I don’t follow baseball.
So I was surprised when I got sucked into a recent Harvard Business School article by Carmen Noble detailing Red Sox general manager Theo Epstein’s two-year campaign to acquire star performers with extraordinary multimillion-dollar, multiyear contracts.
The piece describes one of the most expensive talent hunts in baseball history, starting with the signing of veteran pitcher John Lackey from the Anaheim Angels. Other high-profile hires followed, and baseball aficionados hailed the 2011 Red Sox as one of the greatest teams of all time.
To say the team didn’t live up to expectations would be an understatement. In September 2011, the Red Sox lost 18 of its last 24 games and lost a shot at the playoffs. The glittering, star-studded team was a failure.
The fall of superstars is common in business too. Just look at the number of CEO departures last year, like Leo Apotheker at HP, Carol Bartz at Yahoo!, Ernest Lieb at Mercedes-Benz and Tom Williams at Reader’s Digest, to name a few.
This year is not looking much better. According to placement firm Challenger, Gray & Christmas, CEO departures are up 17 percent from a year ago, with a total of 227 departures tracked through the first two months of 2012 compared to 187 at the same point in 2011.
The most common reason cited is disappointing performance, which, in most cases, came as a surprise. The star, after all, was hired because he had a track record of extraordinary contributions at previous organizations. Why wasn’t he able to replicate that success here?
Find out in my recent AMEX OPEN Forum Culture Beat column, in which I discuss why hiring a superstar might not improve your business.
I agree on this post, sometime business owners think it will improve their business but the truth is you just pay so much with a little return in your profit.
Posted by: Jim | April 30, 2012 at 10:25 PM
@Jim: Definitely what I hear anecdotally - hence the reason for the post!
Posted by: Alexandra Levit | May 04, 2012 at 11:20 PM
From a business perspective, it would be difficult to turn down a superstar though. Someone with a proven track record of success should ideally be what everyone is looking to hire. This means that even if they flame out a huge percentage of the time there will still be a draw to them.
The key that I take from this article is that everyone should strive to be the superstar. They made their millions and moved on. Things didn't work out for the business/team, but that's okay because they're sitting on their stacks of cash figuring out the next move.
Posted by: James Barley | May 13, 2012 at 04:49 AM
@James: You're right. It will always help you to be the superstar no matter what the outcome.
Posted by: Alexandra Levit | August 21, 2012 at 04:51 PM