I graduated from the University of Kentucky which, most people know, is a great basketball school but has forever had a mediocre football team. This year they pretty much stink. They hired a new coach before last season and I don't understand the decision. But the more I think about it, the same dilemma that faced UK football faces companies all the time.
When you need to hire a coach, CEO, whatever, and you want a superstar, you have three options. First, you can pay big bucks for a big name with proven experience. This would be like Kentucky hiring Steve Spurrier. Or in business, it would be like a company hiring Larry Bossidy or Jack Welch. This isn't done too often because it is very expensive, and there is always that chance that the superstar suddenly won't perform as well. So most companies (and teams) turn to one of the other two approaches.
The second approach is to hire someone who is a superstar one level down. This is very common. You find someone with a histroy of success, but not at this level. You hope their success is a function of skill and not situation. This is what happens all the time when an upper level exec from GE gets hired as CEO of another company, the offensive coordinator from a good program gets hired as a head coach, or a head coach at a smaller school moves up to a big school.
The third common option is to hire someone who has played at the top level but not had success. This is what Kentucky did. They hired a football coach who had been at a big school, but had a mediocre record. The hope is that the person has skill but something about the situation has kept them from success. This is what happened with Google. They hired Eric Schmidt who wasn't a superstar at Novell, but has done a good job for Google.
So my question is, which is the better route to success? For a big company (or football program), is there a better chance of success with someone who did a mediocre job at another big company, but has experience at this level, or should you hire someone who is a superstar but has only worked at smaller places where the business considerations are somewhat different? Or, is it irrelevant? Maybe what is more important is not experience but whether the candidate has a personality, skill set, and vision that mesh well with the company.