Moneyball by Michael Lewis tells the story of baseball’s Oakland Athletics. A team with one of the teams with the lowest payrolls in Major League Baseball (MLB).
Despite their small payroll, the A’s consistently managed to make the playoffs and set an American League (AL) record of 20 consecutive wins in 2002.
Management’s unconventional but statistically supported, analytical approach to selecting players was key to their success. Players most didn’t have any faith in.
This strategy built on the ideas of baseball writer, Bill James, who began advocating a statistical approach to baseball in the 1970s, one he called sabermetrics.
At the center of this strategy was Oakland Athletics General Manager Billy Beane. Beane was a successful general manager, in part because he eagerly embraced a sabermetrics approach to baseball.
The three main takeaways from Moneyball are:
- The MLB’s growing salaries made it difficult for small market teams such as the Oakland Athletics to retain star players
- Billy Beane became the first general manager to fully implement a statistics-driven approach into the management of an MLB team
- Statistical analysis suggested that two valuable statistical categories, on-base percentage, and slugging percentage, were better indicators of a player’s future success
Lesson One: The MLB’s growing salaries made it difficult for small market teams such as the Oakland Athletics to retain star players
In 1974, Catfish Hunter (best name ever?) began the modern era of baseball free agency when he left the Oakland Athletics and joined the New York Yankees.
In doing so, he became the highest-paid pitcher in history to that date.
From there, a power war between team owners and players over salaries began, and in the next twenty years, there were six player strikes over salary issues.
In the mid-90s, salaries grew even quicker. Alex Rodriguez of the Yankees was, at one point, earning a yearly salary that was larger than the entire player roster of the Tampa Bay Devil Rays.
The small-market teams simply couldn’t compete.
After the end of the 2001 season, Oakland’s Jason Giambi was named American League MVP, only to leave the A’s to play for the New York Yankees.
As a small-market team, Oakland had to be careful with signing free agents. They had to limit their selections to players who everyone else had undervalued. Or, players who people had a problem with.
Lesson Two: Billy Beane became the first general manager to fully implement a statistics-driven approach into the management of an MLB team
Previous GM Sandy Alderson began the process. However, the A’s seized the full potential of using statistics when Beane was in charge.
Beane’s life experiences cultivated his ability to take an analytical view of baseball.
Beane was a highly touted junior player who all scouts believed had it all.
However, it didn’t pan out that way. He was released or traded by numerous teams as a player, and Stanford University withdrew his athletic scholarship when he became ineligible to play.
Perhaps due to his own ups and downs as a player, Beane was able to see baseball from a cold and impartial perspective.
Lesson Three: Statistical analysis suggested that two valuable statistical categories, on-base percentage, and slugging percentage, were better indicators of a player’s future success
In the book, the Oakland Athletics rarely engaged in hit-and-run plays, sacrifice plays, or aggressively running the bases. Which, most baseball people believed were vital to winning games.
Instead, they encouraged creating walks and getting on first base.
The style of play for the Athletics was more team-oriented, with the emphasis on producing base runners rather than just getting hits.
The Athletics emphasized base runners to ensure that extra-base hits produced more runs.
Using this approach, the Oakland Athletics made the playoffs in 2001 and 2002 with one of the smallest payrolls.
Where the A’s could strike gold was to value parts of baseball that others didn’t care about.
So, have a think. What part of your life or business could you value greater?
Odds are, there’s a KPI or a benchmark that you don’t even look at which could be a gamechanger.
My Personal Takeaway
I love Moneyball.
I love the book, I love the film, and I love the messages throughout.
A great underdog tale about how to be great at what you do.
🤙 Your Next Step… 🤙
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