Four Business Strategies Finance Executives Can Learn from a Jock
During a recent trip to New York, I visited a private equity client whose offices overlooked Times Square in mid-town Manhattan. As I awaited the start of the meeting, I peered over a frenzied crowd surrounding an Olympic-style wrestling mat.
A wrestling mat sitting in the middle of Times Square.
The event was an exhibition match between top wrestlers from the United States and an all-star team from around the world. This was a moment of serendipity. The site of the mat and crowd was quite familiar to me and took me back to my competitive wrestling days. My life was shaped by an 18-year wrestling career which included 12 state championships, four national championships, and one world championship (where I served as US Team co-captain).
Though my current waistline bears no evidence of these days of yore, the strategic lessons I learned in the gym are the same ones I apply daily in business. In this first installment, we’ll take a look at how numbers play a role in performance.
Lesson I – Numbers Drive Performance
To many, wrestling appears to be a brutal sport of blood, sweat and twisted limbs. However, under this veneer is an exercise in analytics which moves along three tracks: practice, weight management and performance results. In its highest form, wrestling practice is about developing muscle memory – a process of training the body to perform automatically in reaction to various stimuli. Muscle Memory is achieved through repetition, making much of practice a counting exercise – 50 reps of move A, 100 reps of move B, and so on. Wrestlers spend countless hours repeating various moves to isolate and hone their most valued skills.
In most cases, wrestlers spend even more time managing their weight through diet, running, jumping rope, riding stationary bicycles and performing a dizzying array of other work-outs all in an effort to maintain or lose weight in order to compete in their optimal weight class. Success is predicated on one’s ability to understand just how much effort one must expend to reach their target weight. For me, I learned over time that a one-hour workout, which included a regimen various exercises, all performed with a certain degree of intensity, would yield a 10-pound loss.
As with all competition, the ultimate arbiter of success is one’s record. Easy enough to track, but remarkably difficult to earn is the wrestler’s win / loss record. However, the numbers alone don’t tell the tale. For a wrestler, the win / loss record is earned by tracking any number of input metrics: average number of moves attempted vs. successfully executed; number of 1-, 2-, 3- and 4-point moves attempted vs. executed; etc. The wrestler’s ability to track the inputs and refine performance based on these is essential to building a winning record. For me, all of the performance stats culminated in an 81-0 record during my last two years of high school.
In all cases, the numbers are different for every wrestler but the key observation is that wrestlers know their critical success numbers (or metrics). As in wrestling, in business it is essential you know your numbers. What are your key business drivers? What financial ratios and/or business performance metrics most accurately evidence success? Successful businesses hone in on only a few key metrics (e.g., sales per square foot, profit per employee, adjusted gross margin, etc.) and work tirelessly to develop muscle memory in the practices which maximize these metrics.