Free Agency Versus the Farm System
In a past blog, the four cornerstones of a business were discussed: build the dream; build the team; build the processes; build the profit
Today’s blog focuses on “Building the Team.” To use Major League Baseball terms, a team can be built through free agency and/or through the farm system. A healthy company does both. By using free agency, you bring fresh ideas into the company. By promoting through the farm system, you create an excitement within the company, and your retention of employees is improved.
With free agency, it is relatively easy to spot talent. In the early 1970s, my father wanted to expand. He needed to add a salesman. He asked several customers about his competition and, specifically, who was his toughest individual competitor. All of those surveyed listed the same person at the top of the list. Once Dad had identified the free agent he wanted, he recruited him to Evans Glass Co.
Of course, I am an example of Dad’s farm system. And, Evans Glass Co. continues to use both methods—we used free agency to acquire a bookkeeper, while our current production manager was an installer, and our operation manager started as a receptionist.
Both methods offer benefits and pitfalls. Free agency's benefits include:
- When a need has been identified it can be filled immediately with an experienced person.
- It can strengthen a company while simultaneously weakening a competitor.
- It saves time by eliminating the need to train.
Free agency’s pitfalls are:
- It is more expensive than using the farm system.
- There a risk that the free agent will not fit the culture of the company.
- A message may be sent to current employees that there is not an opportunity for them to advance within the company.
- It is easy to fall into “The Good Ole Boy Network” syndrome.
The farm system offers benefits as well:
- The person already has blended into the company culture and earned respect of his/her peers.
- The person has “insider” knowledge of the company and its markets to produce immediate results.
- It is less expensive than free agency.
- It creates a feeling that there is a future with the company.
The farm system’s pitfalls are:
- It takes longer to develop talent and knowledge.
- It is harder to recognize potential.
- It takes patience.
Be careful about too many free agents. The farm system should always be a company’s first choice. Don’t overlook people just because they haven’t done the job before. See people as they can be, not as they are. All good leaders see people in this way.
The author is president, Evans Glass Co., and immediate past chairman of the board for the National Glass Association. Write him at firstname.lastname@example.org.
The opinions expressed here are those of the individual author and do not necessarily reflect those of the National Glass Association, Glass Magazine editors, or other glassblog contributors.