Tom Gaglardi and the Rebirth of the Dallas Stars

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One commonality among successful professional sports organizations is strong ownership. Take a look at the most respected and well-regarded teams in the major sports, and a loyal and dedicated owner or ownership group is not far behind. The Los Angeles Lakers have won 10 NBA titles since Jerry Buss bought the team in 1979. Robert Kraft was a season ticket holder for 23 years before buying the New England Patriots in 1994, and Mike Ilitch has made the Detroit Red Wings the premier organization of the NHL through smart hires, patience, and a commitment to the community and the sport.

At the other end of the spectrum, bad ownership can be toxic. The Chicago Blackhawks floundered under the (lack of) direction from Bill Wirtz, and they only reemerged as a contender on the ice and a successful business off the ice after Bill’s son Rocky took over.

The Dallas Mavericks failed to make the playoffs from 1991 until 2000, the year Mark Cuban purchased the team. Cuban has been criticized for many things, but his passion for the Mavericks and willingness to invest his efforts and money to see the team succeed have never been questioned. The Mavericks rewarded Cuban with an NBA title in 2011.

At one time, Tom Hicks was a successful businessman and ran two franchises in the Dallas area — the Stars, and the Texas Rangers. Hicks bought the Rangers in 1998, but the team struggled on the field soon after. They finished last in the American League East for four consecutive years, and Hicks will best be remembered for the record-breaking contract he signed with shortstop Alex Rodriguez (10 years and $252 million).

Under his guidance, the Dallas Stars flourished in North Texas, adding coach Ken Hitchcock, forward Joe Nieuwendyk (now the team’s general manager), and defenseman Sergei Zubov. The Stars won the Presidents’ Trophy in both 1997-98 and 1998-99, and they captured the Stanley Cup in 1999, as well.  The team boasted an array of elite talent, from Mike Modano, to Ed Belfour, to the perennially-underrated Jere Lehtinen.

Trouble for Hicks in other business ventures started to affect both the Rangers and Stars, and the on-field/on-ice performances reflected that. He purchased a stake in Liverpool FC in 2007 for $200 million, and like most  American business men, was hit hard by the economic downturn in 2008. The group that owned both teams, the Hicks Sports Group, defaulted on close to half a billion dollars worth of loans in 2009. After a lot of complications, the Rangers were eventually sold in 2010 to a group led by former pitcher Nolan Ryan. The Rangers have since gone on to make consecutive World Series appearances (losing both).

The Stars were perhaps hit hardest by the struggles of Hicks. The team once boasted one of the highest payrolls in the league, but was now struggling to stay above the cap floor. They were unable to attract (or in the case of Brad Richards, keep) top talent. It was finally unearthed in early 2011 that Dallas had been “financially managed” by the NHL for over a year. The Stars had lost almost $100 million over the most recent three seasons, and the team hadn’t made the playoffs in four seasons.

Enter Tom Gaglardi.

Gaglardi, president of Northland Properties, had been seeking ownership of an NHL team for quite some time. He failed in his attempts to buy the Vancouver Canucks, and jumped at the chance to take ownership of the Stars. A life-long hockey fan who still plays the game, Gaglardi brought an immediate and impossible-to-miss shift in culture to the organization.

This wasn’t his first foray into hockey ownership. In 2007, he purchased the Kamloops Blazers, along with business partners Darryl Sydor, Shane Doan, Jarome Iginla, and Mark Recchi.

Doan, Gaglardi’s business partner in Kamloops, sees big things ahead for the Stars:

“I think he’s going to be incredible for the NHL. We’ve all learned so much from him… he loves the sport so much.”

And what was certainly music to the ears of Stars fans, players, and employees, Gaglardi finished his first press conference by saying:

“The uncertainty is now over.”

The Right People in the Right Places

As any successful businessman knows, you are only as good as the people around you surround yourself with. Gaglardi brought Jim Lites, the extremely popular former President & CEO, back to the Stars organization. Lites had previously held the same position under Hicks, as well as previous owner Norman Green. Lites oversaw the Stars at their peak – seven Division Titles, two Western Conference Championships, two Presidents’ Trophies, and the Cup in 1999.

Lites got a start in pro hockey as Chief Operating Officer of the Red Wings, and he played a big role in getting Sergei Fedorov, Vyacheslav Kozlov, and Vladimir Konstantinov to defect from the Soviet Union. Most recently, Lites had been working with the New York Giants. Seeing a trend here? Great owners recognize great talent – the Giants, the Wings, and now the Stars. From the press conference introducing Lites:

“Having Jim Lites at the helm of the Stars is really an owner’s dream. He knows the market, he loves the game, and he is totally committed to putting the Stars back… as one of the elite franchises.”

Galiardi expressed his support for general manager Joe Nieuwendyk, as well.

“He is certainly fast becoming one of the great general managers of the National Hockey League, and we’re fortunate to have him here.”

Gaglardi brought Jason Farris on board as well. Farris, a successful author and businessman from Vancouver, is best known to the hockey community as the author of Behind the Moves , a fascinating behind-the-scenes look at past and present NHL general managers (I wrote a review for the book back in early 2012).

Farris runs the Business Operations & Development for the Stars, and he has a diverse and interesting background in various industries. He also holds an MBA from MIT.

In head coach Glen Gulutzan, the Stars have a young coach with a proven track record for success at the ECHL and AHL levels. His teams qualified for the postseason in five of six seasons in the ECHL, and both seasons he spent in the AHL. Several teams around the league have gone the route of promoting from within. Gulutzan is familiar with the organizational philosophies, and he came into the job having the experience of coaching many of the Dallas players already.

Bob Gainey has rejoined the Stars as a Senior Advisor

Most recently, the Stars welcomed Bob Gainey back. Gainey served as the team’s general manager during their successes and Cup win in the late 1990s. During his eight-and-a-half season stint running the Stars, the team missed the playoffs only once. He will serve as a consultant to Nieuwendyk.

Having the right people in the right roles is crucial for the success of any business, and Gaglardi has his people where he wants them. Now it is time for the on ice product to reflect the significant off-ice improvements.

Build It and They Will Come

It is no secret that winning is the ultimate sales pitch to sports fans. In 2007-08, the last year Dallas qualified for the postseason, they ranked 12th in league wide attendance. Since that time, their average attendance numbers have fallen to 14th, 17th, 23rd, and eventually dead last this past season.

Gaglardi knows that getting the fans back will be tough:

“”We’ve got to go back now and re-forge the bonds that have been broken between the team and the community here and the fans. We have fewer season ticket holders than we have in quite some time and we’ve got to go back and capture their imagination and build those emotional bonds that are required for a fan to buy a season ticket.”

Fans grew weary of a declining on-ice product, and getting people back in the seats will be top priority for the Stars. The best way to do that is to win. And the best way to win? Build a strong core of players, and surround them with cheap, entry-level contracts (good drafting) and proven veterans (free agency).

At the midway point of the 2011-12 season, Dallas was seeing attendance numbers of 15,000-16,000 for home games, almost 5,000-6,000 more than at the beginning of the season. Fans aren’t stupid, especially in a city rich in sports history and tradition like Dallas. They know a passionate owner when they see one (Jerry Jones, Mark Cuban, and Nolan Ryan are all great examples of passionate owners).

In the mid 1990s, the Stars created several local youth hockey leagues, and invested a lot of time and resources into developing talent in the area.

Lites oversaw much of this side of the business, and since returning to the organization, has made a point of righting the wrongs that occurred during the final years of the Hicks era.

According to Defending Big D writer Brandon Worley,

“One reason that [we] became Stars fans in the 1990s… was our love for playing the sport itself. The Stars were able to create a rabid and very loyal fan base through this method, with kids falling in love with the sport and the team and then dragging their parents along.”

If winning is the best sales pitch, a demanding child may not be close behind.

There are some young players with NHL potential who have come from the area, including Austin Smith (current Stars prospect), and Stefan Noesen, Ottawa’s 2011 1st round draft pick.

Community Involvement

In April of 2012, the Stars announced the formation of a new youth travel hockey league, which will begin play in the fall of 2012. According to Jim Lites:

“We have embraced youth hockey and are deeply committed to growing the game. We would love nothing more than to see more of our young NHL prospects to be homegrown in our youth league.”

Community involvement in other ways is important, as well. I have seen firsthand the impact a sports team can have on a community with the Canuck Place Children’s Hospice, a place where I have had the privilege of helping out with various fundraising initiatives over the past few years.

In Dallas, the team has been working with the Dallas LIFE shelter, and they recently committed $25,000 to build a playground for underprivileged children. Farris, and players Verne Fiddler and Stephane Robidas were in attendance for the unveiling. The LIFE shelter isn’t a typical homeless shelter; they have a successful rehabilitation program aimed at relaunching people back into society with the skills to succeed in the long run.

On Ice Improvements?

Gaglardi hasn’t even been the owner for a full season, but I would expect to see the Stars reemerge as one of the most successful and well-regarded NHL organizations in short order.

Stephane Robidas sums up what it was like before Gaglardi saved the organization:

“Not having an owner, there’s always this uncertainty. We knew the team wasn’t going to move… but just to have a passionate owner, it’s a great thing.”

Dallas was barely above the cap floor to start the 2011-12 season, and the only reason they cleared it was because of the $1.9 million they were paying Sean Avery not to play for them. Avery was waived by the Rangers, and he reported to the AHL, which meant he was off the books for the Rangers (and Dallas, too).

“Sean Avery has officially reported to the Connecticut Whale of the AHL today, and his $1.9 million salary cap hit is taken off the books of the New York Rangers. Unfortunately, this also means that Avery’s $1.9 million cap hit for the Dallas Stars is now gone — something we’ve been contemplating since last week since Avery was initially placed on waivers by the Rangers.”

The meant Dallas had to find a way to get above the cap floor, and they were only able to do so after some creative maneuvering with the trade for Eric Nystrom.

Change didn’t occur overnight, as the team struggled at the end of the season, losing their last five games. End of the season struggles have become all too familiar for Stars fans, as the team lost a must-win game in order to qualify for the postseason on the last day of the 2010-11 season.

Dallas lost Brad Richards, a premier center in the league, to free agency because they couldn’t come close to meeting his market value. They traded James Neal, in part because he brought back a young defenseman (Alex Goligoski), but also because they knew he was getting close to restricted free agent status. Neal since has signed a six-year, $30 million deal in Pittsburgh, after scoring 41 goals in 2011-12.

The core is all locked up for the long term, with Jamie Benn the lone (and large) exception. Goaltender Kari Lehtonen has shaken off the injury problems that plagued him in Atlanta, emerging as a very good starting goaltender.

On the back end, Robidas, Trevor Daley, and Goligoski are all signed for the next few seasons. Up front, Loui Eriksson has blossomed into a premier two-way forward, and his game didn’t fall off with the Richards departure, as some expected. Mike Ribeiro is a creative offensive forward who doesn’t get the respect around the league he now deserves. Michael Ryder was a shrewd free agent signing and is a pure sniper. Captain Brenden Morrow may be trade bait this summer, as he doesn’t appear to be the same player after sustaining a few injuries in recent years. Steve Ott, the best and worst trash talker in the league (depending on who you ask), may be on the market too.

The depth chart thins out quite quickly, though. On the back end, Mark Fistric has become arguably the most menacing hitter in the league. Prospect defenseman Brenden Diillon, a former WHL star, is a player to keep an eye on. Up front, Dallas has several question marks on their bottom two lines.

The most interesting piece in the organization is Benn. The big winger-turned-center (for now) can do it all, and he has the upside to be a game-changing forward. The number one priority this summer is to get him locked up for a long, long time.

The Stars will build around Lehtonen, Goligoski, Daley, Eriksson, and Benn. They need to add a top pairing defenseman, another top six forward (even if Ott and Morrow remain in Dallas), and they need to improve their depth up front, too.

Dallas struggled on the man advantage in 2011-12, posting a league-worst 13.5% success rate. Their 33 power play goals was the lowest number in franchise history, and only 15 more than Neal scored for the Penguins.

Optimism Reigns

However, for all of the negatives in recent seasons, optimism still reigns in Dallas. Joe Nieuwendyk has some money available this summer, a marked change from past summers:

“I feel like now we’re a player again, whereas… I don’t think teams really felt there was a need to talk to the Dallas Stars because of our situation. We have to be smart… but we’re going to look at all options, as far as free agency, trades, you name it.”

Lites concurs:

“The difference between this year and last year is, there is a guy there you can call and say, ‘We have an opportunity to sign this player to this contract and he can make a difference for us for 10 years.’”

The tail end of that Lites quote is interesting. 10 years? Who is he referring to? Benn, perhaps? What about Ryan Suter, who would fill a huge need on the Dallas roster (as well as about 25 others around the league)?

The excitement heading into this summer is contagious. Lehtonen expresses a similar sentiment:

“The last couple of years, it was a weird situation, it was always tough, you knew that we weren’t going to be able to get all the top players here.”

Dallas is a beautiful city with a lot to offer, and will once again be able to attract the top free agents, just like they did in the 1990s and early 2000s. The Dallas – Fort Worth area is the fourth largest market in the United States, and there are no shortage of great places to live, eat, and enjoy life.

This doesn’t mean Dallas should spend big on any and all free agents. Building through the draft and with a long-term focus in mind is still the way to go. Gaglardi agrees:

“You build through the draft. You develop. You coach. That’s the philosophy I come with. I think there’s been enough cases around the NHL to show that you cannot buy a winner. I believe in the old fashioned way of building from within.”

The team has a below-average group of prospects. There are several future Stars on the way, but no future stars on the way, if you catch my drift.

Brandon Worley shared his thoughts for the roster, as it stands today. He believes the three biggest needs (beyond a new contract for Benn) are a center, a top six forward, and a top pairing defenseman. The roster as it stands right now:

LOUI ERIKSSON – JAMIE BENN (RFA) – ALEX CHIASSON

UFA – MIKE RIBEIRO – MICHAEL RYDER

BRENDEN MORROW – STEVE OTT – ADAM BURISH (UFA)

ERIC NYSTROM – VERNON FIDDLER- SCOTT GLENNIE

REILLY SMITH

UFA – ALEX GOLIGOSKI

PHILIP LARSEN – TREVOR DALEY

STEPHAN ROBIDAS – BRENDEN DILLON

MARK FISTRIC (RFA)

KARI LEHTONEN

RICHARD BACHMAN (RFA)

Nieuwendyk can’t wait for July 1st, and who could blame him:

“This summer is different than many summers, because from day one since Tom Gaglardi took over, you could feel that cloud moved away from our organization.”

There is no time like the present for the Stars organization. Once a strong revenue-generating business off the ice and a perennial contender on it, the Stars have the right people in place to get back to the glory days of the late 1990s. Sustainable success in professional sports is impossible to achieve without the foundation of strong ownership. Tom Gaglardi has brought that to Dallas, and success is sure to follow.

3 Comments

  1. Jeff,

    Great article and perspective. I grew up in Dallas during the the thrill of the 90s and continue to follow the Stars like a hawk as an ex-Dallasite. One thing that’s been hard for me to watch is the decline of our defensive corps (gone are the days of Hatcher, Matvichuk, Sydor, Zubov, and Ludwig). I’ve lost count in the past three seasons how many times I’ve had my head in my hands at how little help our defense has given our goaltender. Lehtonen’s talented and a very good goaltender, like you say, but he’s not phenomenal. He needs help back there.

    Daley, Fistric, and Goligoski are solid members right now (though I’m still livid we ever let James Neal go), but Robidas’ time has to be running out before too long. I have little confidence that we have a good core of defensemen waiting in the wings from our minor league teams. I guess what I’m wondering is this: Do you believe Dallas has a legitimate chance at getting Ryan Suter? I know we’d be just one voice among many calling him; Mike Babcock has not so subtly hinted the Red Wings stores of free cash will be aimed at Suter and Parise. You mentioned the Stars will have more money to work with this July than last year—any idea what type of numbers we’re talking here? I’d like to think Dallas can be a big player this summer in the free agent market, but that could be wishful thinking on my part.

  2. Great article, like the roster. But … Where’s Adam Pardy !!! :O)
    IMO, you got it right … terrible signing and should be bought off or sent to AHL.

  3. Pingback: The Numbers Behind the Numbers: The Dallas Stars Bottom Six - Angus Certified

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