Poaching from Competitors

Shawnee Love   •   May 9, 2019

With a hopping economy and unemployment rates at record lows across the country, the topic of employee poaching seems to be raising its head more and more often.  Certainly, I have clients who have lost people to poaching, and even some who have been the ones poaching employees from their competitors.

I am not opposed to poaching (as long as it doesn’t breach laws or agreements [e.g., employment or association]) although I don’t recommend it very often because I think the cons often outweigh the pros.  Here’s my take on both:

Pros (from the eye of the company doing the poaching):

  • Ability to hire a skilled and trained employee,
  • Potential to gain insight into how a competitor does things (note: poaching with the objective of corporate espionage is where it crosses the legal boundaries and is generally bad business not to mention risky), and
  • Possibility of doing a little damage to your competitor (not an admirable benefit but this can definitely be a positive in the eyes of some).

Cons (from the eye of the company doing the poaching):

  • The negotiating power lies with the candidates being poached as they know you want them,
  • Costs increase because the candidate has the power (see above) AND because often a headhunter is hired to procure the individual and provide a measure of distance for the poacher,
  • Employees willing to jump for more money or other such enticements may do the same to you,
  • Employees loyal to their current employer can use your poaching conversations as a way to gain intelligence about your company which they share with their employer (your competitor),
  • You get another employer’s baggage (e.g., bad habits, sloppy practices, management mistakes, etc. from another company can infect yours),
  • If you are in a small industry or small community, poaching can create bad blood, lead to retaliatory measures, and make collaboration in other areas (e.g., shared marketing) impossible,
  • Fitting within your competitor’s culture or job doesn’t guarantee fit with yours and the cost to let someone go after you lured them is more costly than if they found you,
  • Companies feel no remorse about poaching from organizations who they believe poach too so you can become a target, and
  • Many perceive poaching as shady business practices so it can lower respect for your organization.

Additionally, if you are going after a competitor’s people (and sometimes even if they are coming to you voluntarily), you can be hit with a legal suit you have to defend yourself against.

For these reasons, I say tread carefully when it comes to poaching. Come back next week when we talk about how to defend yourself against it.