Green Bay Packers general manager Ted Thompson, like the rest of his counterparts around the league, might not know the NFL's secret formula for dispensing free-agent compensatory picks.
However, Thompson no doubt knows the basics.
If you lose a free agent, you might get one in return.
If you sign a free agent, you might lose any pick you would have gained.
Compensatory picks are the underrated part of Thompson's free-agent strategy. Ultimately, his decisions are based on dollars and cents. Not to mention dollars and sense.
When the Vikings offered Greg Jennings a five-year, $45 million contract that included $17.8 million guaranteed, the dollars and cents didn't make sense for Thompson. Jennings was an aging player with declining production. Engaging in a bidding war beyond that threshold would have been foolish given the long-term salary cap implications.
When the Colts offered Erik Walden a four-year, $16 million contract that included $8 million guaranteed, the dollars and cents made absolutely no sense. With a first-round pick used on Nick Perry and an expanded role planned for Mike Neal, matching that deal would have bordered on insanity.
Beyond the immediate logic behind Thompson's decisions on Jennings and Walden are the draft ramifications.
While the NFL's formula is secret, the overlying factor on compensation is money. The per-year value of the contract — not playing time, statistics or accolades — is the primary reason why one free agent is worth a third-round pick and another is worth a fourth-round pick, and so on.
The other perspective is Thompson's inaction in terms of opening the checkbook in unrestricted free agency. Thompson's roster-building approach was made clear long ago: Draft as many quality players as possible, let the coaches do their work and keep as many of those players as the salary cap allows once they hit free agency. As one scout put it last year, for every free agent a team signs, that's probably one free agent it will lose down the road.
Again, compensatory picks probably are at least a small factor in Thompson's decisions. Had the Packers signed some role player to a contract roughly as big as what Walden received, they would have lost that fifth-round compensatory selection. That's what happened in 2012, when the Packers lost Matt Flynn and Scott Wells but signed Jeff Saturday. That left them with one compensatory pick, a fifth-rounder used last year on Josh Boyd.
Now, you could argue some $4 million-per-season role player would be worth more than a compensatory pick handed out at the end of the fifth round. But if you're Thompson, and you believe in your approach and your coaches, then you stick to your guns.
That approach has paid off in the past. Josh Sitton (for Ahman Green) and Mike Daniels (for either Daryn College or Cullen Jenkins) are two of the team's top players. Marshall Newhouse (for Colin Cole) was a serviceable starting tackle. Davon House (for Aaron Kampman) has played well at times at cornerback.
So, with Thompson's low-key approach to free agency, the Packers now own four of the top 98 selections in what is one of the deepest drafts in memory. That's vital, with Green Bay entering the draft with needs big and small at safety, center, defensive line, inside linebacker tight end and receiver.
Oh, and while Thompson kicked the tires on the likes of Arthur Jones and Mike Mitchell in free agency, his free-agent signings — Julius Peppers and Letroy Guion — were street free agents because they had been released by the Bears and Vikings, respectively. So, at this time next year, the league will grant the team additional picks for losing Evan Dietrich-Smith and James Jones.
So, the cycle will keep spinning and Thompson will get another couple swings in the 2015 draft.
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Bill Huber is publisher of Packer Report magazine and PackerReport.com and has written for Packer Report since 1997. E-mail him at firstname.lastname@example.org, or leave him a question in Packer Report's subscribers-only Packers Pro Club forum. Find Bill on Twitter at twitter.com/PackerReport.