By Kathleen Quinn Votaw
I’m a baseball fan—okay, maybe baseball fanatic. I travel to the Rockies spring practices; throw an annual party in a stadium suite; and am a baseball mom who rarely misses a game. Yeah, I love baseball. For those of you who share my love of this sport, and for those of you who don’t, there’s a lot to learn about running a business from baseball’s Billy Beane—one of today’s most talented and winning sports executives.
You may also know Beane as the subject of the bestselling book and Oscar-nominated movie Moneyball. The story unfolds his “Moneyball” philosophy, which is based on using statistical analysis to pit his small-market team against the big guys, and win. His major strategy is buying assets (players) that are undervalued by other teams and selling those assets (players) that are overvalued. Companies across the country have adopted his approach of leveraging data and using analytics as a way to compete in the talent market and more effectively manage assets and resources.
Beane spoke at the ACG Rocky Mountain Corporate Growth Conference in April and I was enthralled with his powerful insights on using data versus emotion to create long-term business success and profitability. I’m a strong advocate for data-driven talent acquisition as the best way to achieve more predictable results. Using some of Beane’s wisdom as a backdrop for my own experiential advice, I offer you some ideas, below, to help ensure that you have more consistent wins in our fiercely competitive talent market.
Billy Beane: Essentially this has been a business that’s been around for about a hundred years and it really hasn’t changed much so anytime someone’s doing something differently, it’s probably going to create some friction.
KQV: HR, keeper of your most precious asset, your people, has traditionally been seen as a cost center and an afterthought. Its potential was undervalued, unappreciated, and underutilized throughout history–creating an industry ripe for disruption and change. Today, it’s nearly impossible to achieve your goals without the support of strategic HR initiatives. We’re in a time when every organization’s biggest challenge is finding and keeping top talent. If you don’t already have an outstanding CHRO, get one. Having a talented and strategic HR leader on your team will give you a competitive edge in both winning and retaining the best people. You can’t grow your business without them—and they’ll know how to handle the friction.
Billy Beane: We can’t do the same things the Yankees do. Given the economics, we’ll lose.
KQV: Middle market companies can’t compete with the Yankees either. Corporations have big budgets to throw at the talent market, offering things like: higher compensation and better perks; greater marketing reach; and widely recognized brands and reputations that smaller companies can’t touch. Rather than settle for second best when it comes to talent, mid-market companies should develop an intentional culture that offers a uniquely different experience—maybe more personal, more flexible, and closer to the company purpose. These are things today’s candidates and employees are looking for. Understand what they want and find a way to provide it in a way that makes you stand out. Great cultures aren’t based on money and offer something money can’t buy.
Billy Beane: The idea that I [should] trust my eyes more than the stats, I don’t buy that because I’ve seen magicians pull rabbits out of hats and I know that the rabbit’s not in there.
KQV: The idea that you can trust your gut more than the stats to win the best talent is in a word, foolish. Employee expectations, like everything else in business, are in a state of constant change. How can your gut keep up? It can’t, but there are so many ways to get the stats that you need to attract and retain the best and right people for your business: gap analysis to understand and address culture issues; assessments for fit and performance; compensation analysis; market intelligence data … and that’s just a start. Data, not emotion, is your life blood, as Billy would say.
Billy Beane: The bottom line is that any business should be a meritocracy. The best and brightest. Period.
KQV: The way to find the best and brightest people you need to grow is to search for candidates in the same way you do profitable customers. Recruiting is a sales process that requires strategy and resources. Like in sales, part of your strategy is building a pipeline of people with the right talent and culture fit who are available to you when you need them, versus when you are in a crisis. And don’t forget a succession plan for current employees who are counting on professional advancement and opportunity in order to stay with you. A pipeline and succession plan ensure that you never have to fill a position with second-best talent—or as Billy says, “you want to have both a belt and suspenders for support.”
Billy Beane: It’s best to part ways at this point … we were never going to be able to bridge the gap.
KQV: Even with the best stats or a positive gut feeling, sometimes you hire the wrong person, and usually the mistake is caused by a bad attitude, not a lack of skills. Here’s my philosophy on that: When a person with the right attitude, values and cultural fit walks in your door, hire him or her with lightning speed and allow all the time he or she needs to learn the necessary skills to succeed in your organization. When you see an employee blaming others, making excuses or being disrespectful, fire that person with equal speed and take whatever time is necessary to replace him or her with the right person.
Billy Beane: How can you not be romantic about baseball?
KQV: I would ask you the same question.
In his two decades (so far) leading the Oakland As, Billy Beane took the team from being one of the worst on the field to making the postseason eight times. Although the As still have some ups and downs, Beane’s data-based management has revolutionized baseball and is a model for building winning teams everywhere. I hope you’ll take his, and my, advice.