Direct Sales and MLM

Cross Recruiting and Ethics: DSA publishes ethical guidelines restricting proselyting - cross recruiting

By
Kevin Thompson

< src="https://dev-thompson-burton-wpms.pantheonsite.io/mlmattorney/files/2011/08/andresr21888-300x300.jpg" alt="" width="300" height="300" class="alignleft size-medium wp-image-513" />Nadia Jarosh Shipley, an Executive NVP for Arbonne, recently wrote a concise message on facebook of the practice of "proselyting," also referred to as cross recruiting reps from other organizations. I've included her message below. Click here to see it yourself. In her message, she referenced the DSA's specific guideline against proselyting. She started a great conversation about the practice and I, a fan of a some healthy debate, really appreciate her courage. Her message is below along with the DSA's specific guideline. She also included a letter from Joe Mariano, DSA President, who chimed in on the subject. In his letter, which is not included below, he basically asserted that when leaders leave a particular company, they should avoid disparaging their former company in an effort to get their other leaders to quit and move.Ready for a dose of reality?The DSA's policy against proselyting, while written with the best of intentions, is not a sufficient deterrent against cross recruiting. The downside (penalty from the DSA) is not a deterrent given the huge upside (massive revenue spike). Plus, the policy against proselyting is written as a guideline for COMPANIES. In this regard, when thousands of reps leave Company A for Company B, proving that Company B participated in the cross recruiting is like nailing jello to a tree.Being on both sides of this issue representing both companies and distributors, I can assure you of five realities that make this a difficult policy to enforce:

(1) Plausible deniability.

Leaders will never tell Company B, "Hey, I'm going to smear Company A and drive massive growth to you all. Get ready!" Company B can always play dumb.

(2) Plausible deniability...again.

Company B, if accused of foul-play by Company A, will never say, "Yes, we are aware of the false rumors about your business AND we actually spread those rumors on our recruitment calls. Want a link to the recording?" Again, Company B can always play dumb.

(3) Economics.

The economics matter. If a leader can drive 5,000 active people to Company B, with each participant agreeing to a $150 autoship, it translates into $9,000,000 of additional annual revenue for Company B and a big pay check for the leader. Ethics? While Company A screams "Bullshit!," Company B says "Free market, baby!"

(4) Trade secret.

Who owns the network? It's a philosophical and legal debate that's been waging for years between leaders and their companies. Leaders say, "I bring the people, I own the network. I can solicit them for whatever!" Company A says, "Those leaders would never have been in your business BUT FOR our help. Stay away from your non-personals!" Both sides have valid arguments. In the face of earning big bucks, it's safe to say the leader will intellectually side with the "it's my network" angle as opposed to being concerned with ethical limitations. Company B says, again, "Free market, baby!"

(5) Natural Consequence.

Unfortunately, the misinformation against Company A is a natural consequence when leaders leave for Company B. When the downline members are gently nudged by the upline to quit Company A and they ask "Why?", rumors will spread of lunatics in the corporate office, ill-contrived pay plans and junk products. It happens just about every time. When people join a business with a strong emotional story, it takes an equally strong emotional story to get them out. While people in the profession encourage leaders to leave with class, it's a daunting task for any leader of any organization to control the behavior of each individual in their downline.

Conclusion

Ethical standards will not deter the behavior. There's a saying: "God made man. Samuel Colt made them equal." The Colt revolver in this debate is litigation. It's not ideal, it's just reality. While it's important to publish ethical guidelines, until the financial incentives and disincentives are consistent with those guidelines, it's an uphill battle. What are your thoughts? How do we mitigate this behavior?ps, if you like this article, be a saint and hit the +1 button above or "Like" it.Begin post by Nadia ShipleyproselytingProselyting is the term of art used in direct selling to describe the attempt to convert one or more salesforce members from one company to another. The ethics and legality of efforts to attract salespeople from one company to another is a subject of frequent and intense discussion by industry members. The Direct Selling Association has adopted guidelines regarding these practices of which salespeople and companies should be aware. The guidelines and open letter set out below attempt to describe what the Association believes is the state of the law regarding such practices as well as acceptable direct selling business practice in this regard.Proselyting Guidelines of the Direct Selling AssociationIt is considered to be an improper practice when Company A, or its representatives, specifically and consciously targets the salesforce of Company B with the intent of persuading Company B’s salespersons or employees not only to sell or work for Company A, but also to cease selling or working for Company B, thereby interfering with Company B’s business or contractual relations. This is not intended to encompass the occasional incident or two, but it does apply to situations involving more than several persons, where the pattern, approach and timing of Company A would clearly indicate an intention to adversely impact on Company B. If Company B sends correspondence to Company A regarding alleged proselyting activity, Company A is expected to appropriately respond within 30 days after receipt of the correspondence.End post

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