Maybe the New York Yankees aren't so good after all. Billy Beane, the general manager of the Oakland Athletics baseball team, pointed out that during the 2004 season, the Oakland A's paid about $387,815 per win, while the New York Yankees, which has the highest payroll in baseball (about $187 million), paid more than $1.2 million per win.
"It's a statistic I have up on my wall at home," joked Mr. Beane during an April 13 presentation at the Chicago Quantitative Alliance's annual Spring Conference in Las Vegas.
Mr. Beane was the subject of the book "Moneyball" by Michael Lewis. The book, published in 2003, chronicles how the Oakland A's mine statistics to uncover "undervalued assets" among players, to find the most "underpaid statistic," and to make game-time decisions. (P&I, Sept. 15, 2003). The A's have made the playoffs in each of the past four seasons, despite having one of the lowest payrolls in baseball (about $60 million). In those four years combined, the A's have won just one fewer game than the Yankees. The Oakland team's use of statistics closely resembles quantitative money management techniques, the book points out.
Mr. Beane also noted that other Major League teams such as the Boston Red Sox are beginning to use the same methods. "My job will get tougher and tougher going forward," he admitted.