No long 2s
Jordan, Curry and becoming the Houston Rockets of business
The best shots to take in basketball are right around the hoop and just outside the 3-point line. Everything else (aka the “long 2”) is bad.
The Houston Rockets took this observation to the extreme and all but eliminated the mid-range jumper from their game. Austin Rivers was once asked in an interview about long 2s and he responded, “I won’t shoot that shit.” Through his first 127 shot attempts of the year, he’d taken 60 3-pointers and 67 shots from inside the paint. He hadn’t taken a single mid-range jumper so far that year.
And really the entire Rockets team played like this.
A lot of people (like really a lot) did not enjoy watching the Houston Rockets play but I have personally always respected and appreciated the extent to which that team embraced playing analytically correct basketball. It takes a lot to change the way a team of professionals operate, especially when they are the first ones through the door.
Maybe it’s just because basketball is my favorite sport, but the Rockets approach, and the elimination of the long 2, has stuck with me in a business context in a way that other analytics-driven revolutions in other sports has not. I really enjoyed Moneyball, but I never think about the Oakland As when I’m doing my job. I think about the Rockets constantly.
The shot
In 1989 Michael Jordan’s Chicago Bulls were playing the Cleveland Cavaliers in the first round of the playoffs. It was a best of five series and tied at 2 games apiece. There were 3 seconds left on the game clock and the Bulls were down by one.
What came next was so iconic that it became known as “The Shot.”
Game on the line. The mid-air hesitation. Jordan’s reaction afterward. And arguably the moment that began the ascent of what many consider the best run in the history of sports. Jordan’s Bulls would win 6 championships in the 90s.
The long 2 wasn’t always perceived as some analytically incorrect basketball shot. For many years, it was the opposite. It was a mythologized part of the game. The most famous shot in the history of the sport was a long 2. If you weren’t seven feet tall, the mid-range game was the measure of whether you were a good basketball player or not.
When the analytics revolution came to basketball and said that’s (generally) a bad shot, nobody was like, “cool, makes sense.” And on some level, people still fight it. When the Rockets ultimately lost, people used that loss as proof that actually you did need a mid-range game.
Part of why I find the long 2 such a compelling story and analogy is because of the tension between the narrative and the data. Our pre-conceived notion about what good basketball is and the reality of it.
The nature of the long 2 is that while it may look cool, you get the same number of points as you would from a lay-up or dunk but with a much higher degree of difficulty.
And when it comes to business, it’s equally important to train yourself to spot long 2s. Try to see the things that conventional wisdom loves but the data does not. The things with a high degree of difficulty (or cost) but low upside.
When bad shots become good ones
Part of the mythology around the long 2 involved teams believing that three-pointers weren’t good shots. In the late 1970s, the average NBA team was taking only 2.8 three-pointers per game.
That started changing in the late 80s and then accelerated dramatically starting in the early 2010s. Teams were taking 30 a game by the end of the decade. This season the league low is 29.5 attempts per game and Golden State is putting up an astonishing 42.9 3s a game.
While the analytics revolution was a major part of the change in the 2010s, so was Steph Curry. In the same way Michael Jordan mythologized the long 2, Steph Curry did that for three-pointers.
Steph not only passed the eye test and won championships, but he also changed the definition of good shots and bad shots. Kobe captured it well all the way back in 2015.
While you don’t need to be an all-time great shooter to make the three-point math work, you do need to be a really good shooter. There are currently 111 players in the NBA shooting over 33.3% from three-point range (meaning they are getting over 1 point per attempt). This means that the average team has between 3 and 4 guys that shoot with that level of efficiency.
NBA rosters have 15 players, which means 20-25% of a given roster, and thus the league, can shoot threes at point per attempt efficiency levels.
Which brings us to the second lesson that the professional world can draw from basketball stats. Taking higher-difficulty, higher-upside shots is a winning strategy, assuming you have great shooters taking those shots.
And if you don’t have those shooters, it’s critical to either hire or develop them because the alternative is the world passing you by. Shooting 3s isn’t an interesting or innovative part of NBA basketball anymore. It’s foundational to even being competitive in the modern NBA. And I would posit that business is like that too, particularly if you work in a hundred-mile radius of tech. If you aren’t constantly changing and taking risks, it’s a recipe for getting blown out and left behind.
If Michael fooled us into believing that bad shots were actually good ones, Steph helped us all to understand that high-risk shots are really high-percentage shots.
Business as a game of basketball
When I think about companies, and big companies in particular, I find myself consistently drawn to these basketball and shot attempt analogies. You don’t deliver tens of billions in revenue because of one thing. You might have some major strategies, or key players/products, but your performance any given quarter or year is the result of a hundred little things.
And if you believe at all in the idea that these little moments of execution build on one another, create momentum and lead to better top line company outcomes, then you should also believe that the quality of your underlying shot attempts matters a lot.
Managing your shot profile is as important as execution. And it’s not just about which projects you take on, it’s whether you approach that project as a dunk, a long 2 or a three-pointer.
If you are redoing your company home page, are you going to do some high-concept piece of brand strategy work or is just going to be a straight-forward overview of your company and website structure?
Sometimes it’s best to probe a bit on whether there is a three-pointer to be had. The company home page seems like a plausible place where a three-pointer could exist. But if you get into the project a bit and all the discussions and mocks feel like long 2s, nothing truly breakthrough, the smart thing is to take the lay-up. Take the easy improvement and put points on the board.
But I also believe that consistently making lay-ups and dunks is what buys you the time and space to take higher-risk shots. I’ve written about my 70/30 rule before as part of a post I did on first-line manager behaviors, but another way of positioning that rule is saying 70% of your shot attempts in business should be at the rim while 30% should be from distance. It’s not a hard rule so much as it’s a statement that you should be shooting from distance a lot. And when you aren’t shooting from distance, you should be doing things with extremely high probability of success.
Unfortunately in business there isn’t an actual three-point line. There’s no paint. No restricted area. You don’t always know what’s a dunk, what’s a long 2 and what’s a three-pointer.
You develop this intuition over years. From leading projects. From looking at data. From studying the industry. You might call it feel for the game. You might call it having good judgment.
It’s the judgment to decide which projects are worth doing. The judgment to know whether that project is best executed as a dunk or three-pointer. The judgment to recognize something as a long 2 as early in its lifecycle as possible and know which direction to push it so it leaves the low efficiency zone. The judgment to decide which team member should take the shot.
You might read all this as a lot of ink to spill on a slightly different risk and reward matrix.
But what the risk and reward matrix doesn’t know about is the narrative. It doesn’t know about our (flawed) assumptions. It doesn’t know about Michael Jordan hitting the most famous shot ever in the lowest efficiency shooting zone on the court. It doesn’t capture the fact that the long 2s aren’t usually understood as bad shots while we are shooting them.
What the “long 2” analytics model does beyond a simple risk and reward matrix is remind you to question your assumptions about the nature of the game. It encourages you to find high-upside value in places others aren’t looking. And even more it asks that you challenge the prevailing wisdom when you get that inkling that something is off, especially if the data is nonexistent, unclear or contradictory. It wants you to constantly be on the lookout for projects that are hard, expensive, time consuming or all three and that won’t move the needle in a big way.
It's a framework for strategy, innovation and risk management.
Comparing Anthony Davis and Draymond Green is instructive for why this type of thinking is critical. From every distance on the court, Davis is a better shooter than Draymond by about 5 percentage points. Yet, over 100 shots, Draymond puts up 5 points more than Davis. Draymond takes less than 20% of his shot attempts from mid-range while Davis takes over 70% from mid-range. Davis’ shot profile turns him from a really good shooter into a mediocre one.
The quality of your shot selection matters. A lot.
It’s very in vogue right now to talk about how important execution is. And it is important. But never forget that a good team can beat a great one simply by consistently taking better shots.
And a great team with great shot selection is basically unbeatable.
Bad shots will actually beat you faster than anything else. Great analogy, enjoyed reading this a lot!
What do you think the long 2's are for most SaaS companies? The "best practices" that almost never work out. I'd guess things like "start a podcast!" fall into that.