The Greatest Resignation Letter in Sports History
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The Greatest Resignation Letter in Sports History
At the time of this writing, the Boston Celtics have a 2-1 series lead over the Philadelphia 76ers in the second round of the 2023 NBA Eastern Conference Playoffs. After a rocky Game 1, the Celtics have posted decisive victories in Games 2 and 3 and appear to have a firm grasp on the series. The Celtics have shown over the past two games that they are simply the better team.
That being said, the 76ers are now a perennial NBA contender, although this was not always the case at least in their recent history. A storied franchise that boasted the likes of Wilt Chamberlain, Julius Erving, Moses Malone, and Allen Iverson, the 76ers had fallen on hard times by the early 2010s. After losing in the NBA Finals to the Los Angeles Lakers in 2001, the 76ers struggled to make it through the first round of the playoffs for most of the next decade. From 2010-2012 they were particularly mired in the doldrums of mediocrity, compiling an overall record of 110 wins and 120 losses during this time.
Enter Sam Hinkie. Hinkie, who was born in The Netherlands and grew up in South Carolina and then Oklahoma, was a Stanford MBA grad who had previously advised the San Francisco 49ers before working working his way up with the Houston Rockets, eventually becoming the youngest Vice President in the NBA. Hinkie helped to pioneer the use of statistical analytics in basketball along the lines of what Billy Beane famously did with the Oakland Athletics in the “Moneyball” era.
Upon being hired by the Philadelphia 76ers in 2013, Hinkie launched what eventually became known by fans and players alike as “The Process.” In the NBA, as with most major U.S. sports, the worse your record is, the better a draft pick you get. This is meant to promote parity by giving struggling teams opportunities to get better by having the best draft picks. This is a generally agreed upon fair structure, but it does create a warped incentive for teams to lose on purpose, thereby improving their chances to get a more advantageous draft position.
And that was exactly what Hinkie did with the 76ers. Almost immediately Hinkie traded away many of the 76ers existing players including a number of starters. The trades were generally made for draft picks, young players with upside, or veterans that would then be cut to save money. Thus devoid of almost any veteran talent at all, the team struggled, at one point losing 26 games in a row in the 2013-2014 season, and then topping that by losing 28 games in a row in a streak that spanned the next two seasons, which remains a league record for futility. The team won 47 games and lost 199 over those three years including winning just 10 games in the 2015-2016 season, which remains the third worst season of any team in NBA history. “Trust The Process,” Hinkie exhorted fans and ownership, amid these abysmal seasons.
And The Process basically worked, even if it alienated (some) fans and sent the NBA League Office into a rage. Resetting the roster through trades and draft picks is done every year by teams in all major sports, but what upset the League (and what would become a problem for Hinkie) were accusations of intentionally losing games, which the League thought was undermining the integrity of the game. It is a grey area, though: players were not missing shots on purpose or purposely throwing the ball out of bands, for example, but management was purposely putting a team on the court they knew could not consistently win games (or win at all, for some of the long stretches noted above).
But, bolstered by a slew of attractive draft selections that the 76ers earned through their own poor play but also the picks they had amassed in exchange for trading away various team veterans, The Process ended up more or less working. In 2013, the team drafted Nerlens Noel and Michael Carter-Williams; Carter-Williams would end up winning Rookie of the Year. In 2014, they hit it big by drafting Joel Embiid out of Kansas. Joel Embiid has become one of the greatest players in franchise history and, in fact, accepted the award as the NBA’s Most Valuable Player for the 2022-2023 season just this past Friday. In 2016, the 76ers took Ben Simmons, which was a very successful pick for a couple of years before injuries and perhaps mental issues took their toll on Simmons and he was traded to the Brooklyn Nets for James Harden, who is now a key piece of the current 76ers team.
By the time the 76ers drafted Ben Simmons in the NBA Draft in June 2016, however, Sam Hinkie was no longer around. The Sixers had started the 2015-2016 season with just one win in their first 22 games, and by April, Hinkie was out. Technically he resigned, but he did so with his head on a chopping block, dogged by both the accusations of undermining the integrity of the league and the impatience of both fans and team ownership, who were no longer content to continue letting “The Process” unfold amid such terrible results.
The Resignation Letter
Hinkie circulated a resignation letter to team ownership that became public. It should be read by every existing and aspiring executive in sports or non-sports, as well as students in business school and undergraduates in general for its grace, poise, and insight even in the midst of failure. Striking a humble tone, Hinkie began:
What I hope to accomplish here is to give you insight into what has transpired behind the scenes in ways you might not have otherwise heard about…Accordingly, you should anticipate some mild cheerleading (of others) sprinkled with a healthy dose of self-flagellation about things I’ve done wrong.
From there, over the next twelve and a half pages, Sam Hinkie lays out a management case study that weaves self-deprecation with self-defense with insightful commentary about psychology, patience, and human nature:
On innovation:
A competitive league like the NBA necessitates a zig while our competitors comfortably zag….A league with 30 intense competitors requires a culture of finding new, better ways to solve repeating problems…
…Jeff Bezos says it this way: “There are few prerequisites to investing…you have to be willing to fail. You have to be willing to think long-term. You have to be willing to be misunderstood for long periods of time.”
On process:
Divorce process from outcome. You can be right for the wrong reasons. In our business, you’re often lionized for it. You can be wrong for the right reasons.
On humility and the people the organization seeks out:
Lifelong learning is where it’s at. To walk down that path requires a deep-seated humility about a) what’s knowable and b) what each of us know. We hire for this aggressively. We celebrate this internally. And we’ve been known to punish when we find it woefully lacking.
We talk a great deal about being curious, not critical. About asking the question until you understand something truly. About not being afraid to ask the obvious question that everyone else seems to know the answer to. And about the willingness to say three simple words, “I don’t know.”
On thinking long-term:
Jeff Bezos says that is Amazon has a good quarter it’s because of the work they did 3, 4, 5 years ago - not because they did a good job that quarter.
There is also considerable basketball talk throughout the latter half of the letter, which if you’re especially interested in the sport is actually fascinating to read. There is some talk specifically about Joel Embiid, who had not even played for the team yet (“We remain hopeful and optimistic about his long-term playing career, but we don’t yet know exactly how it will turn out. The decision to draft Joel third, though, still looks to me to be the correct one in hindsight.”)
The philosophy behind “Trust the Process,” comes through in Hinkie’s letter. He knows he is done with the team, but he still emphasizes the long-term focus and the need for patience. This is good advice for many executives and leaders in general these days, who might be so attuned to the most recent quarterly results that they may lose track of the bigger and more important long-term story.
But what also really stands out throughout the letter to me, however, beyond the specifics above is the grace and poise with which Sam Hinkie carried himself with even in this moment of public failure. He closes the letter saying, “Your club is on solid footing now, with much hard work yet to be done.” And, “Thank you for the opportunity you all gave me to lead this storied franchise. My gratification is beyond my power to express. What is unequivocal is that the principal beneficiary of your largesse has been me. Thank you.” And finally, “It’s clear now that I won’t see the harvest of the seeds we planted. That’s okay. Life’s like that….I will be repotted professionally. That is often uncomfortable; most growth is. But it’ll also healthier over the long sweep of history, too.”
And with that, Sam Hinkie was gone, his tenure with the Philadelphia 76ers debated into oblivion and even still until this day.
The Verdict on The Process
It’s not hard to blame the fans of the Philadelphia 76ers and team ownership for losing patience with The Process. The 2015-2016 season was the third year of this experiment, and there were very few signs at the time that things were getting better. In fact, the total wins for the team had gone from 19 to 18 to just 10 over that three-year period. It was not yet evident that they would emerge from that trough. The star piece of The Process era was Joel Embiid, but he had not even been on the court yet while he was dealing with injuries for the entire 2014-2015 and 2015-2016 seasons. Since then, the team has now made the playoffs six years in a row through the current season, but that success is only evident in retrospect and at the time it was much more uncertain.
Still, the intriguing philosophy behind The Process continues to allure in part that it was just so brazen and bold. The problem with being “just okay” in the NBA is that if you eek your way into the playoffs as a 7 or 8 seed, you stand very little chance of making it very far. Not a single 7 or 8 seed has ever won the NBA Finals, and only one 6 seed has: the 1995 Houston Rockets. And the problem in a league that rewards its poorest performing teams with the best draft picks is that if you are, in fact, good enough to make the playoffs but not good enough to advance, you’re left with a draft selection in the 15 to 20 range. Sometimes you can strike gold in this part of the draft like the Milwaukee Bucks did when they drafted Giannis Antetokounmpo 15th overall in the 2013 draft, but the odds are much better of hitting on picks in the top 5 than beyond that. Just barely making the playoffs but not advancing is basketball purgatory: you’re not winning championships, but you’re also not getting the best draft picks and, with them, a chance to reload.
It is safe to say that those terrible seasons did lay the groundwork for the success that the team has experienced since. It even seems in the Hinkie Letter that he knew this success was coming, and that while he was sad that he would not be a part of it, he knew the team would soon be a perennial playoff contender.
What is Sam Hinkie up to now? He runs a venture capital firm, and has no interest in returning to the NBA, telling the ESPN Daily podcast in 2020, “Oh, zero…zero. I’ve turned that chapter for sure. That part of my life. I very much like what I’m doing now. I like surrounding myself with people who think in sort of the timeframes I do, which is often longer.”
Epilogue
The Process remains one of the most debated topics in sports (especially in Philadelphia), mostly for the question of whether it is fair or tolerable to put a team and a fanbase through such a period of ineptitude and frustration just for the chance to rebuild. And it is also worth noting that while the Sixers have, indeed, consistently been competitive over the past several seasons using many of the pieces obtained during The Process era, they have not actually won an NBA Championship or even made it to the NBA Finals. (Celtics fans hope this year is not the year!).
Additionally, there is a what might have been component to The Process. Just because a team has a lot of good draft picks doesn’t mean those picks are going to work out. In 2015, for example, the Sixers selected Jahil Okafor with the #3 pick overall. Okafor only played 247 games in his NBA career, averaging 10.4 points per game, hardly the numbers you would expect from a top 3 pick. In 2017, Hinkie was already gone but the team was still benefiting Process draft picks. That year they had the #1 overall pick and drafted Markelle Fultz. Fultz did not work out, playing in just 33 games for the Sixers over two seasons before being traded to the Orlando Magic, where he continues to play. The Ben Simmons pick at #1 overall in 2016 did not really work out either, even he did show flashes of brilliance; the frustrations and missed games far outweighed his strengths.
The Simmons, Okafor, and Fultz picks were just plain misses, as is the nature of the draft and its inherent uncertainty. But perhaps most galling to Sixers fans is that in 2016 just two picks after the Sixers took Ben Simmons, the third pick belonged to the Boston Celtics, who took Jaylen Brown. History repeated itself just one year later: after the Sixers took Fultz first overall, two picks later the Boston Celtics were once again on the clock. Their selection? Jayson Tatum. Imagine how different things would be today if the Sixers had taken Brown and Tatum instead of Simmons and Fultz. A lineup with Embiid, Tatum, and Brown would have been a juggernaut for sure; indeed, the history of the NBA and both the 76ers and Celtics franchises would have turned out completely different. Celtics fans rejoice that Tatum and Brown instead ended up wearing green.
Addendum
Accusations of “tanking,” as it is known, are not unique to the 2012-2015 Philadelphia 76ers. And they are not unique to basketball. In 2022, the NFL suspended Miami Dolphins team owner Stephen Ross for six games and fined him $1.5 million for allegedly telling the coach of the team to lose games on purpose to improve the Dolphins’ draft position.
Funnily enough, the current NBA season featured a “race to the bottom” where teams that had no chance of making the playoffs may have tried to lose more games on purpose to improve their draft position. The reason is that this year’s draft class features a player who is believed to be a once-in-a-generation talent: Victor Wembanyama. Just 19 years old, Wembanyama is a French player who is thought to be the best draft prospect since perhaps Lebron James, and maybe even greater. Lebron James himself has called Wembanyama, “Like an alien,” because of his combination of height, speed, and skill. Wembanyama is 7’3’’ but can handle the ball like a point guard and shoot from outside like a shooting guard. Whatever team has the #1 pick in this year’s draft will undoubtedly take him first overall and immediately start building a franchise around him. The NBA Draft Lottery, which determines the draft order based off a weighted drawing with the worst teams having the best chance to get the #1 pick, is May 16th. The Detroit Pistons, Houston Rockets, and San Antonio Spurs all have the best chance to land the #1 pick, followed by the Charlotte Hornets and the Portland Trailblazers.
Ben Sprague lives and works in Bangor, Maine as a Senior V.P./Commercial Lending Officer for Damariscotta-based First National Bank. He previously worked as an investment advisor and graduated from Harvard University in 2006. Ben can be reached at ben.sprague@thefirst.com or bsprague1@gmail.com. Follow Ben on Twitter, Facebook, or Instagram. Opinions and analysis do not represent First National Bank. © Ben Sprague 2023.
For more on today’s topic, you can listen to the ESPN Daily podcast conversation with Sam Hinkie here, which I highly recommend, and read Hinkie’s 7000-word resignation letter here.
