Evan Davis on... talent

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I’ve been trying to work out in my own mind how companies should deal with those really talented people, those stars on their staff who are kind of high maintenance, difficult to manage. You know that in the pop world there are a legion of stories of difficult-to-handle stars who need to be nurtured and massaged and have the right colour M&Ms in the bowl in the dressing room and all those kinds of things.

What should companies do? It’s actually quite a ubiquitous problem. The book Liar’s Poker documents the extraordinary problems that Salomon Brothers in the 1980s when the bond traders were stars, were making lots of money for the company, and yet somehow it was ripping the company apart that they were getting paid more than everybody else, they were drawing in all the attention and they were constantly threatening to leave if they didn’t get their way.

So how should companies deal with it? Well I think I, in my own head, would make a distinction between two kinds of companies; those which really are built upon individual talent and those that are built on team talent. And if a company’s built on individual talent, maybe it’s a sales operation in which the sales people go out on their own to sell. Really it’s not a team business, it’s going to have its stars, it’s going to have its successes and the rule is very, very simple; if a very talented person makes demands and credible threats to leave if they don’t get their way you go on paying them and meeting their demands to the point that they’re more trouble than they’re worth or more expensive than their net income provided to the company. In other words, you go up to some point and then you say ‘Thank you, you can go, you’re not really worth very much to us.’ That’s pretty simple.

If, on the other hand, you’re a team company where it isn’t actually an individual success that matters, it’s the result of the team, I think there’s pretty clearly one way to deal with the superstars, the big egos, the high talent; it’s to say ‘Can you leave please, we don’t want you disrupting the team with your silly tempers and your tantrums.’ In a team nobody should think that it’s them that determines how things should go. So for managements struggling with someone who seems excellent but is rather difficult, the question to ask themselves is very simple: Is this a business where our performance depends on the team or is this a business where our performance realistically depends on the individual? And you need to answer that question before you know whether to give in to the demands or whether to hold out against them.

That’s my view, but you can join the debate with the Open University.