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Change Management

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Long life employment is a model of the past. On one hand companies all over the world are reducing more and more their core staff and increase cooperation with freelancers, consultants, etc. On the other hand people themselves are changing employers much faster. In Silicon Valley the average software engineer stays for 18 months with one company – a software engineer in Europe sticks to a company for up to 10 years. But even in Europe this number will drop.

What does this mean?

Up to now we “signed” two kinds of contracts with employees: an employment contract and an “emotional” contract. The latter means that the employer felt a special responsibility for employees to give them security and long life employment. Nowadays the second contract isn´t really relevant anymore – which means the fundamental disconnect of modern employment. A main challenge will be that employees might fail to fully invest in their current job. The danger is that neither the company nor the employees invest in the long-term development of the company.


How to cope with that?

In Stanford we met Chris Yeh who is engaged in this topic for years now. Together with his two co-authors he published the book „The Alliance“. And this is their main recommendation: understand employment as an alliance. They are talking about a mutually beneficial deal with explicit terms between independent players. Employees invest in the future of the company whereas the company invests in the market value of the employees. This needs honest career conversations for rebuilding trust and loyalty. At Linkedin for example you are asked at a job interview: What is the job you want to get after leaving Linkedin? The answer will be a guidance for the career development within the company. Furthermore the consensus of values and mission of an employee and the company will become even more important: the more meaningful the missions are that an employee can fulfill the longer he/she will stay. To talk straight about these matters beforehand should prevent any disappointment and accusation when the employee quits.

Altogether this will need a lot of learning on both sides.



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