Built to Win: What MLB’s Playoff Teams Can Teach You About Good Management

by | Oct 21, 2015 | Business

We already know this much about this year’s World Series champion – it will be an underdog. The American League Championship Series features the Toronto Blue Jays, whose appearance in the post-season ended a 20+ year drought, and the Kansas City Royals are trying to win their first World Series since 1985. In the National League, there are the New York Mets, which had their last World Series win in 1986, a year after the Royals. And, of course, there are the Cubs. The last 107 years have left reporters and announcers searching for milestones to assist fans in comprehending how long it has been since the Cubs have won the World Series. At this point, it is like trying to fathom how long ago the Great Pyramid of Giza was built or when druids first conducted their rites in Stonehenge.

In seeking to rewrite history, these teams, as well as the others that made this year’s Major League Baseball postseason, successfully employed organizational strategies not far removed from those employed by successful businesses. While it would be simplistic to boil any team’s success down to one element, or to discount the role luck plays in sifting out a champion, there are still lessons that can be learned from the front offices of each of the playoff teams.

  1. Kansas City Royals –Know your organization’s strengths: Today’s conventional baseball wisdom says to build a team with position players that hit for power and draw walks, and to build around strong starting pitching. But Kansas City hasn’t produced players meeting either of those profiles. Kansas City’s position players don’t hit a lot of home runs and, as a group, they walk less than any other team. In terms of pitchers, Kansas City has been notorious for failing to develop prospects into usable starters.
    But the Royals’ front office saw that they had strengths in several areas. They had hitters that made tons of contact and rarely struck out. In fact, they may be the best contact hitting team since 1950. They have great defenders and assembled one of the stingiest outfields in the game. And finally, instead of assembling a formidable rotation, they focused on their relievers, succeeding in shortening the number of quality innings their starters would need to pitch.The moral here is that not every organization is built to succeed in the same way. Management needs to assess what the organization’s strengths are and build from there.
  2. Chicago Cubs/New York Mets/Houston Astros – Trust in young talent: This trio of teams have youth in common. The Cubs are loaded with talent, including Anthony Rizzo, Kris Bryant, Kyle Schwarber, and Jorge Soler. The Mets are the mirror image of the Cubs, with a fireballing staff headlined by Matt Harvey, Noah Syndergaard, Jacob deGrom, and Steve Matz. The Astros’ best position player was 20-year old Carlos Correa and the surrounding lineup was populated almost entirely by players under 30.
    Experts thought that these teams were set up to succeed well in the future, but each exceeded expectations by making the playoffs this year. In so doing, they contradicted the conventional wisdom that youth needs to be leavened with experience and veteran leadership to succeed in the post-season.The workplace corollary to these teams is the fable that putting Millennials in important positions is asking for trouble. Many of the stereotypes of Millennials are simply false. Millennials do not job hop more than other generations and are more competitive, not less competitive, than other generations. The generalizations that Millennials buck hierarchy also lacks basis in fact. While swinging a bat is a different skill than selling software, there is no reason to doubt the ambition or fit of your new salesperson just because of her age.
  3. Toronto Blue Jays – Don’t be afraid of risk for the right reward: The 2014 American League demonstrated that the teams that had controlled the division throughout the late ‘90s and 2000s – the New York Yankees and the Boston Red Sox – were diminished powers. A decimated Boston squad finished last and the Yankees finished a distant second, finally waving goodbye to Derek Jeter, the last of the players that had led the last Yankee dynasty.The Blue Jays saw a division ripe for the taking and set about acquiring the assets to help them do it. During the off-season, they picked up Josh Donaldson, who was the second most valuable position player in terms of Wins Above Replacement, having belted 41 home runs, driven in 123 runs, and playing a stellar third base.But that wasn’t enough. At the trade deadline, the Blue Jays found themselves 6 games behind the New York Yankees for first place. The Blue Jays decided to go all in – trading for ace pitcher David Price and slugging shortstop Troy Tulowitzki. These deals were not costless – Toronto gave up two of its best prospects (plus a third) to acquire Price’s services for just half a season.The price was worth it. Toronto battered its opponents through the end of the regular season, going 40-17 the rest of the way and seizing its first pennant in over twenty years.

    In going all in in 2015, the Blue Jays demonstrated confidence in their initial assessment of their competition, i.e., that their competition was weak and that the time to challenge them was the present. Rather than fold after a lackluster start, the Blue Jays doubled down on their plan and reaped the rewards.

  4. St. Louis Cardinals – Culture is king: The 2015 season was just another winning season for the Cardinals, which have made the playoffs for five years straight and won its 11th World Championship in 2011. The Cardinals’ success is widely attributed to their culture. The Cardinals’ Branch Rickey invented the farm system and the Cardinals continue to churn out fantastic young players that fill the shoes of departed veterans. The Cardinals’ roster features scads of homegrown players — Yadier Molina, Kolten Wong, Matt Carpenter, Stephen Piscotty, Lance Lynn, Michael Wacha, and Jaime Garcia.The lesson here is obvious: A culture that develops talent assures that your organization can replace from within and continue to thrive even if you lose top-level employees. In business, as in baseball, developing talent internally is far more cost effective than acquiring it from outside the organization. A culture that gives opportunities for advancement is key to sustaining a competitive edge.
  5. New York Yankees – Manage your human capital: Grantland’s Ben Lindbergh has been taking a close look at how wisely managers husband one of their clubs’ most precious resources – their bullpen. Feel free to check out his article for the underlying math, but I’ll give you the upshot here: by Lindbergh’s metric, it turns out that Yankees’ manager Joe Girardi has consistently been one of the best managers at deciding which reliever would be best to use in a given game situation.The ability to manage the bullpen was particularly important to the Yankees, who relied on their star relievers Dellin Betances and Andrew Miller to shut the door on any potential comeback. They were effective enough to basically shorten Yankee games from 9 to 7-innings given how difficult it was to mount any sort of comeback against them.The Yankees are placed right after the Cardinals for a good reason: It’s one thing to develop great human capital, but management needs to know how to deploy them to be effective.
  6. Pittsburgh Pirates – Show that you’re willing to invest in your people: On March 4, 2012, the Pittsburgh Pirates announced that their star centerfielder Andrew McCutchen had agreed to a six-year, $51.5 million contract extension. The move was a change for the Pittsburgh Pirates, which had seen many of its talented young players leave town for more money.It would be irresponsible to claim that this extension was the primary reason that the Pirates made the playoffs in the following three years. However, it sent a message to players around the league that the Pirates were no longer building an organization with sand, but with cement. It is hard to convince veteran players that your organization is a good one to play for if you won’t spend money compensating your most valuable employees.The Pirates serve as a reminder that, while building from within is important, talent must be fairly compensated. In the case of the Pirates, both the player and the team benefitted. McCutchen more than earned the salary and the contract is a steal for a player of McCutchen’s caliber.

By October, management has done its work and the outcome of the playoffs will be decided by the players, not the folks in suits.  But it would be foolish to discount the importance of developing a strategy for building a successful team and then developing and assembling the players who can carry out that strategy. Similarly, in business, management creates the foundations for success by crafting successful strategies and developing and deploying its human capital in the most advantageous way to achieve the organization’s goals.

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