Corporate talent retention in an age of entrepreneurship

The game has changed for new MBA graduates.

In the past, the most desirable career objective for a new MBA graduate was to have a management career in one of the big corporate institutions. Companies like IBM or General Motors, or one of the big banks like Lehman Brothers or Merrill Lynch were considered to be the plumb jobs. But there has been a significant shift. These days, large numbers of new graduates are aiming to develop their own businesses and entrepreneurship is the name of the game. A corporate career is often seen as restricting and lacking flexibility. Many people just don’t trust the big international businesses any more. Business Schools have been responding to this development by crafting courses like an “MBA in Entrepreneurship” Even the venerable Harvard Business School has developed a customized course for “The Entrepreneurial Manager” in their MBA program.


Some of this change is happening because Generation Y has lost faith in the careers which were so admired by their parents. They have also realized that job security is not what it used to be, and in any case slogging it out in some outdated and rigid corporate structure is no fun anymore. Building an own business not only tests your creativity and enterprise, but it also gives freedom from paternalistic restraint and the control of corporate discipline. People now want fun and the opportunity to make money. There are many role models of young tycoons who started their own businesses and now have the good life.

So who are these aspiring entrepreneurs? They are usually the most ambitious, and driven members of the MBA class and the ones who have the energy, the cognitive smarts and the independence of spirit. They are exactly the ones who used to be the target of corporate recruiters, in fact the talent who would be developed for the next generation of successors.

So what does this mean for companies wishing to build a talent bank?

It means that to attract and keep the best of the bunch, the top performers, the old systems will no longer work. Smart independent minded new MBAs want to have greater flexibility and want to create their own work- and life-styles. Instead of insisting on 24/7 commitment to one employer and assuming that there can be only a one-track career thought process, corporate recruiters will have to adjust their offering. Just as “flexi-time” a decade or two ago, enabled the work force to customise its time on the job, so now, if companies want to retain their best performers, they will have to give greater scope for customized career design. A portfolio life has become a reality for many Generation Y individuals. They either want to have their own business, or to be an “intra-preneur” within an established corporate structure. This could mean that they are in a full time job, but may not see it as a long term option, and may want to do their own thing on the side.

The days are gone when it was assumed that a person could only serve one master and that anything outside of this perceived “contract” would be a diversion or seen as being disloyal. Loyalty used to be a virtue, but many people now realize that it has become a one-way process. There is also much evidence to confirm that smart people can do several things well, and can process information from different sources very easily. So why could an employee not also have an own business on the side if it does not conflict with the main job? There is a clear development now where employees or contract workers are being paid for, and performance measured, for what they deliver, ie “output” and not for how many hours they sit in their office. ie “input”. Productivity is more important than attendance. Innovation is more important than sticking to the rules.

Having stimulated the desire for entrepreneurship and self-employment, the corporate world will have to find ways of accommodating those that have decided to take up this challenge. With role models like Richard Branson, Bill Gates Jeff Bizos and others simply being a “salary slave’ no longer holds much appeal for a growing cadre of dynamic ambitious fast-trackers.  

There are several options for the new universe of talent managers…

• A new MBA graduate can be appointed to a position for three or four days a week, providing a reasonable base income but allowing one or two days a week to investigate other options or maybe to start a separate business. This must be anathema to the HR people driving recruitment, but they will realize that having part of a talented person’s life is better that having full commitment from a drone. And anyway a bright driven person will make a bigger effort to contribute even if it is not in an old-style full-time job.

• In the famous “Sovereign Individual” example of a “Hollywood Model” of employment, people come together for the purpose of a specific project like making a movie. They do it and then disperse. Increasingly corporate decision makers will realize that an old style job can be broken into a series of project- or time-slots in the same manner. A new product can be launched, a set of accounts can be audited, a new website can be constructed, a next strategy can be designed etc. all by bringing in appropriate people from outside. So why can one not do the same with much of the rest of what has to be done? “Interim Management” is already an attractive notion for many people who are tired of unproductive long term commitments. Working in high powered bursts is more appealing for many people.

• The stable predictability of old-style loyal corporations is long gone. High turnover and a competitive employment market are now accepted elements of business management. But there are still vestiges of the original thinking. Only lowly paid functionaries are brought in as “temps” or as part-timers. In the future the whole enterprise will be a dynamic organism with many moving parts where some managers will be seconded in for a particular purpose, some executives will be part-time, and many employees at every level will be negotiating their own terms. Business leaders will be well advised to adopt a dynamic model of corporate life and realise that they need to cater to the individual in a time where we no longer want a one-size-fits-all way of managing our careers.

• Increasingly CEOs of listed companies are being encouraged to accept invitations to be appointed as non-executive directors on outside boards. The thinking is that a different perspective and seeing the challenges n another business will sharpen ones thinking for the benefit of ones own company. Precisely. The same will apply to people further down the food chain where outside involvement, until now has been a near heresy. The truth is that many people have been doing things covertly anyway for a long time. Think of the CEO of a major bank who has a big investment in a wine farm, or a top exec in an add agency who is also a partner in an interior decorating business. Or some accountant who renovates houses on the side. It has been going on for a long time. So why not acknowledge it and encourage people to expand their interests while maintaining productivity?