Tim Murphy
As the weather warms and we settle into the summer, I always look forward to baseball. I use to play baseball, like to watch baseball. and find myself discussing baseball often. This year I had a good exchange with some colleagues about the book and movie Moneyball, Michael Lewis’ classic tale of how the the Oakland Athletics competed with much higher payroll teams by innovating the way the game is analyzed.
One of the big thought transitions that Moneyball issued into the sport was a shift from focusing on batting average to a stronger focus on on base and slugging percentages. In many ways this transformation is similar to what many companies are facing in post-pandemic procurement and supply chain management. Before the pandemic, many organizations focused on the singular metric of savings which is reflective in some ways of a narrow focus on batting average. As a statistic, batting average captures the concept of putting the ball in play without making an out. Our understanding of baseball has improved by shifting our thinking to see both that their are other outcomes that don’t result in outs and that the quality of the ball put in play matters.
In procurement and supply chain management we need to evolve our focus from a narrow perspective on savings to a broader range of positive, supplier related outcomes. The quality of supplier relationships and interactions are valuable beyond short term financial gain. We should all be asking ourselves what has been left on the table in the pursuit of annual cost savings that could have represented more value to our company, shareholders, and customers.
You can learn more about our perspective on how the lessons from Moneyball can benefit procurement and supply chain management in our latest white paper.