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Moneyball and Strategic Planning

Baseball and Strategic Planning

I was in the first grade when my home town Oakland Athletics won their first of three World Series in a row. The names of the A’s players came up regularly when we kids got together to play Three Flies Up or 500 in our circle (cul de sac): Sal Bando, Bert “Campy” Campaneris, Joe Rudy, Ray Fosse, Gene Tenace, and, of course, Reggie Jackson. And if we ever pretended to know how to pitch, we became Catfish Hunter, Blue Moon Odom, Vida Blue or Rollie Fingers. These are just the names that I, from my 6- and 7-year old memory, could come up with.

So when a major Hollywood movie came out about the 2002 Oakland A’s, I knew that eventually I had to see it… I just didn’t think it would take me seven years. Moneyball is an unlikely sports story that follows the struggles of the team’s general manager, Billy Beane, who, along with his assistant, a young, recent Yale graduate in economics, is short of money to acquire big name baseball stars.

The A’s found themselves that year in a predicament. They had just lost three of their best players. As Beane and his scouts discussed replacements, Beane realized that they, as a small market, shallow pocketed team, were trying to follow the same strategy as big market, deep pocketed baseball teams had. He came to the conclusion that such a path would lead them to acquiring leftover players, leading to poor results. He knew he needed a different approach.

I also just finished listening to the audio version of Malcolm Gladwell’s David and Goliath, which essentially addresses the same predicament. What do underdogs do when facing with what appears to be the overwhelming advantages. Not to trivialize his point, which I think is intriguing, but Gladwell essentially says that underdogs may not be underdogs at all if they look for and take advantage of the silver linings in the storm clouds.

For Beane, this meant determining which statistics really mattered when it came to acquiring players. This decision lead to the acquisition of several players that other teams did not highly value… so the A’s were able to acquire them at a steep discount. The result, after a rocky start to the season and a plethora of detractors, was the longest winning streak in American League history to that point: 20 wins in a row. They may not have won a pennant that year, but in many ways, they changed the way baseball teams approached the game. The underdogs changed the game, by necessity.

When considering how to apply the takeaways of Moneyball and David and Goliath to nonprofit strategic planning, here are a few principles I noted:Nonprofit Strategic Planning

  1. Recognize your limitations: Many nonprofits are limited by funding, staffing and even regulations. Accepting that your agency may never have a $25M budget will help you focus on the good that you can do now and not on the potential good you might be able to do some day.
  2. Identify what matters: Instead of RBIs, HRs, and batting averages, Beane focused on On Base percentage. Walking in baseball is not sexy, but getting on base is critical to scoring more runs. Is your nonprofit focused on dollars and numbers, on annual reports and tax deductions, or on the lives you change for the better?
  3. Stop thinking like a For Profit: Nonprofits need to stop trying to think like their for profit counterparts in terms of advertising, marketing, public relations and even hiring. Playing by the traditional rules is not my point, but I know there are many nonprofits who try to run their agency like a for profit company. Why would they, especially when nonprofits are at a disadvantage when it comes to earnings and flexibility of focus? Nonprofits need to take advantage of what may only seem to be their limitations to others.
  4. Identify your own competitive advantages: This needs to be part of any strategic planning event. In essence, you are answering the questions, “What can our nonprofit organization do better than any other nonprofit organization around?” Do you have advantages that relate to geography? People skills? Technology? Demographic proximity? Public awareness? Whatever it is, identify it, and build on it. That does not mean that this has to be your only focus, but not using it is akin to leaving money on the table.
  5. Know your competition and their advantages: If you struggle to understand what your own competitive advantages are, answer these questions first: Why do our competitors success? What have they got that we don’t have? What do we wish we could do more like them? These questions might just spark answers to the questions, “What do our competitors wish they could do more like us?”
  6. Acquire the needed resources: Once you understand what your advantages are, ask yourselves if you have the needed resources to maximize that advantage? Resources might include staffing, skills and knowledge, equipment, teamwork and morale, outreach, mission, board support, community networking, and many other resources. Brainstorming is a great activity to come up with all resources at your disposal.
  7. Stay the course: Once you know that you have a winning strategy, stay the course in spite of what the crowd, the fans and the commentators say. All success breads detractors. Listen critically to them, but never take their criticism as a sign of your failure.

If you have not seen the movie yet, I’m going to recommend it, even if you are not an Oakland A’s fan. Seriously, if I could appreciate Pride of the Yankees, than you can enjoy Moneyball.

Looking for a facilitator for your next planning session, click here or call Todd at (208) 649-4788.

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