I always love it when someone like LeBron James creatively bends the rules of a traditional marketing-run organization like the National Basketball Association. The place is full of league-centric rules aimed at packaging the experience of the fan around its self-defined view of “the brand,” using a ’60s view of marketing management where logos and TV ads are viewed as more important than the creation of an authentic fan experience. Those of you who want your kids to emulate the behavior of NBA stars at home, please raise your hand.
The same “I’m in charge of your experience” philosophy applies to the relationship the NBA has with its players. The player’s experience is regimented by rules such as the salary cap – a team’s payroll shall not exceed $58 million for the 2010-2011 season – and the interaction between players, agents, and teams – players shall not negotiate with soon-to-be free agents before July 1. These rules proceed from a league-first paradigm where the league defines acceptable behavior and players are passive recipients of an employment product defined by the NBA.
Fortunately, LeBron James just exploded all of that. LeBron may not have been authorized by the NBA to negotiate with any team as a free agent until July 1, but he had the right to talk with two of his fellow players, Chris Bosh and Dwyane Wade, also free agents. Together, they decided they would co-create the terms of their future employment. They built a group package, defining the length of the contract (6 years for all three of them), how much each of them would be paid ($14 million to $14.5 million per year per player the first year, with a gradual increase every year after that). They intentionally lowered their collective salary by about $50 million over the length of the contract, to allow their new team to put a couple more players on the court (I’m a soccer guy, but I understand a basketball team has five players) and still stay within the salary cap. In the end, the Miami Heat turned out to be the winner, as many people discovered in an extravaganza show on ESPN a week ago.
The new James-Bosh-Wade collective has the two crucial ingredients of co-creation. It produces a better experience for the individuals involved, since they now stand a great chance of winning the NBA championship in the next six years. It also saves the Miami Heat a bunch since the three players have left money on the table for the chance of playing together, not to mention the fact that the American Airlines Arena in Miami should be full from here on. (In case you’re worried about LeBron going homeless on such a meager pittance, the money he makes from endorsements with Nike, Sprite, Glacéau, Bubblicious, Upper Deck, McDonald’s, and State Farm Insurance dwarfs his salary as a working stiff.)
The evolution of recruiting from a one-way, company-centric process to a two-way co-creative interaction where recruits engage with future employers on their own terms, often as part of a group, is a global phenomenon. One of the most innovative companies when it comes to recruiting is the Indian call center company 24/7 Customer, which allows young people in Bangalore to come and interview as a group. The firm even allows the groups to staff and manage themselves as a unit within the firm if they get hired. 24/7 Customer has devised this group recruiting process to find talent in the highly competitive IT industry in India.
Employers beware. From LeBron James to the call centers of Bangalore, madmen recruits are increasingly in charge of the recruiting asylum.