Outsourcing your leadership team: build it… or buy it?

Would you buy a goal from this guy?

One of the newest additions to the HfS family is Brian Robinson. Born in Ohio, raised in Florida, educated in Florida and Virginia, Brian was living in the UK when we started talking to him about working for us. In fact, he was renting my London flat, so I was guaranteed he’d give the place a good clean when he moved out to embark on his Italian adventure.

He’s now based in Rome, where he’s starting to learn the language. Give him a few more weeks and he’ll be ordering the Pasta alla Carbonara in the local tongue, while explaining it’ll be far easier to outsource Berlusconi than trying to lock him into a captive.  Hmmm… maybe CNN can sign him up for a double-act with Elliot Spitzer?

Brian is an internationalist to say the least, so it comes as no surprise that this Ohio boy uses football (you know, the one where you can’t use your hands) as an analogy for how to nurture leadership teams.

Is it better to build or buy? For the answer, over to you, Brian…

Outsourcing your leadership team: The build vs. buy debate heats up

Were you surprised that Rooney biked home the winning goal in the Manchester derby? I wasn’t. Hands down, the goal was amazing. And it may well go down as one of the best goals ever scored in the Barclays Premiership.

Rooney’s ability to catch the ball at this angle speaks to his unrivalled skill as a footballer. The fact that he was in the match to score the goal speaks to strength and intelligence of the management team running arguably one of the most prolific football teams in the world today. To date, Rooney’s 2010-2011 performance has been lackluster: a mere seven goals in 27 matches. Other players would have been benched or traded by now, but Rooney has something special. He knows it and so does his management.

There are similarities between good companies and good football teams: solid staff employees that consistently make the right decisions at the right time. So if you are the helm of a flagging enterprise, should you nurture management talent internally or go to market for it? A review of several clubs’ performance and related management decisions in the Barclay’s Premiership sheds some light on the subject, but the evidence is far from conclusive.

Take, for example, Manchester City. Today it’s one of the richest clubs in the world, bankrolled at a massive loss by Abu Dhabi’s Sheikh Mansour, which has already changed managers four times in the last five years. Yet, despite all the talent money can buy, they have yet to win a single trophy. In contrast to Manchester City are clubs like Manchester United and Arsenal, which have each kept faith with the same managers for 26 and 14 years’ respectively. Each has a stable and revered management team that coaches some of the world’s best footballers. These two clubs have a combined seven Premiership titles over the last 10 years and are currently ranked number 1 and number 2 in this year’s title race, and have both spent far, far less money on new players than their main title rivals. And then there is Chelsea, who’s spending has been even more magnanimous that Manchester City’s, and results have followed with three Premiership titles and three FA Cup titles in recent years. However, this year, the club is ranked a concerning 5th and is in danger of dropping out of Europe’s elite competition, with an aging team and clear disharmony in their camp. Could changing managers four times in three years be a contributing factor? It certainly has not helped. And the darling club of this year’s season has to be Tottenham.

Consistently strong, but rarely considered a star, the club has been under the management of Harry Redknapp for the last two seasons. Having spent his entire life in the Premiership as player and coach, he has enabled existing players to achieve new heights of performance while attracting new talent to the team on a modest transfer budget and salary ceiling. The result: Tottenham had their highest ever finish in the Premiership last year placing fourth. Moreover, they are in the round of 16 in this year’s Champions League, having beaten both Inter Milan and AC Milan along the way, and are currently ranked fourth in this year’s table.  Can Tottenham maintain this level of performance?  What is certain, is that decisions both on and off the pitch will contribute to the club’s long-term performance.

I’ve supported a fair share of management teams over the last 13 years, both large and small, and from all parts of the globe.  Despite the language barriers and, at times, differences in culture, I have observed that the best managers often share a similar set of attributes.  For example, they:

  • Engender trust among all team members
  • Reinforce directly and indirectly that no one single player is the linchpin of success
  • Promote from within the team ranks, more often than not
  • Empower their team with responsibility and the right to take decisions

Brian Robinson, Senior Analyst, HfS Research (click for bio)

Managers don’t turn these attributes on and off like a light; rather, they build them over time through shared work experiences.   More importantly, they give team members the opportunity and time to discover and align shared interests.  So why source talent at all if great leadership takes time to nurture?  From my experience, senior managers brought in from outside the organization can create a much needed shock to the system.  However, when left alone to manage the resulting fall out, they fail.  More often than not, it is the tenured managers that adjust, pick up the pieces, and enable the organization to see a new and better day.

So what does this all boil down to?  It is my belief that sustained peak performance comes as a result of a long-term focus on and development of talented management.  It’s true – great management capability can be bought.  But strong and consistent results cannot.  And who needs to spend thousands of dollars and hundreds of hours researching this hypothesis when the answer is unfolding every week on pitches across the UK and Europe.  Will the debate surrounding leadership outsourcing continue or fizzle?  I know I will be watching the Premiership and Champions League to find out.

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3 Comments

  1. Stephen Cohen
    Posted February 21, 2011 at 5:06 pm | Permalink

    Welcome to HFS, Brian – and I like your examples of tying football success to business leadership.

    It shows you that developing knowledge and experience internally nearly always trumps bringing in “hired guns” to make quick-fixes. When you’re dealing with very unique issues, such as outsourcing, it’s normally a case of “horses for courses”, where the business managers with institutional knowledge of their own firms are the ones in the best position to develop long-term strategies that really work.

    I strongly advise clients to invest in management training, when they deal with management challenges such as outsourcing, BEFORE they spend a fortune on consulting and headhunters. It’s simply insecurity that makes some executives worried that can’t be successful with their existing internal skills,

    Stephen

  2. Suresh Singh
    Posted February 21, 2011 at 7:46 pm | Permalink

    An excellent analogy of leadership, Brian!

    It shows you that sustained success is often nurtured through patience. While relying on one managerr may not bring success every year (for example, Ferguson at Manchester United), when you look at their success over decades, that is when you see the real return on being patient and allowing your leaders to grow into their roles.

    Impatience, such as that shown by Chelsea, may have won them some short-term trophies, but the constant leadership changes has left the team stranded without a long-term plan and quality younger players coming through. As a result, the team will keep having to spend “silly money” to find more success,

    Suresh Singh

  3. Posted March 9, 2011 at 3:40 am | Permalink

    Brian, I appreciate the balanced approach to this issue that you highlight. Too often we want a black and white answer to which is better – homegrown vs. outsider. Your assessment seems to square up with what Jim Collins offers in “Good to Great” regarding the kind of leaders that are able to prosper a company over the long haul, most often ones that come up from within the organization. Yet I appreciate the added point that sometimes organizations need a shake up from an outsider to get on the right track.

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  5. By Do You Build or Buy Your Leadership Team? on March 18, 2011 at 10:20 am

    [...] This article is a fascinating look at the decision to either build a leadership team or outsource it. And for you sports fans out there, it compares the building of a good leadership team to the building of a good football team (sorry, it’s British football…rugby to be precise). According to the article, “There are similarities between good companies and good football teams: solid staff employees that consistently make the right decisions at the right time.” Read More>> [...]

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