Concept of Strategic Management - Paper Example

2021-07-29 07:17:40
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The book presents a cultural phenomenon and takes Americas favorite pastime and tweaks in a way that lies on strategy and logic rather than instinct. At the opening of 2002 season, the Yankees had a payroll of $140million while the other two clubs which were poorer had payrolls less than a third of that, about $44million. About 10 years before, the team with the highest payroll New York Met spent almost $44m on baseball players while the lowest-based payroll team had a budget of $8milion (Lewis & CloudLibrary, 2004). This disparity meant that only the rich could afford the best teams.

Financial budget and spending patterns were the foundation of Moneyball. The truth is that in 2000, two years before Lewis and Beane's Moneyball season, there had never been in the history a more significant competitive balance. Not a single team finished with a win-loss above .600 or below .400. Between 2001 and 2002, smaller teams like Angles and Arizona Diamondbacks won the World Series regardless of their spending and people's perception of them. Subsequently, Minnesota Twins with a small budget had two excellent seasons compared to the New York Mets who performed poorly despite their high expenditures.

According to the book, the baseball executives whined about their high expenditures and payroll. They were right about the gaps that exist between the richest and poorest market teams. However, this did not reflect the state of these rich and poor teams in the field. Some of the poor teams performed better than the more affluent teams with high payrolls. This indicates that having a lot of money does not guarantee winning in baseball. Poor management, injuries and bad luck was the reason for the failure of the richer teams all the time.

Concept of Strategic Management

The book has described "an expedition for something elusive as Holy Grail, something that cannot be bought by money: the secret behind the success of baseball." The Oakland A's of 2002 thought that the secret was in the mundane and the banal data that had slowly piled up over a period of high school and pro-ball competition. Run batted in(BRI), batting average(BA) and on-base percentage(OBP) were accounted for in the previous tears by other scouts, but none did so with the single-minded focus, similar to that of Oakland's general manager Mr. Billy Beane and the right-hand man Paul DePodesta.

Moneyball is a game of crunching copious extents of data to create a stronger and smarter team without the need to go after the rock stars of the sport that could cost a significant amount of money. The method holds that the skills of individual players are not what makes or breaks a team. What is essential are the skills which are accounted for whether by a single player or four players. The team needs to work together like a clock with every cog serving its purpose.

What is interesting is that while the Yankees were in search for the big players, Billy Beane undervalued other players who had quality features to perform in the game. While other teams did see past the physical flaws, the A's were able to capture the players for a fraction of their true worth. This was strategic approach and enabled Beane to craft well-honed team while at the same time staying within a meager budget. The A's didn't have the financial capability to afford some of the players but relied on sabermetrics.

 

Reference

Lewis, M., & CloudLibrary. (2004). Moneyball: The Art of Winning an Unfair Game. S.l.: W. W. Norton & Company.

 

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