A Management in a Minute Book Overview of Moneyball by Michael Lewis
This summary and review of the book, Moneyball: The Art of Winning an Unfair Game, was prepared by Ricky Albin while a Marketing student in the College of Business at Southeastern Louisiana University in Hammond, Louisiana.
Comments (8)|3 Liked It
Everyone has heard, at least once in his or her life, of the sport of baseball being referred to as “The American Past-time”. The sport is filled with a deep history of players, fans, and enthusiasts who have come to know, or think they know, the game of baseball all too well. It almost went without challenge they the most important part of offense was hitting the ball, and the most important statistic for a player was his batting average.
Moneyball tells the true story of a poor baseball team forced to compete in an unfair game. Billy Beane, General Manager of the Oakland A’s Major League Baseball team, was only given about $41 million dollars by the teams owners to assemble a competitive baseball team. While $41 million dollars may seem like a lot of money, it was the second-lowest payroll in all of baseball. Before the start of the 2002 season, Beane was faced with the seemingly impossible task of replacing Oakland’s two greatest offensive weapons, Jason Giambi and Johnny Damon, who were lost to richer teams. While anyone who wasn’t named Billy Beane had given up all hope, the General Manager set out to find an answer.
Billy quickly became interested in the ideas of a man named Bill James, who wrote books about statistical analysis of Major League Baseball. Although the game was notoriously impacted by things that could only be described as feats of luck, Bill James believed heavily in a little thing called “probability.” James’ strongest beliefs were that the most important statistics in baseball were the ones that proved to have a direct impact on a team winning or losing a game. He concluded that the two most important statistics on offense that improved a team’s probability of winning were (and still are) On Base Percentage (OBP) and Slugging Percentage. When you combine the two statistics, you get OPS (on base plus slugging). As for pitching and defense, the keys to winning were deemed by James to be the amount of strikeouts and walks a pitcher gives up. Beane had read many of James’ books and quickly became a believer of these ideas as well. Before the Billy Beane era, no one had ever really heard of OPS, but this was all about to change.
The traditional ways of owning and managing a baseball team were to hire a bunch of old scouts to travel all over the country and watch young guys play ball and decide whether they “had the stuff” or not. Scouts would study a prospect player’s size, athleticism, speed, and strength—all of which Billy had no interest in anymore. What did he want? To win baseball games. What won baseball games? Runs. What produced runs? Walks.
The Oakland A’s would go on to recruit numerous players who shined in their eyes for reasons that other teams looked right past, or undervalued. In some cases, they took players who otherwise wouldn’t have even made it to pro baseball, and turned them into run producing superstars. With a roster full of nobodies and washed up old players, The A’s went on to set the American League record for the most consecutive games won (20) and finished the season atop the American League West with 103 wins. With only $41 million dollars, the A’s won the same amount of game as the Yankees, who spent a whopping $126 million dollars.
The Ten Things Managers Need to Know from Moneyball
1. Think outside the box. Differentiate yourself from the ideas of others. If you repeat the same old process as everyone else, how are you supposed to stand out and become successful? If Billy Beane had taken his $41 million dollars and invested it the exact same way that the Yankees and Red Sox were, he would have either spent it all on about 5 players, or picked up a roster full of guys with .225 batting averages because all the “good” ones would have already been taken.
2. Stick to the plan. A plan only works if it is executed strongly and confidently with no exceptions. The key to the A’s success was the management realizing their role in the league and the strategy they chose to implement in order to remain competitive. If you don’t follow the plan, then what on Earth is it even there for anyways? Discipline can make or break you.
3. Know where you stand. The importance of knowing where your company stands in the industry is key to remaining competitive. There were multiple instances in the book where Billy Beane made strategic moves, often when trading and drafting players, which would allow him to adjust to the team’s surroundings and win more games.
4. Know where your competitors stand. If you are familiar enough with your competitors, you can often use them to your advantage as Billy does when making trade deals with the richer teams in the league to acquire a little extra cash or maybe even an extra player or two.
5. Communicate efficiently. Without communication, a company is completely lost in the dark. Efficient communication both internally and externally can provide managers with tons of valuable information that can be used for planning ahead and decision-making. Not only should managers be gaining information through communication, but they should be spreading it throughout the company as well.
6. Don’t be afraid to make drastic changes. I can’t think of a single successful company who got that way by staying exactly the same. Yes, Darwin’s Law applies even to management. “If we pull this off, we change the game. We change the game for good.”—Billy Beane was actually striving for change. Change was his ultimate goal and also a very important key to his great success.
7. Pick the right people. You’re going to need a team of your own, you can’t do it all by yourself. Every single person you allow into your company is an enormous investment, and letting the wrong people in can prove to be very risky. Do your research–pick a few important “statistics” of your own that are deemed more important than others.
8. Be willing to make sacrifices. You can’t always have the entire package. Along with every strength, also comes weakness. On the field, big, strong ball players lack speed. In the office, careful, mistake free employees are slow workers. It is important to choose which qualities are more beneficial to your strategy and stick with them.
9. Take charge. When something needs to be done, do it without hesitation. Don’t sit around and wait for someone else to make a move. Pieces of a puzzle don’t just fall into place in the business world. You, the manager, are the architect of your company’s business model. Put the pieces together, and do it with authority.
10. Charisma is the characteristic of a great leader. If there was only one thing I could completely comprehend from Michael Lewis’ depiction of Beane’s personality was his ability to, as said best by his former teammate Lenny Dykstra, “talk a dog off of a meat wagon”. This trait was obviously the backbone to his successful management approach and he absolutely would not have been able to achieve such great results without it.
Full Summary of Moneyball
The Curse of Talent
Billy Beane was a highly sought after high school prospect. He was considered by most to be the future number-one pick in the Major League draft, however, his value declined and many teams lost interest in him while he gained interest in a full ride scholarship to play both baseball and football (John Elway’s shoes needed filling at the quarterback position) at Stanford University. Billy had the most promising build and tools any scout had ever laid eyes on—he was a rare spectacle indeed. Faced with what would prove to be the biggest decision of his life, all eyes were on Billy. Would he take the $125,000 signing bonus to play for the New York Mets, or would he continue his education at one of the most prestigious Ivy League schools in the nation? Because many teams believed Billy would turn down the money and attend Stanford, he landed as the 23rd overall pick in the draft to the Mets. His decision to sign with the Mets he would later refer to as “the only decision that he would make in his life that is all about the money.” Billy would go on to have a mildly successful, short career that never lived up to the hype of what he “should” have been.
How to Find a Ballplayer
After becoming increasingly disappointed in his Major League career, Billy Beane Joined the Oakland A’s front office as a scout in 1990 at the age of twenty-eight. Baseball just wasn’t cut out for him anymore. Just a few years later, in 1997, he was named General Manager of the team. Billy viewed the old-timey scouts that worked for him to be the same as the guys who had scouted and recruited him ten years ago. In Billy’s eyes, the scouts were all failures, and he was living proof of that. The scouts would sit around a table in a meeting room and talk about potential prospects, comparing them using tools such as size, shape, speed, and athleticism. Billy fit these criteria all too perfectly years before, and failed. He knew there had to be a much more efficient way to value ballplayers. Billy introduces his newly hired assistant, Paul DePodesta. Paul is a recent Harvard graduate with no baseball background, but a knack for crunching numbers and a special interest in the sport was what caught Billy’s eye. Billy wants to change the game of baseball, and Paul is his secret weapon.
Billy’s career as a Professional Baseball player was rocky, to put it nicely. Although filled with ups and downs statistically, his career was also a constant battle emotionally–with himself. He struggled to live up to the hype, to accept the decision he made to skip out on Stanford. In his mind, Billy was just a guy who should have never made it to where he was—and it was the scouts’ fault for overvaluing him. When Billy came in to work at the front office of the A’s, Sandy Alderson, the general manager at the time, was right in the middle of a little experiment. When previous owner Walter Hass passed away, the Oakland A’s were purchased by businessmen Steve Schott and Ken Hofmann. The new owners, with their business backgrounds, put the team on a much tighter, strict budget. Desperate for an answer, Alderson discovered an author named Bill James, who wrote many baseball analysis books, which he called Abstracts, full of interesting ideas and statistics. James was a strong believer in probability, and if luck was involved in a stat, it was rendered completely irrelevant. In James’ books, he goes on to explain that the two most important statistics on offense are on base percentage and slugging percentage, because each of these statistics are in the most direct relation to probability of scoring runs. The defensive statistic that was focused on most was strikeout to walk ratio, because that had the greatest effect on the probability of not allowing runs. From the moment Alderson introduced Billy to the ideas of Bill James, he was obsessed.
Field of Ignorance
Bill James had no baseball background. He didn’t care about statistics anywhere outside of baseball. He was, in a sense, the mad scientist of professional baseball. He was just so interested and engulfed in baseball statistics and the opportunities he saw within to be exploited, that he spent much of his life doing so. He argued flaws in baseball statistics and better ways to value players other than just the traditional batting average for hitters and earned runs average for pitchers. Bill James had become a baseball genius, yet no one was even noticing. However, backed into a corner and searching for answers, Billy Beane was noticing.
The Jeremy Brown Blue Plate Special
By the time Billy became the GM in 1997, he had absorbed all twelve of Bill James’ Abstracts. Jeremy Brown, starting catcher at the University of Alabama, was the first jewel in Billy’s newly rendered eyes. Brown was the perfect candidate for the Oakland A’s. He was short and chubby, not an eye-catching physique at all—which would cause him to be overlooked by every other team in the big leagues. But the A’s wanted him badly, because he had a knack for getting on base and producing runs, and that was all that mattered to Billy Beane and the Oakland A’s. They would go on to sign Jeremy Brown for $350,000 as the thirty-fifth pick in the draft.
The Science of Winning an Unfair Game
Using such an un-traditional approach, the A’s had to choose their team very carefully. Paul stayed busy organizing statistics and numbers into meaningful points of interest and creating various different ideas and approaches to implement into their new business model. The most important number Paul came up with was 95. This was the number of games he calculated that the team must win to reach the playoffs. The next number was 135, which was the amount of runs they would need to score than they allowed in order to reach 95 wins. Although not aware of what is to come, they ended up scoring 800 runs and allowing 653 that year.
The biggest hole left void in the A’s lineup was, without a doubt, that of first baseman Jason Giambi. In the previous season of 2001, Giambi’s on base percentage was .477, which was the highest in the American League by a long shot. Obviously, Giambi’s ability to reach base and produce runs would be near impossible to replace. However, the lineup was also losing players with less thrilling on base percentages. Beane’s approach to replace Giambi’s .477 OBP was the pick up three new guys who’s average OBP would compare with the average of Giambi, Johnny Damon, and Olmedo Saenz. The three players combines averaged a more realistically replaceable OBP of .364. The three hitters who would emerge are catcher turned first baseman, Scott Hatteberg, the brother of Jason, Jeremy Giambi, and former Yankee stud, David Justice.
Scott Hatteberg, Pickin’ Machine
The most crucial piece of this replacement puzzle would prove to be Scott Hatteberg. Hatteberg suffered an elbow injury while playing catcher for the Boston Red Sox, so naturally he came very cheaply. Billy Beane scooped him up out of free agency, stuck him at first base, and watched an offensive, run producing machine embarrass himself on the corner of the diamond. However, to everyone’s surprise, Hatteberg adapted to his ne position very quickly. Soon enough, people were even referring to him as an “above average” first baseman (Lewis 170). Anything other than the expected offensive productivity from Hatteberg was just considered lagniappe.
The Trading Desk
When the trade deadline came around at the end of June, Billy Beane was not hesitant to make necessary changes whatsoever. He charismatically wheeled and dealed players in and out of his clubhouse like stocks, but there were human beings. Billy didn’t care—he only cared about winning. In a trade with the Phillies, Beane traded Jeremy Giambi, who he had previously thought so highly of, for a player named John Mabry, who he’s hardly know anything about. He wanted to get rid of Giambi because Jeremy seemed to be having too much fun losing games (and also partied and got in trouble a bit too much). “Losing shouldn’t be fun. It’s not fun for me. If I’m going to be miserable, you’re going to be miserable.” (Lewis 201)
Anatomy of an Undervalued Pitcher
Surely enough, pitching had to become a factor in this scheme somewhere along the lines. Coming into a game in relief of All-Star Pitcher Tim Hudson, Chad Bradford too the mound with an 11-5 lead. However, this wasn’t just any ordinary game—The Oakland A’s were on an absolute tear, winning each of their last 19 games and just one win shy of setting an American League record for consecutive games won. Chad Bradford has an interesting background. He was from a small town in Mississippi, hadn’t even been a standout player on his high school baseball team. Somehow or another, he wound up playing for a local community college, moving onto a university college, and then he weaseled his way into professional baseball. Still, no one thought much of him, being a side armed, 84MPH fastball throwing nobody. The A’s saw it differently. His strikeout to walk ratio was more than high enough to catch the attention of Billy Beane. So Bradford found himself there, in front of the largest crowd the Oakland A’s has ever seen, with the chance to make history. Unfortunately, Chad didn’t have his best stuff that day, and the Milwaukee Brewers tied the game at 11-11 going into the bottom of the ninth and possibly the A’s last chance to end it.
The Human Element
Hatteberg hadn’t even planned on stepping foot on the field that night when he was called on to pinch-hit in the bottom of the ninth. He stepped to the plate confidently and delivered a blow over the right center field fence that would be remembered forever. The A’s now held the American League record for most consecutive games won in a season. Hatteberg didn’t do it, he claimed–the Oakland A’s did it.
The Speed of the Idea
The A’s finished the 2002 season winning 103 games, surpassing the goal of 95 and matching the New York Yankees, also with 103. Like all success, it didn’t go unnoticed. Even though it did manage to remain a secret somehow for much longer than it should have. Billy Beane was then the most sought after and valued GM in all of professional baseball. He was offered an extremely high paying job by the Red Sox, which he turned down to stay with the A’s and keep to his promise of never doing anything just for the money ever again.
The Video Lounge
The following video titled “Moneyball – New Way of Thinking” contains many references from both the book and the movie “Moneyball”. Interviews are shown from author Michael Lewis, actor Brad Pitt, and even Oakland A’s manager himself, Billy Beane. It is a quick 2-minute breakdown of the inspiring true story of a team overcoming all odds (actually quite the opposite) and becoming successful in an unfair game of money and resources.
Why I think:
- The author is one of the most brilliant people around…or is full of $%&#, because:
I view Michael Lewis as a very brilliant man for writing this book. He found a story that interested him and went with it. He seems to have let himself become engulfed within the sport of baseball and the statistics surrounding it. Comparing the management of a baseball team to other, more traditional business makes so much sense to me.
- With business conditions today, what the author wrote is – or is no longer true – because:
What Lewis wrote about in Moneyball will, without a doubt, remain relevant in the business world for a very long time. His story tells a prime example of management at it’s absolute best. Companies will always be searching for ways to succeed in the most negative of conditions. In my opinion, the need for differentiation and thinking outside the box will never cease to exist in our world.
- If I were the author of the book, I would have done these three things differently:
1. I would have tried to come up with ideas and strategies of my own instead of just writing about pre-existing ones. I don’t think I would have been able to resist the temptation, actually.
2. I would have studied the more traditional strategies of other general managers around the league to better compare and contrast with those of Billy Bean and the Oakland A’s. It would have given the reader a much better understanding of the average GM as an individual and how he or she typically handles various situations.
3. I would have attempted to give the players a little more credit for the team’s success than Lewis’ point of view exhibited. The players should have received more credit for embracing their productive attributes that most scouts and baseball enthusiasts rendered meaningless.
- Reading this book made me think differently about the topic in these ways:
1. Before I read Moneyball, I had honestly never even thought of a sports team as a company that needed to be run and managed so strategically and precisely. You would never think that something a simple as a game played on some dirt and grass would require so much though and decision making.
2. I realized that no matter how efficient and correct something is thought to be, there is always room for improvement. New ideas should always be accepted and given a chance before being ruled out, no matter how crazy or radical they may seem at first.
3. Probability is one of the greatest indicators of the future that we have. It is impossible to predict the future, but we can always make the best guess possible by using probabilities and anticipate what is most likely to come.
- I’ll apply what I’ve learned in this book in my career by:
1. I will look at change as a positive thing from now on. Change is an essential factor in everyone’s lives that, in most cases, cannot be prevented, delayed, or altered. The best managers accept change and adapt to it accordingly.
2. Within my career, I will find a passion in something—anything—and just go with it. I love what the people involved in this story made out of a simple idea. They transformed the game of baseball just because they found such an interest in the game and its statistical flaws, and couldn’t resist but to exploit the possibilities.
3. I plan on planning more efficiently (starting with that sentence, obviously). Without a solid plan and proper discipline to follow by said plan, managers would spend countless hours wasted bouncing back and forth from path to path, accomplishing next to nothing.
- Here is a sampling of what others have said about the book and its author:
“What others (scholarly and magazine reviews – along with on-line reviews – not simply reviews off the back of the book) have said about the book and its author?” Michael Lewis’ Moneyball seems to have had a generally positive response, with one small exception: “The publication of Moneyball triggered a firestorm of criticism from baseball insiders” (Hakes, 2006). Despite those old, cranky scouts Lewis warned us about, reviewers seemed to enjoy the book to a great extend. “As told by Michael Lewis, the story is both fascinating and instructive” (Shughart, 2004). Some critiques were even left with just one final cliffhanger of a question to fight away at their curiosities, “When every team in baseball adopts the new statistical models for player evaluation, will a cash-poor team like the Oakland A’s be able to win very many games?”(Minor, 2003).
Lewis, M. (2003). Moneyball: The Art of Winning an Unfair Game. New York, NY.: W.W. Norton & Company , Inc.
Minor, Kyle. (2003). Review of Moneyball. Retrieved on March 28, 2012, from
Shughart, William. (2004). Moneyball: The Art of Winning an Unfair Game. Retrieved on March 28, 2012, from http://www.jstor.org.ezproxy.selu.edu/stable/25151338?&Search=yes&searchText=Moneyball&list=hide&searchUri=%2Faction%2FdoBasicSearch%3FQuery%3DMoneyball%26acc%3Don%26wc%3Don&prevSearch=&item=2&ttl=35&returnArticleService=showFullText
Hakes, Jahn. (2006). An Economic Evaluation of the Moneyball Hypothesis. Retrieved on March 28, 2012, from http://www.jstor.org.ezproxy.selu.edu/stable/30033672?&Search=yes&searchText=Moneyball&list=hide&searchUri=%2Faction%2FdoBasicSearch%3FQuery%3DMoneyball%26acc%3Don%26wc%3Don&prevSearch=&item=1&ttl=35&returnArticleService=showFullText
To contact the author of this article, “A Management in a Minute Book Overview of Moneyball by Ricky Albin for Practicing and Aspiring Managers” please email r.Albin@selu.edu.
About the Publisher
David C. Wyld (email@example.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of his student’s publications regarding:
- management concepts (http://toptenmanagement.blogspot.com/)
- book reviews (http://wyld-about-books.blogspot.com/) and
- international foods (http://wyldaboutinternationalfoods.blogspot.com/)