Management by Baseball

Large organizations are not alone in sometimes forgetting what their "mission" is, but the Diseconomies of Scale exert a stronger pull on mission-dilution as the size of the outfit grows. In baseball, while it appears individual teams are able to have a mission and keep in foremost, "the majors", as embodied in MLB are different. At least this week they are.

The news that came out this week was that Major League Baseball was suing a non-profit school. The school is for underprivileged kids in a state with the 5th highest poverty rate in the country. This is in a time where lower-income people, rather than sharing in the boom economy, have seen their incomes decline in each of the last four years. And in an economy that seems to have created more people in that lower-income category every year for the last four years. In a state that is going to get economically hammered and have the number of lower-income kids it has and its poverty rate skyrocket this yearm and in the future because it agreed to take tens of thousands of evacuees from Hurricane Katrina.

The suit is a copyright infringement action -- over the 105-pupil school's logo, which has lettering that truly looks a a fair amount like a team's logo. That team logo was last used 10 seasons back.

Slick move. Good public relations.

--The little non-profit school is The Carver Academy of San Antonio, Texas. Link here
--The logo MLB alleges they are infringing on (and they have a decent argument) is the 1993-96 California Angels' logo. View at this link, or this one.
--The Carver Academy's logo is at this link.
--The story, in case you think I made this up, is at this link. (L.A. Times, so it will disappear soon...let me know if you can't get to it & I'll try to get you to an alternative link).

As you can see, on the pure legal merits, MLB's legal department has a good argument. And while the "player's union" (MLBPA) is like 159-3 against MLB's law team, MLB is capable of winning this one against the level of legal power a non-profit school (for 105 underprivileged kids in a chronically poverty-stricken state that has been sinking into deeper poverty for the last five years) can muster.

From a p.r. point of view, MLB has managed to produce yet another remake of "The Alamo", casting the Academy as the idealistic but overpowered Jim Bowie and Davy Crockett while reserving for itself the role of General Santa Anna.

The Angels have an outstanding p.r. department, by the way, and a very savvy owner. I have to think that if it had been the Angels' legal department ruminating on this move, there would have been a smoother outcome. Say, a donation to cover the costs of designing a new logo that didn't infringe on the Angels' logo, manufacturing replacements, issuing a press release showing how cool they were and staging a small event with some ballplayers on the team's next road trip to Arlington and harvesting the mother-lode of warm-fuzzies that accrue for such acts..

But because of the Diseconomies of Scale, MLB handles this issue centrally, in a remote (from the team and from the school) professional services office disconnected from both, and from the ability to recognize a loser when they see one. I don't think they've decided to take on the non-profit school for a bunch of underprivileged kids just to have a chance to taste victory (possible, but unlikely). They have an actual case here. I just think they've lost track of The Mission, and have allowed a side business (license revenue) to overwhelm the The Mission of the core business.

BEYOND BASEBALL
You see it all the time in business and non-profits and government. The core mission is going slowly, either because that part of the economy is sagging, or Wall Street demands better results, or the core product is entering a natural decline phase, or the function of the core mission hasn't been exercised for a while.

When you see the documented subset of scary stories out of the Katrina disaster that showed individual FEMA folk struggling with their management so they could deliver on the mission (" responding to, planning for, recovering from and mitigating against disasters.") when executive management was forbidding them until all the proper forms were filled out and approved in a six-department process, you can see where the mission gets subsumed to a side business. Process exists, process needs to be respected, but not as much (in this case, more than) the mission. It also was alleged by long-time FEMA employees that when the agency got subsumed into Homeland Security, while the FEMA mission didn't change, the resources were focused away from natural disasters such as hurricanes (inevitable) and towards responding to terrorist attacks.

I don't know if that actually happened, but if so, it's a government-being-more-like-business initiative, because business is quite prone to chasing an immediate opportunity (good) while letting the core mission lie fallow (bad). You see it in business all the time.

Companies having a hard time squeezing out profits in a permafrost economy trying to make money with a currency speculation side-business. Department stores buying insurance companies. Oil companies buying fish food companies. All interesting, all difficult but not impossible to pull off, all potentially worthwhile as long as the attention management pays to the side-business doesn't let them forget what their mission is.

All of a sudden, an engineering- and design centered business like Apple Computer, facing soft results, decides that licensing their valuable intellectual property is another useful source of revenue, a side business that complements the core mission. But within a few months, the team assembled to execute that side business starts threatening lawsuits, mostly justified, against outfits they perceive as violating their patents, copyrights and trademarks. Some small additional revenues squeezed out. Goodwill trashed. Warm fuzzies cashed in for a little immediate gratification, most of which accrues to the legal department.

I'm a strong believer in intellectual property rights. I believe MLB has a legitimate concern in protecting its franchisees' imagery. Rights have to be protected because there really is a slippery slope in letting your image and property slide into the public domain. But legally bombing back into the stone age a school for 105 underprivileged kids is probably not going to pay for itself, and I'm not talking about the cash.

It runs counter to the mission.