As I find myself, for more than two hours every day, driving to and away from my job, in order to spend this time more productively, I have been listening to audiobooks, most of them related to History. The last one that I heard, though, was “Moneyball: The Art of Winning an Unfair Game”, by Michael Lewis, published in 2003, which in 2011, led to the film “Moneyball”, starring Brad Pitt and Jonah Hill.
The book is an account of the Oakland Athletics baseball team's 2002 season and the attempts of their General Manager Billy Beane to assemble a competitive team on a minimal budget, by using sophisticated analytics to break the game of baseball down into leading key performance indicators and metrics that can predict success, meaning scoring runs and winning games. The key to his approach was to look at the desired outcome and work back from there, using the statistics to getting the best trade-off against this outcome, which was to get the most wins with the least money. Hence, the Oakland Athletics began seeking players who were "undervalued in the market", meaning that they received lower salaries relative to their ability to contribute to winning, as it was measured by these advanced statistics.
Although, I don’t consider myself a baseball fan, I enjoyed the book, and the more I was listening to it, the more I found that the concepts and mindset behind the Moneyball philosophy in baseball, can also be applied to effective Sales strategies and data-driven decision making in Sales.
The central premise of the book was to challenge the collective wisdom of the people that are related to baseball, since it considered it as outdated, subjective and, very often, flawed. For example, it questioned traditional baseball scouting methods and instead proposed the use quantitative analysis. Similarly, sales organisations may need to question long-held assumptions about what makes a good lead or salesperson, and instead use more of the available data to guide their decisions. Just as the Oakland Athletics used statistical analysis to identify undervalued player talent, Sales leaders can use data analytics to identify undervalued lead sources, customer segments or sales strategies that may be overlooked.
Moneyball, as we already explained, is about finding ways to win games more cost-effectively, through the embracement of technology and analytics. In Sales, this could translate to optimising the sales funnel, lead qualification and resource allocation to drive the best return with the assistance of Sales intelligence tools such as CRM data and data-driven forecasting.
One of the key contributors to the success of the Oakland Athletics, was that they defined the right outcome to influence and then, they run simulations of various leading KPIs (predictors), until they found the closest. For Sales Leaders, if our desired outcome is to make the Sales target, then we need to define the right metrics, by running several individual and combination factors of our salespeople behaviours and activities, until we find the closest predictor.
Furthermore, the Oakland Athletics and their GM Billy Beane, were always seeking to gain an edge through constant experimentation, by having a continuous improvement mindset. Sales organisations should take a similar approach, constantly testing and refining their strategies and processes, always based on performance data rather than “gut feeling”.
Without a doubt, most of the traditional performance indicators are valuable and have a role in running sales teams, but the main lesson that I got from Moneyball is that we must look beyond the obvious and to dig deeper into what most people can’t see. Obviously, this requires specialised skills, tools and competencies, and it’s in our best interest to look for and find them. While the specific goals and metrics differ, the Moneyball philosophy of using data to gain competitive advantage can be a powerful framework for rethinking and optimising sales processes and decision-making, to such an extent that may end-up giving us an advantage towards the competition.