Determine what kind
of team you want to be
In
Major League Baseball, it’s pretty straight forward: the teams with the most
wins during the regular season make it to the playoffs, where they then battle
it out until one team is crowned World Series Champions. And in order to
win games, one team needs to generate more runs than the other – it’s that
simple. And there are endless strategies and tactics that try and do
that, but when all is said and done, you can essentially boil it down
to two basic strategies: generating more runs than the other team by focusing
more on offense; or mitigating the other team’s ability to generate runs by
focusing more on defense. The difference between the two strategies is
like the difference between The Godfather, Part 1 and The Godfather, Part 2:
one is not intrinsically better than the other – it's just a matter of style.
But the risk of doing too much at once will likely end up like The Godfather,
Part 3: a huge disappointment. So determine who you want to be and how
you want to play (i.e. as the Run-and-Gun offensive team or as the
Staunch defensive team) and what strategy makes the most sense for you based on
your resources, circumstance and market positioning. Because figuring out
which strategy you’re going to employ will not only inform how you’re going to
approach winning, but it will ultimately drive the type of analytics that will
help you get there. |
| "Guys wait, you're messing up Johnny Damon's hair!" |
Numbers don’t lie. The trick is to find the right numbers.
To
this day, the success of baseball teams and their players are largely
measured by a set of traditional, generally accepted metrics that essentially haven't
changed for the last hundred years. For offensive players, high Batting
Average, Home Runs, Stolen Bases and Runs Batted In (RBI) are regarded as the
cornerstones of high performers. Defensively, a pitcher’s Earned Run Average
(ERA), Shutouts and Strikeouts are key measures of success. Interestingly
enough, as the book points out in detail, if you were to statistically analyze how
these metrics actually impact a team’s ability to generate runs, you'll find that none of
these metrics have any significant impact. None.
Instead, it turns out that non-traditional statistics such as On-base
Percentage (OBP), Walks and Slugging Percentage were much better
predictors of a team’s ability to create runs. Not only were they much better predictors,
but they were effectively the only stats that had any meaningful impact on
an outcome of a game, and thus should be the only metrics worth
considering. So while your competitors may be tracking the same old
industry metrics they’ve been tracking since Fenway Park was built and players were catching pop flies with their bare hands, consider
differentiating by using analytics to uncover new, non-traditional metrics that
might actually be driving truer impact to business performance. The main point here is that there are
underlying factors that are positively contributing to performance and using analytics
is an effective way to help uncover those factors.
 |
| "Another walk, another bonus. I think I'll pick up that G6." |
Make it a whole new ball game
Changing the way you look at performance will essentially change the way you play the game. So instead of building a team full of players that hit over .300, hit 40+ home runs and drive in more than 100 runs, you should be building a team full of players that optimize your new metrics i.e. the number of times they get on base (OBP) and the total number of bases they achieve on a given hit (Slugging percentage), thus maximizing the number of runs generated in a game. Now you might think that Batting Average, Home Runs and RBIs are, in fact, indicators of how often a player reaches base and brings in runs, but they only really tell part of the story. For example, Batting Average only looks at the probability that a batter will make a hit on any given At Bat, and it doesn’t take into account getting on base via walks or getting hit by a pitch. And at the end of the day, it's all about getting on base because without getting on base, you can’t score runs. So it really shouldn’t matter how you get on base. The same thing applies to business – it’s all about winning the customer. So building a strategy around how to do that, whether it’s through the use of analytics to identify and predict your most loyal customers or investing in a platform that’s going to engage with your customers in real-time based on their interactions with you, it’s about building the capabilities that will ultimately lure key customers away from your competitors - and keep your best ones. In essence, you’re changing the playing field for which you have the upper hand. Now that’s true home field advantage!
Swing for the fences
 |
| "You're outta there, Trumbo! And here's a reverse punch for questioning my call." |
/LC
