No offense intended to anyone involved in its production or the Wall Street Journal, but this article from Joseph Walker is at best off target and at worst dead wrong. Here’s a taste…
“The human resources department is known for being touchy-feely, but in the age of big data, it’s becoming a bit more cold and analytical. From figuring out what schools to recruit from to what employees should be offered flexible work arrangements, data analytics are helping HR professionals make more informed decisions.”
That’s only a little, but it’s a good sample. Click the link above for the rest, then come back. I’ll wait.
(Full disclosure: I read the book when it first came out and loved it. I was lukewarm on the movie because of how much was left out, as well as the fact that the focus changed dramatically from the book. And I’ve played roto baseball for 20 years or so. And I’m a huge dork. Glad we got that out of the way.)
OK, welcome back. Now here’s the thing. Neither the movie nor the book is about statistical analysis. At it’s core, it is about a team short on resources that has to find a new way to win the war on talent. Yes, the Scott Hatteberg story is a nice one. I don’t recall the movie showing anyone yelling “picking machine!” at him during spring training (as they did in real life…and the book), but still nice. David Justice did have a middling season for the A’s. The movie did, however, leave out the fact that those same A’s had three Cy Young contending starting pitchers on the squad that year (Hudson, Zito and Mulder) and that they were the reason the team won most of their games.
The article is, I’m guessing, referencing the movie, not the book. But that’s ok. It’s still off target. As a practitioner, I’m a little offended by Walker’s insinuation that HR is just now starting to get hip to analytics. I know plenty of smart HR folks that have been slicing and dicing numbers for years. But that’s not the point, either.
The key to the “Moneyball” approach isn’t just running numbers. It’s about finding hidden value that no one else is going after and capturing it for yourself. Back to Hatteberg. It wasn’t just that Billy Beane saw his OBP (On Base Percentage). Anyone could see that. The point was that no one else thought OBP was all that important. That’s what made Hatteberg valuable. Had it just been a matter of the statistics, big teams would have outbid Oakland.
The book also delves into the scouting and minor league management of the Oakland farm system. The same principles are applied. No, they haven’t worked out every time. Jeremy Brown (the hitter shown in the last few minutes of the film, but a major discussion point in the book) still isn’t major league talent. But that’s not the point. The point is he was undervalued, and they went after him. The statistics only support that strategy. That’s the heart of Moneyball.
If HR were to truly adapt the Moneyball approach, here are the kinds of things you would see:
- Candidates who are, on paper, under-qualified for a role are interviewed and hired because despite not having the pedigree, they have demonstrated the right attitude and aptitude to become long term assets.
- Talent is sourced from a number of innovative sources that are known to produce good people and good workers. An example I’ve seen in real life is an organization that made a huge push to recruit in a specific local ethnic group. The eastern Europeans they went after were smart, capable and appreciative of an opportunity. This group produced top performers, including their Employee of the Year. Other hires were tough to keep around for more than a couple of years.
- Employees are reviewed not on how well they’ve done on their current role, but instead have their performance broken down into key skills. Those skills are then translated into other roles they would be likely to handle successfully, and they are deployed in a way that maximizes their value to the organization. Like Hatteberg moving from catcher to first base.
That’s what Moneyball is about. New ways to source talent, new ways to use talent, new ways to get the most from your resources. The statistics make it go, but they are enablers, not the focus of the approach.