In addition to my typical fantasy and regular baseball readings around the web, I have decided to start reading books that I think can help build my analysis skills and baseball knowledge. Afterwards, I’ll give a review of the book and apply some takeaways.
The book I chose to read first is The Extra 2%: How Wall Street Strategies Took a Major League Baseball Team from Worst to First. I chose the book for two main reasons:
- I’m a fan of Jonah Keri’s work elsewhere on the web.
- The title screams to me that there are surely strategies and mindsets that can be borrowed from the book and applied to fantasy baseball.
About the Author
I first became aware of Jonah Keri when I stumbled upon his podcast a couple years back. Unfortunately he no longer produces new episodes, but I found him smart and entertaining, and he had great baseball guests like Rickey Henderson, Rob Neyer, and R.A. Dickey on the show. Jonah has since made it big, appearing on Baseball Tonight occasionally and writing regularly for Grantland.com.
The Extra 2%
The backdrop of the book is a look into the history of the Tampa Bay Rays franchise, from the beginning battles the Tampa area fought to win a team to the inception of the franchise, its initial struggles, and then an ownership change in 2005 that gave the team new life. On top of that historical account of the Rays franchise, Keri highlights the strategic and analytical approach the new leadership team brought with it in 2005. As the title of the book indicates, the Rays turned to a team of Wall Street experienced businessmen and analysts with little or no formal baseball experience. But it was the analytical and value-driven approaches learned on Wall Street that helped the Rays turn things around.
How They Did It
The book is full of specific stories and examples of how the Rays went about this transformation and the decisions they made. From the stories, I observed three main themes the team applied to improve the Rays organization (and that you could apply to become a smarter fantasy baseball mind):
- Strive for continuous improvement
- Apply a consistent, methodical, and analytic process
- Identify and take advantage of market inefficiencies
The book begins with a very interesting foreword by Mark Cuban (another analytic business mind who’s found success in sports), who tells an interesting account of how his Dallas Mavericks apply many of the same principles as the Rays. One segment of this foreword was especially worth remembering:
“…they embrace that challenge every day and continue to improve themselves on and off the field. Like me, they’re always looking for new, subtle ways to beat the competition… No one idea is likely to make a huge difference. But collectively, those ideas make the difference between winning and losing, or between winning a little or winning a lot.” ~ Mark Cuban in “The Extra 2%” by Jonah Keri
There is so much to learn about baseball, sabermetrics, and strategy, that I’ll never know everything. But as Cuban and the Rays believe, if I’m continually striving for more knowledge, I can gain and keep and edge over the competition. Reading and listening to some of the best minds in baseball is a great way to do this. Using the great tools available to fantasy players is another. Plus, I love the game of baseball and learning new things. Continuous improvement is something to strive for in every aspect of life, it doesn’t have to be solely about winning fake baseball competitions.
Believe In The Process
Keri does a nice job of depicting how the Rays set a goal of turning one of the worst franchises in baseball into a winner and then how they developed a specific plan to attain that goal. That goal was then used as a guiding light in every decision made by the team’s leadership. And every decision was made with an objective, well-thought out approach.
“A really smart, analytical GM is going to be better than one who is not as analytical. If you have the ability to get to nuggets of truth, you have the ability to perform better than someone who manages by the seat of his pants.” ~ a quote from Matt Finley in “The Extra 2%” by Jonah Keri
You know as well as I do, that there are no “nuggets of truth” in fantasy baseball. But the proper research and homework can stack the odds in your favor. Do the right things for the right reasons.
“We believe, with the right process, good things will happen” ~ Andrew Friedman, GM of the Tampa Bay Rays in “The Extra 2%” by Jonah Keri
Recognize And Attack Weakness In The Market
The concept of “Arbitrage” is a recurring theme in the book, the same principle applied by the Oakland A’s in Moneyball. Keri tells a number of stories that highlight the importance of this approach to the Rays turnaround, from specifics about trades the team executed to free agents they signed. Essentially, arbitrage is the process of taking advantage of weaknesses or inefficiencies in a marketplace. Buying something at a low price and selling it at a higher price, and pocketing those gains.
If you can consistently succeed in this approach, you turn nothing into something. Buy Player X, whom you believe has the skills of a solid major league utility player, when he’s perceived as a AAA player. Put Player X in situations where he can succeed and demonstrate his abilities. Other teams begin to perceive Player X as the solid major league utility player you have always believed he was. Trade Player X for Player Y, whom you believe is a potential all-star, when Player Y is struggling and is only perceived as an average utility player.
The web is full of “buy low, sell high” fantasy baseball advice. This advice is “Arbitrage”. It’s not a new theory. Be on the look out for any opportunity where a player is being artificially over- or undervalued, then attempt to take advantage of that inefficiency by acquiring the undervalued and selling the overvalued.
I really enjoyed the book. It’s a short read (250 pages). Keri tells a good story. There is a lot of humor to be found in the failures of the first ownership regime. And a lot to learn from those that took over and turned the team around. I learned a lot about the history of the Rays, what it takes to obtain the rights to a new MLB franchise, decisions not to make when running a team, and how achieve success from a seemingly hopeless situation. This story can be applied to fantasy baseball, achieving success in business, or life in general.