Better Decision-Making Systems: Moneyball for Managers

frustrated business manMoneyball: The Art of Winning an Unfair Game

The book, Moneyball was made into a movie starring Brad Pitt who plays Billy Beane the general manager of the Oakland Athletics baseball team. After a score of losses, faced with rebuilding the team with a limited budget to pay superstars, Beane meets Peter Brand, a young Yale economics graduate. Beane hires Brand as his assistant GM who began crunching numbers to arrive at a strict cost-benefit analysis of baseball players.

Brand persuaded Beane that he should hire based on key performance statistics that pointed to undervalued players. Together, they assembled a team that during the course of an agonizing season, proved itself the biggest bargain in baseball.

The result was a small group of undervalued professional baseball players and executives, many of whom had been rejected as unfit for the big leagues, who turned themselves into one of the most successful franchises in Major League Baseball.

What to Measure and Why

Clifton and Harter report, “There are millions of things you can measure in an organization, but what leaders really want to know is what handful of things really count when it comes to moving the needle.”

Gallup has been in the field of big data and predictive analytics for over 80 years–covering everything from global employee engagement to universal management competencies. International Data Corporation estimates that global data doubles in size every two years.

But what is the purpose and what can organizations and leaders really gain from from them?

Gallup’s answer is; superior decision making.

What to do With What You Measure

However, according to one KPMG study, more than half of executives (54%) say the top barrier to success is identifying what data to collect. And 85% say they don’t know how to analyze the data they have collected.

Gartner estimates 60% of data projects will fail to go beyond piloting and experimentation due to culture issues. Gallup has found turning complex analyses into simple, actionable insights that create instant wins is an important element to making predictive analytics a cultural success.

Business Challenges Gallup Can Address

Here is list of business challenges Gallup has addressed using predictive analytics.

Manager development
Attracting and recruiting star team members
Succession planning
Identifying causes of turnover
Refining performance metrics
Defects and safety risks
Compensation and benefits.

It’s The Manager (pages 178).

Do you know the critical few that when measured and acted on will make the greatest impact on results? How about beginning with an audit of your key positions?

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In the Next Issue
Human Nature’s Role in Business Outcomes

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