The long-standing tradition of executives bringing in their own “teams” has been discussed in a recent article on Barnes & Noble, the troubled booksellers. It details the revolving door of CEOs and their bringing in department heads who are loyal to them personally. It is a way for the new executive to establish and solidify their power base. Interestingly, there is no mention of company loyalty, which is troubling and brings many questions to the table. The main questions are what to do with the leftover executives once the CEO has been removed and should an executive be allowed to bring in their personal teams?
B&N’s new owner has a unique and yet relevant solution to the leftover executive problem, they are being let go for the sake of the company. The new owner, James Daunt, makes a compelling point in that “we have the talent here.” This is true for all companies, large or small, with employees who are loyal to the company and can do wonderful things if given the chance. It also gives, as Daunt says, “employees career paths”, something most all companies say but very few actually practice. The honored thought of promotion from within is tossed about with abandon but is rarely put into action. There are scores of talented individuals who hit the proverbial “glass ceiling”. looking upward knowing they can perform the job but realize they will never get the chance for the simple fact, they are not friends of the executive. It is a demoralizing and defeating realization to the employee who when given the opportunity will leave the company. Talent lost.
The question of whether an executive should be able to bring in his own team, displacing others, is an issue worthy of lengthy discussion and thought. In some industries, this is an honored tradition in order to get one person. As an example, in academics, the university will practice dual-career or spousal hiring. That being, hiring the main talent while providing or creating a position for their spouse regardless of their talent. This seems fair as the new employee must uproot their families and such, however, in many cases, the spousal employment displaces someone at the university, a dubious and unfair practice when given thought.
With companies complaining about the talent level, the practice of a CEO or senior executives bringing in their own team should be stopped. If a company touts a hire or promote from within policy, then they should adhere to that policy, it is the ethical thing to do. If, and only if, someone cannot be found within, then the company should seek externally. This creates a group of talented executives that are loyal to the company, not to a single person, who will make decisions that benefit the company. Additionally, it creates a morale boost by signifying that there is a career path for anyone who is successful.
There is a saying that “words are what men say…but real men live those words.” This would apply to the corporate world also. Living the words one says creates an ethical and honest organization, and gives the employees, who are the organization, a chance to make it better.
Dr. Lawson is an executive coach and a Professor of Economics and Strategy. He writes on business issues, education, and developing today’s modern executives. He can be found on Twitter @dplwsn and #TMIBS.