Posted on: September 14, 2011 8:19 pm
Edited on: September 14, 2011 9:15 pm
By Evan Brunell
Managing partner and CEO Bill Neukom will not return to the Giants next season, the San Jose Mercury News reports.
Neukom, who has overseen the Giants since succeeding Peter Magowan in 2009, was asked to leave by the executive committee after a series of disagreements over the three years Neukom has been in control. Larry Baer, the team's president and COO, is expected to succeed Neukom, who may yet stay in the organization at a different position, although it won't be his choice.
Neukom, Microsoft's former top attorney, angered partners by determining on his own how to spend the additional money that the Giants received due to winning the World Series. Starting last October, Giants merchandise rose $500,000 a month. Couple that with a rabid fan base that has nearly sold out the park, and there's been plenty of cash as a result. He boosted payroll and added new technology to the baseball department with the money, counter to the executive committee's wish that the money be used as a rainy-day fund. The committee was so far out of the loop that they would sometimes read of Neukom's moves in the paper before being apprised.
The passing of Neukom could potentially clear the way for Oakland to finally move to San Jose. Neukom has been staunchly opposed to giving up San Jose as a territorial right, despite the A's gifting S.F. these rights years back. While S.J. is further away from San Francisco than Oakland, it's also the home of many technological companies, which could affect the Giants' sponsorship rates if the A's moved to San Jose, a question that has been in limbo for years. Commissioner Bud Selig hasn't offered up any opinion on the matter that has been on his desk for years, but Neukom stepping down could be the jolt needed to re-energize talks. But for now, it's impossible to know what impact, if any, Neukom's departure will have on the A's move to San Jose.
Given that Neukom's successor worked right under Neukom and is expected to stay in power, the Giants shouldn't be adversely affected by the transition, although the executive committee's push to have the cash as a rainy-day fund instead of investing it back to the team in the hopes of keeping up competition as well as raising the qualify of baseball operations' tools is a potential glimpse into a future San Francisco team run under tighter financial constraints.
For the first time in history, the Giants have a payroll over $100 million, coming in around $120 million for 2011. The $95 million spent in $2010 was also at the time a franchise-high, but the team has sustained $90-million payrolls in the past. While it's only good business practice to hold some money back for future investments, the Giants were also in a prime position to significantly increase and retain additional business. In addition, infrastructure upgrades in the front office can be appealing to potential employees, raising the talent. Without intimate knowledge of Giants finances, it's difficult to determine what the correct course of action was. As Neukom is finding out, though, going against the executive committee and making a disagreement out of it is not the way to go.