What You Can Learn from the James Harden Deal

12 years ago

Sports while there is glitter and glam is still a business and yesterday's trade of James Harden, the reigning 6th Man of the Year, to the Houston Rockets is a reminder of the business of sports. The Oklahoma City Thunder are a small-market team and were unwilling to pay the Luxary Tax necessary to pay James Harden the max salary he reportedly coveted. Whether this was a smart move by the Oklahoma City Thunder is not evident today, but of course there has been instant analysis of the trade to determine the winners and losers. The impact of this trade will not be felt just in Oklahoma City and Houston but across the Western Conference, especially for the Los Angeles Lakers who have added Dwight Howard and Steve Nash to their team, and in the Eastern Conference for the Miami Heat who played the Thunder in the Finals last year.

Entrepreneurs and business owners that are growing and building their business can learn three lessons from the Oklahoma City Thunder.

Stay True to the Plan: The Oklahoma City Thunder “maintain the philosophy that the individual sacrifices for the whole”. Kevin Durant and Russell Westbrook, the Thunder two best players, sacrificed for the team, but James Harden wouldn't accept less than a max deal–a $60 million,four-year extension–so he was dealt Saturday. Thunder GM Sam Presti made this philosophy clear when he traded the Thunder's Six Man. As an entrepreneur or business owner, your business plan is your philosophy and it contains your step-by-step guide to be successful. Stay true to your plan and don't deviate.

Be Decisive & Be Bold: The trade was certainly a shock to the Basketball World. It wasn't so much because Harden was traded, but because the Thunder was unable to reach a deal and they didn't wait until the summer of even Wednesday when they had to make a decision. Harden didn't take the deal, so he was traded. In business, when you realize that you have to pivot, make a bold and decisive decision and do it. Don't wait until “Wednesday”.
Sell While High: It's not clear if James Harden is worth the max-deal it appears he will receive from the Houston Rockets, but it is a known principle in business and even in sports that you should sell while high. James Harden struggled in the NBA Finals and even struggled during the summer. If he wasn't as good as he seemed, it's possible that Oklahoma City received the most value they could have received from trading the Los Angeles native. If he was as good as advertised, they might have lost “The Beard” for nothing in a year so it still could be a good deal. Remember they received two first round picks, a second round pick, Kevin Martin and Jeremy Lamb in return.