6/13/2013 8:15 PM ET|
A billionaire learns the NFL ropes
Shahid Kahn took his lumps during his first year as owner of the Jacksonville Jaguars -- the team finished 2-14. Year Two will be different, he says.
NFL players are rarely success stories right out of the gate. It takes time to adjust to the big leagues -- something that seems no less true about becoming an owner in the most profitable sports league on Earth.
In January 2012, Shahid Khan bought the Jacksonville Jaguars for $770 million. The billionaire engineer and Pakistani native who built his fortune with auto parts manufacturer Flex-N-Gate had a rude awakening in his first year. His Jaguars posted a disastrous 2-14 season and Khan replaced both the team's longtime general manager and newly-hired head coach.
In an exclusive interview with Forbes, Khan opens up about the lessons he learned in his rookie season, from coaching hires to cutting edge statistics to the business of selling tickets in Jacksonville. It has been edited for clarity and length.
FORBES: We're in the offseason of your first year. How are you feeling about the Jaguars right now?
KHAN: You know, I think this is the season really to dream. I've been in the league for a year, and I've got to tell you it was quite a liberating experience what happened last year.
What do you mean by that?
Well, you hit bottom. You're 2-14. You unshackle from the past. When I got there, there were two sides, business and football. Business I understand. It was pretty obvious to me what we had to do. But the football side was like the Holy Grail. They had the 'secret recipe' here and the self-analysis of the team was that we were pretty good, that we were just a little bit away from the playoffs and if we just get some free agents signed up, we'll be in great shape. That's why we ended up with the fourth-highest cash payroll last year. The result was self-evident. If you are honest with yourself and the team and the fans, there's only one thing to do when it's 2-14. When it's 8-8 you can be conflicted as to how much baby and how much bathwater there is, but here there was no baby – it was just water.
It sounds like the business side came naturally, but on the football side you put too much trust in the people who were already there.
I think your analysis is correct. To me, it's like if you're in auto parts you ask why you aren't selling a product. Well, our price isn't the lowest or quality isn't the best. If you have best of everything, you wouldn't need sales people. But [on the business side] we're not selling victories. We're not selling whether we have Tebow or don't have Tebow. We're selling a great experience and hopefully a victory. But on the football side it's like being a doctor. The first thing is do no harm. A guy who I really like and respect is [previous owner] Wayne Weaver. What was his analysis? He had a lot of faith and confidence in the general manager [Gene Smith], the organization. He felt that this is what he would be doing and he had been in the league 20 years. For me, I wanted to listen, learn, watch and then let the year run and do the right thing.
Do you wish you had talked with more outside people going in, that you could have started rebuilding a year sooner? Or is hitting rock-bottom in some ways a good thing?
First of all, I think it's good even though it's expensive. You're paying the coaches and so on. But I don't think just coming into the league right away you would have figured out what are the attributes for a successful head coach or what are the attributes for a successful general manager. As the year went on, meeting some of the other professionals in the sport, that was good. Certainly as the season progressed, there's only two outcomes. You're either going to make a change or keep people and you have to be prepared to do both. You can't say, "Well, now I have to go find who the best people are." You have to know everything about them and literally get on it seconds after you let the people go. Also, if you want the best people they have choices. A year ago, they didn't know me. What are they getting into? A year later, there was at least a track record how they could decide if this was the place for them.
Are you saying there were candidates last time around who didn't want to talk to you about the head coach opening?
No, I'm not saying that. You have to remember that with Gene Smith, Wayne was going to extend him – he told me so during negotiations. He thought very highly of Gene, whether the team was sold or not. He had just gotten an extension literally days before the deal was announced and the head coaching search was kind of a transition from Wayne to myself. Gene led the search, so he had three or four candidates, but I certainly didn't know who the candidates were, if that was the best list. Nothing against Gene, but as I saw in the process I ran [this year], pretty much anybody we wanted to talk to wanted to talk to us. It was all about football and a clean slate. There wasn't some of the noise about conflicts or things like that. I felt that we were the best opportunity for a bunch of reasons.
Being much more involved this year, were you looking for different things in your new GM?
Yes, absolutely. I put a lot of time into it. On the football side getting the general manager was the most important thing. I talked to just about everybody, from wise old men of the NFL to some of the people who were still working who weren't conflicted to a number of the owners who I respect. Getting their insight and permission to talk to their GMs to see who they would encourage me to talk to. What are the insights? What makes a successful GM? Who has had success and who hasn't? What are the attributes?
The first thing was the structure. We want to have two people reporting to me: [team president] Mark Lamping from the business side and the GM from the football side. The coach is reporting to the GM, but -- practically -- working with him. They have to be on the same page and have the right personality, and frankly, they even have to be physically located next to each other.
Was that not true with the previous combination?
No. They were on almost opposite ends of the stadium. That's how the culture was. They also had a lot of closed doors. To me, you have to have glass doors to see who's there, people walking in and out – have visual command. We went through this in industry. More transparency where you could stand up, see where people were, have a cup of coffee, exchange ideas. Here you're talking about players, the situation. We want both of these guys to sit next to each other and obviously be very engaged in getting the coaches' opinions on the players. We're getting a fresh start so I felt it shouldn't be a recycled person. There's a lot young talent. I felt strongly that we wanted somebody with a great football mind, who'd make it their mission to succeed. And a coach, likewise. Somebody young, energetic, open.
One of the things that impressed me about [new head coach] Gus Bradley was his desire for knowledge. He sits down with me at least once a week, twice a week just to talk about business, how you pick people, what works, how you inspire. That's one of the things we did at the Super Bowl. I had some of our auto parts guys go and sit with Gus to talk about how you inspire a factory worker to make a better bumper and those kind of things. He has a really keen mind learning about people. Frankly, that's in stark comparison to the guys who say, "We've been in football for X number of years and we know how to do it." One of the things that's exciting is the dynamic change that goes on in this sport. It's a key attribute that you have to learn and change, no matter how successful you are. I see that with some of the other people who have a lot of success in football. God forbid Gus isn't successful in football, he will be in auto parts.
[Philadelphia Eagles owner] Jeff Lurie said that in 18 years of talking to people in football coaching, [Gus] was the brightest, the most enthusiastic, and had the most potential he ever saw in a man. That's a direct quote from Jeff. And that's after we hired him. We were focused on all assistants, because to me we have Dave Caldwell as a young general manager who's never been there before. I want to pair him up with a very high potential assistant so that they can grow together, mature together, and almost the DNA becomes one, they're entwined. It wasn't going to work if we had an older, established, more experienced coach.
There are some people who would say "we're not rebuilding."
No. This is rebuilding, rebuilding from the ground up. There's no illusion about that. This is about as clean and intense a rebuild as you're going to have. But I think the most important thing, and this is one thing that I've learned from last year, that we would be very competitive in the first half. What was the key lesson there? [The opponents] made halftime adjustments far better. We came out and did what we were doing before. They did different stuff. That told me that there was better leadership and coaching out there. [Cleaning house] is disruptive and expensive. I just felt that it was the right thing to do for the fans, for the Jaguars. I was going to have a hard time looking myself in the mirror because I knew what we had to do. There was just no two ways about it.
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