Hey! You! Yeah, you. Come join me up here in this tree. Just come out here and sit on this limb with me. Did you bring sweatpants? Something comfortable? Good. Because you see the end of this limb? That’s where we’re going. And there’s basketball at the end.
The economist Joseph Schumpeter coined the term “creative destruction” in his 1942 book, Capitalism, Socialism and Democracy. Building off of Karl Marx’s idea of capitalist economies as essentially evolutionary, Schumpeter described how a capitalist economy—which is ever-reliant upon innovation and the development of new consumer goods and new methods of production—seeks not stability and maximally efficient production, but rather constant change and turmoil. Fundamentally, the natural state of such an economy is turbulent, and any attempt to develop stability is inevitably undercut by new developments.
This is not difficult to see, especially today when changing technologies are churning markets more than ever. Consider this: Right now, I’m writing this on a laptop in a coffee shop. As recently as ten years ago, a coffee shop that wanted to provide Internet access to customers would have to have Ethernet cables running all over the place. There were cafes set up with the specific purpose of providing desktop computers that people would pay for by the minute or hour to use. This meant these cafes needed to buy and install lots of wires, plus buy and maintain a half dozen or more desktop computers.
Now, people bring their laptops, ask for a WiFi password and they’re off. If I ever went to a coffee shop and was told that I had to pay for Internet access, I would leave. What was once commonplace has become almost unacceptable, and this happens all the time. The rise of digital photography means the decline of film processing. And improvements in the digital cameras in smartphones means a decline even in the importance of standalone digital cameras. I mean, do you remember how horribly awful cameras in phones were even five years ago? I’m now incredulous when I can’t instantly access nearly any album I want via Spotify or Rdio when only a few years ago I took great pride in how I had collected and organized my iTunes library.
This churn—what Schumpeter called “the perennial gale of creative destruction”—is at least as active in the NBA as in capitalist economies. Although the league has its share of socialist protections (revenue sharing, max contracts, the fact that teams more or less can’t go out of business), the fundamental work of building a successful team means buying low (either through getting great young players on rookie contracts or finding undervalued veterans who fit your team) and then selling high (moving big contracts for more young talent). If a team feels they’ve laid the groundwork correctly, they might make a large investment in a free agent or blockbuster trade in order to push themselves over the top and into contention for a championship.
Most fans can accept and understand this in the abstract, and yet teams are still constantly beset by demands for instant accountability, by demands to win now, by constant questioning about moment-to-moment decisions by coaches. It’s why I was really struck by this passage from Schumpeter’s book, which discusses the ramifications of understanding the role of creative destruction in economies.
[S]ince we are dealing with a process whose every element takes considerable time in revealing its true features and ultimate effects, there is no point in appraising the performance of that process ex visu of a given point of time; we must judge its performance over time, as it unfolds through decades or centuries. A system—any system, economic or other—that at every given point of time fully utilizes its possibilities to the best advantage may yet in the long run be inferior to a system that does so at no given point of time, because the latter’s failure to do so may be a condition for the level or speed of long-run performance.
This is, at its core, what many at the MIT Sloan Sports Analytics Conference were arguing for when they called for an emphasis on the process over the results. What truly resonates here is the idea that making the optimal decision at every point along the way in a very long process is not going to give you the best results over that entire process versus an approach that takes into account how very long that process is.
The San Antonio Spurs are a banner example of this. Take Popovich’s predilection for resting his starters at various times during the regular season—even when his team is in a marquee matchup against the Miami Heat, say. In the extremely short term, the choice makes no sense. It doesn’t maximize the Spurs’ resources for the greatest chance of success. Many find this unacceptable, but it seems that a majority can understand this in the longer term view of having his best players ready for the postseason.
But there are even deeper, more subterranean considerations at work here. Having the team’s bench step up and start from time-to-time makes them comfortable with playing different kinds of roles. Furthermore, it’s an understood part of how the team operates that the starters will rest from time to time. The very fact that the express reason for it is to prepare for the postseason becomes evidence of how good the team is. The being-asked-to-step-up becomes a badge of honor, a marker of the quality of the team’s vision.
So yes, the Spurs are playing the long game in terms of team health, but in many ways, the simple mechanical reason for this strategy is a red herring. It’s an integral part of a sly kind of rebuilding that is constantly happening in San Antonio. Even the relatively stable elements of Tim Duncan, Tony Parker and Manu Ginobili have at different points in their tenure with the team occupied subtly different roles. Over the last several seasons the Spurs have pivoted from defensive and meticulous to more open and opportunistic. But even within that, they’ve found ways to once again get better defensively. At Sloan, Spurs GM R.C. Buford said
This summer we went to our defensive efficiency, which for years was very high and last year had fallen to the ten to fifteen range [in terms of ranking in the NBA]. And I think we were valuing some things that weren’t nearly as important as what the data showed. Like what worked for the Celtics was not necessarily defensive rebounding. They were really high in defensive efficiency and they weren’t really high in defensive rebounding. That was a big part of where our emphasis was and that made us question where we should be paying attention. Those were discussions that were then brought to Pop from our coaches and from our analytics team and some great discussions came from it that ended up having us re-evaluate what was important.
That work with analytics doesn’t just help them make on the spot decisions, nor even to make season-long decisions. It helps them build a culture that’s adaptable, flexible, yet rigorous. As Buford explained, “I think Pop got interested when he saw areas that weren’t traditional for lots of people that were supported by the data. And he started asking different questions.”
Asking the right questions is a result of seeing the landscape differently, and it’s something that Schumpeter addressed as well. “Since we are dealing with an organic process,” he writes, “analysis of what happens in any particular part of it may indeed clarify details of mechanism but is inconclusive beyond that. Every piece … acquires its true significance only against the background of that process and within the situation created by it. It must be seen in its role in the perennial gale of creative destruction; it cannot be understood irrespective of it.”
It’s hard to do what’s demanded by this understanding. It’s hard enough to make the right decisions based only on what’s readily at hand, much less based on the entire background of an ever-evolving process and the environment it occurs in. Holding cognitive dissonances in balance is not something that comes naturally to most of us, but it’s often what’s required if we’re going to navigate more than just the next moment and the next.
It’s one of the ironies of this approach that it requires a kind of constant vigilance that’s based not on assessing all available information as completely as possible in that moment, but on crafting an overall flexibility that adheres to overarching principles. That ability was captured in no place better than The Hustler, the 1961 movie starring Paul Newman as pool shark Fast Eddie. As Eddie prepares to play Minnesota Fats, a contest in which he’ll not only have to read and react to an evolving situation but also put his faith in his own abilities and snap judgements, his partner Charlie Burns asks him, “How do you feel?”
“Fast and loose, man,” he replies.
“In the gut, I mean.”
“I feel tight, but good.”