I read an interesting article this morning from WSJ blogger Joseph Walker, entitled Moneyball and the HR Department. By now, I’m sure you’ve heard of the movie, book, and business philosophy of the same name.
If you haven’t seen the movie, you should. If you think it’s a movie about baseball, it isn’t. The movie is based on the Michael Lewis book, and tells the true story of how Oakland A’s General Manager Billy Beane, went against conventional wisdom to recruit undervalued players and lead a woefully underfunded team to success. Beane used statistical analysis to uncover correlations (success metrics) that were not being uncovered by the organization’s scouts.
Naturally, Beane was called a fool for going against decades of conventional wisdom gained from professional scouts watching and analyzing countless hours of player performances. Pro scouting is as much an art form as it is a science and Beane was determined to obliterate the “art” and go all science.
Beane believed he could do a better job evaluating player potential by working with a “statistics geek” than a seasoned, team of professional scouts. Naturally, his scouts disagreed. After all, these men had years of experience that allowed them to uniquely understand the “intangibles” that make a player great.
Turns out there really are no intangibles – in baseball players, accountants, or middle managers. As much as we want to believe we have a gift for recognizing talent, or the characteristics that make someone a good fit with the organization, or we are the types that “trust our gut” to make talent management decisions, we really don’t have any special gifts.
Often, talent decisions made using intuition, or gut, or as Beans’ scouts – decades of experience – do not result in the best performance or advantage for the organization, even though they may seem to work out.
Here is the real lesson of Moneyball thinking. It isn’t the decision that we make, it is the decision we DIDN’T make that we need to reexamine. Take internal mobility, for example. We might pass on a dozen or so equally qualified employees for an advancement opportunity, in favor of an individual we feel has the “stuff” of leadership. Our pick has demonstrated the characteristics we value, like willingness to make decisions, or openness, or risk taking, whatever. But we have no real way of knowing if any of these attributes actually make better leaders, we just believe they do.
One example from the WSJ blog that makes the point:
Capital One, the credit card company and bank, has automated data reports on employee attrition, headcount and promotions. It is also beginning to analyze the characteristics of its most successful employees, like what schools they went to and what their majors were, said Mark Williams, statistical analysis manager for workforce analytics at Capital One. “Now we’re going back through resumes and creating a lot of that data,” he said.
Promoting employees based on their college major? Would anyone looking for high potentials even ask an existing employee that question? Is there a correlation? Maybe, maybe not – but big data, Moneyball, thinking doesn’t care whether you think there is or not – if a correlation exists, it will be uncovered. And once it has been uncovered, you should exploit it.
Take a minute to re-read my post on Big Data, and ask yourself if your HR organization is ready for a “stat geek” of your own.
Another infusion of knowledge…