There's a type of thinking in business circles that values above all else the nonobvious but numerically correct choice. It's the sort of thinking that tells people to say no to customers, to even turn them away. You encounter this thinking a lot at business school, where hidden in every case is the numerically justified hard choice: you can absorb the cost of laying off some people with a system that enables those who remain to do just a little more work. It prides itself in deprecating the creaky old in favor of the more profitable new. Its paragon is the laptop-toting whiz kid.
I'm calling it whiz kid, but I'm not sure what the right word for this tendency is. There's an aspect of iconoclasm, where the old must be overturned; there's a bit of futurism, too, because to be new is to be better; there's complexity bias in the cocktail, too, because the more complex your Excel model, the better it must be.
Though you wouldn't have predicted it when Liar's Poker emerged to torch Wall Street's fancy new financial tactics, Michael Lewis has to be the champion of the whiz kid. His boosterism peaked with Going Infinite, which took a few hundred pages to try to leave the impressed that underneath SBF's Adderall-addled nonsense was a kind of genius. Honesty? Controls? Laws? Whiz kids need none of that. But the whiz kid isn't always such an obvious villain as the imprisoned SBF.
Jonah Hill's character in Money Ball is the whiz kid par excellence. He's crunched the data and found the non-obvious, under-valued stat at the core of baseball. Success at our national pastime boils down to simply getting on base. Talent evaluators and team constructors typically looked at all kinds of metrics and intangibles, but by undervaluing walks and over-valuing hits, they weren't optimizing for what really counted: he gets on base. The weathered, wizened, decidedly old school scouts hated this—the team manager Phillip Seymour Hoffman loathes it. They want the old ways to reign supreme: good hitters, 4- or 5-tool players; who is a baseball guy; the beauty of the game. They know baseball. In the movie, Brad Pitt listens to Jonah Hill, and the hapless A's, after jettisoning their best players, turn into a ragtag band of secret winners, all powered by Scott Hatteburg's underrated ability to get on base. The triumph of the baseball whiz kid leaves you in tears.
I'm not convinced.
In business, pissing off your customers isn't the hard choice: it's harder to serve them well, it's harder to expand to serve new customers without losing the old ones. Completely replacing the old thing with the new isn't more challenging, it's easier; what would be harder, would be to meaningfully keep both.
Big baseball faced this exact choice, just after the pandemic regarding how to run its minor leagues. The sprawling system of teeny town teams, playing just a few months a year, with rules and rosters controlled by the big league clubs, was expensive. The big league, namely, the commissioner's office, lacked control and couldn't monetize the lowest leagues very well. By making the "hard choice," to end two leagues and strip the franchise from 40-plus teams, the big leagues got more control and thus more money from the lower-level leagues. Wouldn't it have been harder to find a way to work within the existing structure to accomplish new goals? Is baseball better served by more control by and generating more profits for the big leagues?
I'm not a stick in the mud. Some old ways aren't great. (Massachusetts has me paying to my city an annual tax based on the resale value of my cars; I have to open a second email to load the account update linked to from the first email.) But we have a mania for "creative destruction" when it's the second word of the phrase that does most of its work. Perhaps the most creative thing to do is find a way to not commit the destruction in the first place.
Reading
Minor Threat
MLB puts the farm system out to pasture
A Quiet Refusal to Compromise
Intellectual conservatism should be more than a war cry. At its best, it is an invitation to enjoy the great traditions of our civilization.