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The best soccer player in the world, Lionel Messi, plays for the Barcelona Football Club — also considered the best in the world. The team just won the European Cup final at Wembley; and last year, its players helped Spain win the World Cup. What is the secret of this team’s success? Good management, according to the Economist. The team has doubled its revenues in the past four years, bringing in $488 million in 2010. Barca has mostly local players — eight of whom attended its football school, La Masia — and puts more emphasis on growing its own team members than any other major team (Messi made his debut at 16, after attending La Masia). Other teams look more like the United Nations.
Barca’s strategy is not unlike that of leading investment firms, according to Boris Groysberg of Harvard Business School, who conducted a study about mobile players in the banking business. “After examining the careers of more than a thousand star analysts at Wall Street investment banks, and conducting more than two hundred frank interviews,” Broysberg found that “star analysts who change firms suffer an immediate and lasting decline in performance.”
He compares this research to the success of leading sports teams in his book, Chasing Stars. Of the banking “stars” who moved firms, after two years only 67% were ranked at their current employers, whereas 83% of those who stayed with their firms were still considered leading performers. “Switching firms also increased the probability of losing rank altogether,” he says.
The lesson? Managers who invest in retaining talent often see the highest returns — and so do the players.
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