Ride 'em Cowboy Desperate to revive America's Team, Jerry Jones swallowed his pride, hired a Tuna, and became a team player.
By John Helyar REPORTER ASSOCIATE Christopher Tkaczyk

(FORTUNE Magazine) – For a moment the old electricity was back at Texas Stadium earlier this month. Some 65,000 Dallas Cowboys fans buzzed at the first appearance of Bill Parcells, the man chosen to revive a team that had fallen from the Super Bowl to the toilet bowl. They roared when Dallas running back Aveion Cason burst through the Atlanta Falcons' line and sprinted 63 yards for the first score. But after leading 7-3 at halftime, the Cowboys reverted to form. The second half was a plague of botched kicks, costly penalties, and porous defense. Atlanta won, 27-13. As for that electricity--well, it was like the Northeast power grid after an overload in Ohio.

Gloom settled back in over Texas Stadium and fell most heavily on the owner's box. Jerry Jones buried his head in his hands, and for the first time in recent memory he had no comment on the game. Even two days later he began our conversation by saying, "I've got the blues face on today."

Jerry Jones isn't a Pollyanna. He realizes that the first half against the Falcons was a momentary pause in years of bad press, bad coaching, bad management--his own bad management--and embarrassing losses. And he knows deep down there's no end to the "blues" in sight. The team is talented but inexperienced, and like many lower-rung teams in the NFL, it may end up as fodder for the playoff runs of more experienced squads. As we went to press, the Cowboys were about to face the New York Giants, a team many believe is headed to the Super Bowl. The Cowboys may have the toughest schedule in the league, including games against the powerful AFC East Conference that features the Miami Dolphins, the New England Patriots, and the Buffalo Bills. (That can't be good.)

Still, Jones feels everything is in place to turn around the team that is arguably the most important in the NFL--and right up there with the New York Yankees in all sports. Weary of losing, this proud, stubborn man reinvented his own management style, and earlier this year hired Parcells, maybe the only guy in football with an ego as large as his. (This decision from a guy used to drafting his own players and shadowing his coaches during fourth-quarter appearances on the sidelines.) The stakes were that high. It's gotten harder to put fannies in the seats and sell Cowboys merchandise. Jones must soon renew luxury-box leases and has no sizzle to sell. And then there was the matter of a new stadium that Jones believes the team desperately needs to remain a first-rate economic entity. How can you convince voters, especially in football land, to underwrite a billon-dollar megastadium for a charisma-challenged team that loses far more often than it wins?

So far, this case study in power sharing has worked well, both men say. Jones, with Parcells in tow, gets an immediate dose of star power on the field as he turns around "America's Team." Parcells gets to do what he does best--rebuild a moribund organization much as he did with the New York Giants (two Super Bowl trophies), the New England Patriots (a Super Bowl appearance), and the New York Jets (one victory away from the Super Bowl and now a perennial playoff team). They also seem to have agreed on most things during their honeymoon period: Stick with the young quarterbacks; don't trade draft picks; keep the damn TV cameras and mascots from disrupting training camp; and continue to let the owner prowl the sidelines during the fourth quarter. But it's a long season.

It has been a humbling time for a 60-year-old man who was raised humble in North Little Rock, Ark., but who put the place in his rearview mirror and applied a combination of high energy and high ambition to his every endeavor. Jerry Jones played football at the University of Arkansas, where as an undersized, overachieving offensive lineman he co-captained the Razorbacks' 1964 national championship team. Then he became an undercapitalized, overachieving wildcatter. Jones was a huge risk taker, even by the standards of that risky business, and he won enough on oil and gas wells to gamble on another industry: He hocked his whole net worth in 1989 to buy the Dallas Cowboys for $140 million. With the Cowboys, Jones enjoyed huge returns again. The team won the 1993 and 1994 Super Bowls and went from being a money pit to the NFL's most lucrative franchise. Jones wrung so much revenue out of Texas Stadium that he set off a league-wide stadium-building boom. He also wreaked havoc by making big sponsorship deals with companies like Nike and Pepsi that weren't approved by the NFL.

Then, after all those years of successfully shooting the moon, he shot himself in the foot. Jones quarreled with, then got rid of, his fine first coach, Jimmy Johnson, believing he could do as well without him. He hired a succession of weaker coaches, and after winning another championship in 1996, the Cowboys began to falter. Jones conned himself into believing he could get one more championship run out of his aging stars. He showered them with money--and they faded. Jones couldn't replace them with fresh young talent because the Cowboys had traded or squandered so many draft picks. Over the past three seasons the Cowboys have gone 15-33, and the consensus on Dallas sports radio has been that Jerry Jones is a man who's lost it. If this cacophony of lowbrow talk could be organized into a Greek chorus, it would go something like this: Whom the football gods would destroy, they first make mad.

That is one reason there's no business like sports business. In bad times an owner sometimes feels like he's being gang-tackled by 320-pound linemen. An NFL franchise is a private enterprise that customers--the fans--treat like a public institution. When their team wins, fans shout, "We're No. 1!" When their team stinks, fans believe the owners should stand for a recall vote. "It's a very hard, unforgiving business," says Bob Kraft, owner of the New England Patriots and a friend of Jerry Jones's. "You've got to be on your toes, and you've got to be flexible, and all that does is give you a chance. Over time you get beaten up pretty bad." In great times it almost seems too much fun to be a business. When Jerry Jones is hosting Saudi ambassador Prince Bandar bin Sultan, who is a huge Dallas fan, or taking a call from the President, who wants to extend Super Bowl congratulations, he might as well be a head of state. He runs a $200 million business yet gets more attention for his product than CEOs of $200 billion businesses. If Exxon Mobil has a great year, its CEO, Lee Raymond, likely gets vilified for high gasoline prices. If the Cowboys have a great year, Jerry Jones hoists the Vince Lombardi Trophy before 134 million TV viewers. Then he hits up Dallas-based Exxon Mobil to be a sponsor. Hey, Lee, you need the goodwill.

The savvy owner makes hay while the sun shines, and Jones has been just about the savviest. He leads the league in corporate sponsors, having signed scads of them to long-term deals when the Cowboys were hot and companies were hot to be associated with them. Jones charges his sponsors top dollar--Pepsi is paying $20 million for ten years--but gives them not just the usual stadium signs but his own top effort. "Jerry speaks to our sales meetings at 6:30 in the morning," says Barry Andrews, a Texas beer distributor whose Miller brand is a Cowboys sponsor. "He's one of a kind." What Jones understands is that the Cowboys are a brand, as surely as Miller Lite is. In that respect, whatever its other differences, the sports business is like all consumer products. A smart team doesn't just open the stadium gates and play games. It tries to build brand equity in its market and make its logo stand for something, whether it be the Chicago Cubs (lovable losers), the Los Angeles Lakers (flashy winners), or the Green Bay Packers (small-town America).

The Dallas Cowboys were really the first carefully calculated, artfully nurtured sports brand, crafted by a man named Texas (his real first name) Earnest Schramm. The Cowboys' first president and general manager took a winless expansion team (in 1960) and within two decades made it into the nation's most famous football team. The label was partly earned on the field; a team with 20 straight winning seasons attracts a following. But even before that run Tex Schramm contrived to make the Cowboys the center of the national TV universe. Dallas was no media center, but he got his team into the NFL East, where it would get great exposure in big, influential cities like New York and Washington. A former TV producer, Schramm also did much to nurture the NFL's relationships with networks and to champion TV innovations like instant replay.

The TV-driven rise in pro football's popularity during the late 1960s and early 1970s coincided precisely with the rise of the Dallas Cowboys. From 1966 to 1985 the Cowboys enjoyed 20 straight winning seasons and played in five Super Bowls. Their colorful players were like characters in a hit series. Dallas had the "world's fastest human," former Olympian Bob Hayes. Linemen Ed "Too Tall" Jones and Harvey "Too Mean" Martin were stalwarts of the "Doomsday Defense." Their lineup had something for everyone, from Boy Scouts (Naval Academy grad Roger "the Dodger" Staubach) to druggies (linebacker Thomas "Hollywood" Henderson). Presiding over them all, striding the sidelines in a snap-brim hat, also picture-perfect for TV in his own stoic way, was head coach Tom Landry.

Schramm was the first to give fans a sideshow to ogle: the high-stepping, skimpily clad Dallas Cowboys cheerleaders. He was the first to add business-class seating, incorporating 196 luxury suites in the design of Texas Stadium, which opened in 1971. He ran the team and the business like an autocrat. In the 1980s, however, the Cowboys demonstrated the fragility of a sports brand and the perils of rigidity. Schramm and Landry, the Cowboys' original and only GM and coach, seemed to lose their energy and, as Cowboys stars aged and slowed, their knack for replenishing the team. The team's 20-year run of winning seasons ended in 1986 with a 7-9 record, and things just got worse from there. By the late 1980s, Texas Stadium often had only 30,000 to 40,000 fans rattling around in it. Schramm had built 114 new suites in the mid-'80s to augment the original 196. He was able to lease six of them.

Upon becoming owner, Jones immediately sacked Schramm and Landry. That outraged Dallas fans, who regarded them as royalty and Jones as a bumpkin. But it enabled the new guy to make changes swiftly. Jones vowed he'd never let the Cowboys fall into disrepair like that.

But as the 2002 season drew to a close, the Cowboys had gone 5-11 for three straight seasons. They were pretty damned low, and so was Jones. As he watched his team get stomped by the New York Giants, 37-7, on Dec. 15, Jones says, "I was afraid. I always just assumed we were going to win football games. If we fell short of contending, I was sure it was temporary--we'll correct that within months. That's the deal I have with our fans and our other constituencies. They know Jones will figure out a way to get it done, and they'll give him the benefit of the doubt. But we hadn't been getting it done for three years in a row. I felt I'd lost a lot of my benefit-of-the-doubt collateral." Meanwhile Bill Parcells was watching that Cowboys-Giants game in the ESPN studio, where he was doing NFL commentary. Jerry Jones came on the screen, and these words came out of Parcells's mouth: "I could work for a guy like that." His colleague Chris Mortensen remembers "just about falling out of my chair." The Big Tuna was a coaching legend, having turned two bad teams into Super Bowl contestants. But he swore off coaching after an 8-8 season with the New York Jets in 1999. His white-hot intensity left him a physical and mental wreck after a few seasons at each team. A year earlier he had signed--and then reneged on--a coaching contract with Tampa Bay. But at age 62, at loose ends after divorcing his wife of 40 years, he had the itch again. Still--Jerry Jones? Before, this old-school coach had publicly declared that he could never work for a meddling new-breed owner like Jones. When Mortensen asked about his change of heart, Parcells replied, "He wants to win. If you ever talk to Jerry, give him my cellphone number."

Mortensen did a phone interview with Jones the next day concerning the future of Dallas's one remaining glory-days star, Emmitt Smith. When they were through, Mortensen relayed Parcells's interest, though not the phone number. (He figured he was a reporter, not an executive recruiter.) "Hmm," said Jones. Then he fell to agonizing. The idea of hiring Parcells was intriguing, all right, but also perplexing. First there was the matter of perception. To hire Parcells would be to admit failure and please his critics. Then there was the reality. Parcells would demand plenty of power, and Jones was used to being the cock of the walk. "It would be a recognition on my part that I needed to embrace a very strong opinion and a very strong individual," says Jones. "I went through the process of saying to myself, Can I embrace that? Can I work in that climate?"

The dilemma will be familiar to students of top management everywhere: Powerful leaders often don't work well in harness. Michael Eisner and Michael Ovitz seemed a dream team at Disney but were a disaster. Sandy Weill and John Reid couldn't co-exist as co-CEOs at Citigroup.

What's more, the Dallas Cowboys are a family business. Jerry is chairman, president, and general manager. Stephen, his eldest, at age 39, is CEO. He's active in both the football and business operations. Jerry Jones Jr., an attorney, handles legal matters. Daughter Charlotte Jones Anderson runs marketing and special events. Would a guy like Parcells fit in--especially when you consider his management philosophy? In a November 2000 Harvard Business Review article titled "The Tough Work of Turning Around a Team," he described his first rule of coaching: "Make clear you're in charge. Don't wait to earn your leadership; impose it." That would be a jolt in the Cowboys organization. But then there's the coach's second rule: "Confrontation is healthy." Parcells believes that blunt is beautiful and admits "it can get very intense, very emotional."

Jerry Jones sat down with family members for a series of heart-to-hearts. Stephen Jones felt a Parcells partnership could definitely work. He told his father to think about it. In retrospect, it seemed that the bigger risk was in hiring lesser coaches. "You hit some home runs in business when you take risk," says Stephen Jones. "But when you've taken a risk three times [on coaches] and you've had three losing seasons in a row, you don't need to take any chances. It was time to take the sure shot." Jerry Jones basically found that everyone backed the pursuit of Bill Parcells. That included his wife, Gene, who thought, as he now recounts, "any of the possible negatives were far overshadowed by the improved chance of winning--having the kind of team that would bring me, personally, a lot of happiness."

Jones turned it over one more time in his mind. "I rolled the tape forward," he says, trying to play out the possible scenarios if he hired Parcells--and if he didn't. Then, almost involuntarily, he hit the mental rewind button. Jones found himself reflecting on a Sunday afternoon at Texas Stadium way back in September 1988, when he was bidding for the team. He was a guest at the game, sitting with Roger Staubach and beholding how far the Cowboys had fallen since the quarterback's 1980 retirement. Amid a small number of fans and a large number of beer empties, they watched the New York Giants--then coached by Bill Parcells--hand the Cowboys one of that season's 13 losses. As he contemplated that vivid flashback and considered the team's current slide, Jones had this chilling thought: "This is where I came in."

He picked up the phone and called Parcells.

"It's understandable to have some down times, but it's inexcusable to let them continue for any length," says Jones. "To me, the Cowboys brand is a cumulative thing. Each year we can step up and have a Super Bowl-contending team, we add huge value to this franchise. But losing has a cumulative effect too. That can also impact the business for years to come." There are many ugly business ramifications to ugly football. Jones says the team has managed to keep its season-ticket base firm at about 45,000 (including suites) but that it's gotten much tougher filling the rest of Texas Stadium (capacity: 65,529) and keeping intact a streak of 105 straight sellouts. Tougher means costlier: more advertising, more special deals, more salespeople. The leases on all 400 stadium suites expire in 2008. How many holders will come back, at $35,000 to $150,000 a pop, if the Cowboys don't make a comeback?

Then there's Cowboys merchandise. Jones had to fight hard for the right to wholesale Cowboys merchandise. (The NFL retains control over merchandising for the other 31 NFL teams.) It's a $50 million business, according to Jones, but it's a devalued product line. The Cowboys were long the league's hottest retail ticket, accounting at one point for at least 30% of all NFL-licensed merchandise sales. But as of 2002, Dallas had slipped to No. 3, behind Oakland and Tampa Bay. Jones could also use a winner for the billion-dollar stadium complex he's dying to build. His Texas Stadium lease is up in 2008, and he would like to move on. The Cowboys, once far and away the NFL's No. 1 stadium-revenue generator, are now barely in the first quartile of teams. Cowboys officials and lobbyists are negotiating with the locals for a new stadium, but a deal--if there is one--may have to be approved by voters. "If we're on the uptick and we're starting to win, and fans believe, 'Hey, here they come again,' that can only be positive for us," says Stephen Jones, who's in the middle of the talks. The retractable-roof stadium would be adjacent to a Cowboys-themed hotel-entertainment-office development, which also relies on revived luster. Jones will have to pony up at least $200 million to $300 million of the cost himself, so he can't afford for the Cowboys to become a nostalgia act. Though the team is still a winner off the field--cash flow is about $50 million on revenues north of $200 million this year--Jones needs a return to glory to secure its future.

That's why, when Jones finally called Parcells for a first date, he was anxious that their initial meeting be a test not just of compatibility but of Parcells's state of mind. Did his inner fires still burn? Jones himself had more passion and energy than ever, despite the long fallow stretch and despite hitting age 60. He did 100 pushups a day. He had sworn off beer and cheeseburgers and dropped 50 pounds. He had the lean and hungry look of his earlier Cowboys years, the years he wanted to re-create. "When you've won, you want to win again; it's the No. 1 thing that motivates me," he says. After those Super Bowl highs, anything less is "like going through withdrawal."

The two men had a clandestine catered lunch aboard Jones's jet at the Teterboro, N.J., airport and wound up talking all afternoon. The owner liked Parcells's obvious passion--he was up on every team's salary-cap maneuverings and knew every player who'd recently been waived or signed. But Jones loved how Parcells explained his interest in the coaching job. "It's like if you go to Las Vegas," he said. "There are acts in the lounge, and then there are acts in the big room, where Elvis and the big names played. The Dallas Cowboys are the big room, and I view this as an opportunity to play it." Parcells also found himself warming to Jones, who seemed to genuinely want change and who acknowledged errors. "He said, 'I've got a legal pad full of mistakes,'" recalls Parcells. "I appreciated that." Jones and Parcells quickly got serious, setting up another meeting and bringing seconds--the owner, his son Stephen; the coach, his agent. Shortly after the Cowboys' dreary season ended with a 20-14 loss to the Washington Redskins, the two agreed to terms.

The duration and money part of the deal is clear: four years and $17.1 million. So is Parcells's ability to choose his assistants, a power Jones didn't grant his three predecessor coaches. Parcells swept out all but four of the Cowboys' incumbent assistants in composing his staff. Jones retained his right to walk the sidelines during games, an owner's habit that Parcells openly scorned in the past but puts up with now.

Some of the finer points of this partnership are murky, though. By title, Parcells has less clout than he did in his last job, with the Jets, where he was coach and general manager. Jones retained the general-manager title, but he has granted Parcells broad authority over the Cowboys roster. The two have mutual veto power on signing or waiving players, but, says Jones, "I don't anticipate Bill not being able to sell me on something." One thing Jones sold Parcells on: giving Dallas's two young quarterbacks, Quincy Carter and Chad Hutchinson, who struggled last season, another shot in 2003. Jones also insisted on handling the release of aging star running back Emmitt Smith. He thought it better for Parcells to start with a clean slate.

So the Cowboys have made the so-called Big Tuna the centerpiece of a large marketing campaign, heralding a new day on billboards and season-ticket brochures but making no promises of miracles. With the Giants and Patriots it took at least two seasons to build talent and discipline. Says Parcells: "I would say the basic things here are very similar." Dallas was denuded because, in the view of many students of the franchise, Jones became delusional. He had the business of football licked, and he began to indulge in what really gave him a kick: the game of football. He undermined coaches' authority by reserving the right to hire their assistants, hearing players' gripes, and taking a much more active hand in drafting and signing players than had been the case with Jimmy Johnson.

The Cowboys won their third Super Bowl in four years in 1996, then began their decline. Part of it was just the system. Championship teams' players are hot commodities as free agents, and Cowboys starters were plucked off. But a lot of it was Jerry Jones. Enamored of veteran stars and determined to win one more championship, he started managing the Cowboys in polar-opposite fashion from how he and Johnson had built the team. The launching point for the great Cowboys teams of the '90s was a 1989 trade in which Dallas swapped star running back Herschel Walker to Minnesota in exchange for a truckload of draft picks that yielded young talent like Emmitt Smith. Now he was lavishing huge contracts on players like Deion Sanders ($35 million) and Troy Aikman ($50 million) and being penurious with talent development.

Under the NFL's salary-cap system, which restricts teams' payrolls to 64% of the league's revenue, that meant a few stars took up a staggering amount of the Dallas payroll--in one year, 25% of it tied up in Sanders and Aikman alone. The team had to start trading down in the draft, because it couldn't afford the costlier first-round players. Since 1994 the Cowboys have drafted only two players good enough to make the Pro Bowl. Jones's star system collapsed and failed completely when players like Aikman and receiver Michael Irvin suffered career-ending injuries. The team was still obligated to pay the remainder of their contracts. In 2001, fully one-third of the team's allotted salary cap of $62 million was tied up in Cowboys who no longer played.

Quite apart from Parcells's coaching skills, Jones has solicited his help on those salary-cap machinations and other management matters. It seemed to have had a calming effect. Trader Jerry is usually wheeling and dealing on draft day, but in 2003 the Cowboys just picked 'em and played a pat hand. Had a pretty darned good draft, by consensus, too. "We haven't had a lot of outside influence," Jones admits. "This has allowed us to get some perspective from someone who's been with three NFL organizations."

He thinks Parcells will help him strike a better balance between winning games now and building for the future. The owner of a sports team is a lot like the CEO of a public company in that respect. Do you please investors (fans) with quarter-to-quarter (game to game) results? Or do you risk the wrath of the Street (the radio talk shows) to develop a long-term strategy? Jones says he's more of a long-term guy now, though he hates losing no less. He vows never again to mortgage the team's future. "I have a high tolerance for risk, but now I'd take into consideration how much our fans should endure. I always assumed we were going to win the football games. Now I have a better sense of how how fragile it all is and how optimistic that assumption was." Jones has also followed Parcells's lead in tamping down fans' expectations. That's actually one of the bigger adjustments he's had to make, for he is both a natural-born salesman and a through-and-through optimist. Before the 2001 season he proclaimed that this team could win ten games. It won five. Not this year. At Cowboys training camp in San Antonio, it was Parcells who set the tone in daily press briefings that amounted to Winston Churchill's "blood, sweat, and tears" speech with a New Jersey accent. This team, he constantly reminded everyone, had a long way to go--and to underscore this, he stormed, scowling along the sidelines, through every preseason game. Even when the Cowboys won one of them 52-13 and he was asked what the team still must work on, he growled, "I could give you six columns to write about that."

I'm told the contrast between this year's camp and last year's is as jarring as a Too Tall Jones tackle. They were both held in the Alamodome, but the similarity ends there. In 2002 there sometimes seemed to be more TV cameramen (for an HBO documentary) than football players. There was a mascot named Rowdy entertaining fans and sometimes blaring music. This year Rowdy's movements were tightly restricted, as were TV cameramen. The coach demanded no distractions as he personally taught, cajoled, and berated players. Jerry Jones was strictly in the background. "It was the best training camp in forever," says Randy Galloway, a Fort Worth Star-Telegram columnist. "I lost ten good standard columns ripping Jerry. I actually had to go to work."

An old Cowboys player watches a training drill at the Alamodome and approves. Calvin Hill, a Dallas running back in the 1970s, sees Parcells taking this club back to the future. "Bill has the same ethic as the old Cowboys," says Hill, now a consultant to the team. "There's an expectation of performance, and you'd better deliver it."

Two questions, though: How long will this reclamation project take, and how long will the interests of coach and owner coincide? In the case of Parcells, things seem to end badly wherever he goes. He quit the Patriots in a huff right after coaching them to the Super Bowl. Jones will be mightily tempted to seize the spotlight again if the Cowboys come back. But people who know both men say that for the moment, they appear more adaptable and less combustible than before. "There will be emotional times when both will have to bite their tongue," says Al Davis, the Raiders' owner and a friend of both. "But they've both had their share of defeats and their share of glory, and I think they know what it takes." Adds Ron Wolf, a former Green Bay Packers general manager: "They both have huge egos, but they have a common goal."

Believe it, says Jones, who recites one more hard-earned lesson from the plague years. "I'm not going to get careless with this relationship, like I did with Jimmy," he says. "I'm not even going to say that I'm going to try to make this work. Trying is lying. I'm going to make it work." But even if the Jones-Parcells union thrives and takes Dallas out of the ditch, there's a decent chance that Parcells, at his age and with his track record, won't even see out his full four-year contract. The longer-term concern is, What then? Assuming Parcells leaves behind a respectable team, Jones will be tempted to again succumb to the siren song of the sidelines. Asks former quarterback Troy Aikman: "How much was this hire based on Jerry's needing something to sell the fans, vs. how much has he changed his philosophy?"

The answer may determine the future, and the very question illuminates the conundrum of America's sports business. This is an industry that runs on passion. The successful owner pours his guts and money into his team and pushes the envelope hard. When it works, he gets a ticker-tape parade and a burnished brand. When passion spins out of control and clouds judgment, he gets the 2002 Dallas Cowboys. The wise man learns the difference.

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