Success Secrets: Hiring the Enemy?

One of the curious rituals of professional sports comes at the end of every season, when the trading begins. As players bounce back and forth like so many pinballs, the rationales of general managers are sometimes exposed as little more than wishful thinking and superstition. It’s not uncommon, for instance, to see team bidding for the services of players on rival squad that has had particular success against them. It’s as if the losing team hopes to acquire lucky charm and reverse its fortunes.

But it’s rare for successful team to give up key element of its success; even rarer to hand such key player over to rival. Yet the folly continues. However, there’s no sense in being smug here, because business is no stranger to that mentality.

The recent implosion at America’s K-Mart is an example. Here is retailing institution in dire need of strategy, losing market share and profits for years and years to Wal-Mart, Target and Costco. Management and the investment community agreed that Wal-Mart’s dominance of its segment of the market meant K-Mart should strike out into new areas, try to differentiate itself. With the signing of Martha Stewart to an exclusive deal, K-Mart seemed to be doing just that. And yet what did K-Mart do next? Management hired number of Wal-Mart executives, installing one as president of major division.

The instinct here makes sense superficially. In many fields, talent flows back and forth as unfettered as the breeze. This revolving chair approach to hiring does tend to produce an unhealthy degree of consensus, however, leading to the sort of herd mentality that gives us dozens of copycat TV shows, and the dot-com bubble.

The trouble arises in situation like K-Mart’s, when difference, not similarity, is required. Here the CEO announces that K-Mart will not go head-to-head with Wal-Mart; then turns around and fills key positions with Wal-Mart people. It’s not hard to imagine the ripple effect that occurred after this vote of non-confidence in K-Mart’s own talent pool. More curious was the disconnect between words and actions: In single stroke, any hope of differentiating the two rivals was gone. The internal structure and mindset of K-Mart now mirrored that of Wal-Mart.

Predictably, in the year since these moves were made, K-Mart’s fortunes have fallen to the point where the company has had to file for protection from its creditors. Almost 300 stores have been closed, and 22,000 jobs cut. And, again, the call from management is variation on the same old theme: We have to be different; this time, we’ll get it right.

If this is to happen, K-Mart needs to stop admiring (and copying) its adversary so much, and it needs to stop hiring its enemies. For you, it means remembering to look past the glowing numbers into the circumstances that produced them. For one thing, the executive you’re looking at may have risen to prominence due to the excellence of better distribution system, superior line of products, even lucky break in the marketplace. The future saviour you covet, in other words, may just be figurehead, unable to duplicate his success without the strong team he enjoyed in his previous position.

Second, you have to ask yourself why your putative miracle-worker is available. True, he could be looking for fresh challenge or even to cash in on his market value. There’s nothing wrong with either of those rationales. However, you also have to take into account fact of life in sports: Any team that is willing to part with player may have very good reason to do so.

Even if these two questions are settled to your satisfaction, you have to prepare yourself for the inevitable request your new hire will make; that is, to clean house in his division and fill it with his own people.

Rest assured, you’ll find it hard to say no. How can you, if you’ve gone to the trouble of bringing this golden stranger all the way over from his world-beating company in order to straighten out your own under-performing household? Certainly you don’t expect him to achieve results with your existing employees, none of whom evidently was up to the job. You ought to be smart enough to know in advance where those people will come from – his old company – and to know what to do about it.

The effect of this, the one that ripples throughout the organisation, merely finishes the job of demoralisation that you’ve unintentionally begun. Employees who think that only new hires have future with the company will soon begin to act in ways that will make the prophecy self-fulfilling. They’ll say to themselves, “What’s the point of doing the extra research? Nobody will read it and, anyway, I’m probably on my way out the door.” Once you’ve started down this road, your last remaining option for retaining control may be in general housecleaning, with all the attendant negative publicity and loss of momentum that this usually entails. Needless to say, this is probably not what you had in mind.

Change is hard enough in any company. Don’t sabotage your own best efforts by surrounding yourself with people whose natural inclinations and talents aren’t aligned with the course you intend to set.

Mark McCormack is the founder of International Management Group.

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