Thursday, April 26, 2007

Book Report: Moneyball

Moneyball: The Art of Winning an Unfair Game (ObAmazonLink) follows the Oakland A's baseball team through the 2002 season and explores how their GM, Billy Beane, has transformed their approach to team building from a method based on emotion and "old school baseball knowhow" to one of logic and math. The result is the creation and management of one of the cheaper teams in the MLB that manages to consistently hit the playoffs. Since a team's ROI is based on ticket sales vs. salaries, the more games you play, the more money you make. In 2006, the wins to player cost ratio was 126. The Yankees are 46 and the Giants are 79. In order to improve their total revenue to player cost ratio, the A's are building a new stadium that is expected to draw a significant increase in crowd size due to the closer proximity to Silicon Valley. (More detail over at Forbes.)

Michael Lewis does a great job of setting up the story with sufficient but not overwhelming background on the team and Billy Beane. Lewis then details several facets of the A's approach by following the draft and several trades. In essence, the book is proof by example.

Highly recommended for anyone looking to better understand the business of baseball through a good story.


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