Saturday, November 08, 2003

The Dream Problem Meets
the Dream Solution:
Constraints & Limiting Factors  

It doesn’t happen very frequently in big organizations (it’s one of the competitive advantages of smaller organizations), but frequently the difference between being mediocre and being on top of the world is just one thing, just one process, just one employee, just one piece of equipment. In project management, they call the single factor holding you back from optimal progress a “constraint”. I like that term, but I prefer a different one, more in tune with my more evolutionary-anthropology view of organization behavior: “Limiting factor”. The limiting factor (there’s always one) is the single ingredient that, at this moment, that limits the effectiveness of an individual organism or limits the size of a population. Unblock the current limiting factor, you get a different one; it may be less significant, it may allow you more success before it limits you, but there is always <i>some</i> factor that is the limiting factor.

In baseball, it’s more obvious when there’s a single human who’s the limiting factor, although it’s no more frequent than it is in any other 40-person shop. It’s more obvious because events/actions/wins-&-losses are much clearer, outcomes more frequent and definitive. Each game is a sub-total line, a daily performance summary. That clarity is a nifty beacon for non-baseball organizations’ guidance.

The Phillies just traded for Billy Wagner, the 3rd or 4th best reliever in the majors last year, according to numbers Keith Wolverton puts together for Baseball Prospectus. They are tabling their own marquee-nightmare, the infinitely implosive José Mesa. (You remember as a teenager reading those Stranger than Fiction books with weird stories where people would be walking down the street minding their own business and suddenly burst into flames and be reduced in a matter of seconds into a small pile of malodorous ash? Mesa managed to do that not once, but again and again, game after game, season after season).

Before I detail some differences (big enough you could fishtail an Abrams Tank through) in the two relievers, let me set some context to why the difference is important.

An Organization With A Single Big Weakness

The Phils had the third best offense in the National League last year according to numbers put together by Baseball Prospectus’ Clay Davenport. Their relief staff, even with the falling-off-the-table Mesa, ranked 6th of 16 NL teams, pleasantly above-average. Their starting staff was 10th of 16 NL teams, basically average/not-quite-average. Given that high offense and average pitching, they went 86-76, although given the number of runs they scored and allowed, they would have been expected to go 91-71, which would have garnered them a trip to the playoffs.

The way closers are used (there’s a great and interesting debate about the standardized rigid use of closers, a model devised by Tony LaRussa in the 1980s, and this article won’t take sides in whether it’s a good model or a bad one for most teams – merely acknowledge it exists), they almost always pitch in games the team has a chance to win but hasn’t locked up yet. That is, overwhelmingly games in which their performance has a strong chance to make a difference between winning and losing.

This year, when Mesa pitched, the composite average hitter facing him produced .295/.375/.445 (that’s batting average/on-base/slugging), about like Bernie Williams, but a little better. I like to phrase that as an analogy like this: “Mesa turns opponents into Bernie Williams”. It gives a clear picture to a listener who knows something about players and their accomplishments.

This year, when Wagner pitched the average hitting performance against him produced .170/.235/.265, about the batting ability of John Smoltz, a better-than-average-hitting pitcher.

So at key moments in games, Mesa turns opponents hitting into middle-of-the-lineup sluggers for a contending team, and Wagner turns opponents hitting into that of a better-than-average hitting pitcher.

Because the at-bats closers tend to pitch are highly leveraged, it’s not hard to imagine Wagner helping the Phils shave off a third of the difference between his blown saves and the Phillies’ blown saves, and that would have bought them 5 extra wins. Since the only player from their major league roster the Phils gave up to get Wagner was a little-below-average starter for them, it’s easy (oversimplification, really) to swap out one performance and swap in the other and imagine the Phils winning more games than the Marlins. But the probability is, they would have had everyone other Phillie performed as they did.

For the Phils, They came into the off-season with an obvious, larger than David Wells’ appetite, constraint, and before the World Series was even out of the rear-view mirror, they attacked it in the strongest and most purposeful manner, acquiring the employee who probably will not just erase that weakness but turn it into a strength.

In big organizations outside of baseball, as I said, most limiting factors are not so obvious as a single important person who is so clearly net-negative, but it happens, and it’s not always a person. Have you ever worked for an organization that was able to overcome internal politics and the programmed fear of the H.R. department and just let a human wind-drag. Or tear out some putrid network infrastructure that was built for the convenience of IT and to the detriment of every end user?

Most big organizations are struggling with multiple limits, but don’t allow yourself to be paralysed because it’s a lot of tricky work. Most managers aren’t good at attacking multiple problems systemically, and if you’re part of the majority, don’t worry. Think one step at a time and start somewhere. I suggest you think like Phillies G.M. Ed Wade, and attack the most obvious limiting factor, address it aggressively, and then see what that does to the overall system you’re running. Analyze the new, revised system, find the limiting factor and when you’re sure what it is, attack that next.

In management, as in biology, there’s always a limiting factor, there’s no final rest. But take heart….if he’s on your roster, you can deep-six José Mesa…think of what it’ll do for team morale.

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