Colts and Leadership and NFL and Pro Sports and Jim Irsay and Media & Marketing and Sports Business

IRSAY'S ODYSSEY: Owner learned from life in NFL to build winning team

January 16, 2006

The Indianapolis Colts' evolution from perennial patsy to Super Bowl favorite is a body of work with a seldom-told—and often misunderstood—history.

It's easy to see the hues all-pros Peyton Manning, Marvin Harrison and Edgerrin James painted on this masterpiece season. President Bill Polian and Coach Tony Dungy certainly colored the landscape. And Offensive Coordinator Tom Moore added his creativity.

But theirs aren't the only signatures on this canvas.

This particular work of art traces its origins to a time when a teen-age Jim Irsay began to soak up what it takes to draw a championship game plan—and saw the missteps that can lead to on-field futility.

Now, Irsay's vision for his team is finally being realized, despite public perceptions tinted by his past prescription drug abuse, rock 'n' roll reputation and eccentric tastes. Indeed, this record season has taken shape thanks to the skills the 46-year-old team owner has amassed since his days as a Colts ball boy and has deployed since taking over after his father's death in 1997.

In less than a decade as an NFL owner, Jim Irsay has transformed the Colts' fortunes far beyond the gridiron. He's led a renaissance that includes double-digit growth in ticket sales and sponsorship revenue and a waiting list for club seats and corporate suites—key indicators of the strength of an owner and his connection to the community.

He did it by building one of the NFL's largest marketing and scouting departments, surrounding himself with on-field and front-office talent few teams can match, and walking a tightrope between personal involvement and micromanagement.

Irsay has developed his own style while paying homage to legacy owners who etched this league into America's collective conscience. But oddly, he is little like the man who influenced him most—and his business philosophy is drawn from an entirely different palette than that of his father, Robert Irsay.

"When you look at the core of a winning team, it's where owners own, coaches coach and players play," said Eddie White, a vice president of team promotions for Reebok, which works closely with all 32 NFL teams. "That's the exact formula of the Indianapolis Colts. That's a testament to the way Jim Irsay does business. He's left his ego at the door."

Philosophies taking shape

Ask Jim Irsay who shaped his personal and professional philosophies and a litany of NFL giants—living and dead—roll off his tongue: Chicago Bears owner George Halas, Kansas City Chiefs leader Lamar Hunt, New York Giants leviathan Wellington Mara, Pittsburgh steel men Art and Dan Rooney, ex-Washington Redskins chief Jack Kent Cooke, and Leon Hess, the paternalistic proprietor of the New York Jets. Then there's former San Francisco 49ers owner Eddie DeBartolo, who created a football dynasty in the 1980s, but lost loads of money along the way.

Irsay also has been shaped by poetry, music, art and philosophy. He's rubbed elbows with singer Stephen Stills and writer Hunter S. Thompson. He quotes John Lennon and John Mellencamp with aplomb. He writes his own music and lyrics, and some in the business say he's good enough to do it professionally.

Still, no one shaped Irsay more than his father, who became a villain in Baltimore and at least temporarily a hero in Indianapolis for moving the Colts on March 28, 1984, from the East Coast to the Heartland in the middle of the night.

But the Colts' journey began more than a decade before—in 1972, when the Chicago heating and air-conditioning tycoon bought the Los Angeles Rams for $19 million, then swapped the team for the Baltimore Colts and $3 million cash.

The elder Irsay ruled with a critical eye and an iron fist.

"[Robert Irsay] was the premier case of the tinkering owner," said Mark Rosentraub, a former dean at IUPUI and author of "Major League Losers," a book about professional sports operations. "In the end, it was a model that seemed dysfunctional."

Ever a loyal son, Irsay said his father tried to apply the principles he used to build his business empire. The strategy sometimes went awry, he said, but there were positives.

"My dad was a great negotiator and a great businessman," he said.

Growing up in the circus

Things went well early on. From 1975-1977, the Colts compiled a 31-11 regular-season record and won three straight AFC East titles.

But in the late 1970s, key players started vanishing from the roster.

"We lost the nucleus of the team necessary to continue to win," said former quarterback Bert Jones, who played from 1973-1981. "It got to the point, I didn't recognize anyone in the huddle."

League insiders said Robert Irsay was overbearing and foolishly cheap, losing top talent like a careless kid who lets go of his balloon at the state fair.

"His dad had a big heart, but he made some mistakes, and Jim had the advantage of learning from those mistakes," said Colts Senior Executive Vice President Pete Ward. Like the younger Irsay, Ward spent decades working his way up the team's front-office ranks.

Jim Irsay, who as a teen handled odd jobs for the Colts—like washing the team's laundry—has vivid recollections of his dad's reign, including a preseason loss in Detroit in the mid-'70s. Robert Irsay was ranting at players, almost coming to blows with tight end Raymond Chester, one of Jim's favorites.

After his dad left, Jim, then 16, went with Coach Ted Marchibroda to the team bus to try to smooth things over with the players. When his eyes began to well up, Marchibroda comforted him and told him to return to his dad.

"The relationship between his dad and the players was less than ideal, and the stress and pressure of that ended up on a kid who didn't deserve any of it," said Jeffrey Marx, who served alongside the younger Irsay as a Colts ball boy, and who later became a Pulitzer Prize-winning journalist and author. "Jimmy stepped into certain situations that no kid his age should ever have to. He handled it all with grace and class."

Most remarkable, Marx said, was the bond young Irsay formed with players.

"Usually, the general manager's or owner's son is looked at with a bit of caution," he said. "But Jimmy loved the players. And they loved him."

Jim Irsay's role with the team became official when he graduated from Southern Methodist University in 1982 with a degree in broadcast journalism and began working his way through every Colts department.

While he often took notes on some of the league's most successful owners during his formative years, league insiders said his front-row view of what didn't work had an even bigger impact on his development.

Robert Irsay, who became known for his nasty temper and love of liquor, had difficulty seeing the long view of professional sports.

"This business tormented him some," Jim Irsay said. "His deep belief was, 'I just can't see paying all that money to a guy who's never played a down in this league.'"

The now-infamous John Elway saga offers a window into the mind-set that drove his father's teams into NFL obscurity.

Elway was drafted by the Colts in 1983, but refused to play for the team, citing concerns over its wavering management and the foul East Coast weather. Robert Irsay, reticent to give Elway the big contract he commanded anyway, traded him to Denver for quarterback Mark Herrmann, offensive guards Chris Hinton and Ron Solt, and a draft choice.

"It was a very difficult situation for my dad," Irsay said. "It was at a time when we had an obviously aging stadium in Baltimore that created difficulties with our revenue stream. It was a decision Dad thought he had to make."

And the lesson the younger Irsay learned from that experience likely helped him hang onto future Hall of Famer Peyton Manning decades down the road.

If Robert Irsay had run the team the way his son is now, Jones said, the Colts would have dominated the NFL long ago.

"The mentality of the Colts would have been very different," he said. "I think you're seeing that now."

Jim grew up in an NFL fishbowl that magnified his father's weaknesses, observers said. He learned early on how to deal with high-profile players and spin the media in his favor. And he saw firsthand in Baltimore what can happen if you get sideways with political leaders in the community your team calls home.

"You have to have sawdust in your veins," Irsay said. "That's the advantage of growing up in the circus."

Under Dad's thumb

His dad's Colts were mired in a nine-year losing streak when the Mayflower moving trucks left Baltimore in 1984. The losses didn't matter to euphoric central Indiana fans.

The Colts had the league's highest ticket price and one of the NFL's worst teams during its first year in Indianapolis, finishing 4-12. Still, home games sold out, and attendance averaged 60,163.

With a lackluster on-field product and little marketing, that enthusiasm eventually waned and attendance dropped off.

Jim Irsay, meanwhile, continued his roller-coaster ride with the team. Although promoted to general manager a month after arriving in Indianapolis, he became the target of many of his dad's tirades. Robert Irsay threatened to fire his son many times, team insiders said.

The younger Irsay yearned to change the team's operations, they said, but he was stuck between being a child and an adult.

"Anytime you're under your father's thumb, it's awfully hard," said Marchibroda, who coached the team from 1975-1979 and 1992-1995. "Jim had his own ideas on how to run the team, but his dad had his say."

Jones said the elder Irsay's domineering style led to confidence problems for Jim in his early years in the front office.

But when his father refused to sign first-round draft pick Cornelius Bennett in 1987, Jim stepped in. He brokered a three-team trade that shipped Bennett to the Buffalo Bills and brought all-pro running back Eric Dickerson to Indianapolis from Los Angeles. It was one of the most significant trades in franchise history.

Dickerson's arrival boosted sagging attendance by 4,000 per game for the next two seasons. The Colts ended their losing streak, but, more important, Jim met and impressed up-and-coming Bills General Manager Bill Polian during negotiations.

"That was an intricate deal, and Jim took a lead on it and was responsible for getting it done," said Marc Ganis, president of Chicago-based Sportscorp Ltd., a consulting firm that works closely with the league, its teams and owners. "That, I think, for the first time really raised the level of awareness of what Jim Irsay was capable of."

Still, his trials were far from over.

In 1994, Robert Irsay hired NFL veteran Bill Tobin as director of football operations, placing him over Jim. But the next year, the elder Irsay was felled by a stroke and Jim took over day-to-day operations.

The next two years continued with exhilarating highs and devastating lows.

Jim was named executive vice president, general manager and chief operating officer in 1996, the same year quarterback Jim Harbaugh led the Colts to within an eyelash of the Super Bowl. In 1997, Robert died, the team regressed and Jim axed Tobin, his former boss.

After a legal battle with his dad's second wife, Nancy, Jim took sole ownership of the team. Nancy got $12 million and her late husband's 38-acre Carmel estate.

Turning 180 degrees

Only then was Irsay able to execute his own game plan.

"Mentally, when my dad died, I was ready to begin my era as an owner," he said.

Irsay knew he had to overcome serious image problems.

"We came in 1984 and created a big splash, but we really didn't do anything to build on that and create a legacy," Irsay said. "When I began as owner ... you'd have to be completely blind not to see change was needed."

Former Colts Coach Ron Meyer said Irsay learned at his father's knee, then went in the opposite direction.

He easily could have made his mark by imposing his will on the team. But Irsay, who dabbled for a time in competitive power lifting, chose not to hoist the team on his shoulders.

Instead, he hired top talent—including Polian—and gave his staff the room they needed to work. His strategy was to open his pocketbook when it mattered and reach out to the community like never before.

He wanted to make the Colts one of the NFL's first regional draws, appealing to fans and corporate sponsors from Evansville to Fort Wayne.

In December 1997, Irsay hired sportsmarketing veteran Ray Compton to head sales and marketing and expanded the staff from four to 24. About the same time, the Colts became only the third NFL team to produce, package and sell their own radio broadcasts, giving up an easy $6 million in annual licensing fees for a gamble to make more. By all accounts, that decision is still paying off.

Irsay also oversaw the team's effort to produce and sell ads on Colts TV specials, a strategy that ultimately resulted in six-figure profits.

The following year, Irsay shelled out more than $1 million to expand the team's 56th Street complex to accommodate growing departments and add broadcast facilities.

"Jim Irsay realized in a small market, you had to control your own destiny," said Compton, who left the team in early 2005 to form his own company. "When [Colts leaders] started bringing more operations in-house, that was the turning point for the franchise."

Still, the regionalization effort wasn't without its bumps.

"A regional plan sounds like a great idea, but there were some lonely times on the road," Compton said. "It was a roll of the dice eight years ago. But it was a carefully calculated gamble."

Ticket and sponsorship sales outside central Indiana have seen double-digit increases in recent years, team officials said, with more than one-third of ticket sales coming from elsewhere.

Irsay believes the effort worked because fans and sponsors far and wide feel they're an important part of the team. That's a sharp contrast from his dad, who told Baltimore citizens on his way out of town, "This is my team," not Baltimore's.

"We believe this community is a very big part of this team, and we take that very seriously," Jim Irsay said. "Without the community's support, you can't compete."

Irsay also proved to be an able negotiator, brokering a new RCA Dome lease with then-Mayor Steve Goldsmith in 1998. The city agreed to an $18 million renovation, adding cash-generating club seats and suites. The Colts also got financial guarantees from the city to keep the team's revenue in the middle of the NFL pack.

That same year, Irsay started focusing on the team's corporate relationships, rallying business leaders he hoped to sell on sponsorships, club seats and suites.

"I told them we could be entering a golden era," Irsay said.

The Colts in 2000 became the third NFL team to sell naming rights to its training complex and headquarters. Union Federal Bank agreed to a multiyear deal worth close to $1.5 million annually, team sources said.

Irsay and Compton, with help from Mayor Bart Peterson and a handful of business leaders, launched the Colts Business Alliance in 2002 to build on that success. The organization, one of the first of its kind in the NFL, initially looked like little more than a publicity stunt. But the alliance now has more than 500 members statewide and continues to grow.

With community support on the rise-and the components of a winning team on the field-attendance climbed from 440,930 in 1998 to more than 457,000 in 2005. Season-ticket sales increased more than 20 percent in that time, team officials said, and sponsorship sales posted a double-digit percentage increase.

Investing in success

Irsay's commitment to winning may be apparent now, but initially he was something of an enigma to local fans and community leaders whose support he was still trying to win over.

In April 1999, he orchestrated a curious trade that sent all-pro running back Marshall Faulk to the St. Louis Rams with little apparent return. The move had observers wondering if Irsay was taking a page out of his tightwad father's playbook.

But the trade made room to draft Edgerrin James later that month and freed salary-cap space to strengthen other positions.

The on-field turnaround began that season, when the Colts won 10 more games than the year before, finishing 13-3. In 2000, the Colts hosted their first playoff game in Indianapolis.

Still, rumors persisted that Jim Irsay would jilt Indianapolis as his dad did Baltimore. So when team leaders started discussing the need for a new stadium, some theorized Irsay was angling to bolt.

"The Irsays didn't move to Indianapolis because they loved Indianapolis over Baltimore," said Ted Bulthaup, owner of Hollywood Bar & Filmworks in Indianapolis and Chicago. "It's all about the money."

Those close to Irsay said he never wavered on his commitment to stay.

"I know moving from Baltimore hurt him," Marx said. "He called a lot of people there personally to apologize. At the time, it was out of his control. Knowing what happened in Baltimore, I could really see the joy in Jimmy staying in Indianapolis."

That doesn't mean it's been easy. Irsay and his staff have had to be creative to raise enough cash to keep the team winning in small-market Indianapolis.

Few would call him cheap.

"He hasn't just drafted and hired talent, he's retained it," said Ganis, the consultant. "Remember, Manning is on his second contract, Polian is on his second contract, and Marvin Harrison is on his third contract with the Colts."

With signing bonuses and an $8.1 million payment to "franchise" player Edgerrin James, the 2005 Colts player payroll was the highest in the league, Irsay said-and $13 million over the league's $85.5 million salary cap.

Polian has often been credited as the architect of the current Colts, but he said those notions are misguided.

"Look at what this team has accomplished since he's been the owner, compared to what they accomplished before," Polian said. "This is the golden age of the Indianapolis Colts, and it's Jim Irsay's blueprint.

"There's no question he'll go down as one of the greatest NFL owners of all time."

Small-market model

Indeed, Irsay has found a way to retain arguably the best quarterback-receiver-running back trio in the league, along with a top-shelf coach and president—all while scoring $100 million less in revenue each year than big-market teams like the Dallas Cowboys and Washington Redskins, according to Forbes magazine calculations.

"He has created a model for how to operate an NFL franchise in a small market," said Jonathan Kraft, New England Patriots vice chairman and president. "He's doing things in Indianapolis I'm not sure anyone before thought was possible."

Getting a commitment for a $625 million retractable-roof stadium—funded largely through increases in restaurant and other hospitality taxes—was no small feat, especially in the current economic environment.

"With tighter city and state budgets, these deals have been much more difficult to get in the last four to six years," Ganis said, and the apparent strength of the Indianapolis pact drove Irsay's stock sky high in NFL circles.

But the new stadium isn't necessarily a slam-dunk. Especially since it doesn't come with any financial guarantees.

"They have to sell the tickets, suites and sponsorships themselves," said Fred Glass, the city's Capital Improvement Board president and one of the lead stadium negotiators. "They're totally at risk."

Irsay is a believer anyway, predicting revenue from the new stadium will lift the Colts from 29th place among the 32 NFL teams to 19th. Ganis thinks profits will improve even more—if Irsay's sales and marketing staff continues to perform.

"They have their work cut out for them," Ganis said. "I still have my doubts about Indiana as a football market. But Jimmy seems to have a belief in the strength of that market, and so far his judgment has been sound."

Irsay said he has seen the tide turn in a city that has long been known in the sports world as an Indiana Pacers town.

"I don't know exactly when we crossed over, but I think Indianapolis is now a Colts town and Indiana is a Colts state," Irsay said. "There's a passion here for the Colts that's never been seen before. There's no reason we can't get to the level of Green Bay or Pittsburgh."

Ganis thinks the Colts will need support from corporate sponsors and media attention from outside Indiana to broaden the fan base enough to fill the new stadium and keep the team winning long term.

Still, the Colts have come a long way since Robert Irsay acquired the team for what amounts to NFL pocket change today. Fueled by the league's TV package, the specter of a new stadium, and the newfound winning ways, the team now is worth about $715 million, according to Forbes.

Making money matters, Irsay said, but it isn't the driving force behind his operating philosophy.

"We've been in the red, in the black and break-even," he said. "If you want to operate a shoestring franchise, you can make a lot of money every year. That's something I want no part of. There's tremendous pride in winning."

White-hot spotlight

Irsay's accomplishments show the lessons of the early 1980s were not lost on him, observers said.

"If you look at the evolution of Jim Irsay, it's gone from, 'What's this guy all about?' to someone who has become a respected member of the business community," said Ed Feigenbaum, publisher of Indiana Legislative Insight. "He's no longer just his father's son. He's stepped out of the shadow and is showing the kind of wisdom this community respects."

That hasn't always been the case. In 1998, a prominent business executive-who was not identified-told the Indianapolis Star he thought Irsay was "in way over his head" running the Colts.

And while Irsay appears to have matured professionally, he has occasionally stumbled in his personal life. A 2002 Chicago Tribune article painted an unflattering picture of him, for example, after he rambled nonsensically at times during an interview and posed for a picture with little covering him but a guitar.

That November, Irsay was caught up in a U.S. Drug Enforcement Agency probe of doctors and pharmacies that were writing and filling excessive painkiller prescriptions. Irsay, who was not a target of the investigation, admitted he was hooked on medication used to treat an old injury from his days as an SMU football walk-on.

"Calling it a personal problem is kind of a misrepresentation in my mind," Irsay said of his addiction. "It was more of a health problem. I got healthy and put it behind me."

Local officials, who were beginning to negotiate with Irsay for a new stadium at the time, were initially concerned by the revelations but later became convinced the drug problem was behind him.

"His personal problems played into a stereotype," CIB's Glass said. "But if we weren't convinced he was beyond those problems, there would have been more focus on him and the stability of the franchise during negotiations."

Even so, critics are still out there. Bulthaup, for example, thinks Irsay's decision to stay in Indianapolis was based largely on what some are calling the "sweetheart" stadium deal.

"I resent Jim Irsay getting rich on my back," he said.

Unlike many of his thick-skinned NFL brethren, Irsay seems to hear every criticism. But league insiders say he's learned to better insulate himself from the endless scrutiny, running his team without being blinded by the white-hot spotlight that often scorched his dad.

Irsay is less accessible to the media these days, declining requests to be shadowed by IBJ, for example, and appearing far more reserved—perhaps even measured—in his public appearances. He even retreats during games, forgoing the company of his wife and three daughters to watch his team alone.

Those who know Irsay best say one thing is abundantly clear:

"People there should see by now, he wants the same thing they do," Marx said. "He has a burning desire to win."

As badly as Irsay wants to win the Super Bowl, it's not the most important thing to the man who became the league's youngest owner at age 37.

"If people are going to follow, they have to believe in the type of person you are," Irsay said. "Respect doesn't come just because you sign the checks. It comes because of the type of person you are. That's more important to me than anything else."

He demonstrates that with charity work, most of which is done without fanfare.

"I can tell you personally of stories of Jim offering his private jet to fly kids suffering from cancer to the Mayo Clinic," Reebok's White said. "He also flew in relatives of a neighbor who died in a fire. There are tons of stories like that."

Irsay showed a compassionate heart at a young age, Marx said.

"I remember in 1978 when he took a stereo to [a Colts player's] teen-age brother who was dying in the hospital," Marx said. "It was a little thing, but a big thing. I know it meant a lot to the family. That's what his life has been about."

Winning over doubters

Sitting in his chilly 56th Street office, where the temperature hovers somewhere slightly north of 60 degrees, Irsay speaks warmly of his father. But a tinge of remorse hangs from his words as he discusses the past.

He hasn't forgotten the 1984 season spent working out of makeshift offices at Fall Creek School. He remembers the painful phone calls to friends in Baltimore to explain the move. His father's legacy lingers on.

But those growing pains heal a little with every winning milestone in Irsay's distance run. He knows his past is intricately woven into the Colts' future.

Only in hearing a myriad of his friends, peers and even dissidents discuss Irsay's virtues and flaws do you get the full measure of the man who put his team on the precipice of greatness.

He built the team from the top down, but those close to Irsay said he saw the franchise from the bottom up.

"He was first and foremost a football fan, and I think you can see how that shaped his philosophies," Marx said. "And he was always close to the players and coaches and I think you can see that shining through."

"I was lucky," Irsay said. "Growing up, I had a chance to hear from everybody."

While the verdict may still be out on Irsay locally, few within NFL circles doubt his mettle.

No other small-market team can touch the Colts' on-field record the last eight seasons. Irsay serves on key councils within NFL ranks, including the committee developing a new collective-bargaining agreement and revenue-sharing formula that will shape the league for years.

White, who is based in Indianapolis, thinks residents don't realize the task Irsay has undertaken to keep the team here while building a Super Bowl contender.

"He's not following in anyone's footsteps in drawing up this blueprint," said White, who worked for the Miami Dolphins under owner Joe Robbie. "He's created a new master plan for how to draw up a title contender-maybe even a dynasty-in the NFL."

Irsay sits in the shadows of his frigid office, his eyes darting side to side faster than his all-pro running back hits a hole in the offensive line, searching for words to explain himself to the community he wants so badly to win over.

It's difficult to say whether they're borrowed from the playbook of one of the league's vaunted giants or collected carefully from the rubble that has littered the franchise's past. But at last, they come.

"I look at myself as a steward," Irsay said. "And a good owner always keeps the fans at heart. We want this to be a vehicle that pulls this community together."

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