We’re a brief break around this place, we are back, and normal blogging herewith resumes! And we resume with a further look at the KHL’s new strategic plan, to which Tomáš Vorčák introduced us a couple of weeks ago. Read on!
As Tomáš discussed in his post (go and read it — it is excellent), the KHL will cut three teams at the end of the coming season, with two more going away prior to both the 2019-2020 and 2020-2021 seasons. Two new teams, probably from outside of Russia, will be also be added in both 2019 and 2020, so the net result will be a 24-team league (the KHL will have 27 members in the coming season, with Metallurg Novokuznetsk and Medveščak Zagreb having departed). The main goal is to increase the league’s competitive balance, both on the ice and in terms of team finances, but the league also wishes to increase its international component.
When the new strategic plan was announced at the end of May, the KHL revealed that it would base its decisions on which teams to cut from the league roster based on a ranking system, which will be made public. That ranking will be based on eight criteria of different weights. In an article earlier this month, the KHL expanded its discussion of the criteria a little bit, with some added details on how the results would be determined. We still do not have all the answers about this ranking — for example, we do not yet know every last thing about how the teams will be graded in each category — but we do know a good deal more at this point than we did when the strategic plan was first revealed.
I would encourage you, incidentally, to read that linked article; it is a very interesting piece that includes a number of helpful charts and diagrams, and it also contains some useful information on the KHL’s incoming hard salary cap and other items of that ilk.
So, here are the criteria upon which the teams will be ranked, with the bottom three clubs dropping out of the KHL at the end of 2017-18. The number in brackets is the weight assigned to each criterion.
Sporting Achievement (30%):
On-ice performance is the “weightiest” criterion of the eight, taking up nearly a third of the overall rating, and that’s fair enough. It is also one of the areas in which the now-departed Metallurg Novokuznetsk suffered greatly, having recorded two last-place finishes in the two most recent seasons, preceded by a second-last overall position in 2014-15. Obviously, teams like SKA St. Petersburg, CSKA Moscow, and Metallurg Magnitogorsk will dominate this category as we move into the new season. And there is not much more we need to add here, I think.
Labour Costs (20%):
It is a little bit hard to judge this category, as we do not know exactly how it will be adjudicated beyond the obvious. As the article at en.khl.ru states, “if a team overspends and underperforms, then the club loses points from its rating,” so it may be as simple as comparing a team’s position in the “size of payroll” standings to its position in the actual “on-ice” standings. Twenty percent is a hefty cut of the weighting as well, so it is clear that league wants its members to spend their money intelligently. And this category may prove to be a strong point for teams like Sibir Novosibirsk Oblast, who have shown the ability to build successful rosters without too many “big” (i.e. highly-paid) names.
TV Demand (15%):
This one will go hand in glove with on-ice performance; according to this chart, KHL games between the bottom seven or eight teams in the standings attracted only about 30,000 viewers, while meetings of top-seven teams gathered an average TV audience of more than half a million. So, a team that does well on the ice will not only get points in that category, but should also see a benefit in this one as well. For teams that are struggling to win games, it will be a bit of a double-whammy, however. Still and all, the KHL’s desire to keep teams that people like to watch is a reasonable thing, and TV ratings do have actual direct financial repercussions for the league (as the article notes, 17% of the KHL’s games last season failed to make enough money to cover basic operating costs, and that number must be reduced).
Government Funding (10%):
Russia is working right now to get professional sports out of the public funds, so for KHL teams lower is better in this category. It does have the potential to get quite complicated; one question that arises involves what will be done when the principal funder of a club is partially state-owned, as in the case of oil company Tatneft, who sponsor Ak Bars Kazan (to give just one example). While the basic premise of this criterion is clear enough, we would need to see a few more details to be able to say much about it.
Arena Capacity Filled (10%):
This criterion could be quite interesting because, unlike the above discussed “TV Ratings” category, strong performance in it does not necessarily go together with a lot of winning on the ice. Amur Khabarovsk’s legions of long-suffering but devoted fans can tell you that, and there are others teams out there with similarly strong local support. This should also be an easy category to track, for obvious reasons. However, the KHL may need to be extra-vigilant for teams inflating their attendance numbers; Spartak Moscow were accused of just that not too long ago.
Arena Capacity (5%):
This is another fairly obvious category. The KHL would like all of its arenas to seat at least 12,000 people, but currently only seven buildings in the league manage that (another three are above 10,000). Four arenas, meanwhile, are at the KHL’s absolute regulatory minimum capacity of 5500. A number of teams do have new homes planned, including Sibir and CSKA Moscow, but for now Dinamo Minsk and the 15,000-seat Minsk-Arena are the league leaders in this category.
Local Market Potential (5%):
This is another criterion for which I would like to see more details. On the surface, however, it is fairly clear: the bigger the local and regional population, the better for the team. The article also mentions “proximity and ease of access,” although we do not yet know how exactly they intend to quantify that. That said, the inclusion of market size among the criteria is a fairly straightforward one, and for fairly straightforward reasons.
Late Payment of Wages to Players (5%):
There has probably not been a bigger chronic off-ice issue for the KHL than wage arrears, and the league’s front office and players’ union have been doing battle with it for several seasons now. In fact, last summer the KHL threatened to punt teams that still owed any wages from the concluded season, and this time around they have announced fines of 20% of the money owed (the deadline to pay off debts and avoid that punishment is this coming Saturday). And so it is a little bit strange to see that this criterion is weighted at only five percent.
A particularly important note is that the scores in each of these categories will be calculated by looking at data from the last three seasons put together (I do not know, at present, whether the most recent season will be weighted more heavily). That is good news for teams like Amur; in 2014-15 the Khabarovsk side finished last overall, amid serious financial concerns, but that campaign will no longer be an issue when the 2017-18 ranking is compiled. On the other hand, Sibir will have their tremendous run to the Conference Finals in 2014-15 dropped from consideration, and we will have to wait and see what effect that has on their final ranking. In any case, the three-year factor should protect solidly-run teams that suffer temporary crises through no fault of their own — it can happen.
Overall, the criteria for these rankings seem fair enough. We might quibble a bit over the weighting attached to this one or that one, but it looks a more-or-less reasonable system. One concern that I do have involves the overlap between some of the categories, which may cause some teams to be punished more than once for what is essentially the same problem. An example: a team from a small-market area (say, Ugra’s home in Khanty-Mansiysk, population 96,000 and fairly remote), will not only suffer in that particular category, but also may run into trouble in the arena criteria. A team like Ugra is unlikely to want or be able to afford a 12,000-seat building, and would not be able to fill one if they had it. On the other hand, we are talking here about a combined ten or 15 percent in terms of the weighting for those categories, so it is perhaps not a big deal after all.
One other surprise for me, as I mentioned above, was the weighting attached to the issue of wage arrears. Team debt has been such a big issue for the league, and so much work has been done to try to fix the problem, that giving it only five percent of the final weight seems low.
All that said, however, no system is going to be perfect. The important things are to have a reasonable set of criteria and to have them clearly explained so that everyone involved knows what the rules are. Full marks on the first of those requirements; these criteria, imperfect though they may be, are nonetheless a reasonable way of ranking the teams based on their usefulness to the KHL. As for the “clearly explained” element, well, we make progress. We know a lot more about this process now than we did in mid-May, and now we wait to see how and to what extent the league will go about making its rankings public.
Next up at the blog will be our look at Chernyshev Division coaches for 2017-18, and that should be along on Wednesday. On the horizon, too, are the team-by-team KHL previews for 2017-18; I anticipate getting those started ’round about July 10th or so (the new season begins on the 21st of August). In the meantime, of course, there will be other bits and pieces of news and so on here (including more on the strategic plan). Thank you for reading!