The Road To General Manager

At age 18, Billy Beane had more hype surrounding him than LeBron James did coming out of high school. Scouts would flounder to his high school and drool at the opportunity of drafting the 6′4, power hitting sensation. The New York Mets got that opportunity, taking Billy with the 20th pick in the first round of the 1980 baseball amateur draft.

The draft simultaneously opened a new door while closing another for Billy. He had always planned on playing pro baseball, but his ideal plan always called for a career to come after college. Now he was forced to make the decision to either leap into baseball, or go to school first. He chose to start playing, a decision that he regretted when he realized that he would miss out on the college life he had always envisioned for himself.

Billy climbed the minor league ladder to make his first Major League appearance in 1984, four years after his journey began. For parts of the next six seasons, Billy would play for four different teams in 148 games, hitting 3 home runs and compiling a truncated .219 batting average.

After ten seasons of professional baseball, Billy entering spring training during what was supposed to be the prime of his career. At this time, a unique opportunity arose.

“I was literally on that field back there (points to A’s spring training practice field) in 1990, and I had a conversation with Ron Schuler, the soon to be GM of the White Sox. He started talking to me about an opportunity, and I said hey, it’s something that I’m interested in. He said yeah, you’d probably be good at it. So I said how about now? The next day I was an advance major league scout.”

Moneyball author Michael Lewis describes this decision to abruptly end his professional baseball career as similar to a movie star walking off the set to be a production assistant. But the three years he would spend as a scout would start his pursuit of a passion that went back to when Billy was a kid playing pseudo-fantasy games.

In 1993, Billy was named Assistant General Manager to then GM Sandy Alderson. Sandy would prove to be a key mentor in shaping Billy’s innovative managing style. He prepared Billy to take over the General Managing position in 1997. After two losing seasons, Billy implemented the entrepreneurial strategies that would reclassify his Athletics team from under-achievers to “winners.”

The Entrepreneurial Approach To The Game

When Billy took over the general manager position for the Oakland A’s in 1997, his situation was (and still is) similar to that of an ambitious entrepreneur going up against a company like Microsoft. He had little resources to work with while facing major league competition. As Billy put it in our interview:

“It was a negatively unique situation in the sense that you have a limited amount of resources and you’re in a small market, but at the same time it’s an opportunity that gives you a complete artistic license to do whatever you want. We knew we couldn’t run our team like the New York Yankees. But we knew we had to find our niche, and we knew we had to find our gaps in the marketplace.”

moneyball.jpg

Faced with this “survival of the fittest” scenario, Billy and his team found their niche to not only survive, but single-handedly change the way baseball execs manage the game. Their niche, which they would soon become famous for, was explored in the best selling book Moneyball by Michael Lewis. They focused on more obscure baseball statistics that other teams took little notice of. Suddenly, stats such as on-base percentage held a value greater than batting average. Walks became just as important as singles. Strikeouts were a big no-no.

The concept was constructed after Beane began to draw upon the success of others outside of the baseball industry, such as Warren Buffet and Berkshire Hathaway. His goal was to exploit the opportunities in baseball much like Warren Buffet did with early hedge funds and to steer away from the stereotypical template that ran so many organizations in baseball. This was innovation at its finest.

As a result of his innovative approach, the A’s haven’t had a losing season since 1999, winning 4 American League Division West Titles on a payroll under a third of that of the storied New York Yankees.

Pursue The Passion Advice:

PTP: What kind of advice would you give to someone who is trying to identify and ultimately pursue their passion?

BB: “Don’t necessarily work towards the end. The end is determining what kind of grade you’re going to get, then what kind of job you’re going to get by virtue of going to a specific school. I’ve got a brother that has spent his life playing guitar and surfing. And everyone wondered what he was going to do, and you know what, he’s doing just fine. He followed his passion, found a way to make a living, and ultimately has been successful. The advice I’d give, if you love art history, major in art history. Because you’re going to be good at art history, and someone is going to find a way to pay you for it. As opposed to saying that I want to be an electrical engineer because it makes a lot of money. Ultimately, there’s a short shelf life to that. To me, it’s the process of learning, and if you enjoy that, the world is at your feet. The process is most important, not the end.”