What If You Hired Only the Best People and Paid Them Like Superstars?

WARNING: US-Centric Post about Baseball and Company Performance Ahead. (Come back in the next section when I say it’s safe.)
Last night the Boston Red Sox won the ALCS and are headed to the World Series. At one point in the series they were down three games to one. But they were never out of it. Know why? They have some of the best talent in baseball. And they pay for it.

In fact, the team payroll for the Red Sox is the second highest in all of baseball, and is more then double that of their opponent, the Cleveland Indians. That payroll pays off. The BoSox have the third best teams stats this year. Guess who has the best? The New York Yankees, which is the team with the highest payroll in baseball. My take: Getting the best talent works. (Yes, baseball aficionados will cite Moneyball, but where are the low budget teams now?)

Now, for the Non-Baseball Fans (it’s safe to come out now)
All that success by high budget teams must mean something. Getting the best talent works. But it’s not cheap. What I’m wondering about is what would happen if a company — big or small — decided that they were going to hire only the most extraordinary talent at every position. I’m talking about getting superstars for everything from the CEO to the lowest level employee. Know how to do it? Pay a lot and make people want to be part of your exclusive club.

Just Say No to ‘Warm Body” Recruiting
What would it take to stop recruiting for “warm bodies” and hire only the best? I’m talking about a real talent solution, one where you cared as much about hiring a dishwasher as you did about hiring your chief executive. I think it would take money. And a boldness that’s not seen except in the world of sports. (Now for the international audience: The same idea goes for Real Madrid and Man U as it does for the Boston Red Sox — great players command big salaries and deliver great victories.)

Sure, I’ll bet there would be rabid criticism of this “go for it” approach to talent. Sure, let’s all rise up in a chorus and sing “We’re all in it for the long term” as our corporate kumbaya. Funny, though, it seems like most public companies release earnings reports every quarter and put financial pressure on their people to win-win-win every year. Cool with me. I say get the superstars. Pay them. And reap the rewards.

How’s that for an HR strategy?

(I have a business idea here that applies to HR I’m going to talk about once I get it fleshed out. It’s about HR superstars.)

NB: John Windsor of The You Blog points out that the Red Sox will be playing the World Series against the team with the 25th highest payroll in baseball. So, my baseball argument might be all wet. But would getting all superstars on your team, in a real company, work?

What Are You Doing with Your Dollar-Paid Expats?

Several years ago, when I was with a a big consulting firm, I had a job in Europe. I was based in Amsterdam and spent my time flying all over Western Europe doing work. Things were good. Then the idea of a long-term assignment came up.

Expat assignments are messy no matter how you slice it. They can be good, but the odds are not on the side of the expat. It’s easy to bargain when you’re getting a job in your home country. You know the place and you know the risk. Plus, you don’t have to know currency arbitrage.

In my situation, the firm wanted to fix my pay in U.S. dollars. At the time, the exchange rate was 1 euro to $0.85. The euro was at a discount and life seemed pretty good. But I asked around to many people I knew who were expats. They all told me the same thing: Get a currency exchange guarantee. Without it, they told me, you’ll regret it.

Well, for any number of reasons I turned down the long-term assignment. One of them was the unwillingness to offer a currency correction. And when I saw the news this past week that the dollar was at its all time weakest against the euro — trading at 1 euro for $1.40 — I breathed a sign of relief. Can you imagine the price of goods increasing 65% and your play staying flat? Now that’s some kind of inflation!

Note to companies offering expat assignments: Your expats aren’t currency arbitragers, but they can read the newspapers. Do it right, and provide currency fluctuation protection. Your expats are working hard for your company and you would never ask your local employees to take a 65% percent haircut and expect them to stay, would you?

Top HR Pay

Somebody’s gotta get paid at the 99th percentile. (Wouldn’t it be great if it were you…just once?)

Workforce Management posted a list of The 30 Highest-Paid HR leaders. These people have a place at the table, all right. And I’d say it’s more like mahogany than Formica.

[via JT International News Wire]

If Motivating You Is Wrong, I Don’t Want To Be Right

I saw this quote today by Sir Ken Robinson on Diego Rodriguez’s Metacool:

If you’re not prepared to be wrong, you will never come up with anything original.

That made me think about why companies use pay surveys to set their pay levels. I mean, what would you do if you had none of that information and needed to create a pay plan? Would you even have base salary? Would you make everyone a partner in the business and let them share in the profits — and invest in the business? Would the calendar dictate when pay increases should happen? Would three years be considered “long-term”? Would you run your company differently? Would you have more managers than workers?

Here’s a challenge: You should pay people at the 99th percentile. (As long as we have data, we might as well use it.) Because you pay more than everyone else you will get the best talent. And those highly-paid people will rock your world. Your company will be the place to work, and the most successful company on the planet. It could work. Has anyone proven that it can’t?

Discuss.

How About a Little Pay Transparency?

How transparent are you about pay in your company? Today’s Dilbert tells how to do it in three easy panels.

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