Reid Hoffman changed the way individuals networked and searched for jobs as co-founder of LinkedIn (LNKD). Now the billionaire venture capitalist has plans for revolutionizing the way employees work. In his new book The Alliance: Managing Talent in the Networked Age (co-authored with Ben Casnocha and Chris Yeh), Hoffman outlines a new employee-employer contract -- one in which employees sign up for "tours of duty." Reid instituted such a radical policy at LinkedIn; new hires were given a 2-year or 4-year tour of duty and if managers were pleased with their contributions, employees were awarded with another tour of duty, which the company characterized as career advancement.
"Functionally this is the way the world works already in many industries," says Hoffman in the video above.
Hoffman picked the two-to-four year time frame because "it syncs with a typical product development cycle, allowing an employee to see a major project through."
He believes this new paradigm builds trust between employees and their bosses and keeps the employee engaged throughout the entire tour; employees direct their attention to discrete tasks and are assigned specific goals. The process allows honest conversations, Hoffman explains, and helps ease employees' concerns over layoffs and instability.
He emphasizes that these tours are compacts -- not contracts -- and he advises against a rigid approach to the process. Employers and employees should view these compacts with an entrepreneurial mind-set, he notes.
Most importantly, these tours can boost recruiting and retention, Hoffman argues in the book, and help employees attain lifetime employability, which may very well be the best job skill in this tough economy.
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