Moneyball: Lessons for Business

1245 Words5 Pages
At its core, the book Moneyball, to me, is about leadership and overcoming resistance to change to create a sustainable competitive advantage.
In Moneyball a new General Manager challenges a traditional industry with a new paradigm. He successfully deals with the resulting resistance from the more tradition oriented employees. In the case of the Oakland A 's this has led to a substantial competitive advantage through lower costs (their payroll goes down) and improved output (the have a higher percentage of win’s) which leads to an increase in return (average cost of a run is among the lowest in baseball).
This represents a major learning to me, it means that I need to be prepared to challenge the conventional wisdom by being innovative
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Money ball begs the question if there is a way to exploit the inefficiency of current performance evaluation systems by implementing a novel, fact based, employee performance measurement and feedback system. Can companies copy the sabermetrics approach to talent assessment, selection and utilization ?
One can imagine that this is possible in a manufacturing or a sales environment where there is a direct relation between employee action and measurable outcomes. It becomes more difficult in the finance, marketing or human resources arena where the immediate impact of employee actions is less obvious. Therefor it would be a major breakthrough if one would be able to identify those factors that predict success.
Billy Bean in Moneyball, after identifying the right empirical data and then training (and convincing) his people of the new approach needs to build organizational capability in using and implementing his new system. In the same way, if a company comes up with a new way of determining what will lead to success (see question 1) it cannot stop at just inventing the new “system”, the organization needs to build capability to use it as a competitive advantage. To build this capability, employee’s performance needs to be evaluated in the light of how much he/she is contributing to the success of the new approach. Usually this capability is built through more “intangible factors”

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