Jan
20
Market Inefficiencies and Developing An Edge, by John De Palma
January 20, 2007 |
The NY Times last week printed an article about how the Dallas Mavericks have a free-throw coach (Investing in Free Throws Pays Off). It is a good case study in developing an edge. The article also touches upon overconfidence biases and systematic methods of improvement:
The Dallas Mavericks, the N.B.A.'s top team this season, are no strangers to winning ways, but in getting an edge on opponents over the past several years, they have gone beyond sheer talent. The Mavericks have what amounts to a secret weapon in Gary Boren, an investment banker who is the N.B.A.'s lone free-throw coach … Boren begins by filming the players shooting free throws … There are 41 common problems that Boren is looking for in the footage, but he cautions that merely telling a player what he is doing wrong will not help him. He must first deal with the mental barriers that players put up. "They all think they're better shooters than they are," Boren said … "I'm trying to take what they've got - because they've already shot thousands of shots - and tweak their shot in the most important areas that will give them a shot to get better." Even when the player wants to learn, Boren must conquer another barrier. He tells them: "When I look at you, I see two things - a brain and a bunch of muscles - and the good news is the brain is really clicking. But the bad news is your muscles have been taking a siesta. They like it the old way and they're not paying attention to any of this stuff. So when we get down there, they're going to resist." … Despite Boren's success, no other teams have hired a free-throw coach.
In a blog post last year, Mavericks owner, Mark Cuban, wrote something that serves as almost a prologue to this NY Times piece:
When I got to the Mavs, I talked about putting the players in a position to succeed by hiring more coaches. After all, if we have a multimillion dollar investment in a player, it only made sense to me to provide that player with whatever individual instruction that was necessary to make them better. To put them in a position to succeed. [Read more here]
Interestingly, for 12 years, Boren followed around former Mavericks coach/current Warriors coach Don Nelson. One of The Wages of Wins (a Moneyball type book) authors offers statistical support of Don Nelson's coaching performance, at least some of which could presumably be attributed to Gary Boren:
One paper I am currently working on is an examination of NBA coaching. The paper is co-authored with Mike Leeds (Temple) and Mike Mondello (Florida State) and gradually it's nearing completion. Our tentative results thus far indicate that some coaches, although not all, appear to have a positive impact on player performance. One of these coaches is Don Nelson. [Read more here]
The NY Times article on Boren is reminiscent of this excerpt from Michael Lewis' feature on the Texas Tech's Mike Leach:
… Schwartz had an N.F.L. coach's perspective on talent, and from his point of view, the players Leach was using to rack up points and yards were no talent at all. None of them had been identified by N.F.L. scouts or even college recruiters as first-rate material. Coming out of high school, most of them had only one or two offers from midrange schools. Sonny Cumbie hadn't even been offered a scholarship; he was just invited to show up for football practice at Texas Tech. Either the market for quarterbacks was screwy - that is, the schools with the recruiting edge, and N.F.L. scouts, were missing big talent - or (much more likely, in Schwartz's view) Leach was finding new and better ways to extract value from his players. "They weren't scoring all these touchdowns because they had the best players," Schwartz told me recently. "They were doing it because they were smarter. Leach had found a way to make it work." [Read more here]
In a column two years ago, Bloomberg columnist, Mark Gilbert, suggested a financial market parallel to all of this:
The authors reserved their most scathing comments for the way trading rooms are managed. "Trader management is a training-free zone,'' they said. "In a combined 70 years of experience, the authors have never encountered so little management development in sophisticated organizations of vast resource." Banks are happy to leave traders alone provided they are making money. Managers only intervene when a trade has gone sour; post-mortems are held when money is lost, with scant investigation of why some trades are profitable. "The combination of trader autonomy, reliance on bonus and management spans of control generates an environment where managers see themselves as a safety net rather than as creators of value or profit," the professors said. "Put another way, trading environments rely too much on managing outputs." [Read more here]
As an aside, this isn't the first time the NY Times wrote about Mark Cuban's innovative approaches to free throw shooting. In the 2005 NY Times magazine "year in ideas" issue, one of the discussed ideas was as follows:
The key to a successful free-throw defense, Engber argues, is to make a player perceive a 'field of background motion' that tricks his brain into thinking that he himself is moving, thereby throwing off his shooting. In other words, fans should wave their ThunderStix in tandem. Last season, Engber proposed this tactic to the Dallas Mavericks' owner, Mark Cuban, who took him up on the idea. For three games, Cuban had members of the Mavs' Hoop Troop instruct fans to wave their ThunderStix from side to side in unison … [Read more here]
John De Palma further adds:
Providing some indirect color on the difficulty of shooting free throws intermittently after running up and down the court, Jack Schwager's "Stock Market Wizards" quotes psychiatrist Ari Kiev:
There are some common denominators, but different sports require different mental frameworks. For example, in bobsledding, you need to start off with a maximum amount of exertion as you run and push the sled. But as soon as you get into the sled, you have to slow down your adrenaline so that you are calm and centered while steering the sled down the course. A similar transition is required in the biathlon, where the athletes race on cross-country skis, with their heart rate exceeding 120 beats per minute, and then have to stop and focus on shooting a target, with their heartbeat ideally slowing down to 40 beats per minute.
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