The â€˜Moneyballâ€™ Lesson for Firms
I convinced my wife to go watch the new Brad Pitt movie, Moneyball, with me. The movie is based on the true story of an Oakland A’s baseball team that, with a payroll of $30 million, had to compete with teams like the New York Yankees, which spent more than $120 million. Many regional law firms face a similar dilemma, lacking money, advertising and name recognition. What lessons can they learn fromMoneyball?
Ask the Right Questions
Pitt’s character, Billy Beane, realizes that he can’t beat teams like the New York Yankees by playing their game. He is told by a recent Yale economics graduate that baseball teams are asking the wrong questions. They are locked on three statistics: runs batted in, home runs and batting averages, while overlooking the on-base percentage that takes into account when a player is walked. Beane changed the focus from whether a player will be an all-star to whether he would increase the odds of winning games. At law firms, instead of asking new recruits about law review and class ranking, we should be asking, “Can you bring in business?”
Don’t Fear Change
Beane confronts a head scout who believes his decades of experience entitles him to make subjective choices about players. He doesn’t want a new system, even a superior one, because it places his job in jeopardy. Don’t let individual insecurities dictate your firm’s overall strategy. Many large firms face this challenge, and this is where more entrepreneurial law firms will find opportunity.
Don’t Miss Your Window
Beane finds players who are undervalued. He brings them together and (spoiler alert) wins 20 games in a row, breaking a record that stood for 100 years. He had the first-mover advantage and as such he reaped impressive rewards. But his secret was out â€” the Boston Red Sox copied his system, with a payroll pretty close to the Yankees’, and won the World Series. Moving first will give your firm an advantage, but time is running out. The big firms will copy the most effective strategies, with budgets to match.
In one of the movie’s final scenes, Pitt’s character meets with the Red Sox owner, who applauds his willingness to take a risk. “The “first one out of the wall gets bloodied,” he says. Big firms usually aren’t willing to take that risk, and individuals within midsize firms are generally afraid to champion the big ideas that could make a big difference.