Talent Development: A Cornerstone of Success
On June 13, 2019, the Toronto Raptors won their first NBA Championship. It was the first ever team to win without a lottery pick player, in other words, a player selected within the top 14 draft picks in any given year. Of the starting group that was part of the championship run, Kawhi Leonard was the highest selected player at number 15 in his year of draft. Since the Masai Ujiri era started, Toronto has been known for one key differentiator around the league, their ability to assess and develop homegrown talent.
Fast forward 2 years and leading up to the 2021 NBA draft, Toronto held the number 4 selection. It was the highest selection the Raptors held since the 2006 when Toronto held the number 1 overall selection in what is considered one of the weakest draft classes of all time. This year however, many mock draft and basketball pundits had declared the 2021 draft as one of the strongest draft classes in ages with four sure-fire blue-chip NBA-ready prospects at the top of the class. Toronto’s selection, Scottie Barnes at number 4, was not one of those individuals.
Instead, many had projected that Jalen Suggs, a consensus top-4 prospect and point guard from Gonzaga, to be the projected pick for the Toronto Raptors. A seemingly perfect fit highlighted more so by the fact that the franchise had just lost their long-time floor general, Kyle Lowry, to the Miami Heat in free agency. In many ways, the selection of Barnes was not only a vote of confidence to their recruiting and scouting department, but a vote of confidence in one key area they have been lauded for: talent development. In a league that values raw athletic talent, oftentimes insufficient credit is given to the amount of hard work and effort the athletes put into realizing their own potential, even less credit is given to the organizations’ ability to enable it. But just as Jim Collins points out in Built to Last, organizations with consistent high performance and productivity focus on strong corporate cultures built through recruitment and talent development strategies.
Organizations take different approaches to building their teams. Some through free agency, some through trades and some through the recruitment and development. Toronto faces the lofty challenge within the NBA of being the lone franchise outside of the United States. It has long faced a reputation for not being a premier free agency destination like Miami or Los Angeles, and any stars they have developed have often shown an eagerness to return south of the border. In salary cap leagues, building through free agency is costly and risky. One can’t help but draw comparisons to corporate recruiting strategies when even prior to the Great Resignation, the average employee lifecycle is less than 5 years.
Leading up to the draft, there were reports that Suggs, had a “horrible” private workout with Toronto. Some even questioned his effort and enthusiasm for his would-be selector. Alternatively, Barnes demonstrated a great attitude, character, enthusiasm, hustle and of course extremely strong fundamental size and defensive skills, traits valued by the franchise.
Hiring the wrong individuals is expensive. Poor recruiting adds to the difficult challenge of employee retention, and it is well studied that employee retention can costs companies up to 400% of that employee’s annual salary. Like drafting Greg Odom over Kevin Durant or Kwame Brown over Pau Gasol. The recruiting process is as difficult in the NBA as in the corporate world. Interviewing, selecting and hiring the right candidate is difficult. For every blue-chip prospect like LeBron James, there are twenty ‘blue chip’ prospects like Kwame Brown. So, what do the Raptors do? Recruit for character and cultural fit and focus on enabling that potential. While not all systems can be perfect and not all prospects turn into stars (eg. Bruno Caboclo), having a strong developmental system mitigates the margin of error in the recruitment process.
Zappos takes an unusual approach to ensuring corporate culture fit. After the being hired, new employees are put through a four-week training program and are offered $2,000 to resign if they do not feel the company is right for them. Hubspot, focuses their recruiting strategy on referrals and inbound applicants for recent graduates. It is no secret that corporate culture is one of the strongest indicators of organizational success, but it should be no secret then that efficient recruitment and talent development strategies are the best indicators of corporate culture strength.
What this means is that rather than focusing on short term tactics around employee retention or paying top-dollar in recruitment, companies would be wise to invest in synergistic recruitment and talent development strategies. Candidates who want to learn about a company’s culture often get the same cliche answers: “respect”, “integrity”, “fun”. Instead, they should ask about how the company develops their leaders and what their career development programs look like. The answers may be far more telling about the company’s culture than any words printed in the office lobby.
Since the draft, Scottie Barnes has propelled himself as a clear top Rookie of the Year candidate. While a less stable organization may have been tempted to draft Jalen Suggs in light of the void created by Lowry’s departure. But John Pierce notes, “Cultural fit impacts both performance and retention. That’s why hiring a poor cultural fit with a great resume is a bad idea.” The Raptors’ selection of Barnes was a testament to their talent recruitment and development system in more ways than one. After all, Lowry’s heir in waiting was already on the roster: undrafted point guard Fred Van Vleet, who in 2020 signed the largest contract ever for an undrafted player in NBA history, and earned his first All-Star selection this year.