You Hire from a Competitor?
by Bill Radin
In a perfect world, it would
make sense to hire someone who's already doing a superlative
job for a direct competitor. After all, why re-invent the
wheel if you can hire someone whoís already familiar with your
unique marketplace of products, services, applications and
Well, sometimes everything
falls into place and the person meets or exceeds expectations.
But more often, reality gets in the way.
First, letís talk about some
potential logistical roadblocks. The first is whether a person
working for a competitor can join your team without legal
complications. As you know, most companies have non-compete
agreements. Whether or not theyíre enforceable isnít the
issue. The issue is whether a candidate is willing to get
caught up in a legal matter that may involve a reputation, a
career and a potentially ruinous financial consequence. I
recently lost a Director of Sales placement in which the
hiring companyís legal counsel assured the candidate he was in
the clear; and if necessary, they would fight any preventative
action sought by the candidateís current employer. Despite
their assurances, the candidate felt it just wasnít worth the
risk to himself and his family.
Another common roadblock is
location. Your company may be lucky enough to have several
competitors in the same metro area. Or not. I recently worked
with a client company based in Kansas City, which is a huge
metro area with a well-educated work force. For a manufacturer
that competes with hundreds of other similar companies, youíd
think theyíd have a direct competitor in the area, but they
donít. So, it seemed certain that the only qualified candidate
would need to relocate.
Unfortunately, with factors
such as an uncertain housing market, candidates with
two-income households and all sorts of intangibles, including
kids, schools, in-laws, health care and so forth, people are
more resistant to change in location than Iíve seen in the
last 30 years. So, in my Kansas City search, I was unable to
find a local candidate from a direct competitor or any depth
of talent outside the Kansas City metro area willing to
relocate. While itís true that in our hyper-connected world,
some positions are location-neutral. But when you run a
business, you may not want a virtual candidate managing a
brick-and-mortar office. In a moment, Iíll tell you how we
filled that position in Kansas City.
But there are other factors
aside from logistics that may curb your enthusiasm for hiring
people from your competitors. Letís say a competitor sells
similar products as yours to the same customers at an
equivalent price point. Fine. But if they sell through
stocking distributors Ė and youíve historically sold directly
to your customers Ė then that competitorís sales manager may
not speak the same sales language as your constituents. And
that illiteracy Ė or change in the way you do business - could
negatively affect your sales force and your customers.
Finally, Iím sure youíve heard
the old saying that familiarity breeds contempt. While itís
great to hire someone from within a community where everyone
knows each other, too much in-breeding can seriously dilute
your organizationís gene pool, especially if your company
needs a transfusion of new blood. When everyone knows each
other, it tends to breed complacency. So, be careful not to
become a zombie company, stuffed to the gills with industry
And the Kansas City company?
Since we couldnít change the location of company, we adjusted
the position requirements and hired a local candidate with
enough of the essential qualities to do an outstanding job and
bring a fresh perspective to the team.