I know virtually nothing about — and have even less interest in — baseball. But I LOVE the movie Moneyball (based on the Michael Lewis book), which is about the application of “HR analytics” to the game.
If you haven’t seen it yet, I highly recommend it. It is the story of how a soft-spoken, recent Yale economics grad applies his analytic know-how, with the help and support of the Oakland A’s general manager (played by Brad Pitt) to help achieve remarkable success (as measured by games won), with the smallest budget in the league for buying “talent.”
Some of the lines in the movie (I’m paraphrasing here) could be lifted from my day-to-day work life as an economist applying the principles and insights of behavioral economics to the business world:
- “People are running the business on fundamentally wrong assumptions.”
- “This is going to fundamentally change the game.”
- “The reason people are resisting it is because it is going to change how they make a living.”
In addition to being entertaining, Moneyball is worth watching because it has important lessons for business.
There is competitive advantage to be gained through analytics – no matter what business you are in. And the laggards will be the losers.
The Boston Globe Magazine’s cover story this past weekend profiled a variety of analysts who are using their talents in the world of sports to drive greater success through thoughtful, creative use of numbers.
Because of the multitude of statistics available in sports, it’s a perfect field for analytic trailblazers. We expect this analytic trend to spread far beyond sports in the years ahead, as other industries recognize the power of numbers, work to create meaningful people metrics, and then crunch the numbers to generate new insights about what’s driving key outcomes.
Interesting article about the use of analytic basketball data by Chris Bosh of the Miami Heat (National Basketball Association) and his coach Erik Spoelstra – as well as the challenges in pushing that information too far.
Of course, most employers don’t have anywhere near that level of detail on the specific performance and effectiveness of each of their employees. But for organizations that are leading the way in applying human capital analytics, there are certainly some comparable insights that are helping to improve overall performance – and leading to the equivalent of more “wins” and fewer “losses.”