3 Business Lessons for Performance Analysts

3 Business Lessons for Performance Analysts

It is often the case that when famous managers retire they start speaking at numerous business events. Telling business managers how to create that winning team, be a good motivator and generally how to apply the lessons of high-performance sport in the boardroom. While there are certainly many lessons that business can learn from sport – Are there lessons sport could learn from business?

I think the answer is a very strong YES!. Professional sport is still sport and sometimes suffers from irrational decisions by fans, managers and owners. Looking at the business of clubs themselves is a whole different case but I wanted to examine 3 business lessons we could use in our analysis department to make it much more efficient.

Lesson 1: Group Buying

This is, in fact, so important I contemplated making it all 3 lessons. I am always asked about how to run an analysis department on a small budget. So to learn from the business world let’s look at a supermarket giant like Tesco. All the supermarkets business models work on something called Economies of Scale – this effectively means the bigger we get – the cheaper each unit of the product we are buying  becomes.

Back in the old days a supplier, let’s take coca-cola as an example, would have to call to every ‘mom & pop’ store in a country and sell them on the fact that they should stock coke and then a sales rep would have to manage those accounts on-going – making sure orders arrive on time, payment is made etc etc… The cost of this meant the ‘mom & pop’ stores were paying a premium, because somebody had to manage all those individual accounts.

Then comes along a big supermarket like Tesco. They approach Coke and say ‘we have 500 stores you don’t have to call to all those ‘mom & pop’ stores anymore just deal with 1 buyer and just manage that account‘. This significantly reduces the cost of a sale from Cokes point of view so they can offer Tesco a better price. Supermarkets and all businesses run off this premise – the more you buy of something the cheaper each unit becomes.

Analyst should think similarly. Instead of each club existing as an individual buyer (mom & pop store) they should be thinking of coming together as a buying group. Everything can still be managed on a club by club basis, but if 10/15 clubs can approach a supplier and say ‘all of us are interested in buying your product – what the best price you can do.’ I know from experience that the price will be significantly cheaper. There are loads of examples where fully independent companies come together to collectively buy from suppliers. It is one sure way to reduce the costs of your capital items immediately and is severely under utilized in sport.

Lesson 2: Not Everything is a Cost

This one is easier said than done but is still very important. Too often analysis costs such as equipment & staff training are considered costs by the higher powers in a club. You will often get comments like ‘it wasn’t like that in my day’ or a simple flat out ‘we can’t afford to spend anymore on analysis’. Cost is clearly a barrier to doing things but as analysts we can learn to phrase our requests in a better light. Instead of presenting everything as a cost – can we present items as an investment or even better as something that will save money?

For example let’s say at the moment you burn everything to DVD and now you want to start putting your analysis on a server or online so players and staff can access the material in their own time. This is a cost, but can you phrase it to the powers that be as a money saver. If I was making the case for this online option I would add up the number of DVD’s we go through in a season and I would include the staff cost of making all those DVD’s every week I would then present the ‘new cost’ against the current cost when making my case. Granted the staff cost is not a real saving as they will still be paying for somebody but you could also add in all the extra work you could get done in that time. Each case will be different and the amounts involved will vary significantly but just thinking about how we phrase our requests can help the case.

Lesson 3: Invest in People

If you look at the most successful companies in the world they will all share this characteristic. All of the from Starbucks to McDonald’s, or from Google to Apple, they all invest heavily in their people. There is no doubt that training opportunities are limited in performance analysis but that doesn’t mean we shouldn’t look for other opportunities to learn. Things like Excel or Photoshop can add significantly to an analysts skill set, rather than just being self thought in all these things find experts who could teach you and your staff more efficient ways of doing it? Can you turn a request for funding into a mini business plan?

I would also include in this that it is a good thing to pay staff – internships are a great way for people to learn the ropes and be introduced to a field but remember there is still a cost to employing somebody even if you pay them nothing. Your time in managing them, training them and teaching them what you know. Why would you let a valuable asset leave your organisation at the end of season when you have invested so much in them? If you pay peanuts – you get monkeys.

Finally: Think like a business

In all aspects of running a team we need to think more like a business. Hopefully the 3 lessons above act as a starting point to think of your analysis more from a business perspective rather than just a cost. If you have any others please leave a comment below.

2 Comments

  1. chetan choudhary April 16, 2012
  2. carpinteyrojzg December 4, 2012

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