Interview with Mark Shapiro
Mark Shapiro is the President and CEO of the Toronto Blue Jays.
Business Today (Molly Milligan): Your dad was a respected agent in baseball. Did he play a role at all in inspiring you to get into the business side of the game?
Mark Shapiro: It's interesting. Informally, I would say yes, my deep roots and passion for the game were built around the fact that part of my relationship and bonding with my father was around the game of baseball. He didn't get even get involved professionally [in baseball] until I was a teenager, but more than anything, growing up, he was a passionate fan of the game. And so, a lot of our childhood experiences were around attending [Baltimore] Orioles games or, playing catch, Wiffle Ball, playing stickball, and everything else surrounding the game.
BT: During your time at Princeton, you were on the football team. How did your experience as a student athlete prepare you for work in the world of sports and business?
MS: I think, whether it's sports or just learning to deal with adversity, setbacks, challenges, and failure, you gain a good understanding of what it means to succeed in any type of work. I learned how integral and important a growth mindset is. But more than anything, probably just learning the value of determination and perseverance. And finally how to attack earning success in anything in life. It was a big part of instilling in me a passion for leadership - that desire to help build teams and be a part of special teams.
BT: You began your career with the Cleveland Indians in the 1992 and worked your way up the ladder there to becoming the general manager and then the president. What did you learn along the way and what was it like to be an internally grown talent?
MS: I think the internally grown talent part gave me an appreciation for and the strong investment in culture there, along with a great deal of pride in that culture and appreciation for the people that I learned from. I also had a chance to help be a part of other’s learning and growth. I think more than anything it was that responsibility to help develop others, to pay it forward. I took that away from the empowerment and belief in me as a very young leader that I felt from the leaders there and subsequently committed the same towards the next generation of Indian leaders, who are now leading the Indians and five or six other franchises throughout Major League Baseball, including the Twins, the Pirates, the Diamondbacks and multiple others. It was a pretty incredible time, the 1990s and 2000s, for the Indians front office. There were so many potential future leaders all in one place. I was proud to be a part of that and we had a mutual commitment to helping develop people as well as compete and win and be a part of something special.
BT: What was it like to be an internally grown talent? Was it an advantage or disadvantage?
MS: I don't think there were disadvantages. I think I understood, and appreciated the landscape in the organization. I think, at times, one of the disadvantages that can occur from staying in one place for so long is you tend to overlook and under-appreciate what a place has to offer and think that someplace else is going to be so much better. It's harder to appreciate the benefits and the advantages of a place you’re in when you don't have a comparison and aren’t seeing what else is out there. It is important to constantly calibrate to make sure that you are fulfilled and maintain perspective. Ultimately that happiness is tied the alignment of your personal values with the values of your leaders and organizational culture.
BT: You spent over 20 years with the Cleveland Indians. What kept you around that team?
MS: Probably the opportunity to continue to grow and learn. My roles changed a lot over that period of time, from entry-level cubicle-dweller to Director of Player Development, to Assistant General Manager, to General Manager, to President. So I was always being challenged to grow, learn, and develop. In addition, I would say there’s a unique culture in Cleveland which I recognized and appreciated. To have so many talented, smart, and motivated people in one place is in some sense is a microcosm of what makes places like Princeton special. That special environment is what happens when you bring a group of incredibly talented, incredibly motivated people with high standards and expectations together and align them behind a common vision of doing something really challenging but really special. Also, the culture was centered upon empowerment and an incredible commitment to growth-oriented learning and that felt truly unique. That aligns with what's important to me, and it’s what I've tried to work to instill here in Toronto with the Blue Jays.
BT: At the top of the Indians’ organization, you oversaw some major projects, including the renovation of Progressive Field and two 90-win teams. How did you make that a reality? What role did you play in managing those projects?
MS: Leadership is about building teams, putting people in the right roles, and ensuring your culture is one that is collaborative, respectful, trustful, and focused on getting better and improving. I think my role was to ensure the resources were there, and to ensure that we expected to and were focused on hiring talented people, and that we never got complacent. I worked to ensure that our values were continually adhered to, and that they were at the core of everything we were doing. But often, I would say, my role was to get out of the way of really talented people and just to make sure they had the best resources possible.
BT: Just a few seasons ago, you made the transition from Cleveland to Toronto. Even though you serve in the same role, what's different about working with a new team?
MS: Well, the undertaking here was “Let's focus on the challenge of modernizing an organization that was being run very differently than the Indians.” Culturally, it was more hierarchical and traditional in nature, and did not have a lot of the more modern resources that exist throughout the game. I've seen a massive evolution in the game of baseball in the way we make decisions in particular—from really anecdotal, gut-based decision making based upon subjective information to highly data-driven, informed decision. In Toronto we have had to build out the resources that create the inputs for decision making on both the baseball and the business side and models that provide the structure for weighting and utilizing the improved information. As importantly, we have had to transform a culture into one that is receptive to and embraces informed decision making, at the heart of which is the essential acceptance of collaboration in all of our efforts. So, that's been a big undertaking, but I was excited about it. Additionally, the environment in the city of Toronto is very different from Cleveland. It’s actually really invigorating—it’s an incredibly diverse, vibrant city in a different country. We’re the only team in Major League Baseball that represents the entire country, not just the city. That responsibility, that understanding is the backdrop for everything we're trying to do. It’s been energizing and also challenging, but it’s what I wanted at this juncture in my career.
BT: The Blue Jays are the only MLB franchise in Canada. Coming from the States, how did you seek to build a relationship with the community and the fans in Toronto?
MS: I wanted to be humble and open, and that is best achieved through listening and trying to understand the uniqueness of the environment while continuing to work to earn respect. I didn’t expect to be treated any certain way just based upon what I, or any of our staff, had done prior in our careers. Ultimately, knowing that we still live in a results-driven industry if we work to build a sustainable winner and if we place the fans first in everything we do, people will be happy. I think that our approach is something that is common in generally successful efforts, but it’s particularly important when you walk into such a unique situation. I knew that coming in and I embraced that. Really, I think to get outside of your comfort zone a bit is important. The greatest growth happens when you step outside of your comfort zone.
BT: You’ve mentioned the transformation in baseball from subjective decision making to highly data-driven decision making. In the movie Moneyball, there's even a character based on you. What role did you play in the data revolution in baseball and why did you think that was the route to go?
MS: Well it's never been for me just about analytics and data. It's always been about that relentless pursuit of the best information, and then putting it in a framework that was most easily digestible and that you could most consistently gain competitive advantage from and use to make the best decisions.
One underlying consideration is that the greatest part of sports is that we're still dealing with human beings, and that human beings are innately unquantifiable because they have flaws. So, it's that pursuit of something you know you're never going to be able to achieve, because you're never gonna get perfect information on an imperfect subject. Within that effort there is an opportunity to gain a competitive advantage. In Cleveland, that effort was driven by the reality that we were a small market team and the nature of revenue sharing in the Major League Baseball system has inherent challenges for smaller markets as local revenues are not shared evenly. Exacerbating the challenge of uneven resources is the lack of a salary cap which then allows team to use those revenues disproportionately. Thus, teams with extreme resources, two of which we now have to compete against each season in the AL East (Red Sox and the Yankees). So, unlike in the NFL [with a salary cap and greater sharing of revenue], Cleveland had to compete with New York, Chicago, L.A., San Francisco, and Boston, which is extremely challenging because they’re going to have double or more the resources. It’s a similar challenge in Toronto, where we have a different currency and compete in a division [the American League East] with two of the behemoths.
Basically, in both those places, we have to outperform objective expectations. That's not going to come from one decision or one player or one leader, it's usually going to be from hundreds of incremental efficiencies, informed decision making and an exceptional organizational culture. Once that culture and that drive for outperforming expectations is scaled, those things can start to make a difference in bridging those extreme resource gaps.
BT: Within the team and the organization, how does the influence of data affect decision-making? What does it look like when you're sitting in the room, trying to decide?
MS: The easiest way to summarize that is that data has helped to regress out bias. In the past in our industry, and as decision makers in the industry, we've been highly subject to bias, whether it’s contextual bias, recency bias or others. We tended to be impacted by a set of experiences or perspectives that was unique to our situation or particularly current. So, using data and decision making models, much like behavioral economics, I think has helped us to better understand what those biases are in order to challenge us to more objectively frame our decision making.
BT: The data revolution is such a frequently covered topic in the sports world. We’ve seen the movies; we read the books. Do you think at all that the influence of data is overblown? Is the press running out of things to write about?
MS: I think in movies, in books, and in mass media they tend to oversimplify. They point out a very necessary and important adjustment that we had to make in the business that was made almost 20 years ago. I think some of the greatest opportunity to gain competitive advantage today lies not as much in analytics and objective decision making—now, you have do that just to keep up—but with more shifting back to the human side and thinking about how we coach our players. And I think you find more and more resources, energy, and time and effort being put in to how we develop, coach, and teach or manage people - the human side.
BT: You’ve also worked in player development and have had to work with a variety of managers and other GMs. How do you communicate with other leaders on your team?
MS: I would say our culture is built upon a constant flow or commitment to collaborate. We live with a basic understanding that our collective intellect, our collective skill sets, and our collective experiences have a better chance to lead us to a good outcome and a good decision than any one leader’s knowledge or wisdom. So, free flow of ideas and the flow of input and perspective and experiences is something that is an underpinning of this culture in Toronto, and was with the Indians as well. We tend to move as an organization collectively to where the highest leverage opportunities are. We don't silo or focus on one individual area. We collectively move to the draft when it’s draft time. Or, we will focus on the very differently me may focus on the renovation of a training facility down here when that is the highest-leverage opportunity, or on a trade or free agency when those opportunities come up. This culture is being built upon the understanding that we just must work to collectively arrive at the right decision with no focus on credit or blame, and just a continual focus on openness, learning and getting better.
BT: A lot of people, even if they don’t know a lot about baseball, probably heard about Manny Machado and Bryce Harper this offseason. It took months and months for both of them to reach deals even as they secured two monster contracts. In the time that you've been in the game, how have you seen the economy of baseball change?
MS: It's changed dramatically. I think we have a better ability to value the contribution and impact that a player can make and model it over the length of a career or length of a contract. So, in the past, at the very simplest level, you know, a decade ago we largely paid a premium for the name on the back of the jersey. We paid a premium for what the player had accomplished prior in his career. At the simplest level, there's much more focus now on what a player is projected to contribute going forward in his career, with a better understanding of how to quantify that, and then compare that to what the alternatives, who are not necessarily big names, could offer as an alternative. There’s still as much value attributed to players in the game, it’s just attributed to different players and not just to superstar players who are largely heralded for their past performances, not their future performance.
BT: What do you think shifts like that mean for the league? All the teams have to adjust to this—how have people taken on this change?
MS: In general, there was something of an ‘arms race’ to build up analytics, but there wasn’t a consistent understanding by everyone about how to apply it. I think there's still some very inconsistent application of data and analytics and their contributions, as well as how technology contributes to such a human sport. There's also some challenge with a business where you're judged on short-term results. Taking more of a long-term approach, a process-focused approach, also continues to be somewhat of a challenge. But I think, in the end, where the game has really ultimately evolved is to how we value players, and while there is as much value of players, it’s just placed differently. Ultimately that change will probably have to be reflected in the next collective bargaining agreement—the underlying agreement for labor and how players get paid.
BT: We also see in the press all the time that baseball's fans are getting older. But in 2018, youth participation numbers in baseball grew compared to soccer and football. What have you done from the team/organization level to promote the sport and to welcome new fans?
MS: There are multiple reasons for the importance of being committed to youth baseball. The Blue Jays have one of the most extensive programs, because it's responsible for promoting youth baseball across all of Canada. Youth baseball uses sports and baseball in order to motivate and help develop at-risk and underprivileged kids by tying the game to education, work habits and success. IN addition, youth baseball helps to develop a love and a passion for the game of baseball thereby cultivating future fans by just getting them to play and understand and appreciate the game at any level. Finally, there is the effort to nurture the elite levels of the game and help to foster baseball at the highest levels in order to develop more Major League players or college players from the area that you work in and play in. Thus, it's a multiple-tiered effort, but we're all working hard to grow the youth game and it's clear that when you look at the statistics that commitment to youth baseball will lead to future fans.
BT: Looking at the big picture, what do you think is the next big thing in baseball?
MS: I think that continuing to understand and think about technology, analytics and their uses, understanding how human beings learn and apply information, and properly deploying technology and analytics into actual gameplay probably represent some of the greatest opportunities in the game going forward. On the medical side, quantifying risk is an area that we are currently very imprecise at and could develop.
The high performance area being built-up has also made a big difference. It’s more than just your standard athletic trainer. We look at the high performance area as the being athlete centered. We have a way of looking at delivering performance support services and resources and that has to do with not just athletic training and medical but the mental performance side, strength and conditioning side, nutrition, sleep, hydration and all the corresponding performance opportunities.
BT: The season is quickly approaching and spring training is under way. What's in store for the Blue Jays this year?
MS: It's an interesting time of our evolution. We largely have turned over our entire roster, along with much of our coaching staff. So, I think our team this year will take a major step forward in establishing a culture that will be at the foundation of future championship teams. We’re transitioning a lot of young players, and with that comes volatility – both on the positive and challenging side. I think we're cognizant of the objective realities of what the A.L. [American League] East represents— but we’re focused on doing the best against the well-funded teams that play in our division. I don’t think we’ll ever go into a season accepting the fact that we're not going to win a title. But we recognize, objectively, our challenges and what we have to work on. Our focus is on competing, developing, and taking the next step toward building a sustainable championship team.
Some of the best prospects in the game are here. Right now, there's a process in transitioning those guys to the Major League level. After one hundred and sixty-two games—all data points—I predict we’ll be able to pull back and look at a lot of positive progress made this year.