Tour of duty theory destabilises the troops

FT

July 22, 2013 3:42 pm

By Andrew Hill

The idea of companies hiring staff for a few years only is deeply destabilising

Detroit’s bankruptcy has many implications, but for Reid Hoffman it will reinforce the cautionary metaphor in his 2012 book The Start-Up of You : “When it comes to your career . . . you may be heading down the same path as Detroit.”

As you would expect from the executive chairman and co-founder of networking site LinkedIn, one of his antidotes for career atrophy is for employees to network frantically. He has reinforced the message in a similarly self-serving, but extremely well-read article in the Harvard Business Review, that urges companies to hire staff for two- to four-year “tours of duty” and to encourage them to build links with potential employers outside.

As I’ve written, LinkedIn is an innovative group that is challenging established norms. By offering a succession of varied internal posts, companies can secure long-term loyalty, as I have found during my FT career. I also try to keep my own LinkedIn profile up to date and to cultivate my network. Mr Hoffman and his co-authors say this makes me an “entrepreneurial, outward-oriented, forward-looking” person.

But their advocacy of “employee-employer compacts” based on mutual self-interest reads to me like a manifesto for an attention-deficit generation of selfish, promiscuous careerists, even though it claims to be the solution to staff turnover and low productivity. It may be good for some mercenary individuals but it will be bad for most companies where they choose to work. To extend the Detroit metaphor, far from sustaining strong corporate communities, such an approach is more likely to tear them down.

In part, the idea merely recognises reality. Few people expect to spend a lifetime with one employer. Most companies will at some point go through a round of redundancies. At the highest level, tenure is already short – sometimes very short. Last week Kate Bostock, who had previously worked at Marks and Spencer, the venerable British shopkeeper, parted ways with Asos, the online fashion retailer, after only seven months as an executive director. It “wasn’t the right place for me”, she said. Even at Royal Dutch Shell, a company that works on long business cycles, the forthcoming handover to a new chief executive underlines the fact that recent incumbents have served no more than five years in the job.

As an employee, preparing for change, staying flexible and being open to opportunity make sense. As an employer, it pays to understand and adapt to this new fluid world.

But while the old-fashioned concept of career-long corporate loyalty has died, I refuse to accept loyalty itself has lost its value. Mr Hoffman describes a loose, finite alliance of employee and employer, after which, if staff leave, they reap the benefits of a wider corporate alumni network. He says the compact is a “realistic zone of trust”. But it is surrounded by a much wider zone of mistrust where staff hunt for their next job, while team leaders scout for their replacements. It is a global corporate version of the cocktail party faux pas of looking over your interlocutor’s shoulder in search of a more interesting guest.

The consequences are profoundly destabilising. First, however focused staff are at the start of a four-year engagement, they are bound to be distracted at the end. “Demob happy” is the term used to define reckless or inattentive behaviour at the end of a military tour of duty.

Second, companies will recognise that investment may not be repaid with longer-term devotion and skimp on inducting staff into new roles. Some two-thirds of executives polled by Egon Zehnder, the headhunter, said they struggled in new jobs because of an inadequate grasp of how the organisation worked or a poor cultural fit. It may be why Ms Bostock failed to get used to Asos.

Lastly, I wonder who will stick around to sustain long-term culture at large companies. The best employers will hope to re-engage their best staff. But by inciting high-potential employees to seek opportunities elsewhere, companies will refresh superficial corporate qualities at the expense of core values, which will stagnate and die. This is a challenge not only for crumbling Detroit, but for shiny Silicon Valley. LinkedIn says it has “evolved” Mr Hoffman’s tour-of-duty philosophy as the company has grown. No wonder. If it had not, at least eight of the group’s 11 senior managers, having served four years or more, would be looking for new jobs elsewhere by 2015.