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Chris Ballard
December 03, 2012
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December 03, 2012

Money Ballsy


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To the casual observer, it may have appeared that the Rockets got lucky, that they were merely in the right place at the right time. And, to an extent, this was true; if Presti hadn't decided to move Harden, the Rockets never could have acquired him. That the Rockets were in position to make the deal, however, had nothing to do with luck.

It is a Thursday afternoon in mid-November, and Morey is sitting in a swivel chair in his office on the third floor of the Toyota Center, engaged in the low-tech task of opening his mail. His desk is littered with artifacts: a stuffed bear holding a golf club, a soccer jersey, a rolled-up Northwestern football poster, a bottle of weight-loss pills, a wire basket of Expo whiteboard pens, a box of Myoplex Lite bars. The latest Economist lies on the floor, statistical tomes line his bookshelves and the blinds are pulled on the two small windows. If it weren't for the nameplate outside the door, you'd never guess this was the office of the G.M.

If you've met Morey, this is not all that surprising. By the standards of NBA general managers, a breed of men who act as if they are guarding nuclear secrets, Morey is remarkably unpretentious and open. He tweets regularly, will speak on your podcast if you ask nicely and recently asked his Facebook friends if any of them could offer babysitting opportunities for his 13-year-old daughter. In the Rockets' office Morey jokes with interns, mocks his own geekiness and responds to most requests with the phrase, "Yeah, sure." Recently he spent the better part of a home game chatting with two fans seated behind him, answering questions about the team's future. "I figure if I can't explain the plan to a random fan, then I can't explain it to anybody," he says.

There is one area in which he is guarded, though. All his mail comes to the Toyota Center rather than to his home address. "I grew up in Cleveland," Morey explains, "and when Art Modell left the city [with the Browns], people were stalking his house. Thankfully, I've never had those issues, but I learned from that." Then, by way of explanation, he adds, "We make a lot of moves that are really big gambles. And sometimes those gambles don't work out."

Indeed, Morey's strategy is summed up by one question: How much risk are you willing to take? That ethos derives from the team owner, a brusque former bond trader named Leslie Alexander. Intrigued by the seismic shifts occurring in baseball, in 2005, Alexander hired a 27-year-old analytics-minded Stanford grad named Sam Hinkie to be a special assistant to the G.M. A year later he hired Morey, with the understanding that he'd apprentice for a year before taking over as G.M.

By NBA standards Morey's background was unusual. The middle of three brothers and the son of an engineer who worked in the auto industry, he got his first computer, a Commodore VIC-20, when he was in the second grade. By the third grade he was reading Bill James. He loved comic books, programmed during his free time and, as he says, fit "the Big Bang Theory stereotype." By 22 he was nearing a computer science degree at Northwestern while working part-time at Stats Inc., where he both met his wife, Ellen—she answered the phones for the fantasy basketball transactions—and became the first to apply Bill James's Pythagorean expectation formula to basketball. (Google it if you really want the details.) In 2000 he got his MBA from the MIT Sloan School of Management, then joined the Parthenon Group, a business strategy consulting firm. After working on a project for the Celtics, he was hired by G.M. Danny Ainge and became the senior vice president of operations. And then, at the age of 33, Alexander came calling.

It is hard now, in this era of Nate Silver deification, to comprehend just how shocking the hire was at the time. Basketball teams were run by basketball men, grizzled former players like Ainge and Pat Riley and Larry Bird. Not only that, Alexander empowered Morey's radical way of thinking, signing off on investments in fledging technology and counterintuitive roster moves without batting an eye. "There was a lot of trepidation in our coaching staff," says Jeff Van Gundy, who was Houston's coach for four seasons, through 2006--07. "What did this mean? Would it impact in a negative light how we could coach?" Within two weeks, however, he had changed his mind. "What impressed me about Daryl was that he had very strong beliefs but he didn't think you could coach just by the numbers," says Van Gundy, now an analyst for ABC. "And, to be honest, he raised good questions."

When Morey took over in 2007, the Rockets were flush with talent. Tracy McGrady was a seven-time All-Star at 27 years old, and 7'6" Yao Ming, the franchise centerpiece, was only 26. Morey's mandate was clear: Win now. So he began assembling complementary pieces, making the type of low-upside trades he'd never make today: the recently drafted Rudy Gay for Shane Battier, a valuable player with limited upside; a first-rounder for Ron Artest as a one-season rental. That season under Rick Adelman, the team won 55 games.

Then Yao's feet and McGrady's knees went, and Houston's title aspirations went with them. The Rockets did everything they could to revive Yao, employing all manner of innovative treatments. Similarly, Morey endeavored to revive McGrady's flagging confidence, at one point driving to his house to show him a PowerPoint presentation entitled "Tracybeaggressive," which featured a downward-pointing yellow arrow indicating how McGrady's failure to attack the basket was directly tied to his effectiveness.

All to no avail. By 2009--10, Houston went from potential dynasty to potential lottery team. At the trade deadline that season, Morey dealt McGrady to the Knicks for a passel of players and picks. The reconstruction project kicked into overdrive.

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