The Strategic Fumble

Last night I wrote about how the concept of the interception translates symbolically into strategic business decisions. Throughout the day, a few of my colleagues and friends have inquired whether the fumble represents the same concept.

I believe that the fumble would symbolize a fundamentally different business mistake. Within football, fumbles usually occur when a player holding the ball is hit in a particular way, causing him to drop the ball onto the ground. Within business, this would translate to competitive pressure forcing a company to make a strategic misstep. The interception usually stems from a self-made mistake, whereas the fumble comes from external actions.

An example that comes to my mind is the recent mistakes made by the U.S. automakers. In particular, during the late 1990s and early 2000s the Detroit-based automakers blindly imitated both their domestic and international competitors by dedicating the majority of their production capacity and marketing funds to over-sized Sports Utility Vehicles. Although Japanese companies sold similarly large automobiles, they also continued to focus design, research, and development on smaller, more fuel-efficient cars.

Like in football, it's usually easier to recover from a fumble than an interception because the offense has a fair chance of picking up the ball.

The Strategic Interception

The interception is one of the most painful events in the game of football. It often represents a change of momentum and instantaneously ends a potentially fruitful string of offensive plays. The interception can be the most important event of a game.

Interceptions usually occur when the quarterback reaches a little too far, attempts a little too much, or takes an unnecessary gamble. The quarterback throws the ball away to the opposing team and gives his opponents a potentially deadly opening.

The concept of the interception translates pretty well into the world of business. The strategic interception occurs when a company takes an extra step and unintentionally weakens its core capabilities - particularly when a successfully growing company over-reaches and stumbles by purchasing another firm. Two recent, technology-oriented examples come to mind:

• eBay's purchase of Skype. eBay purchased Skype, the company which enables Internet-based phone calls, in 2005. Because Skype's offering had very little to do with eBay's core auction service, the acquisition was a major reach for eBay. After sinking Billions into the purchase, development, integration, and promotion, eBay has failed to successfully incorporate Skype - recently selling off 65% of the company at a significant loss.
• Google's purchase of YouTube. By purchasing YouTube, Google entered a new market within the Internet universe. This move has been an intellectual and financial drain to Google and has weakened both Google's search dominance and YouTube's online video dominance - giving Bing the opportunity to slowly gain momentum and Vimeo to gain a foothold with its video offerings.

Although both Ebay and Google are large enough to fully recover from their missteps, their stumbles have given their opponents an opportunity to gain traction and score a few points. It's clear that the strategic interception can be equally as painful in the world of business as it is in football and that even the slightest loss of focus can lead to change of momentum.

The N.B.A. Conundrum

I love professional basketball, more specifically, the U.S.-based National Basketball Association (NBA). Globally-speaking, I'm not alone. Basketball is usually regarded as the second most popular sport in the world (following soccer). In certain parts of the world, particularly in Southern/Eastern Europe and Asia, it is considered as the most popular. The NBA is looked upon as the cream of the crop.

Surprisingly, professional basketball is barely the third most popular sport in its homeland, the United States (following professional football and baseball). Based on my logic, the NBA should be tied for first or at worst, the second most popular sport in the United States. Professional basketball is more dynamic than baseball and the games are typically shorter than both football and baseball games. Basketball offers more scoring than both its main competitors. Basketball offers the perfect mix of individualism and team-play. Basketball arenas offer the same perks that football and baseball stadiums offer. Most importantly, the best global players play in the NBA.

It's difficult to pinpoint why basketball lags behind in both fan passion and overall popularity. I believe that there are a few probable causes:

• The Racial Divide. Due to the socio-economic and demographic realities of our country, the largest group of sports consumers is still a white, European-descendent population. The basis for this potential cause doesn't stem from the absolute portion of non-white athletes in the NBA (since baseball probably has comparable non-white proportions) but instead from the large absolute difference between the best white and non-white players currently competing. This difference is arguably smaller in professional baseball and probably non-existent in professional football. This extreme difference might foster some sort of conscious or subconscious bitterness from the largest NBA consumer group.
• The Limited Live Experience. Arguably, experiencing professional sports in person builds passion and loyalty. Because NBA arenas are smaller than both football and baseball stadiums, a smaller absolute amount of fans is able to view any particular live NBA game and thus build a stronger connection to the sport. This is a relatively weak argument.
• The Guaranteed Contract. Some have argued that professional basketball players are less inspired, dedicated, or driven than football or baseball players. That's tough to prove. But it is true that NBA contracts are typically of the guaranteed variety - once a player signs a contract for a certain amount of years and for a certain sum, that player is guaranteed to be employed for those years and paid that sum. No matter how little or how poorly the player plays, once the contract is signed it is basically written in stone. Most football contracts are not guaranteed. Many baseball contracts are guaranteed but baseball teams also usually have the ability to send players to the minor leagues (often to the detriment of their egos, current salaries, and future salaries). This difference in contract structure could breed a generally less driven collection of players and a weaker overall sports product.

I don't think these causes are the only reasons for why basketball lags, but they do begin to explain how the sport is potentially more flawed than its main competitors. Interestingly, two out of the three causes can be relatively easily fixed.