Monday, July 13, 2009

The Way of Strategy (6): Maintaining Your Competitive Edge

Protect Your Competitive Edge

When everyone knows the particulars behind your strategic advantage, the competitive advantage is now gone.
If the opposition has more resources and a deeper network than you do. What is your counter move?

Brill: In guerrilla warfare, you try to use your weaknesses as strengths.
Robert Clayton Dean: Such as?
Brill: Well, if they're big and you're small, then you're mobile and they're slow. You're hidden and they're exposed. You only fight battles you know you can win. That's the way the Vietcong did it. You capture their weapons and you use them against them the next time.
--- Enemy of the State (1998)

You have to gather and assess intelligence faster and better than your opposition. You need to move faster and set higher standards of performance.

Lesson: If you are ahead of the competition, focus on expanding your competitive lead. If you are behind, focus on finding an innovative way that will change the paradigm of the grand competition.


Beane may not be ready for big screen,
but he is looking forward to a big turnaround

Susan Slusser, Chronicle Staff Writer

Sunday, July 12, 2009

Billy Beane, in his 12th year as the A's general manager, has become a nationally recognized figure. Brad Pitt was even set to play him in a movie.

That's partly because of the team's success - Oakland made the playoffs five times in seven seasons from 2000-2006. It also has a lot to do with Beane being the central character in Michael Lewis' bestseller "Moneyball," which detailed the general manager's attempts to exploit market inequities despite operating with a lower payroll than most clubs.

"Moneyball" the movie was set to begin filming at the end of June, but it was abruptly shelved a few weeks ago and its future is murky. Beane's team, meanwhile, is at the bottom of the division and enduring a rough season full of injuries and underachievement.

With all that going on, The Chronicle recently sat down with Beane to talk about movies, baseball, philosophy and the future. The following Q&A has been edited for content and clarity.

Q: What is your take on "Moneyball" the book? Was it a good thing for the team, in retrospect?

A: I always have to remind everyone that I, or we, didn't write the book nor did we commission someone to write the book. And the fact that it is still a question seven years after the fact, whatever impact it has is maybe not the result of us but maybe because Michael Lewis is a well-thought-of writer. I'm amazed it's still as much a subject of conversation as it is. Again maybe that's the genius of Michael, it's certainly not of us.

For some time, the book and the team seemed synonymous. The "Moneyball" A's.

At this point it seems outdated and I can assure you it's outdated. Listen, you can't get stagnant in this business and we certainly haven't. There are teams that are probably far beyond what we can imagine in this office based on their intelligence and their resources. You can probably figure out who they are.

This is still a great place to work. We have our challenges, but the good outweighs the bad.

Q: So much is made of that so-called "Moneyball" approach in which you identify areas that might be undervalued (in the book, on-base percentage was one such area). How would you say your philosophy has changed or is changing?

A: Listen, you can't do the same things, in this case, seven years later. There are too many changes in the game and it's more and more competitive. Whatever philosophy you label anyone, every one of us has the same philosophy: We'd all like to have good pitching, we'd all like to have a strong defense up the middle and we'd all like to have power on the corners. We don't have this template where we're going to do this and not going to do that. ... The one we have now is the same one that's been around for 100 years.

Q: How would you describe the state of the team right now?

A: If you look at where the current team is this season, where we are right now, where we are headed long-term, there are some good things going on right now, and some things we thought would be better. We thought we'd be healthier, we're not. And we thought we'd be a better offensive club, and we quite frankly haven't been. Some of that, I can't explain.

From a long-term standpoint, we're going through a necessary part of rebuilding this franchise. The history of this franchise is full of very good teams, starting over, all the way back to Connie Mack. It's a function of a lot of things but there's only one right way to do it and there are really no shortcuts in this market.

Q: What are the bright spots?

A: The good thing is that we've started to develop some young starting pitching, which is critical for us to become a good team again on a consistent basis. That's what we set out to do, to try to get the pitching in place. I think they're starting to get established. There are still going to be some growing pains, but there's no denying they have talent and they've shown the ability not only to pitch here, but to pitch well. So it's sort of a glass-half-full situation.

Pitching is so expensive and if you look at small- to mid-market teams - the ones that have had success - they've really developed those pitching staffs organically. We did it, the Twins are certainly one of the most successful ones around, and the Angels are mid-to large-market but they've done a really great job.

Even a large market (team) would like to take that approach and when you look at the Red Sox, they're trying to do that, too. That is an area we're going to have to develop from within and through trades. We've done a little bit of both because it's the one area we really can't go outside ourselves and bring people here. It's very risky and it's expensive and we're probably 20th in line for that free -gent pitcher based on finances.

Q: What is the most pressing need?

A: Some of it is pretty obvious. We need to get some position players and some bats. What's funny - well, it's not that funny, not hah-hah funny - is that when I first started here, we really had no luck developing pitchers and we always had guys who could hit. Recently we've done a good job with the pitchers and we need to get some core position players in place. The good news is that we have some kids coming that I think will be a part of that. With the injuries, we've had a tendency to rush some of the development and it's not ideal. We want to make sure we do everything to give them a chance. But obviously as we go through the summer, we might want to see if some of these guys are ready for the next level. We just want to make sure they get a solid foundation first.

Q: What sort of misconceptions are there about this team, particularly on the financial side? You've mentioned that there is no need to cut payroll, for instance.

A: We really truly want to rebuild, and there are no shortcuts, but in the interim one of the things we're going to try to do is to be respectful of our fans. We're going to spend any excess we have. We owe it to the people who come here to have the best players we can within the confines of our payroll.

This article appeared on page B - 1 of the San Francisco Chronicle


Billy Beane should not have publicize his "Moneyball" process. In a field of copycats, most of the top tier competition were able to catch up with the "Moneyball" approach.

The two points that one must remember are:

  • One must always conceal their competitive edge as long as possible.
  • While concealing the competitive edge, one should be innovating another paradigm shift.

"Do not loan sharp weapons to other men. If you loan sharp weapons to other men, you will be hurt by them and will not live out your allotted span of years."
King Wen said:"What do you mean by benevolence and righteousness? ...
Do not allow other men to snatch away your awesomeness. Rely on your wisdom, follow the norm. Those that submit and accord with you, treat them generously and virtuously. Those that oppose you, break with force. If you respect the people and trust, the state will be peaceful and populace submissive."
- T’ai Kung Liu-t’ao (Six Secret Teachings)

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