While success in the NBA can be defined differently for each team (winning a championship, making the playoffs, etc), having elite talent makes the difference between reaching those goals and falling short. Unlike MLB, NFL and NHL teams, the current structure of the NBA makes acquiring and retaining high-level talent an incredibly difficult proposition for a large portion of the league. Having a league that has both a team salary cap and max salaries for individual players actually makes it harder for small market teams to retain players since they cannot offer something ridiculous to keep a max-level guy once the restricted free agency process has run its course.
Since many organizations do not have a reasonable chance to acquire a high-level player as a free agent, they have to use trades and the draft. The other factor that plays a major role in adding quality is the weighted draft lottery. Those components create the rules that make for the frustrating great truth at the heart of building a team in today’s NBA: Teams without elite talent are best served by clearing the boards and being terrible until they have the talent to spend around.
This occurs because the ways teams can get elite talent feed together in most circumstances since the best pieces a team can use to get these talents are young, cheap pieces and the space to take on bad contracts. As such, teams like the Celtics are well-served to clear the decks once they feel they cannot reach their definition of success- unloading and reloading marks their best chance to get back there. What balances the league here are teams willing to take on the players and salaries necessary for other teams to re-build like the Brooklyn Nets did in the megatrade with the Boston Celtics. While having smarter front offices could change this equation over time, some teams will always feel they are one piece away and swing for the fences.
The 2013-14 season will show the biggest problem that arises from this structure: when the incentives are high enough because of a strong draft class, shrewd teams that know they cannot attain success in the short term all race to the bottom at the same time. This could mean that we have a three-tiered regular season: organizations gunning for championships, rebuilding teams, and a few in the middle. This will likely lead to a disjointed regular season with some incredibly bad basketball towards the end as the incentives for tanking become more identifiable and accessible. While a team shedding their high salaries (Celtics) or not spending too much money to fill out their roster with sub-optimal players (Hawks, if the rumors are true) qualify as rebuilding and not tanking, we absolutely will see a ton of tanking towards the end of the season.
Teams tank because there is a major incentive to do so, especially when pick protection comes into play. Even if the chance of getting the first overall pick never gets that high for any single team, simply being one spot ahead in line can have major benefits. During the 11-12 season, extra losses at the end of the season put the Warriors into a coin toss which allowed them to keep their pick and draft Harrison Barnes after he fell to them. While the pretty blatant losing at the end of the season has its problems, it was within their rights and was the proper decision based on the system in front of them.
At this point, we pretty much know the rules of the game and how most teams will make decisions based on that structure. As long as the structure of the league stays the same, we will continue to see drastic rebuilds and some tanking each and every season. That possibility hurts both the integrity of the league and potentially season ticket sales in some NBA cities.
Unfortunately, only the league and the players (through CBA negotiations) have the ability to change it if desired.
Fortunately, there are a few different ways that they can do so which could eliminate or reduce these effects.
1. Reform or eliminate the draft lottery- There are two basic ideas that could be implemented to take out tanking: the NBA can either give every non-playoff team an equal chance at the first overall pick (one way would be giving each lottery squad the same number of ping pong balls) or an even broader change where every franchise gets a chance at the #1 pick (either by giving lottery teams a better chance or a straight even lottery for all 30 picks). Of these options, my choice would be a 30-team lottery where the teams that miss the playoffs get two ping pong balls and the playoff teams get one, with the process determining the entire first round rather than the first three picks.
2. Eliminate individual maximum salaries- By having both a team salary cap and individual maximum salaries, the league insulates the best players in the league from making a choice between money and quality teammates. Guys like LeBron James and Dwight Howard have the option of having their cake and eating it too since the money does not change too drastically between markets and team situations. Since major market teams would value their salary flexibility more (like now, they would have a better chance to use it to bring in talent through free agency), it could change the process for elite talents. A change like this would have to come through the next round of CBA negotiations because it would be such a fundamental change to the system and there is reason to believe that the NBPA would not support the change since it would squeeze out money for rank and file players.
3. Remove or limit the ability to protect draft picks in trades- In certain situations, pick protection plays a bigger role in tanking than the drive for a top pick. Think of teams like the Warriors in 11-12: at the end of the season an organization can often see a clear line in the sand which incentivizes bad basketball.
4. Eliminate the draft entirely-By far the most interesting potential solution to these problems, though I am sure the NBPA would not love the way it would redistribute salaries. It could be implemented either by giving teams a salary allotment (by record, uniform for each organization, or some other method) or by just using the existing system of cap space and exceptions to make it happen. Either way would also greatly facilitate movement between the US and Europe since players would not be constricted by the desires of the team who happens to hold their draft rights.