Moneyball – essential HR speedreads (part 2)

Moneyball (film)
Moneyball (film) (Photo credit: Wikipedia)

This is the second in a series of quick summaries of essential business/HR books (the first, The Drunkard’s Walk, can be found here http://wp.me/p3wxuY-4H) . As with the first review, I hope the lessons are useful, but also that you read the books in due course. I chose them because they are good books that you might not have recommended or given to you as straight ‘HR texts’.

Moneyball (The Art of Winning an Unfair Game)

http://www.amazon.co.uk/Moneyball-Winning-Unfair-Tie-In-Editions/dp/0393338398

Moneyball was hijacked as book and subjected to the unenviable and unfair fate of having up to a billion articles written about it suggestion it was all about ‘big data’. The book does focus on data – but there are far richer lessons to be enjoyed regarding teamwork, culture, innovation and bravery.

Essentially, the book provides an insight into the workings of a baseball team from Oakland that, due to having a limited budget, chose to hire more diversely; finding talent outside of the normal profiles for successful baseball players. They purchased players that might have unorthodox actions or techniques, but who could still be productive.

The team went on the longest winning streak in baseball history, using a strategy of hiring players based on actual results, rather than perceived desirable skills (informed by some cool data analysis) and getting the most out of them.

A short clip from the movie…and then the lessons from HR.

Lessons for HR

It’s not all about data. It probably never will be. Most summaries of the book focus on the level of analysis that went into the hiring decisions. What is often neglected is that the team’s success only really kicked off when they traded two high performers OUT of the club, due to the negative impact they were having on others around them. They valued and understood team dynamics and made a brave change as a result. The ability to let go of talent that didn’t fit was as important as the ability to acquire.

Performance is in the aggregate. When the team lost high performers it looked for where it could replace their contribution in the aggregate of the next hires i.e I don’t need a replacement star if I can hire two upper quartile replacements. This meant that over time they increased average performance, whilst ensuring that they were less reliant on individuals.

Results matter, not the way they are achieved. The team’s analysts looked at what won games of baseball and made teams a success. They ignored traditionally sexy or glamorous measures, like how many home runs people could hit or how fast they could throw – and simply looked at how good people were at hitting a baseball and stopping other people hitting baseballs. Focusing on metrics that mattered, to the exclusion of all other noise helped focus their hiring policy and how they used their strengths. As you can see in the clip identifying the problem, the real problem, is always key.

They stayed true to their vision. Having identified that they needed to compete in a different way to other teams the management’s strategy came under both external and internal pressure. They had a vision, they stuck to it and they were prepared to take accountability for failure as well. They understood they were playing a game they could lose, but they were passionate that they were playing it in the best way they could. It paid off. You can’t be right all the time, but to fail through lack of commitment. That is a real loss.

‘If you don’t stick to your principles when times are tough, they aren’t principles; they are hobbies.’ Jon Stewart

5 essential HR speedreads (pt 1)

The 5 books I aim to cover in these blogs are all worth a read. To make things faster (and probably shallower for you) I’m going to give you a short summary each books and then key lessons for HR – so it’s almost like you don’t have to read them.

Obviously I would recommend that you do read them- but this should be enough for you to sound relatively familiar with them at conferences etc. If somebody asks you for more detail simply explain that you read so much in this area ‘it has all just become part of a central repository of concepts in my mind, rather than me segregating by title or author’.

That should sound impressive without being a lie, in that it’s true to say you aren’t in a position to segregate by author.

The Drunkard’s Walk by Leonard Mlodinov

http://www.amazon.co.uk/Drunkards-Walk-Randomness-Rules-Lives/dp/0141026472

Summary: Your brain is attempting to impose patterns of things where patterns don’t exist.That is why we hold to feelings like after 5 heads we must be ‘due’ a tail. We also assign things a status of ‘good’ or ‘bad’ way before we are logically in a position to do so – as we might be in the middle of a logically possible/probable sequence. You throw a coin and it comes down tails the first 10 times and you assume it is biased; in fact that isn’t as unlikely as you would think. People look for patterns in the stock market, but in fact the patterns stocks and shares take often look like a drunk tottering down the road, bumping off things as he goes.Hence the title. If you enjoy this then the slightly more challenging ‘The Black Swan’ by Taleb should also grace your bookshelf.

Key HR lessons:

  1. Performance tends to regress towards a mean, that’s why people sometimes think their teams respond to being told off or slack off when praised. The team’s performance is just regressing towards a mean- what the team would normally do. The manager has often had no effect – but we like to assign cause and effect to make sense of the world and make ourselves feel important. Next time you go to ‘coach’ a poor performer hold back, see if their performance uplifts without your intervention. If it does then reflect on your career and how often you have really made a difference.
  2. We completely underestimate the fact that some stuff just happens. And some stuff will always just happen. Reviewing it for meaning when it was a random event can be counterproductive. Could you have done something differently on that last project that failed? Possibly, but even with the best planning some things just don’t come off. The trick is just not to postrationalise things and draw conclusions for change in future behaviour.
  3. You (probably) regularly draw the wrong conclusions from small data sets. If you are going to start analysing data then make sure everyone is aware with it’s limitations – starting off with yourself. If you have 5 leavers from your company in a row called ‘Steve’ it probably isn’t worth your while pulling together a ‘let’s retain Steve’ taskforce. Part of there being no pattern is sometimes that things look like patterns, but aren’t.
  4. There is lots of luck/randomness involved in success. There is lots of bad luck/randomness involved in failure. So stop judging people by their status or wealth and start judging their content. Research has shown that people give more credence to people who earn more – where you can, start making sure your company gives airtime to the best ideas, not those who are at the top of the payroll.
  5. We are less good at making judgments than we think, even in our areas of expertise.As an experiment a Nobel Prize winning book was sent to 20 publishers. They all rejected it. JK Rowling’s recent work only became really successful when the name of the writer was revealed. Recognise your own blindspots – and the best way to do that is to get people you trust to question you.

The human understanding, once it has adopted an opinion, collects any instances that confirm it, and although the contrary instances may be more numerous and weighty, it either does not notice them, or rejects them in order that this opinions will remain unshaken’ Francis Bacon

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Dave