Competing With Data & Analytics
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You’ve seen this at your workplace: some groups of people just perform better than others. The question is: Why?
It’s easy to focus on a team’s hotshot, or those with the best numbers who jointly raise their group’s overall performance.
But some teams do well because there’s a special alchemy among the team members. Alchemy is intriguing because it’s difficult to pin down. It could come from a team member who’s good at keeping other team members focused, or a member who has an upbeat personality that lifts everybody else’s energy.
Fortunately, there’s a way to measure which team members make a group work so well.
It’s called “plus/minus” analysis, and it involves looking at not just individual performance but at performance in context — understanding, through data, how a team of people does overall when one person is part of the mix, and when they’re not.
It’s a lesson that businesses can borrow from professional sports, where this kind of performance assessment is becoming more common.
Writing in the Summer 2014 issue of MIT Sloan Management Review, Thomas H. Davenport says that some U.S. teams in the National Basketball Association, Major League Soccer, and Major League Baseball have become more sophisticated in using analytics to measure team and player performance. Plus/minus analysis is used in sports for looking closely at how a team does when a particular player is playing and when he’s not, writes Davenport, in “What Businesses Can Learn From Sports Analytics.”
“Even if a particular player doesn’t generate impressive individual statistics, he may still be invaluable in a game if the team tends to perform much better when he’s playing,” Davenport writes. Teams are using analytics to look at how they do with both individual members and with different combinations of players.
Davenport cites basketball player Shane Battier, who retired earlier this year, as a notable plus/minus hero. Battier’s team, the Miami Heat, simply played better when he was on the court.
Companies would do well to use this kind of data to understand which of their own team members boost overall group effectiveness.
“In most businesses, analytics have typically focused on operational or marketing issues and not on the human dimension of performance,” writes Davenport, who is the President’s Distinguished Professor of IT and Management at Babson College and a research fellow at the MIT Center for Digital Business. “Even when companies do employ human resource analytics, their approaches are not as sophisticated as those of sports teams, and thus far they have been applied only to individuals.”
“The effectiveness of a large company’s B2B sales teams, for example, could be evaluated across different team compositions for various customers to identify the ‘Shane Battiers’ in the sales organization,” he continues. “Teams in retail stores or bank branches could also be analyzed with such plus/minus approaches.”
While plus/minus analysis is a valuable technique for identifying people who are essentially “secret weapons” to an organization, that’s not the only lesson that the use of analytics in sports has for business.
Davenport’s article also explores the ways teams are using data to coordinate key decisions along different management levels, the way teams take advantage of video and GPS-based location information, and how managers encourage players who are “analytical amateurs” to track their own scores to improve their performance. See the full article for all of Davenport’s examples.