Tiger Woods Caddie Shacks Steve Williams: A Fair Way to Split or Out of Bounds?

21-Jul-11
Published in: Forbes
Author: Patrick Rishe
Description: Tiger Woods fired Steve Williams after 12 years of service and 13 championships together.

Tiger Woods fired caddie Steve Williams after 12 years of service and 13 major championships together.

Shortly thereafter Mr. Williams expressed surprise, disappointment, and a sense of betrayal.

Not surprisingly, sports talk radio this morning is now abuzz about with:

Did Tiger do Stevie wrong?

Does Stevie have a right to vent?

One thing is for sure. Mr. Williams is certainly no ditch-digger (a must see Caddyshack reference).

This Forbes piece from 2007 provides a window into the economics of caddie earnings. Caddies are paid on the basis of how well their player performs: a base salary of $1,000 a week plus 5% of the tournament purse, 7% of a top 10 and 10% for a victory.

Extracting the appropriate prize money data from Tiger's official website and focusing solely on the years that Mr. Williams caddied for Mr. Woods, we deduce the following:

Tiger earned over $105 million in prize money between 1999 and 2010;

If Mr. Williams average just 10% per year, then he earned $10.5 million over this same stretch.

So when Steve Williams says that his family has been distressed over the last 18 months due to Tiger's troubles, there is some lack of sympathy.

After all, he's no slouch himself (yes, another shameless Caddyshack reference).

Mr. Williams has been caddying for Adam Scott during Tiger's absence from the tour, something that he asked and received permission for.

So if Tiger fired Mr. Williams out of anger over a temporary switching of the bags, is that kosher after he gave him permission to do so? When you are used to a particular earnings stream, and you incur a negative shock impacting that stream, you can't blame Mr. Williams for trying to do something in the short-run to remedy the potential loss in income. Bills still have to get paid.

Parting ways is never easy, though at times comical as this scene with Kevin Costner and Don Johnson from Tin Cup displays.

Tiger Woods made Steve Williams a very wealthy man, and perhaps the best-known athlete in New Zealand as well as one of the more recognizable caddies in professional golf.

Tiger is clearly trying to exorcise his health and exorcise past demons. And perhaps he deems cleaning house (e.g. new coach, new marketing firm, new caddie) as absolutely necessary.

If Mr. Williams truly had lost respect for Tiger upon his return to the 2010 Masters, he should have dropped his bag then.

But it sure seems like there could have been a classier way to terminate this professional relationship.

Unfortunately for Tiger, class has not been his predominant calling card over the last 2 years.

Let’s just say these guys won’t be sharing a Fresca together anytime soon.