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Executive Adviser

Human Resources

How to Minimize the Risks of Hiring Outside Stars

By Boris Groysberg, Lex Sant and Robin Abrahams

September 22, 2008

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Talent! It’s the rallying cry of hiring managers and CEOs everywhere. In good economic times and bad, companies compete for the best, the brightest, the hardest-working—the stars who outshine the merely competent.

But hiring top talent is not without risk. There is always the chance that the star won’t be able to replicate his or her success in a new environment. Managers need to think about how portable a job candidate’s performance is likely to be—and to a large degree that depends on the job. The more star workers’ performance depends on the people around them and on their familiarity with their company’s processes and culture, the less likely they are to perform at the same level on a new stage, at least at first.

To examine the link between job description and performance portability, we looked at a special kind of free agent—professional football players. The National Football League labor market is an ideal natural laboratory: All “companies” (teams) are engaged in identical work, the positions are the same in all teams, success can be quantified, and employee moves are a matter of public record.

We compared the performances of star NFL punters and wide receivers who switched teams with the performances of counterparts who did not.

Who’s Portable?

The performance of wide receivers is governed by complex interactions among teammates. Receivers not only must have sufficient speed and agility to escape defensive players and catch the ball, they also must coordinate the distance, direction and timing of their routes with quarterbacks who themselves depend on several teammates to protect them from charging defensive players. Punters, on the other hand, engage in the comparatively simple act of kicking a football. How far a punter kicks the ball is almost completely dependent on the player’s individual strength and skill.

Are punters’ talents, then, more portable than those of wide receivers? The data indicate they are.

On average, the wide receivers in our study declined in performance as the years took their toll. However, those who moved saw their performance drop much more steeply in their first year with a new team: The number of receptions, yards gained and touchdowns all declined more than the totals for those who stayed with their teams. Performance stabilized after a year, suggesting that after a period of adjustment the players were able to build the kind of cohesion with their teammates that had served them so well at their old teams.

Punters, on

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This article was printed from MIT Sloan Management Review online: http://sloanreview.mit.edu/executive-adviser/2008-4/50414/how-to-minimize-the-risks-of-hiring-outside-stars/

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