Decoding the Draft: Are NFL Teams Still Overvaluing the Trade Value Chart?

Decoding the Draft: Are NFL Teams Still Overvaluing the Trade Value Chart?

The NFL Draft is a high-stakes poker game where general managers bluff, strategize, and wheel and deal to build their future rosters. For decades, the “NFL Draft Trade Value Chart,” initially conceived by Jimmy Johnson during his tenure with the Dallas Cowboys in the early 1990s, has served as a guideline for teams navigating the complex world of draft-day trades. But in today’s NFL, with its emphasis on analytics and evolving team-building philosophies, the question arises: Are teams still clinging too tightly to this decades-old model, potentially overvaluing certain picks and undervaluing others?

The Origin and Evolution of the Chart

In the late 1980s, Jimmy Johnson, then the newly appointed coach of the Dallas Cowboys, recognized the need for a standardized system to assess the value of draft picks. He tasked his vice president, Mike McCoy, with creating a chart that assigned numerical values to each pick, with the first overall selection arbitrarily set at 3,000 points. This chart, based on past trade behavior and McCoy’s own intuition, quickly became a league-wide standard.

The Cowboys, armed with this new tool, executed a series of trades that allowed them to amass a wealth of draft capital. Between 1991 and 1993, they drafted an impressive 42 players, including future Hall of Famers Troy Aikman, Michael Irvin, and Emmitt Smith. The Cowboys’ subsequent Super Bowl victories cemented the chart’s reputation as a valuable asset.

However, the Johnson chart is not without its critics. In 2005, business professors Cade Massey and Richard Thaler published “The Loser’s Curse,” arguing that NFL teams consistently overestimated the value of high draft picks, even after the chart’s widespread adoption. They also pointed out that the discount rate (the cost of exchanging a future pick for a present pick) was excessively high.

Alternative Charts and Modern Approaches

In response to these criticisms, several alternative draft value charts have emerged, each attempting to provide a more accurate reflection of pick values in the modern NFL. Some of the most popular include:

  • Rich Hill Chart: Created by Rich Hill, this chart aimed to modernize Johnson’s model by using smaller numbers that more closely align with contemporary NFL trade values. It relies heavily on a sample of pick-only trades from 2012 through 2016.
  • Fitzgerald-Spielberger Chart: Developed by Jason Fitzgerald and Brad Spielberger at Over the Cap, this chart uses NFL salary data to retroactively grade draft selections and project the value of future picks.
  • Harvard Sports Analysis Collective Chart: This chart employs a more analytical approach, using Approximate Value (AV) to determine the value of each pick based on the historical performance of players drafted at those slots.

These alternative charts often differ significantly in their valuation of specific picks. For example, the value of the first overall pick varies considerably across different charts:

  • Jimmy Johnson: 3,000
  • Rich Hill: 1,000
  • Fitzgerald-Spielberger: 3,000
  • Harvard: 494.6

These discrepancies highlight the ongoing debate about the true value of draft picks and the limitations of relying solely on a single chart.

The Case for Overvaluation

Several factors contribute to the argument that NFL teams may still be overvaluing the trade value chart, particularly in the early rounds:

  1. Rookie Wage Scale: The 2011 Collective Bargaining Agreement (CBA) introduced a rookie wage scale that significantly reduced the cost of top draft picks. This has arguably made those picks more valuable, but some argue that teams still overpay to move up in the draft, assuming they have a better evaluation than the rest.
  2. Overconfidence: As Massey and Thaler pointed out in “The Loser’s Curse,” NFL decision-makers may suffer from overconfidence in their ability to evaluate talent. The more information they have, the more confident they become, leading them to overvalue specific players and trade up unnecessarily.
  3. The Quarterback Premium: The demand for franchise quarterbacks often leads teams to make desperate trades, ignoring the chart and paying a premium to secure their guy. As CBS Sports noted, over the past 14 drafts, there has been an average of one trade up each year to take a quarterback in the top half of the round.
  4. Position Value: Draft charts tend to overvalue the top picks in the case when these picks are not used on a quarterback. This adds to the mountain of evidence that NFL teams largely do not understand the relative values of draft picks and are dramatically overconfident in their ability to pick the right players at the top of the draft.

The Case for Undervaluation

Conversely, there are arguments to be made that the trade value chart can sometimes undervalue certain picks, particularly in later rounds:

  1. The “Tom Brady” Effect: Every year, a handful of players drafted in the mid-to-late rounds exceed expectations and become valuable contributors. The most extreme example is Tom Brady, a sixth-round pick who became one of the greatest quarterbacks of all time.
  2. Positional Scarcity: In certain drafts, a particular position may be unusually weak, making the few quality players at that position more valuable than the chart suggests.
  3. Team-Specific Needs: A team with a glaring need at a specific position may be willing to overpay slightly to fill that hole, regardless of what the chart says.

The Modern GM’s Approach

While the NFL Draft Trade Value Chart remains a useful tool, most modern general managers recognize its limitations and use it as a starting point rather than an absolute guide. They consider a variety of factors, including:

  • Analytics: Teams now have access to vast amounts of data and sophisticated analytical models that help them evaluate players and assess the probability of success.
  • Team Needs: A team’s specific needs and roster construction play a crucial role in determining the value of a particular pick.
  • Market Conditions: The demand for certain positions and the willingness of other teams to trade can influence the price of a pick.
  • Gut Feeling: Despite the emphasis on analytics, many GMs still rely on their own instincts and evaluations when making draft-day decisions.

Omar Khan, the General Manager of the Pittsburgh Steelers, has shown that he looks for value in his draft day movement.

Conclusion

The NFL Draft Trade Value Chart has been a fixture of the league for over three decades, providing a framework for teams to evaluate and execute trades. However, the modern NFL is a constantly evolving landscape, and relying solely on the chart can be a recipe for disaster. Teams that embrace analytics, understand market conditions, and trust their own evaluations are more likely to find success on draft day. The chart is a tool, but it’s the craftsman who determines the final product.