{On April 5, 2013, we will celebrate the 15th Anniversary of the First Friday Book Synopsis, and begin our 16th year. During March, I will post a blog post per day remembering key insights from some of the books I have presented over the 15 years of the First Friday Book Synopsis. We have met every first Friday of every month since April, 1998 (except for a couple of weather –related cancellations). These posts will focus only on books I have presented. My colleague, Karl Krayer, also presented his synopses of business books at each of these gatherings. I am going in chronological order, from April, 1998, forward. The fastest way to check on these posts will be at Randy’s blog entries — though there will be some additional blog posts interspersed among these 30.}
Post #12 of 30
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Synopsis presented November, 2003
Moneyball: The Art of Winning an Unfair Game by Michael Lewis. (W. E. Norton and Company, 2003).Jane Aubrey: Do you lose very much?
Billy Chapel: I lose. I’ve lost 134 times.
Jane Aubrey: You count them?
Billy Chapel: We count everything.
(dialogue from the movie For Love of the Game – Kevin Costner and Kelly Preston)
Sure, baseball is a game. But baseball is a business. A big business. And it turns out that Moneyball was early to the game of what has grown and grown and grown – the use of data. It is now called “Big Data.” And Bill James may have been the earliest to that game, and Billy Bean jumped on board pretty quickly.
“So if we can’t tell who the good fielders are accurately from the record books, and we can’t tell accurately from watching, how can we tell? By counting things.” (Bill James).
In the movie version of the book, Billy Bean (Brad Pitt) describes how the Oakland Athletics are at the bottom of the totem pole. “We are the last dog at the hunt,” said the Beane in the movie version.
Michael Lewis captured this challenge, and Beane’s brilliant response to it, perfectly in his book Moneyball, which is the story of how the A’s competed with the big boys by finding the rare talent by crunching “different” numbers, and crunching those numbers differently. It is a fascinating read.
{A side note: I am regularly asked, “Randy, what is the best book you’ve ever read?” I don’t know the answer to that question. It depends on too many factors. But I do know what writers I like. I think these writers share some things in common – they know how to write/tell a story very, very well. They seem to know which stories make the most critical, the most important, the most valuable and useful “points.” David Halberstam could write like that. Michal Lewis can also. In this, just the the 12th post of 30, I’ve already hit my second Michael Lewis book. (I wrote about The New New Thing on day 5). And the only reason I will not include The Big Short, and probably Boomerang, by Lewis in this series is that I did not present these at the First Friday Book Synopsis – I presented these for a client and his group. I really like to read books by Michael Lewis!}.
Back to Moneyball. Moneyball tells the story of the 2002 Oakland Athletics, and how they genuinely competed (they won their division) with less money than any other team in their division. Here are the final American League Western division standings for 2002:
|
Team |
Wins |
Losses |
Games Behind |
Payroll |
| Oakland | 103 | 59 | 0 | $41,942,665 |
| Anaheim | 99 | 63 | 4 | $62,757,041 |
| Seattle | 93 | 69 | 10 | $86,084,710 |
| Texas | 72 | 90 | 31 | $106,915,180 |
Here are some excerpts from the book:
Sandy Alderson concluded that everything from on field strategies to player evaluation was better conducted by scientific investigation – hypotheses tested by analysis of historical statistical baseball data – than by reference to the collective wisdom of old baseball men. By analyzing baseball statistics you could see through a lot of baseball nonsense.
“Until the third out, anything is possible; after it, nothing is. Anything that increases the offense’s chances of making an out is bad; anything that decreases it is good.” (Eric Walker). Alderson’s reference point for running an organization was the time he’d spent as an officer in the Marine Corps… The individual star was less important than the organization as a whole, and the organization as a whole functioned well only if it was uniformly disciplined.
Baseball teams didn’t have the sense to know what to collect, and so an awful lot of critical data simply went unrecorded: how batters fared in different counts and different game situations, who was pitching when a base was stolen, how different outfielders affected the audacity of runners on the base paths, where hits landed and how hard they were hit, how many pitches a pitcher threw in a game. The lack of critical data meant that “we as analysts of the game are blocked off from the basic source of information which we need to undertake an incalculable variety of investigative studies.”
Well into the late 1990’s you didn’t have to look at big league baseball very closely to see its fierce unwillingness to rethink anything. It was as if it had been inoculated against outside ideas.
What James’ wider audience had failed to understand was that the statistics were beside the point. The point was understanding; the point was to make life on earth just a little more intelligible; and that point, somehow, had been lost.
James had something general to say to Billy, or any other general manager of a baseball team who had the guts, or the need, to listen: if you challenge the conventional wisdom, you will find ways to do things much better than they are currently done.
Don’t believe a thing is true just because some famous baseball player says that it is true.
The book reminds: don’t forget that you are in a competition. Value surprise. And do what works, not what you “like”
Here are four key “transferable” principles:
#1 – When you don’t have the resources, you have to go to plan B.
The Oakland A’s have found “undervalued players,” primarily in college baseball. These players are still available because they do not fit the image of a baseball player. They may be “unacceptable” to traditional baseball scouts, but their statistics demonstrate a mastery of the skills needed.#2 — There is a plan B that works, and you can find it if you look hard enough.
Chances are it is not known by the “long-timers.” Chances are that you have to bring in true “outside help.”
In the book, Lewis describes true, genuine changes – changes that affected everything about the way to look at a baseball team.#3 — Numbers are more reliable than intuition, tradition, emotion, or…
Businesses do not have the luxury of making decisions without hard numbers behind them. The Oakland A’s look at numbers more carefully than anyone else. But, they look at numbers in a new way, and the numbers, ultimately, and over the long haul, do not lie.
Numbers are more reliable than intuition, tradition, emotion, or… (or — “who cares how they look in jeans”)#4 — The aggregate is more important than the lone/the individual.
What is done over all (together) is what the company needs. The aggregate is more important than the lone, the individual.
This book is a true story, but it is also one gigantic parable for anyone in business. Collect lots of numbers — the right numbers. Pay attention to those numbers. Know what numbers (and traditions) to ignore. Make the changes you need to make, no matter who opposes those changes. Work with what you can get – then make it work with what you can get. Do whatever it take to compete, no matter how strange, how unconventional, it seems.
Yes, Moneyball, like the other books I am writing about in this series, seems to be standing the test of time very well.
First Friday Book Synopsis 