Michael Lewis: Moneyball. The Art of Winning an Unfair Game. NY: W.W. Norton, 2003. 317 pp.
As someone who scans the headlines but does not otherwise follow baseball, I was hoping to learn lessons from this book that could be applied to sports in general, or at least football and soccer. Let me say first off that while there may be such lessons (though fewer for leagues with a salary cap, like the NFL), one thing I quickly discovered is that there sure are a lot of baseball players I never heard of.
So, what are the sports lessons? On the one hand, Moneyball is about statistics, the key insight being the importance of “inefficiencies in the system.” To a large degree this means determining which stats are the key to winning and – here’s a point that does not get emphasized enough – putting a dollar value on them. The implication is that a player’s total value can be calculated by figuring out the numerical amount you can assign to each of his individual skills. When it comes to getting on base, doing so by walking is just as good as hitting singles. As the baseball fan (Juror Number Seven, played by Jack Warden) says in 12 Angry Men, “Ran. Walked. What’s the difference? He got on, didn’t he – I mean he got there.”
The next step is to see which players on your team are overvalued, sell them and replace them with unknowns who are undervalued by the market but can perform just as well at lower cost. Billy Beane phrases it this way (he’s talking about replacing a player): “The important thing is not to recreate the individual. The important thing is to recreate the aggregate.” Because in Beane’s eyes that’s all a player is: an aggregation of skills. When in the course of time these younger players start to demand big bucks, they too are let go. It’s all about winning on a shoestring. Which makes sense if you’re managing a low-budget outfit like the Oakland A’s.
What’s the downside? Evaluating players by stats alone may be efficient, but it’s also ruthless. It exposes management’s eternal mantra that “we’re all a family” as mostly claptrap. It leaves little room for rewarding loyalty. Whether we’re talking about baseball, football, soccer or basketball – the point is that these are all team sports, obviously. And that means there are certain intangibles such as team spirit and leadership which cannot be quantified. Think of the franchise players on your favorite team – would you trade them virtually at the drop of a hat if you could find a couple of no-names who, according to a spreadsheet, had the potential to produce just as well? Well, you would if you really believed, like Beane does, that there’s nothing you can’t put a dollar figure on. Followed to its logical conclusion, you might end up having less a cohesive team than a bunch of misfit toys. It’s no accident that Moneyball lacks a chapter on team chemistry.
On the other hand, this book is not just about baseball stats – a subject which would not automatically appeal to a wider audience. You’ve got to have some human interest. Where does Michael Lewis find it? Aside from Beane and a few members of his staff, he discovers it in the stories of those who benefit from the system: the unsung players, diamonds in the rough who don’t look like marquee players or even think of themselves as being very good. Players nobody else wants, who are taken on board and turned into winners. The chief joy of Moneyball comes from reading about these underdogs.
But if they are the winners, who are the losers in this system? I missed the stories about those who, either through talent or hard work or both, have risen to the top and can command high salaries, only to find themselves traded for no other reason than “inefficiency in the system.” We’re not necessarily talking about players who have stopped producing either. Where are Lewis’s tales about the shock of being a star one week and finding yourself on the trading block the next? No heart-warming human interest there – to Lewis (and Beane), those guys are like overpriced stocks, to be unloaded before their value starts to decline. No matter how much these players have contributed to the team, or how much we fans have come to like them, no matter if they are still performing at a high level, evidently once they get that oversized paycheck, it’s time to start thinking of how best to cut them loose. The movie is actually much better about this aspect than the book. It goes a long way towards humanizing Beane, who appears somewhat callous in the book, by showing that he acknowledges this fact and tries to rationalize it – “They’re professionals,” Brad Pitt says, “they can handle it.”
Many reviewers praise Moneyball for the business lessons it contains. Of course there are useful tips such as, “don’t accept something just because that’s the way we’ve always done it,” “it pays to think outside the box,” and “dare to be different” – all commendable. At the same time, it should be kept in mind that the advice given here pertains best to organizations like the Oakland A’s: undercapitalized firms that are forced to compete with the big boys. Moneyball shows you how to punch above your weight for a while – but is not a formula for on-going success. As Beane himself puts it, “When you have no money you can’t afford long-term solutions, only short-term ones.” He didn’t manage his team this way because he liked to, but because, given his budget constraints, he had little choice. I worry that the chief lesson CEO’s will take away is: In the name of rationality, it’s okay to treat your employees as though they were members of your fantasy team.
The movie makes it explicit that this is one reason Beane does not like to watch his team play – if he did, he might form an emotional attachment to some players he’s inevitably going to trade away. (German soccer coach Mehmet Scholl, a former player, calls coolly calculating types like him “laptop coaches.”) The other reason being: superstition – he fears his presence might jinx the team.
Keep in mind, too, that this book was written long before the Great Recession, when CEO’s were not as obsessed with cutting costs as they are today – and for most companies, labor is the top expense. It’s perhaps not entirely coincidental that one of Moneyball’s gurus, Paul DePodesta, has joined the board of Sears, according to Bloomberg Businessweek. (July 11, 2013 – the whole article, by Mina Kimes, is well worth reading) Eddie Lampert, Sears’ chairman and an Ayn Rand acolyte, “wanted to use nontraditional metrics to gain an edge, like DePodesta did for the Oakland Athletics in Moneyball and is trying to repeat in his current job with the New York Mets. Only so far, Lampert’s experiment resembles a different book: The Hunger Games.” How so? The company is now “ravaged by infighting as its divisions battle over fewer resources.” Talk about learning the wrong lessons.
Here’s another example: “Treating workers as if they are widgets to be used up and discarded is a central part of the revised relationship between employers and employees… Companies burn you out and churn you out when someone better, or cheaper, becomes available.” (Dan Lyons, “Congratulations! You’ve Been Fired,” NY Times, April 9, 2016) The brave new workplace we all enjoy so much today has been shaped by the ideology of professional baseball management described by Lewis – an ideology encapsulated in the metric called VORP, which stands for “value over replacement player.” Employees are now given an annual VORP score as part of their evaluation.
But that’s not the fault of Michael Lewis. I give the book four stars for being thought-provoking.
By the way, Moneyball is scheduled to appear in Russian translation. I don’t envy the person tasked with writing explanations of technical terms for an audience that for the most part has probably never seen so much as a single inning of baseball. It’s been years since the sports channels here have broadcast MLB games with commentary in Russian. (They tried again for a few months in 2020, then abandoned it.) The movie was released here first, under the title, “The Man Who Changed Everything.”
Update
“Reading ‘Moneyball’ back then [2000], you found yourself rooting for Billy Beane and his geeks against the bloated Yankees and their bullying owner, George Steinbrenner. Now you realize that what you were actually rooting for was a bunch of guys who were trying to figure out a way to underpay their players. In exchange for the chance to be in the big leagues, Oakland’s players settled for less compensation than they were worth, simply because no one else knew how to value them. There are foreshadowings of the gig economy in the ‘Moneyball’ story.” – Louis Menand: “Twist and Scout. The Lessons of Baseball,” in: The New Yorker, April 8, 2019
© Hamilton Beck
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