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Moneyball Government

The way evidence-based analysis—rather than what ‘passes for wisdom’—turned a losing baseball team into a winner has powerful lessons for government decision-making.

As a longtime public administrator, I've gotten laughs when I've drawn parallels across different program areas, such as how the legal complexities of upgrading a train station might be overcome with lessons learned in closing a state mental hospital, or how an analysis that streamlined adoption services might help us better understand why mortgage foreclosure prevention programs weren't working as well as we hoped.

But I've been able to up my game by seeing home runs far from the baseball field in Michael Lewis' 2003 bestselling book, "Moneyball." It's a great read, but its real value is in how it challenges conventional wisdom and shows the value of evidenced-based analysis, as demonstrated by the Oakland A's general manager, Billy Beane. He used this approach to transform a team with one of the smallest player bankrolls into one that for years sustained success with low-cost, high-value players.

I'm certainly not the first to draw these lessons. In a 2007 GOVERNING column, Robert J. O'Neill Jr., executive director of the International City/County Management Association, used "Moneyball" to dissect the ways organizations—and public agencies in particular—make decisions. He cited a Harvard Business Review article arguing that what "passes for wisdom" in an organization is often outdated information, unproven traditions, personal experience and—my favorite—"casual benchmarking."

Contrast that with the approach described in "Moneyball." Beane's Ivy League-educated analysts created highly granular performance data on players to understand which metrics really contributed to outcomes and which didn't. They learned, for example, that the "yield rate" (the proportion of new amateur draft choices who made it to the majors) was much higher with college rather than high-school players. That reminded me of the adoption agencies that recruit prospective families broadly, spend time and resources on doing background checks, and then at the end discover that most of them are not interested in adopting the children needing placement.

My copy of "Moneyball" is most annotated in the early chapters, when Beane first challenges the staff of scouts charged with picking draft choices for the A's. For any public manager who's taken on the task of turning around a major institution, the similarities are startlingly familiar. Consider these excerpts:

"In professional baseball it matters less how much money you have than how well you spend it." In the public sector, while the most attention is often on the increment of increase or reduction of funding, the quality of programming of the base budget is usually what determines success or failure.

Beane completely upended the scouts' roster of "wanted" potential amateur drafts with highly sophisticated analyses of performance. He was met with incredulity and hostility by men accustomed to having their firsthand opinions accepted. They were, in Lewis' description, the Greek chorus underscoring the eternal themes of baseball: RBIs, errors, power pitches, foot speed. Does that sound like agencies that have frustrated us all?

But one scout caught on sooner. He had a unique quality, according to Lewis: "vast experience to which he had no visceral attachment. ... He knows when an old thing has died." Is that not a perfect description of the senior public servant who is prepared to help steer an agency into a new world?

"You don't change guys, they are who they are" and "[the infield coach] had a gift for making players want to be better than they were." These two phrases, seemingly in contradiction to each other, in fact capture the essence of good leadership. A strong leader first matches the task at hand with the right talent and then motivates improvement to achieve success.

"Are we asking the right question?" In what perhaps is the most important lesson from "Moneyball," Lewis recounts repeatedly how time-honored measurements of player value missed the mark. When the A's lost a key player, Beane scoured the data to identify the unique quality, among many, that the departing player contributed to the team's success, and then drafted an improbable successor at low cost—because he understood "what are we looking for."

These are the central questions in public management: What are we really trying to accomplish, and how will we know how we're doing? I may go see the movie.

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