Moneyball 3/7/18

Supported by Greenhaven Road Capital, finding value off the beaten path.

The March 7th, 2018 Wharton Moneyball podcast was full of interviews Casey Massey conducted with 2018 SSAC attendees. This is the sports analytics conference we drew from for the Competitive Advantage & Sloan 2018 posts.

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Mina Kimes articulated that data is not a panacea. Thanks to a background in business journalism, “I look to data to find answers to basic questions and if I don’t I almost find it more interesting that if I did find the answer.” I forget this sometimes…

Data and curiosity, in James Carse’s terms, combine to form an infinite tool.

Kimes and Massey also agree that situations matter. “Perhaps one of the biggest lessons from the NFL season is how much situation affects quarterbacking, which has always been true unless you’re Aaron Rodgers or Tom Brady. To me it’s like 90% team scheme,” Kimes said. Yes, Massey agreed, context and situation matter so much “and it’s still underappreciated” added Massey.

From two-hour marathons to New England Patriots scouts situations affect outcomes.

I’ve started the Leonardo Davinci book by Isaacson and Leonardo is a product of circumstances. Here’s Isaacson early in the book.

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Ben Alamar pointed out the importance of communication. This is the next nut to crack in sports analytics.

“Even in this day of data availability and analytics sophistication, you still need to render it as simply as possible. And it’s still possible to come up with simple analyses that are insightful.”

Michael Lewis said that while he was researching Moneyball (the book) “Billy Beane told me, ‘we never talk to them about it (Moneyball), it just confuses them.'”

In the same interview Daryl Morey said, “It’s not what you know. It’s what you can impart on coaches so they’ll believe in it and they will then give it to their team. You have to have people skills. It’s not like you can come in and put something on someone’s desk and he’s going to believe in it.” How do you do this? Start by finding data that supports what the coaches already know.

Dean Oliver told Massey much the same thing, “If you can’t communicate it you won’t get a seat at the table.”

Data digging is never done and data discoveries are never obvious.

 

This is the clip Massey mentions, and it shows how the Warriors are trying to crack the communication challenge.  “Without a coach like Steve,” Lacob said, “it would be incredibly difficult to get these messages out.”

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Kirk Lacob from the Golden State Warriors told Massey about their decentralized command structure. “I always thought our secret sauce was that we have great people and turn them loose and let them do what they’re best at.”

What makes Lacob’s boss, Bob Myers good at his job? “Those guys have something in common, they know what they don’t know. They’re very self-aware. They’re very trusting of other people. When they know there’s something they aren’t good at they’re happy to look to other people for those answers.”

This kind of structure requires humility and self-knowledge at the top and Lacob said they have this thanks to “sophisticated ownership.” This is an idea that Charles Koch emphasized too.

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Sandy Weil spoke about alpha erosion. “Basketball might have the slimmest margins. In hockey we have draft models and how many teams have draft models as good as ours? Probably only a handful…In basketball, it’s probably three-quarters of the league.”

As both Jeff Luhnow and Daryl Morey have noted, once you do something that works others will copy it. Weil adds that most of basketball’s low-hanging fruit is picked.

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Chad Millman has broken smart. I was struck by the number of interviewees who started a WordPress blog, YouTube channel, Twitter account, or email list. A lot of the people talking about analytics implementation and decision making started talking about analytics and decision making to no-one in particular online. Breaking Smart is:

“This is breaking smart: an economic actor using early mastery of emerging technological leverage — in this case, a young individual using software leverage — to wield disproportionate influence on the emerging future.”

“How and why you should choose the Promethean option, despite its disorienting uncertainties and challenges, is the overarching theme of Season 1. It is a choice we call breaking smart, and it is available to almost everybody in the developed world, and a rapidly growing number of people in the newly-connected developing world.”

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Jeff Ma (who has his own delightful podcast) told Massey why he wanted to start a podcast. Being on TV “wasn’t the best form for us.” Ma and Rufus Peabody needed time to explain things and focus on the process. It’s only in a podcast that you can articulate what Tetlock calls “the wrong side of maybe.”

Invisibilia started up their fourth season and led with an episode about changing norms (which can change behavior). We can all view the world as cut and dry or nuanced and funky. The medium dictates the norm for that message. Even though Ma is saying the same thing on his podcast that he said on ESPN, the message is different.

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Brian Burke, the creator of the 4th down bot, spoke about career capital. “The Eagles weren’t the only winners that day,” after the Super Bowl, Burke explained. Why? Because Doug Peterson went for it on fourth down, and this normalized it. The adage to fail conventionally is easiest to see in sports.

Rory Sutherland noted that without career capital, people purposely make negative choices because they signal positive characteristics “There are lots of cases where you need to signal something, by making a decision – and it may be the rationality of the decision – actually prevents you from making a better decision.”

On August 16, 2017, Moneyball podcast, the Wharton hosts said that stability and patience can balance the scales when leadership lacks career capital. Massey said, “My sense is that the single scarcest commodity in professional sports is patience…everyone is looking for an edge and the biggest edge is patience.”

 

Thanks for reading.