Poached or fried?

The pitfalls of poaching staff from other businesses ? be aware, you may create more problems than you solve.

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Events of this past month have prompted me to hammer the keyboard on another mission — this time to examine the wisdom of engaging in the time honoured process of poaching staff from other businesses. Given the tight labour market, there is a fair bit of it going on at all market levels at the moment, and many of the perpetrators are going to be in for a bit of a rude shock.

Before I get into this, I need to explain that I can readily understand the temptation to make discreet offers to people you believe can contribute to your business. After all, you figure you may be able to snaffle a great staff member, eliminate a big chunk of your recruitment and training costs and weaken a competitor all at the same time. What could possibly be wrong with that?

The first issue that comes to mind is the question: ‘Why do you want this particular person?’ The answer usually revolves around the fact that you have observed them working, or been served by them yourself, or you have heard of them through the ‘grapevine’, etc. This may be an indicator that this person may be a valuable potential member of staff, but it is by no means a reliable indication of their potential merit.

Take the staff member who serves you while you are a customer in another business. They may deliver great service to you, but what is the guarantee that this is their normal level of performance? You may have just caught them at a good time and ‘won the lotto’ so to speak — you might have been there during the 1 in 50 or 1 in 100 shifts when they got it right. You don’t know unless you delve into them by more sophisticated or more thorough recruitment methods.

The other related issue is that by making an assessment of their customer service you are only observing one aspect of their performance — albeit an important one — but by no means the only important aspect of their work. What if that person is unreliable and constantly comes to work late and pulls ‘sickies’ at the last minute? What if they are a totally poisonous member of the team; one who is always whinging, bitching and backstabbing? What if they have had 27 jobs in the last two years? What if they have a drinking or substance abuse problem? You won’t know that from casual observation. You could be drawing a total liability into your business.

Another thing to consider is the cost of poached staff. You usually have to offer them more money to come across to work for you, and if you do this regularly you will slowly but surely increase your total wage costs way beyond inflation, and create a rod for your own back. Your existing staff will soon learn what the poached staff member is getting paid, and they will, quite naturally, hold their hands out too — the resulting chain reaction potentially putting you into a spiral of seriously escalating wage costs.

Interestingly, the increased wages you usually need to offer a poaching target will often far exceed the normal cost of recruiting and training a far cheaper person using normal recruiting means, and you will come out financially a lot worse off over time. In other words, poaching presents the illusion of saving you money, but in the long run it can cost you dearly.

I have to also throw another issue to do with poached staff at this point. Staff who have worked at another business will usually have used totally different procedures than those you use. You will often have problems getting them to adopt your way of doing things. They will pay lip service to doing it your way, but will keep defaulting back to their own way. This resulting lack of consistency has the capacity to damage your business by annoying customers until they drift away to another business.

Another common problem if you poach staff is that you will often start an expensive little war. I can speak from personal experience here. Some years ago a client poached one of my staff by throwing a large amount of money at them to jump ship — after it had cost me a packet to train them and I had not had a chance to recoup my investment. You may think this is all a part of the rough and tumble of business and I should take it on the chin. Not bloody likely.

Live by the sword, die by the sword. Poaching works both ways. I normally have a policy of not engaging in poaching for the reasons outlined above, and because it offends my ethics, but in this case I made an exception. It’s going to cost them a lot more than it cost me off into the distant future — I love a game of hardball.

I mentioned that there is a lot of pretty ugly behaviour going on at the moment, and it is generating significant ill will among the networks of people we deal with. I wonder if the people engaging in it have really thought it through properly. I wonder why they have to resort to these means — if you are a good employer and you treat your staff well, you’ll always have good people wanting to work for you, and you shouldn’t have to poach.

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