Moneyball for Business

Micheal Lewis is in my top 2 favorite writers/authors (Malcolm Gladwell and him go back and forth). He originally got me hooked on his style and insight with the book, Moneyball. I am not a particularly quick reader (both in dedicated time and actual pace of reading), but I think I read the 300+ page book in a 48 hour period.

Moneyball is about one baseball General Managers' (Billy Beane) statistically focused approach to a sport, which traditionally tracks stats, but often mis-used these stats to make decisions... The book was revolutionary in a lot of ways. First, 5 years after it was published, it's fair to say that almost all of the Major League Baseball teams reconsidered their approach - and many hired quant guys to fill top positions rather than the traditional baseball guys. Secondly, other industries and sports began to think how they could apply the practices to their worlds. In particular, Bill Simmons talks incessantly about the MIT Sloan conference last year where several owners/GMs etc. of various sports leagues (the NBA in particlar) spoke about how they all have terabytes of data that help them make decisions - but different from Billy Beane and the A's ... they're choosing to keep their strategies private.

Now ... I work for a company that is notorious for believing that fast is better than slow and that most importantly DATA TRUMPS OPINION. In the classic business world - it's my belief that this is NOT the norm. Opinion and tradition are the reigning rulers - and there is always some way to cut metrics where they can partly defend such opinions...

I've had somewhat of a new role the past 6 months at work which is trying to QUANTIFY the tangible business impact (sales lift) that online media has on offline sales. We have sucessfully done this - and it's really exciting to see. I get to interact with a lot of smart Quant people - and I get to see some truly amazing ways that data metrics CAN be used to help make decisions... The challenge is getting people to buy-into the fact that DATA SHOULD TRUMP OPINIONS.

For Major League Baseball, holistic buy-in was attained through the success of a book. What is it going to take for the Marketing/Advertising/Media business to follow-suit? We shall see .... Maybe when it's all said and done - I'll need to play the role of Micheal Lewis, but for now, I'm merely on my soap box saying that this is the next big thing. Data models/algorithms/sophisticated math is 100% the way that successful businesses will make decisions in the future.

1 comment:

Dirk said...

I just finished his book "The Blind Side" which was great on multiple levels -- as an inside view of the college/NFL and as a story. I hear it will soon be a movie, too.

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