Effectively Wild: A FanGraphs Baseball Podcast - Effectively Wild Episode 765: MLB’s MBA Future

Episode Date: November 12, 2015

Ben and Sam talk to BP author Jeff Quinton about how baseball teams could benefit from design thinking.

Hey, Mr. Manager, messing up my life. Hey, Mr. Manager, think I need that kind of stride. Good morning and welcome to episode 765 of Effectively Wild, a daily podcast from Baseball Perspectives, brought to you by The Play Index at BaseballReference.com. I'm Sam Miller, along with Ben Lindberg of ESPN. Hi, Ben. Hello. How are you?

All right. Anything to talk about before we get to the thing? No, I'm ready for the thing. All right. We have a guest today. Today's guest is Jeff Quinton. Hello, Jeff. How's it going, guys? Good. Jeff is a Baseball Perspectives author, and this week he is the author of a three-part series on design and the concept of design as a way of running a baseball team, I guess, sabermetrically. running a baseball team, I guess, sabermetrically.

And it's, in my opinion, a very well-written, very thought-provoking, very interesting and very forward-looking series that excited me a lot, and so I wanted to have Jeff on to talk about it. And we will talk about what it means, but first we should just talk about what it means. What is design, Ben? Not Ben. You had Jeff on and you're asking me? What a waste of a guest. Jeff, what is design, Jeff? Design, and I'm not a designer, but design as I understand it is finding solutions to problems given a number of constraints. So designers, as we think about it,

traditionally, they design clothing that people think is attractive or useful or whatever it may be, or they design stuff like cars or advertisements, stuff, logo design. What we've seen a change in over the last couple decades is what the CEO of IDEO, who I talked to for the piece, Tim Brown, would call design thinking. And so that's taking the concepts of design and applying it to far more things than just designing graphics or logos. So using those concepts to solve problems of process and strategy and innovation. That's design as best I put it. I hope I'm doing it justice, doing the design community justice. Yeah. And so we'll talk about what a few,

I have a couple of those in mind that I want to talk about, but is it too much to say that essentially not only is it taking some of the tenets of design, but in a sense you are designing a process. You are designing an organization. You are not just having a set of things that you want to accomplish, but you are actually designing a way for an entire organization to accomplish those things. Absolutely. Something that they'll talk about, that you'll hear Tim talk about a lot is he actually mentions that when asked, you know, how was he prepared to become the CEO? Because he's a trained he's trained as an industrial designer. He said he realized he could do it once he realized he could treat everything as a design problem. So how to manage people as a design problem or how to run a company as a design problem. And we've seen that kind of proliferate and become very popular in today's business world, the discussion of design, and especially the power design has got a lot of the limelight, particularly with the emergence of Apple products and those kinds of things where design is really starting to matter to people, how you interface with any given thing. So one of the reasons that I was so excited by this piece, and that maybe I'll just talk about before we get into the specifics or ask you about, is it seems to me that after Moneyball for the last 15-ish years, we've sort of thought about the teams that set them apart as being

mathematically savvy or statistically savvy or perhaps software savvy. And those were the sort of sciences that were kind of in vogue and were especially valuable to setting oneself apart from your competition. And it seems to me, perhaps, that in the next 15 years or so, the science or some might say pseudoscience that is most applicable might very well be the science of kind of business management the like sort of mba kind of idea and i don't know if it's right to call that a science or not but it has its own literature and it has its own expertise and it has its own testing processes and all those sorts of things. So sure, let's call it a science.

Do you think that this is a reasonable kind of expectation that I have? Yeah, well, I think that it's definitely, I think the reasonable expectation is that what's going to be the next breakthrough or step change innovation or change to the game of baseball isn't going to be what was the previous step change innovation or change to the game of baseball isn't going to be what was the previous step change innovation. You know, we never, you never see that happen in the history of things generally is that once someone becomes good at something, especially in a competitive market where there's a lot of dollars at stake, people become pretty good at copying or replicating what other people have been successful at in general.

And at least they're going to try to do so. So I think that that's kind of what we've seen since Moneyball, so to speak, is that teams have gotten better. More and more teams have embraced it or fully embraced it and it's grown. But it seems as if the gains are maybe not as great because everyone else can do it and they're not as long lasting because as soon as you have it something that is pretty uh transparent it can be copied by your competition for example i don't have as great an example but i think you know teams have you see teams that now, you know, everyone's almost, as far as the front office, has embraced analytics.

So you start to see teams, no teams get, there's no, there's no like, I guess you'd say there's no, there's no almost crazy contracts of just, we gave this guy, I guess, tons of money because of RBIs necessarily. I guess, tons of money because of RBIs necessarily. We just don't see these crazy different valuations in extensions or contracts as maybe we used to. At least it feels that way. And I think that or as teams gain advantage through, let's say, the shift, teams or at least a majority of teams are able to adjust more quickly and are able to then, you know, mirror whatever advantages teams are getting. So it's a hypothesis.

I don't know for sure, but it would be that as teams become, as teams front offices become more progressive in the sabermetric sense, they don't have to think of every idea. But once someone else does, they're pretty able to see what the idea is and kind of reverse engineer it. So the idea would be, as you're mentioning with management thinking or whatever the next big change would be is, you know, what's going to be the next thing that can be done that has, that isn't going to be easily replicated. And maybe we're already seeing that with some teams. You know, people question, there's kind of a, maybe it's the teams where there's a kind of mystique of how they've been able to be so good for so long. Maybe

the Cardinals or the Giants, where the success is sustained and there's no real easy way to put a finger on it. Now, maybe it's just the ignorance of the analysts or, you know, the public, but something like that. Whereas what is truly differentiating these teams for long periods of time that their competition can't replicate, and we would guess that they're trying to. It's kind of like the discussion that we had with Andy McCullough where we asked whether there was any secret that the Royals were worried about teams finding out,

because, right, like if you, most things that you do these days, they take place in front of all these people who are watching and they'll notice it but with the royals it just seemed like oh well they had a a nice kind of quiet competence about the people who were running and so and that's hard to copy but if you use management techniques then then maybe you actually you know could do that you could have an edge that isn't really copyable ben do you want to i i know that you're just begging to jump in ben well so it sounds to me like the idea is that it's great to recognize that you know on base percentage is more telling than batting average for for instance but everyone catches on to that so it's even better if you can have that realization and then be able to implement it without having

to throw a chair through the wall or trade Carlos Pena because your manager insists on playing him and that's the only way that you can keep him from being played so it's like a more seamless integration of the epiphany that you have in the front office or wherever it originates, you don't want anyone to have to throw chairs through walls. Yeah, and there's kind of two advantages here of, if you want to call it, management thinking or even kind of what the pieces are about in design thinking, is that the one advantage is what you talk about, Ben, is that if you can have this, anytime you have an insight,

is what you talk about, Ben, is that if you can have this every, anytime you have an insight, you know, that an insight's great, but it doesn't, doesn't get you anywhere until you can actually act on it, whether it's able to sign or trade for a particular kind of player, you know, grab an, what you're, what you considered an undervalued asset, or be able to implement a new idea at the field level or the player development level before your competition can or before to get as much value out of the idea as possible. So that's one sense in which design thinking or a different kind of approach or just, and we don't know, I mean, teams could definitely be already caring more about the implementation just as much as they care about the discovery of these ideas or the analysis of these ideas. So that's one

advantage. And especially as the margins get tighter or as the competition seemingly gets fiercer on the front office front, that becomes more and more important. But then the other idea too, is that now that everyone, and so in business classes, I'm only so many years out of business classes now, a lot of discussion revolves back to what they call core competencies or differentiators. There's a lot of talk about how can you sustain an advantage over your competition so that way you have a viable business? What ends up happening with a lot of those sustained differences is that people catch

on and you start to look at these advantages through what Claudia Kotska, who actually rolled out design thinking at P&G, talked about is through a lens of feasibility. So you start to only look at, you know, what are the different ways we could differentiate, but based on what we know how to do and based on our core competency. And that's great if you're just interested in returning shareholder value. Baseball is a little different because it's a closed market. There's only 30 teams. So you have a lot more game theory involved in that as soon as you your core competency can only last so long and that people are changing teams the people that you that work

for you are now going working elsewhere so being able to really constantly redefine problems or challenge assumptions and then finding new solutions that other people aren't going to be able to find is going to be is going to be huge it just can often i feel like it's not a short-term solution it tends to be more of a long-term solution so committing to a game that's so demanding in the short term will also commit to these long-term goals i could see being an issue or being a difficult thing to balance so i want to talk about three specific things that you talk about, three kind of concepts, one of which is all these from the ideas of design but applied sort of to management. One is the idea of the end user and understanding your end user better than he understands himself.

And I think part of the reason that these were so fun for me to read is because I saw all the idiotic mistakes me and Ben made this summer trying to get people to buy into things we were trying to get to buy into your vision is that nobody ever asked for an iPhone, that the person who created and designed the iPhone had to intuit or anticipate what the end user was going to want and find helpful because no one really knew what they thought they wanted or would find helpful. So can you give an example of that in baseball, how that has been an issue for a team or a factor in a team rolling something out? Yeah. So, and I think it's a factor anytime. It's the term, the business term that people like to use is change management. So anytime you try something new, it's not just, you know, it's not just an algebra problem in that people are involved. So people just resist change or have trouble with change to varying degrees depending on role and circumstance

or their individual makeup, so to speak. So an example in baseball, what I found interesting is, you know, we had the shift. It was kind of our most visible change that a lot of teams were trying out over the last couple of years. And, you know, the time you always see the pitchers get upset is ball goes through where a guy would have been. It costs them a run. And then you hear the announcers talk about, or you hear the players talk about after the game, you know, I made a great pitch and I got burned by the shift. And there's this idea that, hey, if I just do my job and this new change is hurting what I'm doing, you're not going to get buy-in that way.

And what you really hear when you say that is that, or when you hear someone say that, what you're hearing is a person who doesn't understand maybe necessarily the full or doesn't care to understand the full impact of the shift. So the idea is that, yeah, in this one example, it's going to make you upset. And in any change, there's going to be little parts that are going to be difficult for anyone. But if it improves what you do or your well-being, or in this case, your ability to get outs over a long period of time, then you're able to get people to buy into that change. But you only get that if you understand the mindset of certain pitchers or players from the get-go. And in a game like baseball, where, I mean, I think we use the Astros as an example because Luna was the one who spoke at the Sabre seminar in 2014.

But it was, and he used this example, but it's, they lost the season of the shift or they lost a portion of the season of the shift because they didn't get proper buy- in in the beginning because they didn't have that user understanding or didn't care to have that user understanding. And then they really learned how to appreciate that come the following season. But those are going to be examples. You would assume there'd be examples with other teams where it was more critical, where the difference could be a couple of games. And that's the difference between making the playoffs or not. I wonder what you do. It is my theory that most ballplayers don't care about winning, first and foremost,

that they would rather win than lose and be around a winning team than a losing team, but that, in fact, they have a much more emotional reaction to anything that affects their own personal career and statistics. So I wonder what the solution is to that, where the end user actually is not technically on your team, or he doesn't technically want the same thing that you want him to want. Yeah, and I think this is a big topic that I think it goes on with a lot of the, I don't know if you want to call it the behavioral economics community or whatever it is, is that the way that we view the short term, just any person views the short term versus the long term, causes a lot of conflict in us as far as the decisions we make. I mean, how often do we make decisions about something we bought or something we ate or a time we decided, you know, we didn't exercise and we wanted to, or we didn't go to work when we wanted to. And in the long term, we said, how could,

how could, how could you possibly make that decision if you're able to think in the long term? And that again, goes back to really understanding your end user and caring to understand people because you can't't if the assumption is that all people are going to act rationally we've seen that fail time and time again and it's it's something that design thinking can help with because they don't treat the end user as this idealized human or this economic theory they treat the end user as they take time to get to know the end user and what that person actually is. So the solution, I don't know if it's, it can be any one solution, but I think the core of it would need to be not just understanding why it makes sense for anybody,

but why it also makes sense for the agent that you're looking to change. All right. So the second concept is the idea of the prototype. Of course, when you release the iPhone, it's not your first draft. You've sort of built various prototypes of it, tested them, seen what failed, improved it, perfected it, and by the time it gets to the end user, it is theoretically perfect. And you can't really do that to some degree in Major League Baseball because no one has the tolerance for failure either in a competitive season or on such a grand stage. So what is the solution to the prototype problem in Major League Baseball for

Major League Baseball teams? Right. So one of the concepts of designs you mentioned, prototyping, what it essentially does is for if you're implementing a new idea or trying to come up with a new idea, what it allows you to do is it takes a, you don't need to fully form the idea because taking the effort to fully form an idea of how are we going to implement this new pitching program for all our pitchers across the minor leagues, you know, just saying we're rolling that out today. program for all our pitchers across the minor leagues, you know, just saying we're rolling that out today. We see a lot of that type of rollout fail because you have to make so many assumptions and all those assumptions are just never going to hold, especially across what can be often a very complex problem.

So what we see is that what prototyping allows for is for pretty much what's an acceptable space to have small failures. And so what the Pirates do when I talk with Stuart Wallace is if they're rolling out a change, they might try it at the most minor league, you know, at the lowest minor league level, try it on a couple guys, get their feedback, you know, get feedback that they would have never been able to have insight on, no matter how good their observation is, no matter how good the design team was. So that way they could then rejigger

whatever their initial thoughts were and come back with a better solution. And then the article we talk about at the major league level, it's a little bit hairier because wins and losses matter so much. But if you can, I think it was the examples, Joe Maddon was, you know,

he pulled out a very quick hook for a lot of his pitchers all through the season and you know it was just you know it was applauded by the sabermetric community because that's just good practice you don't want your your pitcher facing the lineup three times through the order especially if you can if you can help it and then uh when they rolled it out in the playoffs they were able to I think it was I think in the article I mentioned that they have they lost the first game with Lester going you know six or seven innings or something and then they won the next three getting four and two-thirds five and two-thirds and three innings out of the starters what that really showed too is that the Cubs their bullpen was made up of a lot of these failed starters that

they moved to the bullpen. So guys who could give more than just one inning, they could give a couple, you know, more than three outs. They didn't have to, but they could. And so you have this idea, right, that the front office came up with saying, hey, we think these guys are maybe underpriced in the market, but you still need that execution and the ability to have a manager who's willing to take full advantage of this idea that the front office has come up with. And so you really see that bridge from idea to prototyping to then implementation where Cubs were able to successfully utilize that new idea. to successfully utilize that new idea. And then the last concept is, I don't even know if concept's the right word, but you address it in the third piece, which is running on Thursday morning, and which I loved because you mentioned Clayton Christensen. And anytime I'm reading something and Clayton Christensen comes into my life, I'm happy. But I specifically, the line that was so

interesting was that when it comes to innovation, when it comes not just to implementing good ideas, but to innovating good ideas, to finding what the next big thing in baseball is going to be, you can't base it on data because by definition, data doesn't exist. So in essence, all of the skills that we have so lauded in our front offices and GMs over the past 15 years, the ability to work with data, to pay attention to data, use data, is potentially limiting because it keeps them thinking about all the possibilities in front of them and maybe incremental improvements, but not the innovations that might be out there that they don't yet have data on. It's an interesting thing. And Clayton Christensen always talks about how a lot of what's being preached in business schools nowadays, net present value, return on investment, these ideas of how much is an investment worth right now compared to, you know, how do you choose amongst a bunch of investments, that you're always going to choose the one they place over emphasis on the smallness of the denominator. So whatever

is the cheapest, essentially, that's why we, you know, hug prospects, and we increase our analytics department, because those are small incremental gains that we can, we know that there probably be some return on investment, whereas signing a big name free agent, or investing in trying to find some breakthrough new idea by however you want to do it, bringing in a design firm or whatever crazy idea you could come up with. There's no data that's going to tell you, yes, that's going to work. This is going to work. And really what we find when reading through the literature about innovation or what people

have to say about innovation is really what it comes down to is one, what we touched on earlier, is the insights that you have about people, your understanding of people's needs, but also it's the quality of the questions you ask. And that's what I talked about earlier in the third piece is of challenging assumptions, is that the analytics and the great analysis and code and all that is all incredibly important for kind of the execution of the ideas or to be able to know that this is an idea that's actually we can do. But none of that stuff gets started. You never come up with money ball if you don't ask why. If you don't ask why are we doing something this way or what about doing something this other way.

And that's what Clayton Christensen talks about and what Claudia talked about when she gave that quote is that innovation, if you want innovation, you can't take the same incremental approach or the approach you took that's gotten you to where you were. You've got to kind of find – you've got to find a way to ask those questions that are going to lead to those innovations. So is there a presumption that there is a design that will work for any organization or any group of people? And that therefore, if there's a failure somewhere along the way, there's some kind of breakdown in communication that it was a flaw in the design or is hiring and staffing a big part of this i mean you know i can imagine that a suboptimal design might still work if you have great people who are really receptive to ideas whereas even if you have a really well designed organization it might not work so well if everyone is really set in their ways.

So I'd imagine that part of this is making sure that you have people who are open to the design. So how much of it is putting the right people in place and how much of it is catering to the people who are already there? That's the question I was asking all these people as I was interviewing them is, how much does it matter people you're putting in place versus the process you have in place, right? And there's kind of a way to look at the organization or Roger Martin looks at the organization as kind of reliability versus, I guess, more of the innovation side. And the idea is that you need both, right? You need to be able to exploit. You need to be able to take advantage of these executional tasks.

But you also need the ability to kind of explore and have that innovation side. And you need to have the right people in each, right? So and sometimes and baseball has so few roles, it seems as if right now the idea is you need kind of like that super coach, that Joe Maddon that can do both, right? That can be a good manager from the regular sense, but also be able to be a communicator and a person that's willing to try new ideas. we spoke with for the piece, what they mentioned was that really what matters most as far as, as far as getting that, the right people and the right buy-in is it starts with the top, is that if you don't have people, you know, the CEO or in baseball's case, I guess it would be ownership or general management, you know, general ownership that has supportive general management that's really willing to support these new ideas or a change in culture, then it never goes anywhere because the first sign of failure, which is inherent in any

change, or especially in a game like baseball, something new isn't going to last on the first down fluctuation, so to speak. But what they do talk about a lot as far as the, you know, the different people for different roles is that if you have a role that's more exploitation, more, you know, idea creation, you want to make sure that it's a different kind of design. You're designing, you know, how you place your people or a different kind or, you know, use the principles of management. You're not going to put someone who's maybe very linear or very driven by execution in one of those roles, whereas you wouldn't put a very idea-driven person in a role where you just need them to get short-term results. So you have to pick,

kind of pick, you put your people where you want. But if you want to truly build, and lastly, if you really want to change your culture, though, that you can't do that just by saying, I want to change my culture to be more innovation-based or more design thinking-based. That never works. You hear people say that, and it sounds nice, and a bunch of people clap at an investor's meeting, but that doesn't actually ever change anything. The real way you get anything to change is from, you know, the person up top and then the people that they bring in. All right. So last question I have is that we have sometimes talked on this podcast about whether there are

competent, qualified GMs out there who have nothing to do with baseball. And in many industries, your CEO is chosen because he's a CEO, not because he worked, you know, in the exact same industry for your rival company, you know, necessarily. And so do you think that there will ever be a point where leadership and management are just considered more important than baseball experience, period? Like, will there ever be a GM who is brought in from you know another industry or who was like you know running a division at apple or is there a limit to how much you can relate uh baseball to to business in in a certain sense i think the going back to kind of the

premise of the question of where we just see you know a you know ceos kind of just swap places you know you take the ceo from one company or you know, some VP at one company and you make him a CEO of another company. That happens, but I also don't think it happens without any knowledge or without some understanding. Now, you sometimes get limited understanding, but you do tend to see, you know, the CEO of a CPG company was a VP or executive VP of kind of a food or another CPG company. So I don't think it's going to be as, I don't think it currently is that free in who's being swapped positions. But I do think you could see that, but you would need, again,

your organization to be designed in a probably would be my guess is a much more robust way. So right now, I think the way that baseball teams function the way they do is because they're relatively lean. It's all baseball people. Everyone understands baseball. If you really wanted to have tons and tons of different departments, maybe where you'd have you'd have your r&d you had your procurement you had your it and and i'm sure baseball teams are starting to become structured like that i think at that point the person managing is more or the person leading is more about is more about vision and understanding how people work or how to bring in the right people for the current situation than it is about you you know, number of years in the game.

But I think no matter who gets brought in, I think they need to probably appreciate the value of what it does mean to have a number of years in the game or the people that do have experience. Because, you know, you can come in and you can have all the good ideas and you can see everything right. But just as, you know, design thinking or management is a skill that takes a long time to master and be able to really become exceptional at, so too does understanding baseball players or understanding how the game works. So as far as who's in what position, I don't, I think that that's something that we could definitely, that we could definitely see. But I don't think it happens just by we're cleaning house and having no baseball people until the coach level.

I don't think we'll see that. Or if we do, I wouldn't expect that to succeed. All right. Thanks, Jeff. I will link to the series on Facebook and in the blog post at BP. You can find Jeff on Twitter at JJQ01. Thanks for coming on. Thank you. All right.

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