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Should your company hire a rock star? Yankee fans wouldn't
Rock stars" such as Alex Rodriguez, Jason Giambi, Mark Teixeira and CC Sabathia were paid superstar compensation packages and arrived with great fanfare only to fail to perform as well as their former high standards. - photo by Taylor Cotterell
Research reported by Harvard Business Review reports an interesting phenomenon. When rock star employees Fortune 100 CEOs, chief software developers and top hot shots in advertising, consulting and law get hired away, in many cases the luster of their all-star performances lessen.

Even the Yankees have learned this lesson. Rock stars" such as Alex Rodriguez, Jason Giambi, Mark Teixeira and CC Sabathia were paid superstar compensation packages and arrived with great fanfare only to fail to perform as well as their former high standards.

What does it mean? According to researchers, star executive talent may not be as easily transferrable as organizations believe.

To test these assumptions, three researchers, Boris Groysberg, Ashish Nanda and Nitin Nohria began to track the executives we classify as stars superior performers regarded as prodigies by both their organizations and by employees. The researchers noticed an interesting phenomenon over the years. As stars were lured away, in many cases they didnt perform as well in new companies as they had in the organizations where they had initially earned their superstar reputations. Why is this?

The bell curve has started to toll

In some cases, superstar prodigies have delivered the best of their performance in their original settings and are nearing the sunset of their best creative deliveries by the time new suitors with bigger enticements and pockets are coming to call. If a superstars best days is behind him, an investment in a mega deal to obtain that one and only talent is less than ideal. This is a factor for recruiting companies to think about before they become so enamored they are ready to pay any cost.

It takes more than talent

In many if not most cases, a superstar performance is the result of an ideal synergy between executive and company and team. So the spectacular outcome an executive achieves in one organization may not mirror what that executive achieves in another.

For example, in the competitive field of stock analysis, star analysts can receive as much as $2 million to $5 million in annual pay and can have a vast influence on their organizations success. However the mercurial success an analyst achieves in one organization may falter dramatically when the analyst moves to a smaller company that cant produce research data so quickly or doesnt have a sufficient synergy among team members to allow the analyst to meet prior achievement levels with ease.

Consider this: A star makes a team perform better, but the team compels the star to perform better as well. Its a delicate balancing act that requires synergy between star and team for the resulting mix to succeed. Do you have that balance? If youre going to make an all-star investment, the working synergy is something to be sure in advance you can fully achieve.

Superstars frequently leave

Even though theyve been lured by ultra-rich compensation, when a superstars performance is faltering for any reason, the strain to perform to mega levels may cause that person to give the role a try for a small season, then leave. Remember that when a company has strained itself to obtain the star with super-rich compensation, the strain is felt from both sides the company that makes the investment and the superstar performer who arrives with a high reputation and an extra steep performance bar to achieve. If the mix isnt working, the strain that is felt by both the star and the company can make the superstar employee quick to leave.

According to these researchers, the strategy of building a company quickly by buying superstars is not a good plan. But in cases where the synergy of the performer, the company and the team have been tested in advance, when its possible to assess whether a high performers season of success is likely to continue and when the executives resilience is high, scoring a superstar hire could be the magic ticket that is worth any cost.
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