Why Theo Epstein and the Cubs Are Fortune’s MVPs This Year

March 23, 2017, 10:30 AM UTC

In the fall of 2016, as partisan distrust and division reached abysmal depths, fascination with the Chicago Cubs became that all-too-rare phenomenon that united America. As the Cubs fought to end a 108-year championship drought, television ratings for the World Series soared by almost 50%. Even casual fans who didn’t know a bunt from a beanball stayed up late to watch the excruciating extra-inning Game Seven that turned baseball’s most famous lovable losers into winners at last.

In his book The Cubs Way, Sports Illustrated senior baseball writer Tom Verducci details the five-year rebuilding plan that led to the team’s victory. The Cubs owe their success to a concatenation of different leadership styles, from the affable patience of owner Tom Ricketts to the innovative eccentricity of manager Joe Maddon. But most important of all was the evolution of club president Theo Epstein, the wunderkind executive who realized he would need to grow as a leader in order to replicate in Chicago the success he’d had with the Boston Red Sox. In the following passages, Verducci describes how a deeper understanding of important human qualities among his players—the character, ­discipline, and chemistry that turn skilled athletes into leaders—­enabled Epstein to engineer one of the most remarkable turnarounds in sports.

A few weeks before spring training of 2012, in the ballroom of a budget hotel in Mesa, Ariz., Theo Epstein stood before nearly every person connected with the baseball operations of the Chicago Cubs and told them how the Cubs were going to win the World Series.

Epstein devoted the first three days of the session to on-field strategy: hitting philosophy, pitching philosophy, defense, and baserunning. But the entire last day was devoted to character. The Cubs, Epstein insisted, would acquire only players with outstanding makeup. Even Epstein realized himself how far he had evolved since he put so much faith in numbers when he began as general manager of the Red Sox. Now character did not just matter. It was essential to Epstein’s blueprint to win the World Series.

Theo Epstein is no. 1 on our 2017 World’s Greatest Leaders list. See the full list here.

There was a reason character loomed so large in Epstein’s thinking, a reason that helped explain why Epstein was spending spring training in Arizona with the Cubs and not in Florida with the Red Sox. Epstein’s devotion to a Moneyball ­approach—data-driven analysis that helped teams identify and accumulate players with little-noticed but crucial strengths—had succeeded inestimably in Boston, where he steered the team to six playoff appearances and two World Series titles in nine seasons as general manager, helping the team break its own 86-year-old championship drought along the way.

But character and chemistry were strengths that a “quant” approach couldn’t capture, and in 2011, in what turned out to be Epstein’s final season in Boston, their absence was painfully clear as the team underwent a late-season collapse. The more the team lost, the more it broke apart from within. Players ­feuded with one another. The egos that had created cracks in the clubhouse while they were winning caused deep fissures as they lost.

So toxic was the atmosphere that, as Boston’s lead slipped away, one unidentified player began to shrug it off by saying, “Why do we want to play in October anyway? We don’t get paid for that.” True enough—players get their annual salary based on the 26 weeks of the regular ­season—but the sentiment, even if expressed in a joking manner, revealed a deep problem with the character in the clubhouse. Epstein heard about it and wondered, Who says that? And he knew the answer: a losing player.

Once he’d joined the Cubs, Epstein gave his scouts very specific marching orders. On every prospect he wanted the area scout to give three examples of how that player responded to adversity on the field and three examples of how that player responded to adversity off the field. They were to dig into the player’s makeup by talking to just about anybody who knew him: parents, guidance counselors, teammates, girlfriends, siblings. He wanted as many questions answered as possible: What’s the family situation like? How does he treat people when no one’s looking? What do his friends say about him? What do his enemies say about him? How does he treat people he doesn’t necessarily have to treat well? What motivates him? Is he externally motivated where he wants money or followers?

Cubs scouting reports would never look the same again. Epstein wanted reports that went on for pages, like the Russian novels his father had him read as a boy. The scouts who didn’t take to the long-form scouting reports didn’t last. Epstein ran them off. It wasn’t hard, measurable data. But it was information nonetheless, and if Epstein was going to build a team around high-character, high-impact position players, he wanted as much of it as possible.

Epstein made a bet on the importance of the makeup of the players he acquired, not to replace the edge in analytics he once wielded in Boston but to enhance it. He made this bet just as baseball teams more and more resembled technology companies. The baseball operations offices swelled with brilliant people with math and science degrees. The spin rates of pitches and the launch angles of balls hit off bats were being studied with the rigor of major science research projects. Players were donning “wearable” technology to collect data on how hard their bodies were working. Teams were fiercely guarding all kinds of proprietary statistics to find hidden value in players. Catchers were being schooled on how to subtly cradle pitches with their fingers to influence umpires into calling balls as strikes. Baseball teams were obsessed, at unprecedented intellectual and scientific levels, with finding “the next inefficiency.”

2016 World Series - Chicago Cubs v. Cleveland Indians: Game Seven
Theo Epstein celebrates with fellow Cubs players of the 2016 World Series between the Chicago Cubs and the Cleveland Indians at [hotlink]Progressive[/hotlink] Field on Wednesday, November 2, 2016 in Cleveland, Ohio.Rob Tringali—MLB Photos via Getty Images
Rob Tringali—MLB Photos via Getty Images

The brilliance of what the Cubs did was to put their faith not just in numbers, but also in the type of people they acquired. The four pillars of the rebuild—first baseman Anthony Rizzo, future Most Valuable Player Kris Bryant, out­fielder Kyle Schwarber, and shortstop Addison Russell—were all acquired because the Cubs valued their character, not just their skill.

Epstein and his assistants had come a long way from when they couldn’t wait to tear into an analytics project for Boston in 2002. This time there was no proprietary formula, no algorithm, for acquiring self-motivated, high-character players and creating an environment to allow them to flourish. They never stopped searching to find edges, but they made a fundamental decision early after coming to Chicago that the one edge they could exploit was found in a very old-school resource: people.

Said Epstein, “If we can’t find the next technological breakthrough, well, maybe we can be better than anyone else with how we treat our players and how we connect with players and the relationships we develop and how we put them in positions to succeed. Maybe our environment will be the best in the game, maybe our vibe will be the best in the game, maybe our players will be the loosest, and maybe they’ll have the most fun, and maybe they’ll care the most. It’s impossible to quantify.

Courtesy of Crown Archetype
Courtesy of Crown Archetype

“When people do things they weren’t even sure they were capable of, I think it comes back to connection. Connection with teammates. Connection with organization. Feeling like they belong in the environment. I think it’s a human need—the need to feel connected. We don’t live in isolation. Most people don’t like working in isolation—some do, but they typically don’t end up playing Major League Baseball.”

Adapted from THE CUBS WAY: THE ZEN OF BUILDING THE BEST TEAM IN BASEBALL AND BREAKING THE CURSE Copyright © 2017 by Tom Verducci. Published by Crown Archetype, an imprint of Penguin Random House LLC.

What Business Can Learn From the Cubs’ History-Making Win

1. Hire for character

How employees treat one another or cope with adversity can be more important to your success than their sales numbers or skill sets.

2. See data’s limits

A statistics-driven strategy won’t help you if all your competitors are using similar techniques with similar data. Do you truly have an analytical edge?

3. Foster connections

Epstein credits the Cubs’ success in part to the years-long relationships among their core players. “People don’t like working in isolation,” he says.

A version of this article appears in the April 1, 2017 issue of Fortune as part of our World’s Greatest Leaders package.

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