‘Moneyball’s’ Beane: Business of Baseball Has Changed Forever
By CNBC | Off the Cuff – Tue, Mar 12, 2013
“I always kid that in ten years I won’t be smart enough to apply for this job,” said Billy Beane, the much-praised general manager of the Oakland Athletics baseball team. “The amount of intellectual capital that’s coming into the game… has changed significantly in the last decade.” Beane, a former professional baseball player, went on after his playing career to work as a scout for the A’s, and then moved on to the club’s front office in 1993. His approach to selecting players became the focus of the Michael Lewis best-seller, “Moneyball: The Art of Winning an Unfair Game.”
Traditionally, a baseball player’s relative worth was gauged according to his recent successes, his number of stolen bases and his batting average. But Beane, faced with a limited budget, had to find a new way to field a competitive roster. In the late ‘90’s, he embraced Sabermetrics – the analysis the game through specialized statistics that look at individual players’ on-field performance. Beane’s own use of Sabermetrics relies much more heavily on stats such as runs scored and on-base percentage than it does on the older, more traditional metrics. It’s used as a predictor of a player or a team’s future success, and has become a factor in trades, rosters and contracts. Beane used Sabermetrics to build a team of players for a fraction of the cost that major-market teams were paying at the time – and he’s still doing the same thing.
Sabermetrics is still “everything,” Beane said. “Because we have less than everybody else, we have to make sure there’s high probability that there’s success with the money we’re investing.” In 2012, the Oakland A’s had the second-lowest payroll in baseball – at $55 million. By comparison, the New York Yankees’ 2012 payroll was $200 million.
“Moneyball” was published in 2003. “When the book came, I remember getting a letter from Robert Rubin. You know, a handwritten letter,” Beane told “Off The Cuff” – referring to the former U.S. Treasury secretary. “And I was in awe. Things like that were really humbling for me. And the opportunity to sit down with somebody like Warren Buffett was, given my playing career, would’ve never happened to me.”
Beane credits the book with changing the business of baseball. “The book created a meritocracy for running a baseball team. Whereas before it was very much guys like myself who grew up in the sport, played the sport. But Michael Lewis allowed a portal for some really, really bright people to come in who normally would’ve ended up on Wall Street or starting their own businesses or out in Silicon Valley.”
In 2011, “Moneyball,” a film based on the book, was released, starring Brad Pitt as Billy Beane. “When the movie came out, it did introduce our story to people that never would’ve picked up the book. And even to people outside this country. The good thing is that somebody else played me, so it’s not, like, my day-to-day life has changed significantly.”
What has changed, Beane said, is the prevalence of Sabermetrics in baseball. “Are we more quantitative now or less? More so. I think once you sort of enter the quantitative world, it’s hard to go back to an intuitive, gut-feel type of decision-making process. And the great thing about today’s world is we have more information available, more technology to get more accurate information.”
If he hadn’t made a career in baseball, he would have enlisted, he said. “I come from a military family. My father was a military officer, as were my grandparents. I grew up near Miramar Naval Air Station. So being around jet planes was exciting.” But, as for becoming a fighter pilot, he laughed: “The country’s glad I’m not.”
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