The Science of Success

As with most academics I read a lot.  At the moment I am reading two books on Pete Maravich (a boyhood idol of mine), Michael Lewis's new book Blind Side, which is excellent, and then a host of more academic books.  The biographies on Maravich and Lewis's books deal with sports, but I read these books from the point of view not only of a sports fan, but also as a political economist.  I cannot help but see the "political economy" elements in the narratives offered.  Maravich was an innovator, a genius on the court, and a cultural icon.  His father was the architect of this dream in the same way one reads of the life experience of Mozart and of John Stuart Mill in the realms of art and science.  BTW, quotes from Ludwig von Mises and F. A. Hayek may be found in my papers, but the "wallpaper" on my computer at the office is Pistol Pete.

Lewis's book deals with how rule changes impact the relative value of different players on the football field, and how these changes at the highest level of the sport (NFL) will trickle down to the HS level.  In this instance it is the evolution of the West Coast passing offense, the athletic outside linebacker, and the left tackle to counter the blitz.  It is a fascinating story that is wonderfully written.  Alongside of Moneyball, I think Blind Side probably establishes Lewis as the most insightful observer of sports that we have seen --- no offense to John Feinstein, but while he tells a great sports story, Lewis sees the bigger picture and dissects with analytical precision.  His works are full of useful economic ideas that someone who pursues an entrepreneurial market process perspective in economics can sympathize with and use to illustrate major points in providing an understanding of the world around us.  Lewis and Malcolm Gladwell might be my personal favorites among public intellectual observers of the world to read.

Back to the books.  Maravich was a creative individualists trapped inside the confines of a team game.  He never did win that championship he so craved. He was ahead of his time and thus his creativity rarely meshed within the confines of the team game.  Maravich, himself, wanted to be a team player and he did do some spectacular things that translated into team success. But never at the level he aspired. But he made it possible for the Magic Johnson's, the Michael Jordan's, and now the Steve Nash's to be flashy, fundamental, and lead a team to winning records and championships.  Maravich fell short in certain dimensions that Johnson, Jordan, and Nash didn't and don't (Nash still needs to win an NBA title to go along with those MVPs).  Maravich was a flawed genius, but his flaws remind the reader that this amazing athletic showman was human --- a fact brought home so clearly by his untimely death at the age of 40.

In Blind Side Lewis describes how the broader organization of sport --- the rules, the perception of experts, etc. --- changes the value we place on particular skills and attributes.  Sports are a "school of rules" for many, but they also highlight the basic insight that strategies evolve in rule specific contexts and not in any abstract and general context.  Incentives and knowledge in sports, as in all of life, are contextual in nature and as such are of "specific time and place".

This is why sports can teach us so much more than just winning and losing on the field of competition.  This winter I read an absolute fantastic book about the legendary basketball coach John Wooden, You Haven't Taught Until They Learn: John Wooden's Teaching Principles and Practices -- this book may very well be the best book I have ever read on education.  During the early 1970s a study was done on Wooden's effectiveness as a teacher and the researchers were astonished by the retention rate of knowledge among his players. It far exceeded that of any other teacher studied in depth at the time.  His teaching methods obviously worked.  Wooden was the master teacher on the basketball court, but what he did there is just an example of what we try to do in the classroom, in our families with our kids, and in our businesses.  The master teacher is part motivator, part disciplinarian, and part master of his craft.*  The master teacher creates an environment in which inquisitive and creative individuals can express themselves without losing sight of the common cause of the enterprise (team, class, firm).  It is, I contend, about CREATIVITY WITHIN DISCIPLINE. 

Effective entrepreneurship is not creative destruction, as Schumpeter argued, but creativity within discipline through encouraging continual adjustment on the margin to add value to the enterprise (whether that is learning and communicating economics, winning sporting contests, or earning profits in a firm).  Activity without accomplishment is to be avoided as wasteful, activity toward specific value-creating accomplishments is to be encouraged.

It is the rare individual who can build organizations that allow creativity within discipline and flourish as an organization for a length of time.  Charles Koch is one of those individuals, and in the process he has built the world's largest privately held company --- Koch Industries in Wichita, KS --- over the past 40 years.  I recently read Koch's new book, The Science of Success and I have to say it is extremely well-written, very informative, and full of brilliant insights into the organization of activities within a firm, the nature of free societies, and the rules of social interaction that provides the best opportunity for individuals to live flourishing and meaningful lives while giving space to others to live flourishing and meaningful lives themselves.  I had read a manuscript copy of this book several months back, but I read the final published book 2 weeks ago during a day of flying that started at 4:30am and I couldn't put it down.  Koch draws on the writings of Mises, Hayek, Polanyi, and Maslow to frame his discussion of the evolution of his own business career and his experience with running a large firm.  He also draws on best practice in fields of engineering and scientific research.  He calls his management philosophy "market-based management" (MBM) --- a term Koch came up with to capture the sort of creativity within discipline that I was talking about above within the firm.  MBM has five main areas of emphasis: vision, virtues and talents, knowledge processes, decision rights, and incentives.  The book attempts to show how by emphasizing these five principles and learning within them and refining ones understanding of them in practice, Koch Industries was able to continually find new and better ways to create value for their customers and grow into the largest privately held firm in the world.  I cannot recommend this book highly enough.  The book is a must read not only for businessmen hoping to learn how to better organize and manage their enterprise, but for anyone who wants to think about building a successful organization (in the for-profit and non-profit sector), and also the larger picture of working toward a more prosperous and free society.

Reading Koch's principles reminded me of Wooden's pyramid of success, and just like Wooden's pyramid it is not enough to list the characteristics of MBM, but you actually need to LIVE by them. When you do, you might not only win 10 NCAA titles or grow a business enterprise into the largest privately held firm in the world, but live a life full of the peace of mind that comes from the satisfaction the you did your best to become the best you are capable of becoming.  We don't have enough narratives of holding to a standard of excellence in our culture.  John Wooden demanded excellence, so does Charles Koch.  In doing so, both men rely on timeless principles of individual freedom and responsibility.  The Wizard of the Westwood meets Wisdom from Wichita and a science of success is born.

*Wooden's characteristics of the effective teacher are: (1) make learning engaging; (2) passion for the material; (3) possess deep subject knowledge; (4) extremely organized; (5) intense; (6) recognize students for even small progress; (7) treat everyone with respect; (8) fair; (9) believe all students are natural learners; (10) like being with the students; and (11) put priority on individual learning.

Comments

[Josh Hall]

I know your not a hockey guy, but one of the best sports books with a lot of economic reasoning is Ken Dryden's "The Game."

See my blog post on one aspect of the book here:

http://divisionoflabour.com/archives/001293.php

[Rafe]

There is a lot to be learned from games but I wonder if game theory is using the right ones. For a representation of life, including economics, cricket is probably more appropriate than most games especially the four or five day test matches where a draw is one of the possible outcomes if the game is unfinished in the time available. Also the tests are played in a series, usually five games, so the personnel (in addition to the strategy and and tactics) can be changed as the series proceeds and they can be adapted to different conditions at the different venues, especially the nature of the pitch or wicket which can be all-important because the ball mostly comes on the bounce, like a tennis serve.

Test matches are the pinnacle of the game and one of the characteristics of great players is called "Test match temperament", meaning they bring out their best at that level. It corresponds to "Competetive Greatness" in the Wooden pyramid.

North Americans may be surprised to learn that the first international cricket matches were played between the US and Canada.
http://www.the-rathouse.com/Revivalist4/cricketessay.html

Just to give some indication of the way that cricket can function as a point of entry to some problems of explanation in the human sciences, here is a reconstruction of a thought experiment from 1970, never written up for some strange reason. Probably because soon after I enrolled in a university course in Sociology and became disabled from serious intellectual work for several years, though not before writing a couple of useful essays on Talcott Parsons.
http://catallaxyfiles.com/?p=2368

One of the things that turned up in the thought experiment was the need for some kind of objective or interpersonal realm of ideas. That is an area where some Austrians were heavily involved, notably Bolzano, also Franz Brentano who is acknowledged as an influence on the economists and Meinong who sat in on some Menger lectures but did his work in philosophy where he was overshadowed by Husserl.

For more on that line of work, a draft paper from 1985 http://www.the-rathouse.com/popobjectknow.html