This story is part of Peak, The Athletic’s desk covering the mental side of sports. Sign up for Peak’s newsletter here.
Spencer Harrison is a professor of organizational behavior at INSEAD and an expert on culture. He is also an NBA fan who grew up in Salt Lake City during the John Stockton-Karl Malone era of the Utah Jazz.
Every NBA executive knows the numbers.
They know how rarely “all-in” trades actually deliver championships. They know how many franchises spend a decade digging out from under the rubble of lost draft picks and frozen cap sheets. They’ve read the postmortems. They’ve lived them.
And yet, when a superstar becomes available — or even when there’s the hint of availability, as is the case right now with the Milwaukee Bucks’ superstar Giannis Antetokounmpo — the same pattern repeats: teams empty the cupboard, mortgage the future and tell themselves this time will be different.
This isn’t just a basketball problem. It’s an organizational one. And it points to a decision-making trap that leaders face in any organization.
Executives spend a lot of time on strategy and forecasting. The goal is to gain some intuition about future possibilities so that they can then pounce on good decisions: investing in a new technology, acquiring a competitor, capturing a new customer segment. Often, these decisions feel safer when people with a proven track record are involved. But that is a fallacy.
Consider the example of Quibi, a streaming service designed for phones.
Quibi was built on a single, high-stakes belief: that people wanted premium, scripted, short-form entertainment designed specifically for mobile moments like commuting. That belief turned out to be wrong. People already associated short-form video with free, socially shared content, and when they paid for storytelling, they wanted immersion, not fragments.
But Quibi’s deeper failure wasn’t just a bad forecast. It was how the organization treated those who were involved as evidence that the strategy would work. With Jeffrey Katzenberg, the former chair of Walt Disney Studios, and Meg Whitman, the former CEO of eBay and HP, at the helm, and A-list talent attached, partners didn’t just fund a product. They funded the people. Hollywood studios, advertisers and investors aligned themselves with proven winners — and in doing so, made escalating commitments before user behavior had been validated.
As those superstar affiliations accumulated, they quietly replaced market evidence. The presence of famous executives and creators made success feel less like a hypothesis and more like an inevitability. That legitimacy unlocked massive budgets, long-term content contracts and global marketing plans that eliminated cheap exits.
Instead of testing demand, Quibi locked it in.
By the time weak signals appeared, the organization no longer had a real alternative. Too much money had been raised. Too many reputations were attached. Too many powerful partners had staked their credibility on the outcome. So Quibi escalated — more content, more promotion, more conviction — trying to justify the original bet.
Quibi didn’t collapse because its leaders were careless. It collapsed because superstar credibility made it possible to go all-in before anyone had earned the right to.
The same holds true in the NBA.
To understand why the NBA keeps making extreme trades, we need to stop treating front offices as gamblers chasing glory and start seeing them as decision-makers trapped in a power imbalance they didn’t create and can’t easily escape.
The power shift that changed everything
The modern NBA is defined by a simple reality: superstar players have leverage that teams don’t.
Not because teams are irrational, but because stars control the most important thing in any negotiation: the ability to walk away.
When LeBron James signed a series of “one plus one” contracts in Cleveland, he wasn’t just maximizing flexibility. He was applying pressure. Every summer, the Cavaliers faced the same choice: spend future draft picks to upgrade the roster now, or risk losing LeBron with nothing in return.
It worked. Cleveland escalated. Repeatedly.
This wasn’t unique to LeBron. Kevin Durant, Kawhi Leonard, Anthony Davis and now Antetokounmpo all exist in a system where elite players possess credible exit threats — free agency, trade demands or quiet disengagement — that fundamentally reshape how teams make decisions.
In organizational behavior terms, this is called asymmetric bargaining power.
When negotiation power forces bad decisions
In negotiation theory, power comes from your “BATNA” — your Best Alternative To a Negotiated Agreement. Superstars have excellent BATNAs. They can leave in free agency, force a trade to a preferred destination or sit tight and wait out the clock
Teams, by contrast, often have terrible ones: lose the player for nothing, potentially alienating their fans, enter a long rebuild (further testing fan patience), all while absorbing financial and reputational damage
This imbalance doesn’t just tilt negotiations. It changes behavior. Teams aren’t chasing upside so much as avoiding catastrophe. And that’s where psychology enters the picture.
Escalation of commitment, NBA-style
Organizational scholars have a term for sticking with a failing course of action because of past investments: escalation of commitment.
But the NBA version is more troubling.
Teams don’t escalate because they believe the plan is great. They escalate because they fear what happens if they stop.
Once a team trades draft capital to acquire or retain a star, those picks become sunk costs. Letting the star leave doesn’t just hurt — it makes those losses feel wasted. The result is a cycle of defensive decision-making: trade picks to get the star, trade more picks to keep the star happy, then trade even more picks to avoid admitting the original bet might fail
Each move narrows the team’s future options, making retreat more painful and compliance more likely. One party makes large, irreversible investments in a relationship, and the other party can then extract additional concessions because walking away is too costly.
Once those investments are sunk, the player’s leverage increases while the team’s decreases.
From that point on, every negotiation happens under the shadow of collapse.
Why smart leaders still fall into the trap
This is why “just be patient” is such a misleading critique. Executives aren’t ignoring history. They’re responding to structural incentives. Owners want relevance. Fans demand stars. Coaches operate on short timelines. Star players can always leave, even if they have a long-term contract.
In that environment, the rational move for an individual executive may be the irrational move for the franchise long-term.
The lesson isn’t that NBA teams are reckless or foolish. It’s that power shapes decision-making more than evidence does.
As long as superstars control exit options, teams will continue to overpay. Not because they misread the odds, but because the alternative feels worse in the moment.
Extreme trades aren’t a failure of analytics. They’re a consequence of leverage.
And teams will keep walking into it, knowing better, but unable to stop.
