Taking Control Over Your Business

Do you ever feel like everyone else is controlling your business but you? The pressure from suppliers, staff and government to name a few, can be overwhelming and make you feel like you have little control over the daily operation of your business. But wait -there is a solution.

I had an article ready to go until the other night when I decided to put it on the shelf for the next newsletter in preference of this 2012 New Year's message. Typically I begin the year writing about what I consider to be important New Year's resolutions. However, after watching a movie called "Moneyball" last night, I decided that this should be a lesson for everyone in business.

If you have not already seen this movie, then your homework for the weekend is to watch it. You can either rent it at your local video store or use on demand on your TV. This is a true event that literally turned the lights on for me when I watched it. It's a story about making an unpopular change to the way the Baltimore Orioles managed their baseball team.

Brad Pitt stars as the General Manager of the Baltimore Orioles and after losing the Pennant in the final series he was left with the task of rebuilding the team. They were going to lose three of their top players to free agency so the story begins with Pitt sitting in their board room with all of his scouts and managers trying to figure out how and who they could recruit to fill the open positions.

He goes to the team owner and begs for more money so he can recruit some top players. The challenge was that he had to field a winning team on a $39 million budget as compared to other teams like the New York Yankees who had a $105 million budget. The owner said no because they were a small city in comparison and simply did not have the revenue to increase the salary cap.

Pitt goes to Kansas City to negotiate a trade with the Royals. During the trade talks in the Managers office, Pitt realizes that a quiet, unassuming guy at the back of the room seemed to be pulling the strings on the manager's decisions. After an unsuccessful negotiation he went to this guy's desk and asked if he was responsible for the manager saying no to the deal. The guy said he was just a number cruncher, but his statistical analysis said no to the trade.

Pitt hires this guy and makes him the assistant GM. The number cruncher has a program he designed that laid out what each player needed to produce to achieve the necessary number of wins to get them into the playoffs. It narrowed down how many times individuals needed to get on base, who was most efficient at getting walks and a host of other obscure statistics. Pitt got in a big fight with his scouts and managers, because he told them who to go out and get to fill their roster. The players he wanted were basically unwanted or injured players that fit specific needs of the team and could be acquired for a very low salary. The scouts said he was nuts and that it would never work.

I don't want to give the whole movie away, but the Baltimore Orioles set the record that year for the most consecutive wins in one season of any team in baseball at 20. They also made it to the big show, although they did not win the Pennant. Their statistics showed that they paid $237,000 for every win as compared to the Yankees who paid $1.5 million for every win.

This was not popular with the players or owners throughout the league, because it completely changed the approach to fielding a winning team. It said that you can be successful without the big budget and super star players. The classic example was a pitcher nobody wanted, because he was so unorthodox. He was a submarine pitcher that had a really funny delivery, but he turned out to be Baltimore's best relief pitcher. Why? Because the stats showed nobody could figure out how to hit his pitches.

The point I am making is your success like baseball, is hidden in the numbers. Baltimore was successful because they used history and statistics to acquire the right players who could deliver. Analyzing the statistics and financial data you have at your fingertips can be your window of opportunity. Sometimes thinking outside the box and adopting a system that is different from the status quo can be your solution to success. The principles of financial management are the future, so don't be like those scouts who cannot see past traditions. It's time to take control!

It's a really entertaining movie, so take some time and watch it. I have no doubt the light will come on for you as well.

If you would like more information on how financial management can benefit your business, contact me for a free tele consult.

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