Reid Hoffman, Ben Casnocha, Chris Yeh: The Alliance

Employment in the Networked Age

The company is asking employees to commit to itself without committing to them in return.

Both parties act in ways that blatantly contradict their official positions. And thanks to this reciprocal self-deception, neither side trusts each other.

Employers continually lose valuable people. Employees fail to fully invest in their current position because they’re constantly scanning the marketplace for new opportunities. Managers, meanwhile, are caught in the middle.

Employers, managers, and employees need a new relationship framework where they make promises to one another they can actually keep.

The old model of employment was a good fit for an era of stability. The traditional model of lifetime employment, so well-suited to periods of relative stability, is too rigid for today’s networked age.

“Employees are our most valuable resource,” companies insist. But when Wall Street wants spending cuts, their “most valuable resource” suddenly morphs into their most fungible resource.

A business without loyalty is a business without long-term thinking. A business without long-term thinking is a business that’s unable to invest in the future. And a business that isn’t investing in tomorrow’s opportunities and technologies — well, that’s a company already in the process of dying.

The Alliance lays out a path forward for companies and their employees. Think of employment as an alliance: a mutually beneficial deal, with explicit terms, between independent players.

Employers need to tell their employees, “Help make our company more valuable, and we’ll make you more valuable.”

Employees need to tell their bosses, “Help me grow and flourish, and I’ll help the company grow and flourish.”

A business is far more like a sports team than a family. Teams win when their individual members trust each other enough to prioritize team success over individual glory; paradoxically, winning as a team is the best way for the team members to achieve individual success.

Today, entrepreneurial thinking and doing are the most important capabilities companies need from their employees. As the competitive pace increases, it becomes more and more critical.

Intuit CEO Brad Smith told us, “A leader’s job is not to put greatness into people, but rather to recognize that it already exists, and to create the environment where that greatness can emerge and grow.”

Tours of Duty

David Hahn went through the unique way in which he structured his nine years of working at LinkedIn. Over four distinct “tours of duty,” Hahn transformed the company and his career.

This seeming contradiction — regularly changing roles in the context of a long-term relationship — is the essence of the tour of duty framework.

The key concept that both military and business tours of duty have in common: focus on honorably accomplishing a specific, finite mission.

In the context of the alliance, the tour of duty represents an ethical commitment by employer and employee to a specific mission.

Employees don’t need your permission to switch companies, and if you try to assert that right, they’ll simply make their move behind your back.

Rich Lesser, the CEO of The Boston Consulting Group, calls this building an “opt-in” culture. You hire the best people you can possibly find. Then it’s up to you to create an environment where great people decide to stay and invest their time.

We’ve classified an employee’s tour of duty into one of three general types.

A Rotational tour isn’t personalized to the employee and tends to be highly interchangeable — it’s easy to swap an employee in to or out of a predefined role. The first flavor of Rotational is a structured program of finite duration, usually aimed at entry-level employees. The purpose of this type of Rotational tour is to allow both parties to assess the potential long-term fit between employer and employee. The other type of Rotational tour applies to employees at all career stages. These tours are highly structured and largely programmatic, but focus on maximizing the current fit between an employee and his role, rather than grooming the employee for a different role.

Unlike the Rotational tour, a Transformational tour is personalized. The focus is less on a fixed time period and more on the completion of a specific mission. The central promise of a Transformational tour is that the employee will have the opportunity to transform both his career and the company. A general rule of thumb is that an initial transformational tour of a duty lasts two to five years. As Intuit CEO Brad Smith said, “Year 1 [of the tour] lets you gain the important context for the role, year 2 is about putting your definitive mark on transformational change, and years 3 to 5 are about implementing and growing your successes — or pivoting when assumptions don’t play out the way you expect.”
Exceptional alignment of employer and employee is the hallmark of a Foundational tour. If an employee sees working at the company as his last job, and the company wants the employee to stay until he retires, he is on a Foundational tour of duty. The employee sees his life’s work as the company’s mission and vice versa. The Foundational tour recognizes and formalizes that reality. Ideally, most of the top executives of a company should be on Foundational tours. When teams work together over many years, they share a common background of experience, enabling more rapid communications and decision making.
Think of a Foundational tour as a form of marriage — a long-term relationship that both parties anticipate will be permanent, in which both parties assume a moral obligation to try hard to make it work before ending the relationship.

Think of the different tours of duty as the ingredients in a metal alloy. Different mixtures lead to different capabilities, which are suited to different uses. Rotational tours provide scalability by helping companies hire large numbers of employees into stable, well-understood roles. Transformational tours provide adaptability by helping companies bring in the specific skills and experiences required. Foundational tours provide continuity by helping companies retain employees who focus on the long term.

Since Transformational tours represent the greatest departure from most companies’ management practices, this book focuses on defining and implementing this type of tour.

Companies have long devoted resources to crafting personalized roles and career paths for their stars.

Every employee relationship should be bidirectional in nature; it should be clear how the employee benefits and how the employer benefits.

A competent professional in the corporate middle class might complete multiple tours of duty without a change in job title.

Yes, a tour of duty has an end point, but a successful end to a tour of duty can be beginning a new tour of duty at the same company.

Each completed tour of duty builds the bond of mutual trust, and knowing when a tour of duty is drawing to a close allows you to begin the process of working with the employee to define the next tour at the company — before that employee starts to look elsewhere. Even if the employee wants to explore options outside the company, in a trusting alliance, he’ll grant you the “Right of First Conversation,” which means he’ll discuss his plans with you before he approaches other employers.

Building Alignment in a Tour of Duty

Today, a modern company cannot expect its corporate purpose to become the sole purpose of the employee. Unless an employee is on the (rare) Foundational tour of duty, he will want to explore and cultivate interests outside the company. The most entrepreneurial employees want to establish “personal brands” that stand apart from their employers’. It’s a rational, necessary response to the end of lifetime employment.

Alignment means that managers should explicitly seek and highlight the commonality between the company’s purpose and values and the employee’s career purpose and values.

Both sides thrive on progress.

By focusing on building alignment for the duration of a specific mission, a tour of duty reduces the issue of aligning values and aspirations to a manageable scope.

The required level of alignment varies based on the type of tour.

Achieving alignment is both an art and a science. Here are some principles of the craft a manager can follow.

1. ESTABLISH AND DISSEMINATE THE COMPANY’S CORE MISSION AND VALUES.

2. LEARN EACH INDIVIDUAL EMPLOYEE’S CORE ASPIRATIONS AND VALUES.

In general, you should expect that a company’s mission and values will be clear and relatively unchanging, while an employee’s career mission and values will be comparatively less well-defined.

3. WORK TOGETHER TO ALIGN EMPLOYEE, MANAGER, AND COMPANY.

This is a collaborative rather than top-down effort. It’s not just a job for you, but for the employee as well.

For new employees, the process of alignment should begin during the hiring process itself.

Ultimately, the alignment of interests, values, and aspirations increases the odds of a long-term, strong alliance between a company and its talent.

“At LinkedIn, the philosophy is to let our brightest go after areas that interest them, especially in areas where they will be a bit in over their head at first,” Hahn said. “It’s been a great strategy to keep our most talented folks motivated and learning as fast as possible.”

If your company lacks meaningful official values, take the liberty of defining those values for your team.

DEFINE PERSONAL VALUES ONE-ON-ONE. Meet one-on-one with each of your direct reports to discuss their core aspirations and values, and how these values fit with those of the company.

BUILD TRUST BY OPENING UP. Learning what an employee cares about helps build a relationship of trust.

Bear in mind that the underlying power dynamics can make it seem intimidating when you ask direct questions. That’s why it’s important for you to start by opening up about your own core aspirations and values.

Implementing Transformational Tours of Duty

Here is a step-by-step guide to implementing Transformational tours of duty, either with your direct reports or throughout your organization.

1. Start the Conversation and Define the Mission

Establishing a minimum mutual commitment, benefits both employer and employee.

To define a tour of duty, you and your employee need to answer the following questions.

What Is the Overall Objective of the Tour? The tour of duty you define with your employee should have a clear, detailed, concrete mission objective. Examples include a specific project launch, internal project, or organizational initiative. Based on the mission objective, you should also set the employee’s expectations for the length of the tour. Finally, the mission objective also needs to help employer and employee align their aspirations and values.
What Do the Results of a Successful Tour of Duty Look Like for the Company? A successful mission objective delivers results for the company for either quantitative or qualitative goals.
What Do the Results of a Successful Tour of Duty Look Like for the Employee?

2. Set Up a System of Regular Checkpoints for Both Sides to Exchange Feedback with Each Other

The mission objective, not the calendar, defines a tour of duty.

3. Before the Tour of Duty Draws to a Close, Begin Defining the Next Tour of Duty

Well before the end of the current active tour, you should set aside time to discuss what your employee would like to do once his tour of duty is complete.

The Manager and Employee Define a New Tour of Duty within the Company. Part of the commitment an employee makes during an initial tour of duty is to seriously consider your proposal for a second tour of duty.
In the event that no obvious next mission presents itself, you and your employee might find yourselves in purgatory — you both want to continue the relationship, but you’re not sure how. In this situation, the best course of action is to extend the current tour, but set up a time to re-examine the possibilities in a matter of months, rather than years.
The Manager and Employee Conclude That the Employee Will Be Pursuing a Tour of Duty at a Different Company. Together, you and your employee should negotiate a transition period and draw up a transition checklist. The goal of the transition checklist is to lay out everything that the company needs from the employee to finish the mission, especially the question of who will pick up the project ball going forward.

4. Managing for the Unexpected: When There’s a Change in the Middle of a Tour

The alliance is ethical, not legal, and the tour of duty is an informal agreement to respect and honor a key relationship.

What Happens If One Party Breaks the Alliance? If an employee departs the company in the middle of his tour without any investment in a transition, he breaks the employment alliance and has to face the consequences. First and foremost, the employee will take a major hit to his credibility and reputation. With the advent of social media, the consequences to employers of breaking an alliance are far-reaching.
What Happens If the Employee Gets a New Manager? The right approach is a respectful transition. The default expectation should be that the new manager will continue the existing tour of duty.
What If One Party Is Performing Poorly? Overall performance impacts the durability of the tour of duty. Even when performance deteriorates, it’s still important to remember that the alliance is a relationship, not a transaction.
What If the Employee Wants to Move into a New Role within the Company? If an employee can keep his mission on track and arrange an orderly transition, you shouldn’t block the change.

The keys to having a successful conversation about tours of duty are to be systematic, consistent, and transparent.

BE SENSITIVE TO POWER IMBALANCES.
CHOOSE METRICS THAT ARE LEADING INDICATORS.
APPLY MORAL SUASION ETHICALLY. Moral suasion, rather than contractual law, binds the parties to the alliance.
REGULARLY CHECK IN ON HOW THE TOUR IS EVOLVING. This is not a onetime conversation.
ESTABLISH A BASIS FOR TRUST THROUGH OPENNESS AND TRANSPARENCY.
ASSURE YOUR EMPLOYEES THAT YOU’RE NOT ABOUT TO FIRE THEM.

Explaining the tour of duty framework isn’t an off-the-cuff conversation. Set aside several hours and schedule a formal meeting on the calendar for the discussion.

The final deliverable should be a written Statement of Alliance.

Employee Network Intelligence

The alliance at work: growing their professional networks helps employees transform their career; employee networking helps the company transform itself.

Most of us utilize a fraction of the information available to us.

There are more smart people outside your company than inside it. In a healthy ecosystem, this is always true.

Frequently, senior management neglects a broader and more useful resource: the collective knowledge and networks of all the company’s employees, even the most junior among them.

Network intelligence that leverages the individual networks of your organization’s people is the most effective way for your organization to engage with and learn from the outside world.

The second function of network intelligence is its ability to provide access to “hidden data” — knowledge that isn’t publicly available.

The third function of network intelligence is to generate serendipity, which is a major driver of innovation. Writer Frans Johansson has argued that innovation arises at the intersection of different disciplines and cultures.

The fourth function of network intelligence is to help you see opportunities you would otherwise miss.

Implementing Network Intelligence Programs

Here is a step-by-step guide to implementing a network intelligence program in your individual team or throughout the organization.

1. Recruit Connected People

Make a candidate’s network strength an explicit priority when hiring.

In the interview process, ask candidates about their strongest professional allies. Find out how they solve problems — do they call experts in their network?

The need for network assessment is even greater when hiring a senior manager.

2. Teach Employees How to Mine Intelligence from Their Networks via Conversation and Social Media

Encourage your employees to play offense. Direct reports should talk with people in their network about key challenges their group is facing.

Finally, to make sure this information gets back to the company, establish a “push” process for funneling tips or information from employees back to the management team.

The venture capital firm Andreessen Horowitz taps its people’s network intelligence in an unusual way: at the beginning of every partner meeting, the firm awards a $ 100 prize for the best rumor presented, confirmed or not.

3. Roll Out Programs and Policies That Help Employees Build Their Individual Networks

Encourage Employees to Be Active on Social Media and to Make Themselves Discoverable. Set Up a “Networking Fund” for Employees. Facilitate Speaking Gigs for Your Employees.

4. Have Employees Share What They Learn with the Company

Network intelligence needs to be an integral part of the alliance and the tour of duty conversation.

MAKE THE CASE FOR WHY NETWORK INTELLIGENCE IS IMPORTANT FOR EMPLOYER AND EMPLOYEE.
PERSONALLY EXPLAIN THE COMPANY’S PROGRAMS.
MODEL PROPER USAGE OF INDIVIDUAL NETWORKS.
ASK EVERY EMPLOYEE TO FURNISH A LIST OF THE SMARTEST PEOPLE HE KNOWS WHO DO NOT WORK AT THE COMPANY.

Corporate Alumni Networks

Lifetime employment might be over, but a lifetime relationship remains the ideal.

Establishing a corporate alumni network, which requires relatively little investment, is the next logical step in maintaining a relationship of mutual trust, mutual investment, and mutual benefit in an era where lifetime employment is no longer the norm.

The first way an alumni network helps with hiring is making it easier for “boomerang” employees to return for another tour of duty after an absence from the company.

Alumni are a great source of network intelligence — competitive information, effective business practices, emerging industry trends, and more.

Alumni can become customers or refer customers, especially when incentivized to do so.

Implementing an Alumni Network

Here is a step-by-step guide to launching and leveraging a corporate alumni network for your organization, whether for a single department or the entire company.

1. Decide Who You Want to Include in Your Alumni Network

2. Explicitly Define the Expectations and Benefits of the Relationship

3. Establish a Comprehensive Exit Process

4. Build Links between Current Employees and Alumni