DAVID BIANCULLI, host: This is FRESH AIR. I'm David Bianculli of tvworthwatching.com, sitting in for Terry Gross. The new Brad Pitt movie "Moneyball" is based on the book by our guest Michael Lewis, who told the story of how a maverick general manager used a new kind of statistical analysis to rebuild his baseball team into a successful franchise.

It's an approach that's been widely copied ever since, even on "The Simpsons," where Bart's team improved once brainy sister Lisa began offering mathematically generated advice.

(SOUNDBITE OF TELEVISION PROGRAM, "THE SIMPSONS")

PAMELA HAYDEN: (As Milhouse Van Houten) Your spreadsheets.

LISA CARTWRIGHT: (As Bart Simpson) Oh, my stupid sister has taken the fun out of baseball. What happened to stealing bases, the suicide squeeze, throw in a little gin(ph) music?

(As Nelson Mandela Muntz) We're no longer cellar dwellers - well, the team isn't.

(As Bart) This isn't the game I grew up with, the game played in the misty ballparks of Enron Field or Pac Bell, then FBC, now AT&T Park, and from now on I'm gonna play my game, gummyball.

BIANCULLI: When Michael Lewis began researching his book "Moneyball," he had a simple question: How did the Oakland A's, a motley collection of baseball misfits and utility players with the second-lowest payroll in all of baseball, win so many games? The answer was found, as it so often is in baseball, in statistics.

But in this case it was a creative and unusual use of statistical analysis on the part of the A's general manager, Billy Beane. Beane paied attention to numbers collected over the years by a group of baseball enthusiasts, including software engineers, physics professors and Wall Street analysts. They were numbers that most everyone else in baseball ignored.

Those stats enabled Beane to discern the unique talents of undervalued players no one else wanted. He then assembled and regrouped them on the field according to their strengths, eventually pulling together a winning team.

Beane's approach revolutionized baseball, and his innovations have since been adopted by other teams, but in the last few years he's been unable to replicate his earlier success. Currently, his Oakland A's are completing another losing season.

In "Moneyball," Michael Lewis followed the A's through their 2002 season, when they broke the American League West record for most consecutive wins. Terry Gross spoke to Michael Lewis in 2003.

TERRY GROSS, host: You attribute a lot of the Oakland A's success to its general manager, Billy Beane. What kind of shape was the team in when he took over the team?

MICHAEL LEWIS: It was a losing team when he took over in 1997. Billy Beane came into the organization and embraced the idea that there was such a thing as new knowledge in baseball, and you could research baseball and find out interesting things about it by researching it and that the way baseball teams were conventionally run had all sorts of inefficiencies in it that could be exploited for profit.

And so you've got to - essentially one team is living purely by its wits and making a good run of it.

GROSS: So the new knowledge, as you put it, that he was trying to find or to create in baseball was based in part on new baseball statistics and new ways of measuring the performance of players. What made him look at statistics more carefully and look for new ways of creating statistics?

LEWIS: Well, his predecessor in the job at Oakland, a fellow named Sandy Alderson, had discovered Bill James, the baseball writer who in the late '70s and early '80s published a series of what he called abstracts, where he - he almost - he systematically challenged the conventional wisdom of baseball, the traditional way baseball was played on the field, the traditional ways of evaluating baseball players.

And while the Oakland A's have not sort of aped Bill James in taking everything he said and applied it to their system, they embraced the idea that's sort of central to James' work, that just because everybody does it a certain way doesn't mean it's right and that you can use statistics to sort of dig below the surface of baseball and find the hidden game and find attributes, for example, in players that are very important but not highly valued in the marketplace, and also find attributes in players that teams pay a lot for that actually aren't worth that much when it comes to victory and defeat.

GROSS: What are some of the Bill James statistical creations that changed the thinking of the A's?

LEWIS: Well, as I say, it's the spirit of James more than the specifics, but in his early works, James does something, you know, which seemed commonsensical. He builds a model, a statistical model, to explain where runs come from, you know, how important is a walk or a single or a double or a triple in creating runs.

And what he would do is take all the singles and doubles and triples and walks that, say, the Boston Red Sox in 1975 had and try to figure out - and try to predict how many runs the Boston Red Sox would score on the basis of that.

And so he developed this predictive model that was actually quite good. I mean, he could see that - he could see how important these offensive attributes were, these offensive statistics were. And he quickly came to the conclusion that batting average, for example, which is held out - it was maybe the chief way to evaluate the effectiveness of a hitter, was less important than on-base percentage.

And the big difference between batting average and on-base percentage is how often a player walks, so that the Oakland A's take this, and they go out and look for players who walk a lot but don't have gaudy batting averages. So they aren't very expensive, but they generate this thing that's very valuable called on-base percentage.

But there are a number - an awful lot of what the Oakland A's do is actually now proprietary to the Oakland A's. They saw - they sort of embraced the spirit of James and they created their own kind of research and development program within the organization to generate proprietary information.

GROSS: Two of the guys who created one of the systems that the Oakland A's have used were from a stock market background. They analyzed and traded derivative securities. And they came up with their own baseball statistics.

LEWIS: No, that's right. They were two traders from the Chicago exchange whose job had been analyzing complicated securities, and they realized that the sort of thinking they were doing about securities could be applied to baseball players. And they set out to essentially strip out the luck factor from players' performances.

So take a simple example: A hitter hits a double, and he's credited with a double in the record books of baseball, and his value goes up a little bit because doubles are valuable. But what these guys recognized was that's really not adequate if you want to price what the guy - the value of what the guy has done, because not all doubles are alike. There are sort of fly balls that get lost in the sun that should have been outs, and those really shouldn't be scored as doubles, they should be something in the credit book for this player, they should be something else.

And then there are screaming line drives that normally would be doubles, and, you know, just because there was some sensational outfielder who happened to be there or some luckily positioned outfielder, they get caught and they become outs.

And so what they did is they took everything that happened on a baseball field and reduced it to - sliced it and diced it to its most elemental parts, and they said this is the true value of that event, and so we're going to credit that value to this player's account.

And the end result was coming up with very different valuations for players' performances than the conventional wisdom. And this is basically what the Oakland A's are doing too.

GROSS: It's a very subjective way of being empirical.

(SOUNDBITE OF LAUGHTER)

GROSS: Because, you know, you're subjecting analyzing each play and, like, who gets the credit for it. And then you're converting it into this empirical number.

LEWIS: Well, it isn't that subjective because what you're doing is comparing what happened on the baseball field to what normally happens. And so what they would do is they would say, let's say Johnny Damon of the Boston Red Sox hits a line drive - they would call it - they would actually not even call it a line drive. They'd call it a ball hit. It's a certain velocity and a certain angle to the ground that landed in this - on this little spot, on this little point on the baseball field.

And they would say, well, balls hit like that over the past 10 years, what typically are they? And they would say typically, they'd say 87 percent of the time they're doubles. So they would say whatever happened in that particular case with Johnny Damon's ball, that he should be credited with 87 percent of a double.

GROSS: So what they're trying to do is sort eliminate the subjectivity. Instead of judging the thing that happened by the outcome, they're sort of looking at the process that led to the outcome. The end result of all this is that the Oakland A's are forced, because they don't have any money, to build a team from players, out of players, that the other teams don't value, because if the other teams do value them, the Oakland A's can't afford them.

LEWIS: So they're forced to find a way to find the hidden value in players, and they have built this team out of players that other teams often had no interest in at all and always had much less interest in, and that this group of, you know, rejected parts from other organizations has come together and become this juggernaut on the field was to me the really astonishing thing.

GROSS: Why don't you describe one of the - how one of the players signed to the Oakland A's became a big success with the A's but hadn't been thought of as a great player before joining the A's.

LEWIS: There are plenty of examples, but, well, let's take one of the characters in the book, Scott Hatteberg. Scott Hatteberg had spent 10 years in the Boston Red Sox organization, four of them in the minor leagues and I guess almost six of them in the big leagues. He'd been a catcher, and the Red Sox viewed him as a catcher who, you know, wasn't a disaster as a hitter, and that was because they didn't value what he did really well.

What he did really well was he got on base way above the major league - at a rate way above the big league average, which is the single most important thing that a player can do.

And in addition - and this is a more subtle virtue in a hitter - each of his plate appearances were inordinately drawn out. He saw he would always see more pitches per plate appearance than just about any player in the league. And he rarely swung at pitches that were out of the strike zone.

Now, the effect of this is to subtly wear down the opposing pitching. It's good for the team to have a team full of guys who don't swing at balls and who force the opposing pitcher to throw lots of pitches, but it's even better to have a team full of guys who get on base a lot.

Anyway, the Oakland A's had seen these qualities in Scott Hatteberg because they measured things like the number of pitches he saw per plate appearance and they watched very closely for on-base percentage. And so they had been, for several years, praying that some - they could some way get their hands on Scott Hatteberg.

Well, Scott Hatteberg had an accident during spring training with the Boston Red Sox and ruptured a nerve in his throwing elbow, and it basically meant he couldn't feel his hand. He had to relearn how to throw the baseball. He was finished from that moment on as a catcher because you have to be able to throw as a catcher. And the Red Sox then tossed him on the scrap heap. They had no sense that he was valuable as a hitter.

Well, Scott Hatteberg ends up becoming a free agent, and no one wants him. I mean, it was actually extraordinary. He becomes a free agent, I think, it's two days before Christmas, at midnight, and at 12:01, Paul DePodesta, the assistant GM of the Oakland A's is on the phone to his agent saying, we've got to have this guy.

And as his agent said: Look, we were looking at a market where 29 teams regarded Scott as useless, and one team desperately wanted him. So Hatteberg became the first baseman of the Oakland A's last year, and he's been terrific.

He's been a subtle but extremely important offensive player, and the reason they got him is that no one else saw the value in him. And because no one else saw the value in him, he was cheap. They didn't have to pay him very much.

GROSS: And also it seems like, you know, Oakland is using players differently than other teams might use them because it's measuring your skills differently.

LEWIS: That's right. You know, one of the things they're doing in Oakland is identifying which traits in a baseball player are overpriced and which are underpriced. And the trait that is dramatically overpriced is foot speed.

They say that, you know, the effect of speed on the game, you know, it is there, there are effects, but it's small in relation to what you pay for it. So as a result, they don't buy it. They don't buy fast guys because fast guys get paid too much, and as a result they're by far the slowest team in baseball.

And that leads in turn to an even greater disdain for things like trying to steal bases or taking risks generally on the base path. They would have that attitude towards base-running anyway because they think - they have analysis that shows that trying to steal bases often doesn't - the rewards often don't justify the risk. But the fact that they have collected a group of people who can't steal bases anyway means they're not going to do it.

BIANCULLI: Michael Lewis, speaking with Terry Gross in 2003. His book "Moneyball," about the Oakland A's baseball team, was a bestseller and is now the basis of a new film starring Brad Pitt. More after a break. This is FRESH AIR.

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BIANCULLI: If you're just joining us, Terry's guest is Michael Lewis. His book "Moneyball" tells the story of the 2002 Oakland A's and their manager, Billy Beane, and is about money and baseball and new strategies for measuring the abilities of players. When we left off, they were talking about pitcher Scott Hatteberg.

LEWIS: Just to finish off a thought about Scott Hatteberg, that to me what was great about this story, as I say, is that you have this collection of junkyard dogs, these underdogs that nobody else wanted, coming together to be a really great team. And often what was valuable about them as baseball players was hidden to the wider world.

There was traits that were discerned by the Oakland front office that other people hadn't seen. But they were also often character traits. I mean, one of the questions, sort of the open question that they discuss often in the Oakland front office, is whether this quality that Scott Hatteberg had, and has, plate discipline, they call it, which is so important in an offensive player, whether it can be taught or whether it's in some way innate.

And Billy Beane, the general manager of the Oakland A's, has come to the conclusion that it's innate, that basically unless they could get a guy in diapers, by the time they become professional baseball players, they have - they're almost hardwired to approach hitting the way they approach hitting.

So the question I had when I, you know, get to know Scott Hatteberg and spend some time in his life, is what is it about him that makes him - that makes him so patient, that makes him so disciplined and composed when he's in the batter's box, which in turn leads to his value.

And this wonderful stuff comes out of it. You know, I would spend an hour before every game with him, reviewing tape of his performances and of the pitchers he was about to face. And there was one - I remember there was one tape where he's facing a pitcher from the Seattle Mariners named Jamie Moyer, and he has - he's already seen seven or eight pitches.

There's a full count and he's fouling off pitches, and Jamie Moyer, in disgust, steps off the mound and shouts something to him. And I said: What on Earth is that about? And he said: Well, it's a little weird, he said. But he was asking me what I wanted. And I said what do you mean? He said: Well, well, he said just tell me what you want and I'll throw it. That he was - his approach to hitting absolutely frustrated opposing pitchers because everything he did - he drew out their encounter for far too long in the eyes of the opposing pitchers.

And I spent an awful lot of time just trying to get to the bottom of what it was inside of Scott Hatteberg that led him to do this.

GROSS: And do you think you figured it out?

LEWIS: I think I figured out that what it was inside of him had been inside of him since he was a little boy, because since he was a little boy, baseball coaches, Little League baseball coaches, high school baseball coaches, college baseball coaches, have tried to beat out of him this valuable approach.

There is this strain of thinking in the game that if you're going to be a great hitter, you have to be aggressive. And people are always screaming at him to swing at things he didn't want to swing at. And he took refuge in a tape that the Yankees famous first baseman, Don Mattingly, had made when Hatteberg was a boy.

And it was a tape called "How to Hit .300." And on this tape, Mattingly explains that it's important to be patient at the plate, that drawing lots of walks is a good thing for a hitter, that swinging at things that you can't hit hard, even if they're strikes, is a bad idea.

This is the one thing that Hatteberg heard as a young baseball player that gave him the courage of his conviction, but he wanted to believe it anyway. It was as he said: I've always felt uncomfortable, say, swinging at the first pitch. I need to slow the game down before I can really play it.

And have always thought - and another time he said: Even when I was a little kid, when I'd swing at something that, you know, I really couldn't hit hard, and I'd ground out to second base, it just struck me as a worthless experience.

And it was an insistence that the game conform to his idea of what it should be, that to slow the game down, to kind of give it a kind of meaning.

GROSS: Do you feel like you see baseball differently now that you've studied the management and the money end of it?

LEWIS: I tell you, I tell you, the - spending a year as a fly on the wall in the Oakland A's front office and in the clubhouse has had a couple of big effects on the way I just watch a baseball game. I mean, they have taught me to see it as a game of odds, and they've taught me to see that everything that happens on a baseball field changes the odds of what might happen.

So first pitch strike, it lowers - and I have some sense of how much - it lowers the odds that a hitter will get a hit, that it's going to end well for the hitter. First pitch ball, the opposite. Runner moving from first to second, what the likelihood of that leading to a run. The probabilistic nature of the game was something I dimly sensed before and am now acutely aware of. And that's one big effect it's had on me.

The second is to humanize the players. I mean, I spent a lot of time working my way into the lives of several of the Oakland A's players, and it was fascinating to me to see the way they thought about the game, I mean to see that - I mean these guys were essentially lab rats in a science experiment in some way, and they were - they were oblivious to the experiment, but they knew it was working, if that makes any sense.

BIANCULLI: Michael Lewis, speaking with Terry Gross in 2003. His book "Moneyball" was a bestseller. The film based on the book opens today. We'll hear more of their conversation in the second half of the show. I'm David Bianculli, and this is FRESH AIR.

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BIANCULLI: This is FRESH AIR. I'm David Bianculli in for Terry Gross. Let's get back to Terry's interview with Michael Lewis, author of the best-selling book "Moneyball: The Art of Winning an Unfair Game," it's the basis for new film starring Brad Pitt. It's about the 2002 season of the Oakland A's and how, despite being one of the financially poorest teams in baseball, they went on to break the American League West record for most consecutive wins.

Lewis describes how general manager Billy Beane used unorthodox methods of assessing player's talents to assemble a winning team. For instance, he played more attention to a player's on base percentage than to his batting average. That ended up radically influencing the kinds of players being hired.

GROSS: You know, in talking about how Billy Beane signs new players, he gives you his rules for a shopping spree. What are some of his rules?

LEWIS: The first and most important rule, violated by many, many teams in big-league baseball, is that the minute you feel like you have to do something, you're screwed. That you can always recover from the player you didn't sign, but you may never recover from the player that you did sign that you shouldn't have. And baseball is littered with teams that have signed putative superstars to huge contracts, who then don't pan out. And franchises are wounded, or sometimes severely crippled, by the fact that they don't have any money left to go and pay other players. And they're left with a superstar who's not performing and earning $80 million.

In baseball it makes much less sense to do this than most sports, because one guy on a baseball team rarely makes that much difference. It really is a team sport. So the notion that you've got to sign this superstar or that superstar is really a little silly. And that's the first principle of Billy Beane's school of management.

GROSS: What's another one of his rules?

LEWIS: Number two is: identify exactly who you want and go and get him. I mean, what they do is they use statistics to identify Scott Hatteberg or the pitcher named Chad Bradford, who they got, or any number of guys. And they say this is the guy who has the value, the hidden value, that we can afford. And I am going to relentlessly pursue the team he plays for until I get that guy.

So they don't go into trades with a, kind of, loose notion of what they want. They're very, very focused about what they want. And this was a big problem for them, because Billy Beane has been so successful in the trades he's made in the last three or four years. He always seems to get so much more than he gives, that other teams have become instinctively very wary about doing business with him.

So if he wants a guy, he'll often find that the guy is magically not available. So he's had to find all kinds of clever ways to get the players that he wants, because once he wants them they're not his.

GROSS: What's a clever way he found?

LEWIS: Well, what he does, he goes fishing. What he'll do, I mean he did this, there's a long section in the book about a very improbably successful pitcher named Chad Bradford - who is a submariner, he throws underhanded basically - who was in AAA, in the minor leagues with the Chicago White Sox, and who had been just deadly. He had just been wiping out opposing hitters and yet the White Sox were refusing to move him to the big leagues. And Billy knew that if he called the White Sox GM and said what do I have to give you to get Chad Bradford, that the price would've gone up to the point where you didn't want to do it.

So, instead, what he does is he calls the White Sox GM and he talks about how he has his catcher he might like to move, because he needs to get a pitcher who might be a kind of, as he said a 12th or 13th man on the staff - a guy who might be in the bullpen or might be shuffled between AAA, but someone. He just needed another arm, he said. And he asked the White Sox GM to recommend some names. And the first set of names didn't have Chad Bradford in it.

So he goes back and he says, can you recommend any more guys? And so eventually the White Sox's general manager says well, you know, I hate to even mention him because, you know, he only throws 82 miles an hour and he's called recently and said that his back is not feeling so good, but there's this guy named Chad Bradford who is in AAA. And Billy, you know, Billy says oh, he'll do.

GROSS: Right.

(SOUNDBITE OF LAUGHTER)

GROSS: How did Billy Beane become a manager? He started as a player.

LEWIS: He began his life as a player. He spent 10 very frustrating years bouncing around the minor leagues and then on the benches of big-league teams. And when he realized that the hopes and dreams of scouts had been miss-focused upon him, that he really should not have been a player, that even though everybody thought he was going to be a superstar, he wasn't cut out to be a baseball player.

He walks out of the dugout of the Oakland A's where he was a fourth or fifth outfielder and into the front office and asked for a job. He's 27 years old, at the peak - at what should be the peak of his playing career - and he decided he doesn't want to play anymore. The front office had never seen anything like it. I mean nobody walks out of a dugout and says I want to be a scout or I want to be employed, I want to be put on a suit and take a job here. So nobody quite knew what to make of it. But they gave him a job.

And what had happened was, baseball had essentially rendered Billy Beane unfit for anything but itself - that he had not gone and gotten his education. He had a high school degree and no experience in anything but baseball, so, I mean, I think, as he put it, it bred a certain sense of desperation in himself. But he thought that he had seen enough of the game to know that there was an awful lot wrong with it, an awful lot of inefficiency in it, and he thought maybe he might make a career attacking that inefficiency and taking advantage of it. So he worked his way up within the front office of the Oakland A's, and his boss, the GM of the A's at the time, Sandy Alderson, made him his successor in 1997.

BIANCULLI: Michael Lewis speaking with Terry Gross in 2003. His book "Moneyball," about the Oakland A's baseball team was a bestseller and is now the basis of a new film. More after a break. This is FRESH AIR.

(SOUNDBITE OF MUSIC)

BIANCULLI: Let's get back to Terry's interview with Michael Lewis, author of the best-seller "Moneyball," which tells the story of the 2002 Oakland A's and their manager, Billy Beane. When we left off, Michael Lewis was talking to Terry about Billy Beane.

GROSS: Do you think the fact that he used to be a baseball player himself has affected Billy Beane's relationship with the players on his team?

LEWIS: There's no question that the fact that he played has a huge effect on his relationship with the players. Because he - I mean most general managers loiter around the clubhouse. David Justice, who played for the A's last year, told me that he saw more of Billy Beane in one season than he had seen of all the GM's put together in the previous dozen or so years combined, in the big leagues.

Billy Beane is maybe the one general manager in baseball who never sets foot in his luxury suite in the Oakland Coliseum. He spends all of his time in the clubhouse. I mean he is, he's very hands on and he's very comfortable mingling with the players. And the big thing is that there's an awful lot of -he's not deterred by the mystique of a big-league clubhouse. He doesn't have any use for it. And it's very hard for players and managers to buffalo him with big-league baseball nonsense because he's been there. He's played. He knows what's true and what's not.

And oddly, you know, and one of the strange things about the Oakland A's, is that their general manager is perhaps the best athlete in the organization. I mean, he was a sensational natural athlete who was just not a great baseball player. And so when Billy Beane - and he is still, he still has that aura about him, he still feels like a, he still moves like a great athlete. And when he goes into the clubhouse, he often goes into the clubhouse to put on his sweats and hit the weight room or run on the treadmill. And I think that, you know, he has a certain credibility with the players as a man among men.

GROSS: One last question. Since the Billy Beane approach to signing new players takes into account talents that they have or abilities that they have that other people haven't really noticed, once they join the A's, that talent does get noticed, therefore they become more valuable, therefore another team might want to sign them, therefore the A's might not be able to afford to keep them anymore. Or the player might just, you know, because the player might demand a higher salary that the A's can't match. So have they already lost players or do you think they're in danger of losing players because the players have become more valuable?

LEWIS: Oh, that's a great question. It's completely true. I mean let's take an example. Jason Giambi, who they identified as an amateur player and drafted in the second round, who they identified as a good natural hitter. But he didn't actually have a lot of power, didn't hit a lot of home runs. And then comes to the A's and develops into this slugger. And the way baseball is structured is that the team that drafts a player, basically has him as an indentured servant for the first three years of his career. The second three years is a kind of negotiation called arbitration, where they get him at below his market value. And, but in the seventh year he can auction his services. He can become a free agent.

And Jason Giambi did just this after the 2001 season. And he ended up getting about $120 million from the New York Yankees for seven years. And the A's didn't even begin to compete for him. I mean they pretended, in the media, as if they wanted to re-sign him but they knew that if they invested this kind of money in a single player they were putting the entire franchise at risk. It would be a violation of Billy Beane's first rule of management: don't put yourself in a position where one bad contract can ruin your future.

But the interesting thing is that when he left, at the end of 2001, everybody was saying ah, this proves that poor teams can't compete. This proves that the A's are doomed. Now they've lost one of their stars to free agency. They had won 102 games in 2001. They came back without Jason Giambi in 2002 and won 103 games.

What they show, is that even when you lose these stars, because you can't afford to pay the market price for them, there are ways of replacing them. What they understand is that superstars can be replaced if you understand what exactly it was that they contributed to your baseball team. You can often go find those pieces and other players and reconfigured the team so that it is just as successful without him as it was with him. And you don't try to replace the star, you try to replace the aggregate. You try to replicate the team you had, the aggregate statistics you had with the star on the team. So it may mean moving a couple, replacing three players and upgrading the team in other places.

GROSS: Well, Michael Lewis, thank you so much for talking with us.

LEWIS: Thanks for having me.

BIANCULLI: Terry Gross speaking with Michael Lewis, the author of "Moneyball" in 2003.

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