How to Bet the Big Game
Betting the Big Game: Analytics or Intuition?
I made a fortune taking the Buccaneers over the Chiefs in last year’s Super Bowl — and you can make a fortune too if you follow my system. Tell you how after using sports metaphors to illustrate an ongoing business issue that smart managers should constantly attempt to optimize.
The movie Moneyball from 2011 popularized the use of data analytics as applied to sports. Brad Pitt and Jonah Hill starred as the management team of the Oakland A’s, developing proprietary algorithms to drive decision-making on everything from which players to acquire all the way down to whether a certain batter should swing at the first pitch against a certain pitcher. Hill commented that the analysis “enabled them to find value that other teams could not see,” and leveraging this intelligence enabled them to win their division. Sounds perfect.
Then Trouble with the Curve came out in 2012 and made the exact opposite point. Clint Eastwood played a baseball scout with decades of experience in evaluating players. He mocked his team’s front office execs that sat in an office staring at numbers; he thought it ridiculous that they wanted to select players without ever actually having seen them play. He recommended they pass on drafting a player that checked all the boxes mathematically. Why? Because he noticed a flaw in the player’s swing that would render him unable to hit a Big League curveball (hence the movie title). The flaw was camouflaged by weak high school pitching and because was using an aluminum bat (not allowed in the pros). These things didn’t show up in the Big Data analysis, so experience reigned supreme.
Which is the best approach, in sports and in business? Does data rule, or should you make decisions based on the experience and intuition of your leaders / employees? The answer is partly situational. Ads are targeted on social media, for example, based on demographic and behavioral data; the sheer volume of information available in certain situations makes it impractical to get too granular. At other times experience rules. I worked in a hospital and analyzed how long it took various dentists to perform a surgical procedure. Three dentists took significantly longer than the rest, which was potentially important since operating room time is very expensive. I presented the findings to the Chief of Dentistry, who said “Doctor A does all our root canals, so it makes sense his times are long. The other two are just slow.” Perfect illustration of how businesses need to combine the ability to analyze data with the knowledge and experience to react properly to what the data tells them.
Moral of the story: In today’s business world you have to know your numbers… and you have to know your business well enough to know when to ignore them.
And by the way… how did I know the Buccaneers would defeat the Chiefs in Super Bowl LV? Easy. They have way cooler helmets.