d have to look at his management. First, he shouldn’t suffer any blame for any player’s behavior. Albert Haynesworth, Pacman Jones, Mike Vick are all their own people. Roger Goodell can’t babysit them.
But he did preside over a player lockout. With the flow of headlines and 24 hour Sportscenter coverage, you’d think it was a big deal but…we didn’t miss any football. The only results was that it was really really obnoxious. That’s it. So, the “NFL company” can’t really hold that against him either: a deal got done, we’re going to have football, end of story. Sure we annoyed the fans but they’re all going to be back on the couch this fall.
So by business standards, Roger Goodell has done a fine job as NFL Commissioner.
But here's the problem. The NFL is a business, but it’s not a corporation—a traditional one. Economically, you could make the argument that it is a monopoly, which is technically correct. You have exactly one place to get your pro football fix: the National Football League. Teams are nothing more than subsidiaries of the parent company.
But in evaluating Goodell's job as CEO or Commissioner, you actually need to shift your thinking. Malcom Gladwell recently over-explained an important fact about owners: They rarely run their teams like businesses. Exactly zero owners in the NFL "built their team from the ground up" the way you hear about, say, Mark Zuckerberg building Facebook in his dorm room. With the exception of inheritance, they buy their franchises after they're good and rich, when ten million dollars is called "interest on my checking account."
Owning a sports team is the light at the end of the tunnel for powerful businesspeople; those that spend years, decades even, busting their ass to build some other business. By the time they can afford an NFL team, those grueling meetings about setting margins or leveraging analysis to create an international strategy are wayyyy in the rearview. Sayonara. Time to have fun. These guys want to fly to the stadium in helicopters, sit in a plush box and purvey over all that they've earned: Gladiators doing battle while the commoners cheer on!
And that's why you get many of the famous idiotic contracts. "100 million for Albert Haynesworth? Sure, why not? I like his tenacity! Jeeves! Another martini!" These sound business minds don’t apply the same scrutiny that they applied their businesses. They’re usually—rightly—tired of it.
Gladwell talked about how owners are under the spell of "psychic benefit" when managing their teams, that they own teams for pleasure and not as any sort of real business venture. This is a fancy way of saying: sports franchises are toys.
The 32 subsidiaries of the NFL do not make up a corporation; they make up some sort of Society Club.
So back to Goodell. If the NFL were a real business, it’s not that Goodell should or should not be ousted as CEO, its that he never would have been hired in the first place. The other considerations for Commissioner of the NFL were Gregg Levy (NFL Counsel), Frederick Nance (High-profile attorney), Mayo Shattuck III (CEO of energy giant) and Robert Reynolds (COO of Fidelity). Except Levy, those are all outside, powerful businesspeople. ("Hey National Sports Media, look at our hiring due diligence!")
Goodell started in the league as an intern in 1982 and worked his way up. He's known nothing but the NFL. He’s a company man. He knew what his role would entail as Commish, the owners knew he knew it and they voted him in. You think the COO of Fidelity Investments, manager of a company that transacts billions of dollars every day in a real market, is going to waste his time telling Chad Johnson that his shoes are the wrong color? Obviously not. And the owners knew that too. A businessman would have run the joint like a...business. And they’d rather have their cabal of revenue sharing. Who cares if it’s not as profitable as their first business: it’s fun.
So, is Roger Goodell doing a good job? Sure, but only in the same way babysitter of a bunch of spoiled children has done "a good job" by ordering the kids pizza and plopping them in front of the TV. It would be tough to screw up.