One important lesson over the past 18 months is there is a difference between not having money and not having money. I am very early in this new business stage and some people would say it has not even really begun. I am running a company that I do not own, but lots of people do that. We call them CEOs. It is interesting, in that regard, that people treat me so different.
I go back to the business learning day I was at and two examples that were used for showing good execution. McDonald’s expansion in the 1950’s and the 2002 Oakland A’s. It is interesting to look at both of those and compare it to today. You have a business that is still the world’s largest fast food chain but not one that anyone would call well run or well managed by any stretch of the imagination and the other the Las Vegas A’s by way of San Jose or wherever they are housed this year.
The Oakland A’s are a fascinating story and the book Moneyball is credited with leading to the SABRmetric revolution in baseball, but there is more to the story. The first and probably the most interesting thing about Moneyball is it was almost written about the Minnesota Twins and would have then focused on scouting and player development. I always find that part interesting. The other is that Moneyball is still a story of scouting and player development. The strength of the Oakland A’s was looking at players in a way other clubs weren’t.
And it wasn’t anything new. Look at people like Earl Weaver and Davey Johnson. They were championing Moneyball style philosophies long before Moneyball was a book, let alone a movie. The innovation of Billy Beane was that other GM’s were still looking at what contributed to winning in the steroid era. Sports go through shifts. Different aspects become over and undervalued and Billy Beane found that baseball was overvaluing the raw numbers and missing the approach behind them. So instead of looking for players that were complete players he looked for ones that did one thing really well, not make outs. That was the big discovery. The longer the inning continued the more runs a team was likely to score.
The interesting thing about Moneyball, if we look back at it 23 years later, is the attributes Beane was looking at didn’t stay undervalued for long. The Boston Red Sox won the World Series in 2004 behind a team that was built in a very Moneyball way. All of a sudden players like Joe Mauer and other on base machines were commanding six figure deals.
If we’re looking for a darling franchise of this day and age. The new Moneyball approach. The Guardians, Athletics, and Rays are all leading their divisions in the AL and the Cardinals and Nationals are both .500 or over in the NL and those are five of the seven clubs with an under $100M payroll. The only team with an under $100M payroll that is awful are the Rockies who happen to be led by Billy Beane’s sidekick Paul DePodesta.
The big issue is the Dodgers. They have taken the dynamic of the early 2000’s that a team can either be smart or spend money and decided to do both. Relaying this to business is the lesson that your smarts can take you a long way, but eventually there is going to be a giant at the top of that hill.
I am way over time and this journal entry feels insanely unorganized this morning.
David Huzzard Writes 