What a $252,000,000 Contract Means to You - Alex Rodriguez - Brief Article

Workforce, Feb, 2001 by Todd Raphael

A 25-year-old has just agreed to a quarter-billion-dollar contract (yep, that's a "B"), but it's really a home run for human resources. As we speak, Alex Rodriguez, a shortstop who now works for the Texas Rangers baseball franchise, is entering spring training with one 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 the Rangers, told WORKFORCE late last year that the contract was "like buying a company ... or a country." Turner says the HR department had to buy insurance in case something happened to Rodriguez.

All these zeroes are a good thing for everyone who reads this magazine. They're a good thing because it's a sign that people are adding up the contribution that employees make to the bottom lines of their employers. I mean, if we really believe that (cliche coming) employees are our most valuable asset, then certainly Rodriguez is worth every penny. In his profession, in his position, he's the best employee in the world, and arguably the best ever. If we look at the company's business results, and put the money where our mouths are, this kind of dough starts making sense.

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

That same importance must hold for those who:

* Train that talent (HR)

* Help that talent get along with other talent (HR)

* Try their darnedest to hold on to that talent (HR)

* Design benefits, salary structures, and relocation incentives (HR, HR, HR)

* Hire and supervise the people who manage that talent (HR)

The Rodriguez signing is a signal that when all's said and done, what really matters to the success of your company are the people on the payroll. It's a signal that no matter how nice a stadium you build, no matter how big a computer chip plant or how great a business plan that promises to sell 5 million widgets by 2020, in the final analysis it's your employees that make a difference to the bottom line.

Whew.

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

Baseball has been a breeding ground for one workforce trend after another. The concept of "free agency" started taking root in baseball in 1969, and spread to the rest of what became a job-hopping workforce. Baseball became more diverse more quickly than many other workplaces, with Hispanics (like Rodriguez) and other minorities from every walk of life working side-by-side in relative harmony. Long-range workforce planning and succession planning were a way of life in baseball before they were in many other industries. Arbitration gained prominence in 1974 as an answer to baseball's salary disputes and has spread into other industries and into other areas of contention. Pay-for-performance was alive and well in baseball before it was trendy in many corporations.

The signing of Alex Rodriguez may be an indication of yet another trend, one that will place HR professionals in an even brighter spotlight.