Hit Your Competitors Where It Hurts — Adopt the Hire-to-Hurt Strategy

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Nov 4, 2019

Access to this article is limited to fierce competitors 

Most CEOs are fierce competitors. They love my strategy of “targeting your competitor’s top talent, because hiring them makes you stronger, while your competitors simultaneously get weaker.” It’s a two-for-one deal.

You might assume that most corporate recruiting leaders share their CEO’s high level of competitiveness. But you would be wrong. I find most TA leaders are quite risk averse. However, by actively avoiding the controversy that can be associated with targeted poaching, they are purposely lowering their strategic impacts. Unfortunately, this is a tremendous missed opportunity. Avoiding it means missing out on an entire category of significant business impacts which cover directly decreasing the performance of competitor firms as a result of targeted talent poaching. 

Hurting Your Competitor Is a Standard Practice in Most Business Functions

Of course, outside of HR, intense competitiveness is quite common within most business functions. For example, products are developed specifically to counter a competitor’s successful products. And your product’s prices are routinely shifted in order to draw away sales from your competitor’s competing products. Store locations are often picked with a primary goal of reducing the sales at a nearby competitor’s location.

So, if your goal is to increase your business impacts, in my view, it’s time for talent-management leaders to become “fierce competitors” and to adopt a competitive advantage recruiting approach that I call “hire to hurt/learn.” This approach improves your corporate best practice learning and the performance of your workforce while directly reducing a competitor’s performance.

Get Over It; Hiring to Hurt Is Not Uncommon 

You might think that hiring to hurt is unusual in the business world, but you would be wrong. In fact, “team lift outs” are quite common in the financial industry. And in Silicon Valley, targeted poaching is not an uncommon practice. For example, there is some evidence to show that Apple directly targeted Google in order to improve its map product. Facebook is currently using big money offers to target a wide variety of Google employees. Uber got into legal issues (because direct secrets were involved) when it poached a leader of its self-driving car project away from Google. 

Calculating the Multiple Business Impacts of the Hire-to-Hurt Strategy

Some firms do poach talent away from their competitors, but they only do it indirectly when one of their competitor’s employees decides on their own to apply to the firm. However, compared to this subtle poaching approach, the “hire to hurt/learn” approach has significantly greater impacts because it purposely targets the highest-impact employees and those impacts are targeted to maximize the benefit to your firm, while simultaneously hindering your competitors. The goals of this hiring strategy include:

  • Hampering their future plans — a hire-to-hurt strategy will result in the loss of strategic impact employees. It immediately reduces a competitor firm’s current performance. In addition, that loss will also likely hamper or slow their upcoming plans and the future direction of their products. 
  • Shifting into new product areas — a firm can move quickly into a new product area by acquiring a competitor’s mid and lower-level talent that is already designing or producing the product. There are of course some legal issues related to recruiting high-level product talent that may bring and use company secrets at your firm. 
  • Increasing your learning — the hire-to-learn component of this strategy means recruiting individuals who will directly help your firm learn in a critical new learning area and catch up to the advanced knowledge level that your competitors already enjoyed.
  • Shifting the innovation levels at both firms — this new addition of recruited innovators will help foster innovation within your firm both through the ideas they bring with them and the example they set for others, while slowing or reducing innovation at your product competitors.
  • Shifting the leadership bench strength at both firms — the new infusion of leadership talent will immediately help your firm build its leadership bench strength while simultaneously reducing the leadership capabilities at your product competitors. Recruiting a competitor’s leaders will also help your firm better understand its future strategic direction.
  • Shifting into new geographic areas — rapid growth into new geographic areas is a key business success factor. A firm can move quickly into a new geographic area by acquiring a competitor’s talent that is already established in that area.
  • Gaining contacts quickly –when a firm is trying to break into a new industry or product channel, recruiting existing talent from established firms makes sense because they will bring with them their established contacts and connections. These are connections and trust levels that would take years to build if your firm started from scratch.
  • Shifting skill levels at both firms — your company can rapidly gain the future skills that it will need by recruiting individuals with those advanced skills away from your competitors. This skills transfer increases your own capabilities, while simultaneously reducing the skills and capabilities of your competitors.
  • Distract managers at competitor firms — the successful hiring of key talent by your firm will force executives and managers at your competitors to focus on retaining their remaining top talent. Diverting their attention will likely slow both productivity and new product development. Any potential retaliation raiding by your competitors will be less of an issue if your firm has already acted to proactively minimize its turnover risks.

Action Steps for Implementing This Strategy

This boldest of all recruiting strategies are not for the faint of heart. If the strategy becomes public, it can generate a significant level of controversy. One common criticism that is not valid is the contention that you are “stealing talent” away from a competitor. Simply put, employees are not owned by any corporation and employees are free to leave at any time for any reason. In fact, some corporations like Apple have gotten into legal trouble because internally they purposely restricted direct poaching from their competitors. If you decide to implement this hire to hurt strategy, here are some foundation action steps.

  • Identify your competitor’s areas of strength — your firm needs to conduct a competitive talent analysis of the leading firms in your industry to determine what your firm can learn from the poached employees of each one. 
  • Talent mapping — your firm needs to capture an organizational chart or phone directory to identify or “map” the desirable talent within each competitor. In addition to identifying superstars, identify critical areas where the bench strength is weak — where the loss of a single person might be catastrophic to the competitor. Try to identify and target individuals who are designated as “backfills” in key jobs. Also, target individuals who are designated as high potentials, who are part of the leadership development program, or that are on the succession plan. Identify individuals who generate high revenue and innovations.
  • Prioritizing recruiting targets — your managers and recruiters need to study the talent map in order to determine which talent to target first at each major competitor. Prioritize talent based on both their potential impact and their probability of joining your firm. You also need to prioritize your retention efforts on your own key employees. 
  • Identify attraction factors — your firm needs to identify the most desirable work and environmental factors that will cause the targeted employees to consider leaving. And if your firm has those attraction factors, it must decide the best ways to communicate to prospects the benefits of joining your firm.
  • Put together a hiring team – in most cases, a permanent hiring team has the highest probability of successfully recruiting these targeted individuals. Identify your key recruiters and hiring managers and train them so that they become extremely proficient in direct poaching.
  • Develop a process for quantifying your business impacts — work with the COO and the CFO’s offices to develop a process for estimating the dollar value that poaching adds to your firm as well as what it costs your competitor’s in dollars.

Final Thoughts 

A recent survey of trends at the top 10 firms (on LinkedIn’s most desirable employer list) revealed that increasing recruiting’s business impact was the second-ranking trend among top firms. So, if you want to keep up with the top firms, take a closer look at the hire to hurt strategy, which has one of the highest total impacts of any talent acquisition strategy.

Author’s Note: If this article stimulated your thinking and provided you with actionable tips, follow and/or connect with me on LinkedIn and subscribe to ERE Daily.

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