Editor’s note: Reid Hoffman co-founded LinkedIn in 2003. He’s a partner at Greylock and co-author (with Ben Casnocha and Chris Yeh) of The Alliance: Managing Talent in the Networked Age.
Success in Silicon Valley is all about people — about how companies build lasting alliances with talented teams of entrepreneurial employees. Outsiders sometimes think that recruiting and keeping great people in the Valley requires offering Google-like perks or eye-popping compensation packages. In fact, it’s far more powerful to treat an employee like an “ally,” be realistic about how long they’ll likely stay at your company, and then offer a promise of career transformation if they work for you. That’s something every startup can do — even those still in the bootstrapping stage.
When we are advising our portfolio companies on how to do this, my colleague at Greylock Jeff Markowitz and I employ some of the principles from my new book “The Alliance: Managing Talent in the Networked Age.”
In the networked age, the old employment model, in which employers offered lifelong employment in exchange for loyal service, is no longer affordable or desirable. Instead, companies need to foster a new kind of long-term dynamic loyalty — an alliance: a mutually beneficial deal, with explicit terms, between independent players (company and employee).
To create this alliance we must perceive an employee’s career not as a monolithic entity owned by one employer, but as a dynamic entity that consists of successive “tours of duty.” These tours should give employees the opportunity to transform their careers and the company they’re working for. They should encompass both the employer’s goals and the employee’s aspirations. Based on this alignment, employers can construct a mission that leads to a fulfilling tour of duty for the employee and significant advances for the company.
For example, many people who work at startups want to start their own company someday. Rather than avoid the topic or try to convince the person to stay at your company forever, craft a tour with a mission and a time horizon that, if completed, will help your employee be a better entrepreneur in the future. Talk openly and honestly about this promise.
Recognizing that top talent may someday want to leave — and allowing employees to network and consult at other companies while they work for you — leads to more honest conversations at work that can even help with long-term retention.
In Part 2 next week, Jeff will go into more detail about fostering the relationships between your employees and other people in the industry.