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| A's GM Billy Beane |
As the GM of the A's, BILLY BEANE has defied a number of conventional baseball methods for stocking and building teams and for playing the game. In doing so, he has found success with his small‑market franchise, keeping the A's at or near the top of the American League despite a relatively low payroll and the free‑agent defection of a number of stars who have departed for greener rewards (JASON GIAMBI, JOHNNY DAMON, MIGUEL TEJADA). His track record has led a few of his competitors to re‑evaluate their own approach and to lure away two of Beane's former lieutenants (J.P. RICCIARDI to the Blue Jays and PAUL DEPODESTA to the Dodgers). Beane spoke recently with SportsBusiness Journal New York Bureau Chief Jerry Kavanagh.
Question: It's a practice in art school to copy the old masters. You seem to have made a practice not to copy the old masters in baseball.
Beane: I guess it depends on who you qualify as the old masters. There are some people in the industry who have had a tremendous impact on me and my career. First and foremost is SANDY ALDERSON. But some of the things we're doing here are not that far off from some of the things the Dodgers were doing years ago. People think on‑base percentage as a statistic is sort of in vogue now, but it's something the Yankees focused on years and years ago. So, while some of it may be viewed as new, in many cases it's not that new. What we're trying to do is examine everything and every dollar we spend to make sure we're getting the greatest return on our capital.
Q: In "Moneyball," MICHAEL LEWIS writes: "The old scouts are like a Greek chorus; it is their job to underscore the eternal themes of baseball. The eternal themes are precisely what Billy Beane wants to exploit for profit by ignoring them."
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| Scott Hatteberg Is One Player Beane
Brought In With Forward-Thinking Model |
Beane: As it applies to how we spend our capital, we're going to do it where we have the least amount of risk and the most amount of success. When you're in Oakland and you're splitting a market, you're one of the smallest markets in baseball, you can't afford to go on the roulette wheel and place everything on double zero and hope that it gets a return. Every dollar we send out we want to see some return on it, and we want to do it objectively. It is similar to the way an actuary or an insurance company would set insurance rates. Or the other example we use: We are going to play blackjack and, if we can, we're going to deal the cards. Does that mean every decision is going to be right? No. But we want to place the odds in our favor.
Q: Nonetheless some of this was original thinking. Baseball has long had a conservative streak.
Beane: We're not telling anyone how to do their business. We're going to do it our way that allows us to compete in what is a chaotic market. Which in some respects, a chaotic market, is good for us. It allows us to take advantage of the inefficiencies.
Q: Is it oversimplifying to say that college players are a lower risk than high school players?
Beane: I don't know if you can put it any more simply. Not only that, but you get a quicker return. There's a return on your asset probably more immediate than there is with a younger player. The bottom line is, there's more data from which to make a decision. That's really what it comes down to. We're not good enough to walk onto a high school baseball field and watch some kid and predict what's going to happen. We're just acknowledging we need more data from which to make a decision. The more info we have, the better decisions we think we're going to make.
Q: Your approach is less risky than that of others.
Beane: That's what I would say. Listen, I've got a responsibility to my owner to make sure that the money he spent is being well-spent and he's getting some return on it. We have to function as a business, not just as a baseball team.
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| Beane Counts Weaver As His
All-Time Favorite Manager |
Q: Years ago, DAVEY JOHNSON...
Beane: I always thought Davey Johnson was one of the most underrated baseball minds. He was a roving instructor and then was the manager with the Mets when I came up. Here was a guy who was not only a very good major league player, but he was also a guy with a mathematics degree from Texas A&M. So, he had an analytical approach. And he played under my favorite manager of all‑time, EARL WEAVER. I always thought Davey never got the recognition as a manager he deserved. He won everywhere he went: Cincinnati, New York, Baltimore, Los Angeles. I've always been a big admirer of Davey Johnson.
Q: It must have been an interesting player/manager relationship between Johnson and Weaver.
Beane: I never had the privilege of meeting Weaver, but there was a brilliance in the simplicity, just in the way he ran the team. He was a proponent of the three‑run home run as a much more efficient way to score runs. He wasn't a proponent of losing outs on the base paths. He wasn't someone who believed in losing outs by bunting someone over in the second inning. He understood the value of an out.
Q: Selena Roberts in the N.Y. Times wrote about how threatening an alternate view is to baseball's theology: "It's a threat to inept owners and/or a certain baseball commissioner who have used their small‑market woes as habitual excuses for futility. It's a threat to romanticized scouts whose legends are built on a 5 percent success rate."
Beane: We're just a small‑market team, and I'm the keeper of the gate when it comes to having responsibility with what my owner spends. I find it somewhat humorous that with a market of this size, someone would be so concerned with what we do.
Q: You're a small‑market team that has had success. There is a built‑in underdog appeal.
Beane: Well, I think the greatest compliment this organization can take is that we're no longer viewed as an underdog. There's now an expectation level placed upon us. There's an assumption that we are going to, and should, succeed. Some people have forgotten about the payroll, and I take that as a compliment to the organization. We are a small‑market club and one of the lowest payrolls in the game. We still continue to lose players because we can't afford to sign them, which isn't necessarily a bad thing from a business standpoint. But I think the bar has been raised for us.
Q: The A's have lost not just talented players, but also key personnel off the field. Has it been difficult to rebuild the front office?
Beane: It is probably harder to rebuild there. I'm no revolutionary. Sandy was the one who started this whole thing. I sort of view us all as coming off that tree, because [Alderson's] background was the most unique. A Harvard law graduate and Marine officer who came into the game as a legal counsel. The thing that I'm probably most proud of here in this organization are the people who have left. I shouldn't say left. They've been pursued by others to run other franchises. That's the greatest compliment you can have. I would love nothing more than to see a number of people who work here in parallel positions to myself or even higher.
Q: Has your playing experience -- a first‑round pick in '80 by the Mets -- given you any kind of advantage or unique perspective?
Beane: Having played the game gives you some credibility in the locker room. But what I've drawn from my playing experience are the people I've met. Some very bright people. Guys I mentioned already. Davey Johnson, in a strange way, has had a very big impact. And FRANK CASHEN, ANDY MACPHAIL and BILL LAJOIE. I always thought I was like Forrest Gump. In my brief career, I played under SPARKY ANDERSON, Davey Johnson, TOM KELLY and TONY LARUSSA, all guys who have a chance to go to the Hall of Fame or have been successful in most people's judgments. That's where the advantage of playing came for me. The one thing I don't get caught up in is the idea that I played the game and therefore I know. Being in the front office is completely different, and you're not giving enough credibility to some people who have not played and are very bright, capable people.
Q: You have said, as much as anything, we don't complain about what we don't have. We focus on what we do have and we make the most of the opportunities we get.
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| Alderson Served As
A's GM From '83-97 |
Beane: When Sandy was here, when I was working for him, we knew with our payroll we weren't going to be able to put together the perfect player at every position. In most cases, we couldn't even find the perfect player in one position. So we had to look for players who at least did one thing really well and then had to find a way to put them into the jigsaw puzzle. The great thing about being in this market is that it does force you to be creative and it also puts you in a position not to make bad decisions. The last thing you want to do is give your credit card to your 16‑year‑old kid. It forces discipline on you, and therefore forces creativity. Every year there's going to be a major free agent who comes out, or a major decision that we have to make or can't make because of finances, and we always take it as a chance to be creative and find an answer. We try not to spend our time wishing for what we had. We try to spend our time coming up with answers for what we are going to lose.
Q: I wonder if some of the lessons of the A's success have translated to the business world. For example, Michael Moritz, in a keynote address at the 2004 Venture Capital & Private Equity Conference at Harvard Business School, said venture capitalists should study your formula for finding winners among undervalued players.
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| Stealing Bases, Ricky Henderson's
Forte, Now The Lowest-Paid Stat |
Beane: It's very flattering. What's been interesting is that a term I use, the larger culture, has been very receptive to what we've tried to do here. As an example, if you look at the draft, it has changed significantly in the last years as it related to what type of players were being drafted in the first round. There has been a noticeable change in the way many people have started to put together teams and run their businesses. The fact of the matter is when Sandy was here we were on a quest for every high on‑base percentage guy we could get, and people were sort of laughing at us. And now the highest paid stat in baseball is for on‑base percentage. And the lowest‑paid stat is stolen bases. The one thing about Wall Street is that there is an immediate return usually on your decisions. In most other businesses there is a significant lag time. But the incentive and the return on your decisions and finances are right there right away, so you're probably more apt to make change in that sort of business than you are in other businesses.
Q: What's the best new idea in baseball?
Beane: When I see guys like THEO EPSTEIN running the Boston Red Sox and Paul DePodesta down in Los Angeles, I think that some of the people who are now attracted to this business are those that in many cases you would have seen working at, say, Goldman Sachs. It's people who can implement new ideas.
Q: Do millionaire players need incentive clauses?
Beane: A contract is not a unilateral decision. It's something that is negotiated by two parties. So if [the incentive clause] is there, it means that two parties have agreed upon it.
Q: What is the best call you have made in your position?
Beane: That's easy. Hiring J.P. Ricciardi as my director of player personnel and Paul DePodesta as my assistant general manager.
Q: BILLY MARTIN said, "There is nothing greater in the world than when someone on the team does something good, and everybody gathers around to pat him on the back. What do you consider the best thing about sports?
Beane: It's a fraternity of people going in the same direction. And I think that that also exists when it comes to being in the front office as an executive. You sort of build your team in the front office. You have long days and long nights, and then when you win, you have that same espirit de corps that you have on a baseball team in a locker room. You’re around each other so much and you're all pulling in the same direction. And when it's realized with a division championship or a playoff appearance it's really satisfying.
Q: RICK REILLY called you the shrewdest or most creative business man in sports today. Who is your choice?
Beane: I really like the way the New England Patriots as a whole are run, from BILL BELICHICK on the field to their front office, and the way they balance their personnel decisions with their finances, and the fact that they've won a championship but they've also set themselves up for the future. From a personality standpoint I've always admired JERRY WEST. And I'm kind of a [BILL] PARCELLS guy, too, when it comes to personality.
Q: A few personal questions. Favorite sportswriter?
Beane: I think probably the greatest ambassador baseball has is PETER GAMMONS. He has a real passion for the game and he's a very bright guy.
Q: Who is the greatest competitor you've seen?
Beane: LEN DYKSTRA and DAVE STEWART.
Q: Smartest player?
Beane: In my first major league camp with the Mets I lockered next to TOM SEAVER. He wouldn't know me from anybody, but all I remember thinking to myself was -- forget baseball -- how bright he was, period, and thinking this is a guy who should be running a company. I was very impressed with how bright he was beyond baseball. KEITH HERNANDEZ was very bright, and LARRY BOWA and Tony LaRussa.
Q: What are you reading now, and what books have meant the most to you?
Beane: I'm a voracious reader. I am currently reading "Charlie Wilson's War." I finished "When Genius Failed." I'm usually reading a couple of books at one time. I didn't start doing that until I read that (former President BILL) CLINTON did it, and I said, "Well, heck, if he can do it, maybe I should try it." I try to read every WARREN BUFFETT book -- anything that's ever been written about him or that he's written. I've always been fascinated by his discipline. And my favorite book of all time is "Les Miserables."
Q: Favorite piece of music?
Beane: "I'm kind of a closet alternative music guy, going back to the New York City punk scene. I consider Johnny Ramone a friend.
Q: Favorite actress?
Beane: I'll start with Elizabeth Hurley. Gosh, I sound so shallow (laughs). Hey, how about Diane Lane? She's had a renaissance last year. I think she's great.
Q: Favorite movie?
Beane: "It's a Wonderful Life." And I love "Braveheart."
Q: What's a typical day off like?
Beane: During the season it's very much wrapped around baseball. I take a fishing trip every year during the season. That's a good getaway. During the winter it's quite a bit of skiing and spending time with my daughter.
Q: We've thrown around a few quotes. Oscar Wilde said, "We are all in the gutter but some of us are looking at the stars." Do you have a favorite quote?
Beane: I save them, too. I pull a lot from the books I read. Chuck Yeager said, "The rules are made for people who aren't willing to make up their own."
