Last week, my plumber hired a drywall guy to come to my home and patch up some holes from a plumbing repair. After completing the job, the drywall guy handed me his business card and said, "Let me know if you ever want to do any remodeling - I specialize in kitchens and baths." The problem? My plumber also has a remodeling business that specializes in kitchens and baths.
This situation is a modern-day example of sending a wolf to check on your hen house. Sure, the wolf has excellent references and works for a reasonable rate, but the wolf ultimately wants to eat your chickens! Any situation where someone you hire has very different interests than yours can result in unwanted consequences. Economics fans refer to this as the principal - agent problem: both parties are guided by their own self-interest, so it is important for the principal (the plumber) to create the proper structure so the agent (the dry wall guy) doesn't work against the principal's interests.
Here are some more examples of wolves in the hen house:
- A customer service rep is hired to provide outstanding service. The customer service rep wants a an easy, stress-free job. The result: the customer service rep only provides outstanding service in situations that are stress-free.
- A company hires a salesperson and pays her a commission on gross sales. The sales rep wants to make as much commission as possible, so she offers discounts to make the product more attractive to customers. The company's sales look good, but their margins are so poor there is very little profit.
- A company hires a technician to make house calls and do in-home repairs. The technician loves the technical work, but can't stand dealing with people. The repairs are always done correctly, but the company's customers frequently complain about poor service provided by the technician and often take their business to a competitor.
These situations aren't necessarily simple to resolve, but the starting point is deliberate alignment. You can use our simple competency model to work this out for anyone you plan to hire -- before you hire them! Download our competency model.