Much has been said recently about recruitment of the leaders of competing MLM companies. The method has its supporters and opponents. Managers specializing in this field operate on the market. They pick out collaborators, one after another, taking them away from the competition. We also know many good managers who do not use this method. The former ones consider this method ethical, the latter claim to the contrary. As it happens in a real life, both of them are right.
In the previous article we dealt with the issue of rotation of people in MLM www.rankingmlm.pl . It can be safely assumed that the rotation of the collaborators of the MLM companies is widespread, normal and generally accepted. Now, on to the question whether the headhunting of distributors is normal, ethical, and whether it is beneficial or results in losses.
In the life of corporations the headhunters are of more and more importance. They work on behalf of the management boards and are to find suitable job candidates. In some professions it is really hard to find a good specialist. Unfortunately, there are just a few top-class specialists. Companies go to no end of trouble in order to find the right people. They write attractive advertisements, exhibit at jobs fair, but it is not always effective.
The first important factor is that outstanding managers do not read the job advertisements. They are busy with their project and they do not look for a job. If a man is well-off, he is pleased with himself and with his work, he is a man of success, and such opinion follows him into the world, why should he look for something else. The corporations seek such a man.
International corporations seek winners. People for managerial positions are not sought by a job center. Typically, people who failed in some way are made redundant, but this is not a rule. Sometimes, the company has "shortness of breath" and gets rid of expensive employees and the managers leave it before wages are cut.
Note that in the MLM industry we have a similar situation. The outstanding managers are always missing. This is a "product" which is most desirable on the market. The best managers develop their structures, working their way up the ladder, multiplying their income. They do not look for job offers. The MLM companies hunt for such people. Expert managers took the headhunders' place. They have knowledge, experience, and are provided with appropriate arguments.
Let's watch multinational companies entering the Polish market. The principle is similar in every industry. When a new company enters the market, it must prepare a development strategy. The assumptions of the company involve the purchase of a company connected with the industry or acquisition of a good manager from the competition. It rarely chooses to build its business organically. Of course it is possible.
The natural strategy of the companies entering the Polish market is to buy a company already operating on the market or recruit managers from the competition. I mean, the people at every position, from the president of the board down. The companies have relevant budgets for this purpose. They often use preferential conditions for the outstanding managers. Whether the manager benefits from them- it depends on him.
Of course, it has to be assumed that the headhunders are not always successful with valuable manager. The manager is not always ready for a change, sometimes it is simply not worth it. Human factors, such as below, decide about the fact that the manager stays in the company:
– Is he connected with the company?
– Is he connected with his supervisor?
– How close is he with his group?
Let's assume such a scenario that the headhunter is successful. He recruited a good manager for the job. The company, which acquired the manager usually gets even 70% to 80% of his structure. If the manager had the structure calculated in thousands of collaborators, the company headhunted a large group of people and it can expect a surge in turnover.
Typically, new people make purchases, introducing their distributors one by one. The downside of this project is that the collaborators have experience with another company and operate according to the scheme of the "old company". Those habits are not always bad. They often bring something new to the company. The company, which acquired a large structure, must take care of its smooth assimilation. A large amount of training courses, analytical conversations, managerial meetings leading to the development of managerial work schedule are needed.
The "old" company is in a bit worse situation. It invested in development of a manager and his structure and its turnover delines. Another negative factor is a drop in morale in the company. As a good manager leaves the company, this means a crisis situation. The management board needs to think about what's wrong, what mistakes it made and how to prevent them in the future. Departures of large structures are often accompanied by unnecessary confusion. The two parties blame one another. It is not always clear who is right.
How does it affect our industry? In the short term it may negatively affect the image of the company or industry. In the long term – it positively affects the conditions of cooperation. Companies have to become more competitive. They are motivated to upgrade their products. They know that they have to pay better and better, because competition does not sleep. Nothing motivates and develop better than good competition.
From the perspective of the market, it cannot be explicilty determined whether the recruitment of MLM companies' managers is good or bad. It depends on many factors, mainly on ways of how the companies headhunt those distributors. If they do it in an ethical manner, not maligning the company, it can only positively affect the market.
If they are trying to undermine the credibility of a competitor, it usually has negative repercussions. In the corporate business it is natural and completely ethical to "outbid" good managers from the competition. A company which does it better wins.
Daniel Kubach
