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Think Twice What a $252 Million Contract Means to You

February 9, 2001
Related Topics: The HR Profession, Featured Article
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A 25-year-old has just agreed to aquarter-billion-dollar contract (yep, that’s a “B”), but it’s really ahome run for human resources. As we speak, Alex Rodriguez, a shortstop who nowworks for the Texas Rangers baseball franchise, is entering spring training withone of the largest jackpots ever in the hands of a nonexecutive employee.

    Terry Turner,assistant vice president for human resources for the corporation that owns theRangers, told Workforce late last year that the contract was “like buying acompany ... or a country.” Turner says the HR department had to buy insurancein case something happened to Rodriguez.

    All these zeroes area good thing for everyone who reads this magazine. They’re a good thingbecause it’s a sign that people are adding up the contribution that employeesmake to the bottom lines of their employers. I mean, if we really believe that(cliché coming) employees are our most valuable asset, then certainly Rodriguezis worth every penny. In his profession, in his position, he’s the bestemployee in the world, and arguably the best ever. If we look at the company’sbusiness results, and put the money where our mouths are, this kind of doughstarts making sense.

    Why should we care?Well, if employees are getting paid solely for their worth to the business’sbottom line - not their experience, not their age, not anything else - itfollows that those who must evaluate these employees (HR) suddenly become very,very important.

    That same importancemust hold for those who:

  • Train that talent
  • Help that talent get along withother talent
  • Try their darnedest to hold on tothat talent
  • Design benefits, salary structures,and relocation incentives
  • Hire and supervise the people whomanage that talent

    Whew.

    The Rodriguezsigning is a signal that when all’s said and done, what really matters to thesuccess of your company are the people on the payroll. It’s a signal that nomatter how nice a stadium you build, no matter how big a computer chip plant orhow great a business plan that promises to sell 5 million widgets by 2020, inthe final analysis it’s your employees that make a difference to the bottomline.

    One might argue thatwe shouldn’t draw too many conclusions here, that since baseball is merely agame played with a stick, it falls in an industry that is somehow unlike therest of American commerce. This sounds like it makes sense, and believing it isa nifty way out of the huge responsibility and opportunity that greaterattention to employee worth could mean for HR. But the radical opposite is true.

    Baseball has been abreeding ground for one workforce trend after another. The concept of “freeagency” started taking root in baseball in 1969, and spread to the rest ofwhat became a job-hopping workforce. Baseball became more diverse more quicklythan many other workplaces, with Hispanics (like Rodriguez) and other minoritiesfrom every walk of life working side-by-side in relative harmony. Long-rangeworkforce planning and succession planning were a way of life in baseball beforethey were in many other industries. Arbitration gained prominence in 1974 as ananswer to baseball’s salary disputes and has spread into other industries andinto other areas of contention. Pay-for-performance was alive and well inbaseball before it was trendy in many corporations.

    The signing of AlexRodriguez may be an indication of yet another trend, one that will place HRprofessionals in an even brighter spotlight.

Workforce, February 2001, Vol80, No 2, p. 112  Subscribe Now!


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