The Shifting Dynamics When Leaders LeavePublished: October 15, 2010 in Knowledge@Emory
Earlier this summer, basketball superstar LeBron James announced that after seven years with the Cleveland Cavaliers, he was leaving to play for the Miami Heat. The six-time NBA All-Star, two-time league MVP, and Ohio native drew criticism for revealing his move to Miami in a highly publicized, hour-long, nationally televised special. Heat fans rejoiced, while many Cavs fans and sports commentators called the move narcissistic.
“I feel this is going to give me the best opportunity to win, and to win for multiple years . . . I want to be able to win championships,” said James, who is teaming up with NBA stars Dwyane Wade and Chris Bosh. “I never wanted to leave Cleveland, and my heart will always be around that area. But I also felt like the greatest challenge for me is to move on.”
As the October 26 opening game of the 2010–11 NBA season approaches, James’s high-profile exit, the leadership and ability vacuum it creates for the Cleveland Cavaliers, and the challenges it presents for a Miami Heat team already rich with talent continue to stir debate among sports enthusiasts and commentators. James’s move also raises some fundamental questions of communication, marketing, and management for any business competing for high profile talent or undergoing changes in leadership.
“The interesting observation to me is that sports are not as different from traditional business as one might think,” says Steve Walton, associate professor in the practice of information systems and operations management at Emory University's Goizueta Business School. “The leadership, cultural, and operational issues are virtually identical to those in the corporate world. They are different only in their specifics, not in their nature.”
Dynamics between leaders and teams aren’t particular to athletics, adds Walton. Neither is the addition, performance, or exit of high achievers and the struggle to lead and market through change. The media spotlight shines a little brighter on the athlete, but the day-to-day world faces many of the struggles Cleveland and Miami must address on the court and in the marketplace.
“Most industries are just like the NBA,” says Brandon Smith, a senior lecturer in the practice of management communication at Goizueta. “They’re limited in terms of players.”
Communication—or a lack thereof—defines James’s exit from Cleveland and suggests potential pitfalls in Miami. The way in which information is communicated or withheld can cause or resolve many conflicts faced in corner offices across the nation.
“He didn't do anything right,” adds Smith concerning James’s primetime TV announcement and departure. “He needed to think about [his] customers. Where LeBron went wrong was thinking these fans are Cavaliers fans, not LeBron James fans, and that's an important distinction. If they're all Cavaliers fans, it doesn't matter. Once he’s gone they’re not going to like him anymore."
Cavs owner Dan Gilbert responded to the announcement by posting an open letter to fans bitterly denouncing the move. Not the best way for a leader to communicate in the midst of a bad situation, notes Smith.
"In general, go right back to your customers and say: ‘We’re in this with you. We want to help meet and serve your needs. Help us think through how to make this situation right and better,’” Smith says. “Conceptually, that would have been the best way to handle it. What the Cleveland Cavaliers owner did was the opposite.”
Decisions to leave on the part of high-profile leaders aren’t always made with malice, deceit, or unrelated motivations, saysRick Gilkey, a professor in the practice of organization and management at Goizueta.
“Sometimes the company has gone in one direction and you’re someplace else,” he says. “It’s not unlike other managers and executives who leave at the close of a project or must step aside when a company changes direction. There’s nothing more tenuous than someone trying to stay on and play a game they don’t have their heart in.”
Gilkey points to Mitchell Kapor, founder of Lotus Development Corporation, as an example of a leader who steps aside for the good of the company (Kapor's exit opened the door for others who could foster business development). This type of move occurs when a leader realizes he or she could be a liability and is often heralded as an act for the greater good. James’s decision to go for championship aspirations over a larger paycheck can be viewed as admirable or unusual, depending on one’s point of view. When it comes to making such a choice, Gilkey says leaders and high performers should do their research.
“Understanding your impact on the company and what the negatives are is key," he says. "You really have to do a cost-benefit analysis.”
Particular attention should be paid to those invested in the person or company. An attempt to polarize one’s audience rarely pays dividends, because it takes focus off customer need. James’s departure and Gilbert’s response can lead stakeholders to question what might happen the next time such a situation occurs. Will there be a negative response? More mismanagement? Lost jobs? Goizueta faculty says such questions are important to consider for any business or industry with highly talented employees.
“You want to preserve your relationship with your customers when you leave and you want to make sure you leave a company better than when you found it,” Smith says.
But what happens when the high-potential employee or executive is the “face of the franchise” and moves to a similar or competing company?
For better or worse, leaders often get the most public attention. A photo of James in a Cavs jersey once covered the side of a downtown building; images of NFL quarterbacks are splashed across advertising collateral; the name “Steve Jobs” is as recognizable as the Apple logo in buzz surrounding the iconic computer company.
“To me the issue is about replacing a key performer,” concludes Walton. “Much like a company that loses one of its high-performing divisional presidents, the Cavs have both a leadership and performance hole to fill. And as we have seen with companies that hired excellent performers that didn't match the culture of the organization, replacing just the performance pieces isn't enough. Ideally, they'd get the performance without violating the culture of the team. Otherwise, expect the rebuilding process to be slow and painful.”
Companies facing a loss of talent might identify with the Cavaliers, who now must find a way to sell tickets without a main attraction. On the other hand, companies faced with building an effective team of high-powered talent can relate with the Miami Heat—now the proud owners of multiple all-star performers, including two proven team leaders in Wade and James.
“Such a situation would be a real challenge for any coach,” Gilkey says. “The phrase that comes to mind is, ‘A collection of stars does not a constellation make.’”
With so many such stars now crowding the stage in Miami, fans and business leaders alike will get a look at aggressive marketing and branding in action this NBA season, says Mike Lewis, associate professor of marketing at Goizueta.
“If Miami does win the championship, there is going to be the question of the media’s narrative,” Lewis says. “Will Miami be viewed as LeBron’s or Wade's team? If they lose, then the narrative will likely be how the egos clashed and how LeBron isn't a ‘winner.’”
Smith, a business communications coach, suggests that companies can effectively manage drastic leadership changes with a three-part “game plan” of setting expectations, determining how decisions and debate will proceed (who has the final word), and establishing protocol for addressing personality or professional conflicts and/or failures.
“The team management questions are leadership and culture questions,” adds Walton. “From a leadership perspective, you have multiple players who would be viewed as leaders were they on a different team. Will the three Miami Heat stars be able to find their own leadership voice in a way that creates a positive leadership team, or will their styles clash so much that the leadership team becomes dysfunctional? This leadership question then leads to the culture question. Dissension between the leaders will create a negative culture that could really get in the way of the team’s win-loss goals.”
LeBron James, the cities of Miami and Cleveland, and, perhaps to an even larger extent, the NBA will remain in the spotlight as James’s highly publicized move plays out on the court, among the franchises, and with fans, serving as an instructive tale for businesses benefitting from the work of highly talented individuals or facing high-profile leadership changes of their own.
“The NBA clearly has chosen to be a ‘star-oriented’ league,” Lewis says. “Now they get to see what happens when the ‘stars’ realize they’re power.”