I like books about baseball. But what I really like are books about baseball that aren’t really just books about baseball. What a deal—you can read about baseball, but receive some bonus lessons. The most obvious example is the book Moneyball by Michael Lewis. That book, in fact, is on our list of top ten book recommendations.
Moneyball was, in many separate ways, a groundbreaking book about the Oakland Athletics, their former-player and now analytical General Manager, Billy Beane, and a previously overlooked statistic called On Base Percentage. That brilliant book by Michael Lewis recounted through effective storytelling the Athletics approach to competing with much richer baseball clubs by exploiting inefficiencies. That is, among other strategies, Billy Beane and his team capitalized on the fact that players that reached base at an impressive clip (i.e. had high on base percentages) were not valued as much by other baseball teams as they should have been.
The Extra 2%, by Jonah Keri, is, in many ways, a more modern version of Moneyball. Keri published it in 2011 and describes the Tampa Bay Rays from their founding in 1998. The team went from laughing stocks that players avoided to, more recently, a surprise powerhouse that outdid the much richer New York Yankees and Boston Red Sox.
How did they do it? They followed the same approach as Billy Beane’s Oakland Athletics: They exploited inefficiencies. They sought and engaged players and strategy that less analytically inclined baseball franchises underrated or didn’t even consider.
The title “The Extra 2%” reflects the fact that from every angle the Tampa Bay Rays sought that extra edge, no matter how small, that would give them an advantage. Cumulatively those advantages added up to many victories.
The book itself is well-written, delving both into baseball analytics (but not too numbers heavy) and storytelling about the individuals—both the good guys and bad guys from the perspective of helping the Rays win. The chapter about Manager Joe Madden and his upbringing in Pennsylvania is particularly compelling.
One point that the author, Jonah Keri, reiterated is that unlike Billy Beane and the Athletics, who seemed unconcerned about their secrets getting out (and they did), the Rays were secretive, to the point that they forbid certain analytical employees from disclosing the fact that they even worked for the Tampa Bay Rays.
This secretive approach supports and may be necessary to maintain that two percent advantage, but it certainly doesn’t help the author of a book about those tactics. Nevertheless, Jonah Keri did a great job piecing together what he could obtain from others to create a compelling story.
The Extra 2% is About More than Baseball
The idea of seeking small advantages or exploiting inefficiencies is certainly not limited to baseball. In fact the Rays (and the Athletics from Moneyball) applied this general concept to baseball in a way that has not yet caught on among all Major League baseball teams. Indeed, my favorite team—the Minnesota Twins—seem to be near the back of the line of using analytics.
The Rays executives and ownership that turned the team around arrived from Wall Street where these type of analytics are common; most people focus their careers in finance on exploiting inefficiencies and seeking small advantages that add up to big riches.
When you read a book like The Extra 2%, you should enjoy the storytelling and the baseball, but think more broadly about what you can learn from the book’s protagonists—the Wall Street executives that saved the Rays and helped them thrive.
Sometimes the idea is one that you’ve never had before; other times you know the concept, but haven’t been conscious of it lately. Reading a book will bring it to the top of your mind. That, in fact, is part of why I like to read books about writing. I learn about writing, but reading about writing makes me think about writing. And when you engage a concept, idea, or process, you typically get better at applying it.
In this case, the key concept is that you should look for small advantages or inefficiencies and find a way to benefit from them. This idea might hit you for the first time when you read the book, but if you have any investing experience, it probably isn’t new to you.
But as you travel through your days and weeks and months, you likely set your attention elsewhere and don’t consider how you can find these small advantages that can create your own wins.
An obvious application of this extra 2% is through investing. If you can obtain even a small advantage in your investments, whether informational or otherwise, you can do quite well (I’d recommend against Insider Trading, however). Real-estate investing, in particular, calls out for this type of advantage because markets are local and each property is unique. It isn’t difficult to find small advantages. But the application is much broader.
For example, if you are seeking a new job, consider different tactics that might increase your chances, even a small amount, of finding or obtaining the position you want. What can you do that most applicants don’t even consider?
If you have a business, try to view your industry and market freshly and determine what your competitors are under or over rating. What are they ignoring? For example, maybe you can find a way to outsource a task for less cost that most people in your industry do themselves merely out of custom?
If you are one of those adults that still like to compete in sports or other athletic competitors, like Crossfit for example, research the latest science on the most efficient and effective methods of improving aspects of your athletic condition. I highly recommend Tim Ferrriss’ The Four Hour Body for great tips on the lowest effective dose of physical improvement.
The key is that you must unlock your creativity to seek opportunities that others have missed. They are everywhere.
If you enjoyed this article, please recommend it to your friends with the social-sharing buttons below.