Moneyball

For those who don't know the backstory behind Moneyball... The true story of a low budget baseball team, the Oakland A's came up with a formula that changed baseball forever. Baseball teams used to evaluate a player's worth based on likeability and a list of individual stats. What the Oakland A's figured out was that it was a numbers game. Instead of buying players, they bought wins. How did they do this? Well they put together an formula that combined the average number of hits need to win games and signed players to hit that number. It was a success and forever changed the way baseball organizations operate and recruit. The numbers don't lie and aren't limited to baseball either. 

The key is to find market inefficiencies based on numbers. For example, some of the biggest companies have absolutely no video content. Why would they ever need to if they're some of the biggest companies? Well you could make that argument for the Yankees too. Here's what the numbers show, video increases landing page conversions by 80% and organization that use video increase their revenue 49% faster than those who don't and lastly consumers are more likely to watch a video about a product or a company than they are likely to read about them. The numbers don't lie and they're coming for the Yankees of the business world if they don't start building video content. 

Finding market inefficiencies is an ongoing concern. Baseball is a copycat sport. Whenever a team has a winning season with an affordable payroll, other teams are bound to copy the template and poach key staff. Advantages are short-lived. Which means that teams like the A's must constantly search for new ways that they can affordably compete with larger-budget entities like the Yankees. It's a form of business-model innovation, in the sense that your business model--which should address how you keep costs like payroll in check--is not fixed but, rather, continually modified to stay profitable. The key to successful business model innovation is a larger subject. But as this article on Harvard Business Review points out, it requires three things: The ongoing attention of the top team, a willingness to experiment, and the bravery to "pivot" the business model in a new direction, when the time is right. - Ilan Mochari, Inc Magazine