- 1 Book Summary - Moneyball: The Art of Winning An Unfair Game by Michael Lewis
- 1.1 Key Insights
- 1.2 Key Points
- 1.2.1 Where Moneyball begins
- 1.2.2 Sabermetrics were developed early on, but not used to its full potential until the early 2000s.
- 1.2.3 Salaries in the MLB have risen dramatically with the introduction of Free Agency, leading to small market teams struggling to compete against big market teams (such as the New York Yankees).
- 1.2.4 In 2002, the Oakland A’s turned to statistics put together by a computer over reports from scouts in an effort to draft new amateur players.
- 1.2.5 The Oakland A’s use of sabermetrics meant that an emphasis was placed on typically ignored numbers. Specifically, a player’s slugging and on-base percentages were given priority over typically looked at numbers such as runs batted in, stolen bases, or even batting average.
- 1.2.6 Even with their apparent success with Sabermetrics, the technique remains controversial.
- 1.3 The Main Take-away
- 1.4 About the Author
Book Summary - Moneyball: The Art of Winning An Unfair Game by Michael Lewis
When it comes to learning lessons about business and life, baseball might not seem like the obvious choice as inspiration. However, there is always something to learn from other people’s success.
And nothing says success quite like being champions without breaking the bank.
In Moneyball: The Art of Winning an Unfair Game, Michael Lewis looks at how the Oakland A’s were able to use statistics to create a winning formula that carried them into the history books.
Not only does he touch on the team’s success, but also what drove that success.
This is not just the story of baseball, it is the story of using a more analytical approach to business in order to achieve one’s dreams and goals.
Where Moneyball begins
In the early 2000’s Major League Baseball was all about the big budgets and winning games. As budgets increased, being competitive became even more difficult for teams that could not afford payrolls associated with big market teams, such as the New York Yankees.
The Oakland A’s wanted to change the game, but in order to do this, they needed to save some money. Using statistics, the team was able to not only win the playoffs, but also set at least one American League record with 20 consecutive wins.
However, unlike other teams, they did not need the highest payroll in baseball to do it. In fact, they were able to achieve baseball supremacy all while having the lowest payroll in the MLB.
The question is, how did the Oakland A’s achieve this level of success on what essentially amounted to a budget?
The answer is surprisingly easy. The team took advantage of statistics and used the numbers to their advantage.
What this means is that with the help of a set of statistical analytics developed by Bill James, known as sabermetrics, the team was able to remain competitive, even as some of their biggest players defected to other teams for a higher paycheck.
While many baseball teams chose to focus on traditional numbers associated with statistics surrounding things like runs batted in and batting average, the Oakland A’s took a different approach.
Thanks to General Manager Billy Beane, a former player, the team opted to use the sabermetrics approach to putting together their team. Based on the sabermetrics approach, one looks at runs as what wins a game.
Rather than just focusing on a standard batting average, which sees hits divided by at-bats, this new approach looks at all of the ways a player might get on base. This means that both hit-by-pitch and walks are included in the numbers.
Using these statistics the Oakland A’s determined that there are two indicators that would better determine a player’s future success - slugging percentage and on-base percentage. Two numbers that had rarely been looked at when it comes to determining how a player would do in the future.
Sabermetrics were developed early on, but not used to its full potential until the early 2000s.
Sabermetrics was originally developed in the 1970s but was basically ignored for the next few decades, until Billy Beane chose to really utilize it in his approach to putting together his team.
While Beane was not the first manager in baseball to use sabermetrics, the previous managers simply did not have the technology necessary to make their use of these statistics work to their best advantage.
Luckily for the Oakland A’s, by the early 2000s, technology had caught up to sabermetrics, and the team was able to use these statistics to their advantage.
With the help of computer models, the A’s became the first major league team to create a more detailed analysis of hundreds of players using statistics (specifically numbers revolving around rarely looked at player stats).
Salaries in the MLB have risen dramatically with the introduction of Free Agency, leading to small market teams struggling to compete against big market teams (such as the New York Yankees).
Modern Free Agency began in 1975, leading to ever increasing salaries for baseball players. For some teams, this lead to disparities in terms of payroll and ability to compete against teams with the ability to offer higher salaries.
Even as team owners worked together to try and keep salaries lower, over the course of 20 years, players went on strike a number of times in order to get the higher salaries they believed they deserved.
After the last strike in 1994, players found their salaries growing exponentially.
Even in the era that was depicted in Moneyball, there is a single player who made as much each year as the entire payroll of a single team. That player was Alex Rodriguez, and the team that he earned more than the entire payroll of was the Tampa Bay Devil Rays.
Considering the Oakland A’s are a small market team, they needed to be careful when it came to signing Free Agents, as their budget did not allow the big names like Rodriguez. This means that in order to get players that would work well within their system, they actually need people who were thought to have “something wrong” with them.
In 2002, the Oakland A’s turned to statistics put together by a computer over reports from scouts in an effort to draft new amateur players.
With the help of Billy Beane, the team opted to use sabermetrics in order to find players. This led to 102 wins in 2001, followed by 103 wins in 2002.
As a former player, who found himself traded multiple times and was unable to develop as a player in a way that would allow him to succeed, Beane was able to use his own experiences to build a successful team.
Rather than looking at baseball as a game, Lewis seems to believe that Billy Beane was more dispassionate about his approach to choosing players for the Oakland A’s. This means that he looked at the game as a business, using statistics to make his decisions.
In fact, according to Lewis, Beane had the ability of “seeing the opportunities and seeing the threats, and adapting accordingly.”
As part of drafting amateur players using sabermetrics, the Oakland A’s looked at players who would typically be passed over by other teams. One number they chose to focus on was on-base percentage, rather than looking at their speed.
Thanks to the fact that they did not get a single Free Agent in 2002, MLB compensation rules were put into effect, allowing the team to draft extra players. This meant that the A’s were able to pull in 51 players for their minor league teams.
Of the 51 players drafted by the team, 14 would end up getting the chance to play in the major leagues, with one of the most notable players drafted being Nick Swisher, who went on to be an All-Star player.
The Oakland A’s use of sabermetrics meant that an emphasis was placed on typically ignored numbers. Specifically, a player’s slugging and on-base percentages were given priority over typically looked at numbers such as runs batted in, stolen bases, or even batting average.
It seems that it was as much about the numbers as it was potential with drafted players. Given a chance, it seems that the Oakland A’s believed a player could be worked with to develop the skills needed to be a success in the major leagues.
Even the way the team played the game in 2001 and 2002 was different from the rest of the league. Not only did they choose not to run the bases aggressively, but they did not participate in many hit-and-run plays, or even sacrifice plays.
Instead, the A’s did a lot of walking onto base.
Even when they got on base, players did not steal bases often. In a single season, the team stole just 68 bases, coming in well under the rest of the league where the average was approximately 118 stolen bases.
The Oakland A’s opted for an approach that put the emphasis on the team over getting hits. This meant that the team’s emphasis was more on actually getting base runners to make sure that when a player got a hit, there were actual people on base to potentially score.
By opting for baserunners over hits, the team was able to make the playoffs two years in a row. In both 2001 and 2002, the Oakland A’s were able to prove that their style of play was in fact successful over the way other teams in the league played the game.
Even with their apparent success with Sabermetrics, the technique remains controversial.
Although the Athletics were able to make back-to-back playoffs, they were unable to win a World Series. This, and the fact that there are plenty of traditionalists in the MLB means that the sabermetrics approach to the game remains controversial even today.
As more teams became familiar with Billy Beane’s approach to managing the Oakland A’s, the team’s edge has diminished over time. With other teams utilizing certain aspects of the sabermetrics approach, it became hard for the A’s to keep their competitive edge.
However, even as it remains controversial with traditionalists, sabermetrics continues to have an influence on the sport. In fact, sabermetrics has been used in other sports as well, including the Olympics.
No matter how other teams felt about Billy Beane’s management style, sabermetrics has found a way to influence all of the teams that are part of the MLB. Even as traditional numbers keep many teams competitive, there is still some aspect of the statistical approach that works to help teams develop their minor league stable.
The Main Take-away
Moneyball: The Art of Winning an Unfair Game is the story of one baseball team’s ability to play competitive baseball using sabermetrics over the usual numbers associated with a winning player. Rather than focus on players already in demand, the Oakland A’s opted to approach the game as a team effort and not an individual’s chance to shine. This also allowed them to help players who may have previously been overlooked to get a chance to develop into stars.
About the Author
Michael Lewis is an American financial journalist and bestselling non-fiction author. He has written for Vanity Fair since 2009. He has published 18 books, three of which were turned into best selling movies. He is the best selling author of The Undoing Project, Liar's Poker, Flash Boys, Moneyball, The Blind Side, Home Game and The Big Short, among other works. He graduated from Princeton University with a bachelor’s degree in art history in 1982. He enrolled at the London School of Economics and received an MA in economics in 1985. After graduating, he worked in New York for the Saloman Brothers as part of their training program and later in their London office as a bond salesman. He married three times and currently resides in Berkeley, California with his wife Tabitha Soren.