Stats are for Winners: Moneyball & Customer Sat
Posted by Vovici Blog on Fri, Apr 01, 2011
Bill Belichick, the coach of the New England Patriots, famously said, “You know how I feel about stats. Stats are for losers. The final score is for winners.”
Another Bill, in another sport, would disagree.
As we celebrate yesterday’s Opening Day of Major League Baseball, it seems appropriate to look to Billy Beane, general manager of the Oakland Athletics, for some inspiration. Michael Lewis chronicled Billy’s baseball journey in Moneyball: The Art of Winning an Unfair Game. In 2002, Billy had to wrestle with how to field a competitive team when he could invest only $41 million in salary while the Yankees were spending $125 million.
His solution was, of all things, statistics. He rejected traditional statistical measures of success – batting average, runs batted in (RBIs) and stolen bases – in favor of metrics like on-base plus slugging (OPS), walks plus hits per inning pitched (WHIP) and defense independent pitching stats (DIPS). Each of these new metrics – collectively called sabermetrics (from SABR, the Society for American Baseball Research) – was proven to have greater predictive validity of a team’s success than the old ways. This approach enabled Billy Beane to build a competitive team on a budget, by finding good players who were undervalued by traditional measurement criteria.
In the world of customer satisfaction and loyalty, which metrics are most likely to predict topline growth in revenue? What stats are going to help you best build a winning team? For some firms, an old-line batting average stat like customer satisfaction will work great, while other firms will find a new measure like Bob E. Haye’s RAPID or the Forrester CxPi works much better. It’s not hard to collect data on 19 metrics that affect customer experience, customer satisfaction and loyalty, then analyze the results to identify those that are most important for your organization. Don’t assume the old stats are the best way to measure the effectiveness of your team.
The A’s have yet to win the World Series under Billy Beane. Ironically, another team went the sabermetric route and ended an 86-year drought of World Series titles, winning two in four years. They even caused the Yankees to blow a 3-0 lead in a 7-game series for the first time in baseball. Maybe stats are for winners.