Bringing two star candidates into a team actually could lead to both of them underperforming, according to Paolo Aversa of the Cass Business School in the U.K., Gino Cattani of New York University’s Stern Business School in New York City, and Alessandro Marino of Luiss University in Rome. They came to this paradoxical conclusion by studying every racecar driver in Formula 1 races between 1981 and 2010.
The group found that, yes, great past performance often led to great future performance among Formula 1 drivers. However, when two top drivers competed on the same team, the closer in level their past performances were, the worse those drivers performed. One reason for this is that the team may dedicate too many resources to the two stars; another is that the drivers might focus too much on competing with each other. In Formula 1 racing, this can lead to one or both drivers crashing.
“This is a phenomenon that affects top managers at public and private organizations, leading scientists in R&D teams, and movie stars in Hollywood,” says Aversa. “Organizations that attempt to establish the perfect team by hiring a portfolio of stars risk putting two roosters in the same hen house,” which can erode performance as a result. If managers must bring in two stars, the authors recommend that they make their strategy and expectations clear from day one. In that way, managers can keep both individuals focused on the team’s objective instead of on each other.
“Why do high status employees underperform? A study on conflicting status within Formula 1 racing” was presented at the Strategic Management Society Conference in Madrid last September.