Management by Baseball

I received a handful of comments on yesterday's entry, and a common thread was I didn't lay out the argument crisply enough (I'm being polite to myself). The most pointed comments was from a reader I'll call Jeff Manto, who felt the numbers got in the way of the assertion, and I just needed to be more WWW-like and spit it out in brief and the supporting data be damned.

IN BASEBALL

[] In baseball, there are things you need to be able to do that, in themselves, don't increase success much, but you have to be able to do them anyway, and to be able to do them decently, you have to do them enough to master them.

[] One of these things in baseball is the ability to execute "small ball tactics," including sacrifice bunting, stealing, and possibly bunting for a hit. These tactics are not on average net-positive, but in specific situations have very high returns in producing an occasional extra win.

[] Occasional extra wins are disproportionately important in the playoffs and in the World Series, where winning a single extra game has a massive advantage because the series, which have a binary outcome (win/go-home), are very short and require very few wins, so any incremental win is immensely important, as opposed to the regular season where each game is only 1/160th of the whole.

[] Baseball teams that are good at small ball tactics, but don't rely on them as a core way of scoring runs, have a small incremental advantage in short series, and this doen't mean small ball tactic loving teams are at an advantage in winning the regular season's division title, nor in winning a playoff series. The odds are they won't even make the playoffs

IN NON-BASEBALL ORGANIZATIONS

As in baseball, non-baseball organizations need to master operational and strategic actions that are not hyper-optimized to some specific approach. Yes, it undermines to a small degree current returns of effort, but a monocultural approach (using the same tools over and over, the same approaches, the same targets) limits competence, because it's rare that competence is just manufactured out of thin air; in most cases it takes practice. Strategically, things change over time, and the approach that's hyper-optimized to a single objective becomes a ruts that hard to turn out of when needed.

Most successful farmers in the world grow more than one crop to avoid being wiped out by a specific pest or weather condition in any given year (even though it will undermine returns in any reasonably close to average year), and I call this approach polycultural. In the same way, organizations need to master, or at least acheive adequacy, in other tactics that are winners in different environments that have a decent chance of arising so they don't have to start from scratch chasing adequacy under pressure.

All organizations optimize their chances of success by taking a polycultural approach, knowing how to work in multiple distribution channels, managing expenses in various economic environments, not letting a single customer dominate too high a percentage of their revenues, driving marketing in multliple markets. Organizations spend too much time focusing on trivia (which programming language should we standardize on? Should we become an LLC? What price shall we set our stock options at? what are the tax consequences of booking that sale in this quarter as opposed to that one?) and not enough on core competencies. Like an ADD with hyper-focus (not the more famous ADHD), these organizations are bound to be dysfunctional or at least significantly dis-optimized.

So Jeff Manto, does that clarify it? Let me know.