by Aric A. Jensen, AICP
One of the major challenges of small, local governments is attracting and retaining qualified and experienced employees. This is especially true in the Intermountain West, where any change in employment may necessitate the physical relocation to another county or state due to geography and settlement patterns. To illustrate, approximately two years ago I was recruited to serve with the City of Reno, NV. At the time I was gainfully employed in the Salt Lake City area and had never even visited Reno, let alone considered moving there. However, the recruiter was persistent and convinced me that it was an opportunity I shouldn’t pass up. And so, with much trepidation, I applied and eventually accepted the position. Why trepidation? My analysis was this:
I was already vested with 15 years in the Utah State Retirement System.
The Nevada Public Employees Retirement System (NPERS) does not have a reciprocal agreement with Utah, so I would have to restart at year 0.
I wouldn’t vest in NPERS until after five years.
There are only a handful of Community Development Director positions in Nevada, and so if it didn’t work out with Reno I would likely have to move out of state and lose any contributions to NPERS.
With every relocation, I lose 6 percent of the value of my home just to real estate listing fees, not to mention moving costs.
I still had young children at home, and there were many local and state government opportunities in northern Utah within an easy commute of my existing residence - why risk the unknown?
We made the move anyway, but it got me started thinking - how can states like Nevada, Montana, Wyoming, New Mexico and others compete against their larger and more metropolitan neighbors in workforce attraction and retention? And then it hit me - baseball.
Short of perhaps organized religion, I would argue that there is no entity greater than Major League Baseball at cradle to grave recruiting, training, and retention. Even our armed forces don’t compare - and they would be wise to learn from baseball’s successes. I have specifically identified five elements of Major League Baseball and how they inform good governance:
Professional baseball is organized into different levels of proficiency, ranging generally from A to AA to AAA to the major league. At each level is a group of privately owned teams or “clubs” that play other teams within their level. While the teams are individually owned and typically play only other teams within their level, they are frequently affiliated with at least one team on each of the other levels, creating a vertically integrated system of player development. Players are “drafted” or “signed” by a club and assigned to a team based on their level of proficiency. Each player is considered to be an independent contractor, and an organization can buy and sell a player’s services depending on the negotiated terms of the contract.
Additionally, each club is typically a self-contained business proposition and competes against other clubs to sell tickets, concessions, memorabilia, and other otherwise make a profit. However, at the same time, each team is also dedicated to player development league-wide, as it is well understood that most players won’t stay with a team their entire career and that individual success is dependent on the growth of baseball as a whole. This acceptance that a “rising tide raises all ships” has led to revenue sharing and other arrangements to make sure that “baseball” stays healthy and competitive.
Major League Baseball does not have an official mission statement. And yet it has a clear focus - to grow its industry at all levels. Long before Fujio Cho said “First we build people, then we build cars,” baseball was building players, teams, and a fan base.
Now imagine if government was not statutorily mandated but that its existence depended on its ability to develop employees, affect governance, and attract citizenry. While at first glance this may seem like a stretch of the imagination, the United State’s robust levels of legal and illegal immigration can be substantially attributed to the desirability of its governance model in comparison to that of other nations. As such, it can be argued that what is required is not wholesale change, rather it is a paradigm shift to the concept that success in the City of Peoria, Illinois, translates to success in the City of San Francisco, California.
In baseball, each member of an organization acts as if his (or her) individual success depends on the success of the organization as a whole. Coaches want players that work hard and have talent because it improves their individual opportunities for advancement/higher salary. Players want coaches that work hard and have talent because it likewise improves their opportunities for advancement. Players and coaches want club owners and front office staff that invest in the team and baseball as a whole because it provides them the resources to succeed. And club owners want players and coaches that work hard and have talent because they attract more fans and generate more revenue, thus improving their level of success. And the fans want owners that invest in the team and players, and coaches that work hard and have talent, because then they feel like they are getting a fair return on their investment (emotional/time/financial). It is this codependency of success that makes the model work. From a theoretical perspective, this phenomena can be informed by one of the key concepts of both LEAN and Six Sigma - for a system to work there must be universal buy-in from, and benefit to, all participants.
Baseball’s vertical integration structure encourages and facilitates recruitment, training, and retention. Once a player enters the system, there is a low likelihood that he will be lost to a competing industry unless he fails to perform. Government is arguably similar in that it has many career employees; however, it lacks the collaboration and codependency that baseball enjoys. For example, local government A has no motivation to train its employees for advancement to local government B or state government C because the loss of an employee results in new employee training costs, recruiting downtime, loss of institutional knowledge, and other negative outcomes. If a way was found for government agencies to cooperate and pool employees and training like baseball, substantial efficiencies would be achieved.
Baseball has arguably one of the most successful recruiting programs in the world. From family-friendly venues; to youth leagues; to high school and college programs; to South American, Caribbean, and Asian outreach programs - it can be said that baseball truly has a cradle to grave recruiting program. The closest parallel that I have identified in government is the Armed Forces ROTC programs, but even those don’t compare to the hundreds of thousands of youth playing recreational and competitive baseball every year.
For many years the primary government recruiting tool was the promise of a rich retirement pension and a stable paycheck. However, in recent years many states have reduced or substantially modified their pension programs in response to an increase in average lifespans and other cost increases. And during the great recession, many public employees were furloughed or released outright due to dramatic reductions in tax and fee revenues. In response to these issues, the State of Utah modified its retirement system to a 50/50 mix of defined contribution (401K/457K) and defined payment (typical pension) for new members. It remains to be seen how these changes will affect public sector recruiting efforts; however, it is likely that they will erode government’s ability to compete with the private sector for employment resources during strong economies.
As previously mentioned, one of the core foundations of baseball is continuous employee development. While certain sectors of government such as the military place a premium on training, many others do not. Arguably, this is because there is no incentive to provide training except as related to the specific duties the employee is currently performing - because if the employee becomes too skilled he/she might seek advancement with a different organization. The question then becomes, how does government reinvent itself such that employee development becomes an asset and not a liability?
Lastly, employment with baseball frequently involves quick and unanticipated changes of the workplace, which is often disruptive to the employee and his family. To remain competitive, baseball has developed a robust retirement plan and contract system that travels with the employee and gives him the confidence necessary to deal with change. In this regard, the biggest takeaways for government are threefold:
In baseball, all players, coaches, and managers are hired on a contractual basis, which spells out the employee’s obligations and compensation. In government, it is typical that only the agency administrator has a contract; all other department heads and managers are at-will employees, while the rank and file are usually covered by a bargaining agreement or similar arrangement. This effectively creates three classes of employees, an administrator with guaranteed employment for a fixed period of time similar to baseball, department heads and managers who are at risk of being let go at any time and for any reason, and a line staff with a strong sense of entitlement but fewer opportunities for advancement. This three-tiered system inherently creates incentives and disincentives to mobility - executive administrators have the best of both worlds - mobility and predictability, department heads and managers tend to “hunker down” and protect their turf as they fear unanticipated mobility, and the line staff are generally less motivated to grow themselves due to limited mobility within the organization.
In baseball, a player’s contract can be bought, sold, and traded, and the player has few options but to accept a new assignment. No such provision exists in the public sector but imagine for a moment that it did. If every employee had a contractual arrangement with his/her employer, a local government struggling to attract a planning director could theoretically buy the contract of a director from a jurisdiction that had a robust planning staff. Obviously, there would have to be other financial considerations involved such as moving expense reimbursement, cost of living adjustments, etc., but such a program could be an industry disruptor.
Baseball has a universal pension system that moves with the employee wherever he is assigned - even out of the United States. This is necessary given the inherent high mobility of the system. One of the weaknesses of local and state government retirement systems is that they are not very portable - in many cases, there is not even reciprocity with other states. This puts government agencies in low population states at a disadvantage as there are fewer employment opportunities within the retirement system and therefore higher risks - especially for employees in at-will supervisory positions. In recent years several western states have discussed the possibility of banding together to create a regional presidential primary so as to compete with California for candidates’ attention - what if those same states created a regional public employee retirement system? Again, this could be an industry disruptor.
What has baseball taught us? First, to succeed in a competitive environment an organization must find a way to align its success with the success of its employees. In the past, government’s mission of service and stability has aligned closely with its employee’s desire for employment and stability. As governments move away from traditional pension programs and relatively guaranteed employment, they move out of alignment with their employees’ definition of success.
Second, administrative parochialism does not encourage employee development or innovation. There is an old adage that illustrates this issue: “They paid me 30 years to work with my hands - if they had just listened they could have had my brain also.” Instead of investing in the whole employee, government’s focus on silo’d duties and task-specific training nets only a limited return on its human resource investment.
Third, smaller organizations/operations can be successful and competitive by creating mutually beneficial relationships with other organizations. While there are only 30 Major League Baseball teams, there are more than 200 minor league, foreign league, and independent teams in existence. This is very similar to the handful of metropolitan areas in excess of 1,000,000 persons within the United States, and the myriad rural and less populated communities which need to create mutually beneficial relationships amongst themselves and with metropolitan organizations to be competitive.
Government is inherently less nimble than the private sector, and the smaller, rural communities in the United States have even fewer resources than their urban siblings to attract and retain human resource capital. If government is to compete and remain relevant, especially within rural communities, it must effectuate real change in how it recruits, trains, and compensates its employees. And Major League Baseball is a proven commodity that would be worth emulating.
Aric A. Jensen, AICP graduated with honors from the University of Utah with a Bachelor’s Degree in Real Estate Development, a Professional Certificate in Urban Planning, and a Masters of Public Administration. During his career he has served in various leadership capacities including as a member of the Advisory Board for the College of Architecture and Planning at the University of Utah, as President of the Utah Chapter of the American Planning Association, as the Director of Planning and Economic Development for Bountiful City, Utah, and as the Director of Community Development for the City of Reno, Nevada. He also served several years as the acquisitions and planning manager for Knowlton General, a portfolio development and construction company located in Bountiful, Utah. He currently lives in Reno, Nevada, and manages the Office of Economic Development.
Published in March 2019