Division 1 football can generate a huge profit for colleges, but it also has the potential to leech a university dry with its exorbitant costs. Millions of dollars are spent on facilities and coach salaries with the justification that such expenditures are necessary for a team to be competitive. In some states, the flagship university's head football coach is the state's highest-paid employee.
But let's do the math. With high-profile coaches earning millions of dollars per year, university administrators, alumni and fans should take a pragmatic look at the added value that big-name coaches bring to a program. Which coaches are actually worth their price?
In an attempt to measure the "value" of Division 1 head coaches, I created a rating to measure the team's performance on the field against the head coach's monetary compensation. Additional factors that were weighted into the equation were the strength of each athletic conference, the team's Sagarin rating and the number of wins for that year. See below the top 10 most valuable coaches, and then read on for a complete explanation of my methodology.
I obtained coach salary data from USA Today. I divided each coach's university compensation by the number of games their team won that year to find their "cost-per-win." I used each team's 2010 final regular season Sagarin rating as well as Sagarin's conference strength's rankings. I divided the cost-per-win in half, and then divided that number by the team's Sagarin rating and squared it. I added the team's conference rating to that number to find each coach's ultimate "value rating."
The modifications to the original data (dividing the cost-per-win and squaring the Sagarin rating) were made mostly to account for discrepancies in pay levels from conference to conference. Without them, all the lowest ratings tended to go to coaches from the Mid-American Conference, which has the lowest average coach's salaries for any of the Division 1-A conferences. The argument could be made that those lowest-level salaries represent what universities should be paying their coaches. However, for the sake of comparing coaches against their peers both within their own conference as well as around the country, a coach's on-field performance was weighted more heavily. After all, six wins in the SEC or Pac-10 are much harder to come by than six wins in the MAC or Sun Belt conference.
Please keep in mind that this is an experimental formula. These statistics reflect the past 2010 season only, and do not include any new coach hires, firings, raises, or schools that are moving conferences.
Lastly, Sagarin's rankings rely heavily on strength of schedule and often deviate strongly from human polls. For instance, Sagarin has Wisconsin ranked 15th while the BCS has the Badgers as the 5th best team in the country.
Vanderbilt, Notre Dame and USC all declined to reveal their respective coaches' salaries. Salaries for coaches from Northwestern, Stanford, Boston College, Miami, Syracuse, BYU and Tulane are based off of 2009 estimates.
See below a spreadsheet of my calculations.