Why Alumni Networks are Critical to our Talent Supplyby Alumni Content in Alumni Leaders Podcast | Last Edited: 03rd December 2020
Podcast Name: Engage For Success Radio Podcast
Episode: Ep. 351 – Why Alumni Networks Are Critical To Our Talent Supply
Air Date: 2nd July 2020
Host: Jo Moffatt, Leading Leading Authority On Growing Small & Medium Sized Businesses
Guest: James Sinclair, Chief Executive of EnterpriseAlumni
On radio show number 351 of Engage For Success, James joins host Jo to discuss why companies should maintain a life-long relationship with employees, even when they walk out the door.
With companies increasingly recognizing the power of employee experience, it is time for a shift in thinking. How people leave the business is just as important as how they join it. Innovative businesses should be actively engaging with their corporate alumni. After all, an investment was made from the moment they were recruited.
Doing this gives the organization access to a network of people who can be leveraged as a known talent pool, as brand advocates, to provide employee and business referrals, as well as sales and development opportunities.
- That ex-employees represent your brand. When you tell the world that you are a great company to work with, are they saying the same thing after leaving?
- Why employees who are not a good fit for business now might well be in the future.
- What boomerangs are, and why they are coveted in recruitment, alongside referrals.
- Why, through this downturn, CEOs are going the extra mile to stay connected with furloughed and redundant employees. They recognize that their skills will be needed when recovery happens.
- The new model of alumni engagement is “How can we help you?”, and not just an address book and some news.
- Retirees who are alumni should form an integral part of the business rebound conversation.
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Engage for Success Radio, raising the profile as employee engagement and shining a light on good practice. The people who believe there's a better way to work.
Jo Moffatt (00:12):
Hello and welcome to show 351 from Engage for Success. The UK's not for profit social movement, devoted to shining a light on best practice in employee engagement, uncovering research and sharing case studies about just how it is that engaged employees can contribute to organizational success and how organizations can go about engaging their people, whatever our circumstances might be at the moment. And we've got a very interesting angle to explore today, which is really the whole topic of alumni and the idea... Well, as we will learn shortly from today's guests, the idea really of lifetime contribution, lifetime loyalty, lifetime value that our employees bring to the organizations where they work.
So to help us explore the topic of why alumni networks are so critical to our talent supply, I'm very pleased to welcome this week special S. James Sinclair. James is chief executive at an organization called EnterpriseAlumni. And we're going to be talking through that topic over the next half hour. So welcome to the show, James.
James Sinclair (01:28):
Thank you so much for having me on lucky number 351.
Jo Moffatt (01:31):
351. Absolutely. We welcome it. Sir, it's a pleasure to have you, so tell us a little bit about your story, your own professional story, not your personal story. We don't want to [inaudible 00:01:43] you, your own professional story.
James Sinclair (01:47):
Yeah, thank you. I don't think we have enough time to go through my personal story, but professionally it's always been focused on rapid innovation, rapid delivery and how large organizations can become more agile and can deliver quicker. So I've always been in the space of as people are talking about business transformation, there're things you can do today and you can start now. Not everything has to be a 16 year journey per se. And so I come out of SAP, IBM EDS, the big enterprises and landed about three and a half years ago where we started EnterpriseAlumni.
Jo Moffatt (02:21):
Right. Okay. So you were one of the founders of the organization were you?
James Sinclair (02:21):
Correct. One of the co-founders.
Jo Moffatt (02:29):
And so tell me then how did that come about? As you say you were working in organizations that were very much about tech digital transformation. What took you down the route of alumni? It was quite a niche area.
James Sinclair (02:47):
Yeah. And I'd love to say that we were sitting there pondering the next great big business idea and landed upon this. But I think like most entrepreneurial stories, you start by going down a left lane and then a lane and you end up in a pothole and you find an idea that resonates. But for us it was, we saw the very large organizations, all large organizations for that matter. We're starting this migration to the cloud, essentially they were moving off these on-premise applications, these custom built applications. And we saw a real opportunity for a smaller vendors to be able to support these organizations with what I would call best of breed applications. Essentially we have an application that can solve either.
And the area that I was focused on was in HR. And we just saw this tremendous investment going into recruiting, which haven't changed much in a number of years and even bigger investment by companies on retention, education, quality of life. And then when people leave, it was almost well good luck with your life goodbye. And we saw a massive opportunity that why would you possibly let people go and not maintain a relationship, given the amount you've invested in these people?
Jo Moffatt (03:54):
Well, I suppose the glib answer will be well, they're not working for me anymore, so I don't care about them and they've chosen to leave. So literally good luck to them and forget about them. But what's wrong with that approach then James? Why should companies actually actively care about those employees who almost said to them, sorry, I don't want to be a part of you anymore? Why should companies care about that and what should they do about it to maintain a more positive relationship?
James Sinclair (04:29):
Yeah. I think the reason of why should they care? Is because when people leave and they go to their new job, usually the first question they get asked is, Oh, where were you working beforehand? And there is an option there where the employee is going to say, I worked at this amazing company. This is what they did. This is what I learned here, some techniques we might be able to implement here, or they might say I left this company and they basically kicked me out after I said goodbye and treated me like a traitor. And so this conversation of ex employees is not only for brand advocacy, because they're going to walk out and they're going to represent your brand, whether you like it or not. And so you want that to be a positive. The second is they might not be a good fit anymore, but that's right now, in two years, four years, 10 years, they might be a perfect fit.
So this concept of letting people leave, gaining new skills, gaining new network, gaining new perspectives, and then when the time comes potentially being able to re-recruit them. So there's some great data out there. I think we had a podcast last week with EY and Citi and EY says 17% of all of their employees are boomerangs. As in people who leave and come back the Citi, it was 12%. And I believe Andrea has said that they worked at out there was about $75,000 saving when they bring someone back, not only in time to fill and time to productivity, but also because they stay longer, they're more effective, they're better employees, all of these keywords that you want, when you think about a great recruit.
Jo Moffatt (05:55):
Blimey, that's a significant percentage, isn't it? Were you surprised that it was as high? Yeah. That absolutely resonates with your own experience.
James Sinclair (06:08):
Yeah. We see between a 10 and 25% fill rates of the requisitions not only just alumni coming back, but also referrals. And I think that's something also to consider is that when you leave, you may not want to return right now for whatever reason, but maybe you do have someone great. And if you're a great organization, you're going to be willing to say, Hey, I have someone great for this role. And there are many of our customers who offer gifts, monetary rewards, gift certificates for people that refer a candidate to get the job. And so these people out there are just a massive army.
I think it was the CHRO of Starbucks who basically said, you have to treat every single touch point with every single person you come across, like a customer touch point. And that includes when they leave. And I think that, that's a really important conversation. Another customer talks about the fact that when you leave, you're basically promoted from employee to customer. And so I think that's this change in dynamic we see organizations think about, which is you're leaving for now. We never know where the world's going to go and what's going to change and where we might need access to you, your resources, your network, or whatever else that might mean.
Jo Moffatt (07:16):
Interesting. Certainly my own business would read our proposition has always been to treat employees like customers and what we've always meant by that is to use the techniques, the approaches and the insights and putting your audience, your customer audience, or your employee audience at the heart of your thinking. To do that internally in the same way your marketeers do externally. But I love that quote that... What you're talking about here just takes that to another level. If we think about when an employee leaves actually they've just begun life as a customer.
That's great. That really strikes a chord with me, certainly so interesting. Okay. We can't ignore the world as it currently stands at the moment, out there we have COVID-19, we've got dispersed workforces of awful lot of organizations living with dispersed workforces. Many of whom might be thinking that those dispersed workforces are going to be dispersed for a very long time to come if not forever. So what have you seen in your particular specialist sphere have been the big impact of COVID-19 on this whole issue?
James Sinclair (08:33):
I think the biggest thing is this recognition of maintaining a relationship. It is not optional anymore. And I'll give you the example. We have a large influx over the past three, four months of travel tourism, really impacted industry where tens of thousands of people are being made redundant. And you hear the same common theme. We spoke to a recruiter for one of the largest hotel chains on earth last week. And she said, we are laying off people who we love, people that I spent months recruiting people, who I spent months acquiring from our competitors and now we're laying them off, and we cannot let that go to waste. We need to make sure that there were two things happening. Number one is if we're laying them off and we're not happy about it, we need to provide them access to resources, information, education, do everything we can to replace them because that's all social responsibilities in organization.
And we see amazing things. Some of our customers, I think one of them does... At a CEO does a town hall, I think every week or every other week, where he comes on to all of these redundant people and basically says, look we know the situation we're in, but let me give you some visibility. This is what we think recovery is going to look like. This is what we think you can expect in terms of when we're going to start rehiring. But then he said something amazing, which is just so you know, there are now 10 new caught skills we didn't need in January that we're going to need going forward. If we think about it from Zoom to collaboration tools, to Slack, to Teams, all of these new tools or not new tools, all these new tools for certain organizations are suddenly in play.
And I think one of our other customers said that amazingly, our 2030 transformation is now happening on Tuesday. And therefore... I love that phrase. And he basically said, look, if you be made redundant, use this time and he opened up all of their learning resources, he extended the discount that they have for the online university and basically said, look, make sure you use this time to come back more skilled. You come back either to us with more skills, more competencies or to our competitor or to someone in the ecosystem, but don't go in horizontally, make sure this is the time to go vertical.
Jo Moffatt (10:39):
Fascinating. That is so optimistic. Isn't it? When it's very easy to see everything around as being a bit doom and gloom, particularly in the hospitality industry and travel industry, and if there's a sector that's been really, really badly hit by this it's is them isn't it?
James Sinclair (10:59):
Well, I think it's a consistent pulse that we're seeing in the market, which is the great employers know the recovery will happen. We hear from hotels, it may well take two years. For airlines it might take three years, but that ability for leadership to say, we need to spend time and budget on this displaced workforce, because it's the right thing to do. And because it will serve us in the future, it's a really a reflection of longterm thinking around how they treat their people. Why am I engaging and offering resources to up skill people who are going to take it to my competitor? Well, the answer is because they're going to think amazingly of us and when I need something of them, they're going to be like, of course I want to return to this amazing employer that even in the worst of the worst basically said, what can we do for you? And how can we help you?
Jo Moffatt (11:45):
Yes, yes. So do you think the organizations that embrace this concept, James are ones are already doing an awful lot of other things right? They already understand the importance of engaging their people. And this is just a logical, I'm not saying a bolt-on because it clearly isn't, but it's integral to that mindset that actually our people are our biggest asset and that continues forever.
James Sinclair (12:17):
So I think there are some companies where you have a small cluster of people who say we have to do this and they just push it forward in the organization. And by pushing it forward, it expands the concept. So there are going to be people in the company who are saying, why are we spending a dollar on these people that left when we should be spending a dollar on our own people? But ultimately they get to see value through the program. And there are other companies who actually truly mean it and breathe this concept of, relationship for life, not relationship until you leave. Essentially, what we're seeing companies have to do is stand behind their hashtags. And if they say it's relationship for life, that has to mean relationship for life. And I think this COVID and everything else has made everything slightly more human and made it easier for companies to actually say that, this is the time to make those changes.
This is the time where you can go out to your employees, your customers, your vendors, and say the words, Hey, we're going to try something new, we're not sure if it works. Whereas in December or January, you could never say that, you would never admit to your customers or your employees or your vendors, whoever they are, that you're trying, something that you haven't fully fleshed out in detail. But actually now you've given this opportunity. This is you can rip off that band-aid. So we see a lot of companies just starting somewhere specifically around this experience conversation and what can we do to support you better? We see a lot of companies who are ramping up and just starting somewhere.
Jo Moffatt (13:38):
Interesting. Yes. It's almost like putting it out there in Beta. Isn't it?
James Sinclair (13:40):
It's exactly what it is. And that's exactly how companies should operate. And they should be really comfortable with that because they put it on a beta. They see what works, see what resonates, see what they can double down on and then grow from there, versus spending months or years trying to plan it and then realizing, well, this is not what we wanted or this isn't working as we expected. The quicker you can move into production per se is the quicker you can get that feedback.
Jo Moffatt (14:04):
I love that quote. You were saying, 2030 digital transformation is happening on Thursday or Tuesday, we took it to someone the other day. And we were talking about, what do we not want to lose when... Of course the last few months has been very difficult, but there's been a lot of positives that have come out of it too. What are those positives that we wouldn't want to lose in the future world? And one of those has been organizations are forced to become more agile, on Monday [inaudible 00:14:34] always been saying, Oh no, we can't have our workforce work from home, Oh no our 2030 digital transformation will happen in 2030 and come Tuesday, they were there and they were forced to be agile and forced to adopt agile approach to things.
And that does involve testing things and trying things and not knowing that not everything's going to work exactly as you imagined, it would. So really fascinating mind shift that you're seeing happening. And there is obviously key to this. So tell me how, what does that alumni network look like? What does it comprise? What's in it? How does it work? What's in it for the employee as well as the employer?
James Sinclair (15:26):
Jo, would you mind if I just follow on to your last point about agility? I think it's such a big statement that you've made, is companies are suddenly realize, they're becoming agile without even realizing it. Look, we recognize that we have one customer in construction who says, look, when you're building a bridge, there's no time for agile, but where Sir Anthony said, sometimes we apply those same processes to our HR processes, but it's wrong. We need to have an agile process when agile fits and a Six Sigma or whatever process when it doesn't fit. And so I think your exact point is agility is just being forced, whether they call it that or not, it doesn't matter. They're moving forward, they're trying stuff and they're giving it a chance. And I think that's a good change. Not from just HR and employees, just globally for companies to run a little bit quicker if that's fair [crosstalk 00:16:11].
Jo Moffatt (16:15):
Yeah. Some had become stodgier oil tankers that take months, if not years, to turn around and found themselves taken to the cleaners by agile new competitors who are able to respond quickly. That's just the nature of business.
James Sinclair (16:29):
And employees love it. The employees love moving a bit quicker. They're excited. They see it, they see all these things and you find more renewed enthusiasm, renewed excitement, that ideas can go to production in a week as opposed to again, 2030. And I think when people can get greater gratification of the work they're doing and see the impact of the work they're doing, they ultimately are more passionate and work faster, harder, and better.
Jo Moffatt (16:54):
Yeah. Yeah, absolutely. And you're much more likely to feel like being innovative and creative. If you feel you're doing it in an organization that is actually going to do something with what you're suggesting, rather than it disappearing into some black hole of rigid processes and assessments and iterations till the cows come home.
James Sinclair (17:13):
We'll hear back on that Excel spreadsheet in 2023, when it's been reviewed by 862 people. So I think that leads to your next question, which was, what does that even look like? So the legacy viewpoints of alumni was always an address book and some news, find other people that also worked at this organization. And when we open a new office in Sao Paolo, it's going to be on the feed. That's no longer the relationship that your past employees want. So I think there's two big points here. Number one is you have five or six generations in your post employment journey. Everyone from interns who leave all the way to retirees, who've 45 years at the company and each one of those groups wants something different. So the new model of alumni engagement is how can we help you?
Learning, discounts, mentoring, volunteering. We have one bank that's just started a program that allows their senior executives to come in and help mentor people that have left and started companies, started new startups and the internal people at the company love it. They one of the guys was like, nothing makes me happy and then ripping off my tie and my Tassel shoes, putting on my sneakers and a t-shirt and spending a few hours on the phone with these guys and girls, because I get excited. And then I go back to work and I'm more excited. And so this new conversation around alumni is how do we help you? What do you need? And I think that's a really important question that sometimes companies forget to ask. And the overwhelming thing that we're finding for specifically early in career is not teaching them competencies, but teaching them the core pillars.
Here's how you need to learn. Here's how you need to understand financial management, financial planning. We had one company who basically went to their early stage field workers, people generally on the minimum wage who are in the field, who are not thinking about financial or 401K or retirement, but are saying, actually you have to, and there's things you can do today that allow you to make sure you're starting somewhere. So in five years, 10 years, when your kid goes to college, you actually have some savings. So you see different companies basically saying, how can we help you all the way from intern to retiree?
Jo Moffatt (19:20):
Yes. Interesting. Okay. So the benefit to the organization you've outlined, and as far as the employees are concerned, or clearly these things that you're talking about are going to be a value to them. Do they embrace it or do they just want to... Is there a sense of got out of that place now, they really don't want to be contacted in a network for the long term.
James Sinclair (19:54):
So I think there's both sides. There are people who leave, who just, I didn't like my manager, my organization, whatever that reason, there's other people who leave because they just got a better opportunity. I think there's a letter that comes out from British Airways when a senior executive leaves that says, good luck with your offsite training. We'll see you back here soon. And has a really cheeky and humorous way to talk about the fact that they believe the grass is not greener on the other side. And we know that, we know that something like 30% of people that leave jobs actually regret the change. But obviously you can't go back to your manager 10 days later and be like, oops, can I come back? Our ego wouldn't allow for that. But yes, a majority of employees do jump in and do embrace it.
When a company says, what can we do for you? And it's different for different people. So it's not like a LinkedIn group where everyone has the same conversation, listening to the same topic instead is very focused it says, look, we see your early career, here is access to our learning management system, here is access to a university where you can get a 50% discount if you want to do an MBA program. The same for senior executives, we have Speakers Bureau, mentorship, things that are going to be a value to the individual is where the future of employment is, is what are you doing for me? I'm not going to sign up to this thing just so you can put me in a talent pool. That's not a thing I left. Let's have a relationship.
Jo Moffatt (21:12):
Yes, yes. So it's treating the employee as an individual and fashioning, whatever is appropriate to them depending upon their circumstances, the stage they are at in their employment life cycle, I guess.
James Sinclair (21:29):
I'm recognizing that people are individuals and not, everyone's going to fall into what you expect. One of the findings and look, we're a small organization, but one finding we have had is there are some employees who like to start a bit later and work later, and they are unbelievably more productive and their velocity is exponentially higher. So why are we forcing them into an early morning meeting? The really we could do two hours later. And so essentially this topic of how do we serve you as an individual? I think is going to become more and more the concept going forward for large organizations say, why am I forcing you to force into our methodology? Instead what makes you happy? What makes you grow? What makes you work better? And I think companies sometimes forget to ask that question.
Jo Moffatt (22:15):
So that's interesting. That question is a bigger question than simply the alumni relationship beyond them leaving. That's actually almost a philosophical question that should underpin an employer's relationship with their people across the board, which-
James Sinclair (22:35):
None of these conversations are unique to alumni. Just treat people right, treat them like a customer at every point and ask them how you can serve them better and then listen to the results. And if you take those steps, it doesn't really matter whether you apply that to a vendor, a customer and employee, or an alumni or a recruit, because now you're basically saying as an organization, these are our guiding principles and those guiding principles should act with every interaction anybody has with your firm.
Jo Moffatt (23:03):
At whatever stage, I think Deloitte call it cradle to grave engagement [inaudible 00:23:07] or something, which is what you're talking about. Okay.
James Sinclair (23:12):
Absolutely. And [inaudible 00:23:14] EY seems all the professional server. EY have a million or a 1.2 million alumni that they're talking about. So if you need an army to enact change, I can find you a million people.
Jo Moffatt (23:24):
Wow. That's amazing. And they actively engage with them for their lifetime.
James Sinclair (23:32):
Actively. And when you need something, so we have a customer right now that stopped all of their online advertising, primarily because of budget. And so what they're using their alumni community for is to help like, and share and amplify their content. And so it's a very simple, Hey, would you mind over the next 30 days, if you happen to see this, this and this post clicking like, clicking share, adding a comment. And they got an overwhelmingly great reaction. In fact, the social media team said the reaction was greater than any paid advertising they've ever done. So it's not always just recruiting sales referrals. Sometimes it's nothing more than just amplification of our brand or our employment brand or whatever that might be.
Jo Moffatt (24:08):
No, that makes sense. I guess I think I know what you're going to say in answer to this next question, James, but Deloitte. So I mentioned cradle to grave implies that this alumni relationship doesn't just go to a retirement from the active workplace, but goes beyond, is that what you tend to see or do things tend to stop when that individual is no longer actively involved in the workplace in pay capacity?
James Sinclair (24:44):
That goes back to the selfish intent of the company. Oh, they're in the retiree stage now they're just a burden. Why would we spend a dollar to engage in them? And there's two answers that are very easy. One of our customers leverages their entire alumni community, including retirees to help with the activist investors, because most of those retirees have 401Ks that include company stock. The second one is one of our customers is actively going to all retirees who left in the past three years and saying, would you come back to this organization on a part-time basis? And the reason is not that they just need people to be able to ramp up very quickly boots on the ground, very quick action in terms of no training and so forth. But also they said, look, the retirees have access and have experience not only catastrophic failure, but also rebounded.
And if you look at our management team, there's not many people in that management team, who've been through the entire cycle of awfulness to recovery. And so looking at those retirees and saying, can you come in, provide mentorship, provide insight, when the Spanish flu happened, how did that work for you? When SARS happen how did that work for you? When 9/11 happened, how did that work for you? And so you see a lot of big companies actually reaching out to these retirees and saying, Hey, we'd love you to come in. We want your insights. We want to know what works because we want to try not to have to recreate a wheel that you guys already created.
Jo Moffatt (26:01):
Yes. Yes. That's interesting. Isn't it? We'd like the benefit of your experience and we want to learn from it rather than constantly reinventing the wheel. Yeah.
James Sinclair (26:12):
Jo Moffatt (26:12):
So we've got just over three minutes left James, and I wonder whether we could talk very quickly about quantitative versus qualitative value of this. So you've outlined a lot of the good things, the value that is in this for the employer and the employee. Do these things pay for themselves in terms of improve retention or reducing costs on recruitment? Is that seen as an added bonus?
James Sinclair (26:53):
So everything obviously has to go into the business case because we can have all the warm fuzzies we want, but ultimately the platform has to have an ROI. And ultimately the person that we're talking to needs to have a dashboard, they can show their stakeholders and senior leadership. But when you think about lower cost of recruitment, even the baseline cost of recruitment, I think the Sherm say it's about $4,500. So if you were to hire 10 people back, or you are hired 15 people and five retire referrals, all of a sudden these numbers are very quickly, we do know that people that return stay about two years longer. So you actually suddenly have a life cycle saving over the duration. And most importantly, they're a good fit.
This is the whole conversation, we talked about a lot of hiring strangers versus hiring someone you know, and in some roles, it's great to be able to say versus going out and trying to get resumes and seeing who we can try and work out is going to be a good fit. Well, we know Sally, let me just ring her all manager and see what she says and see if she like working with her. And now we know that not only is Sally a great fit, she's a diamond and we should jump on that. And so hiring known people just reduces the risk for companies of hiring someone who is not perfectly suited potentially for the role.
Jo Moffatt (28:07):
Yes. Yes. Interesting. Very interesting. I think there was a comment you made to me offline, which was that leaving should be as good as joining. And I love that concept because if we think about the excitement and the positivity and the warm fuzzies that we have with regards to our attitude, to this new employer that we don't know at all from [inaudible 00:28:32], but we give them the benefit of the doubt. We feel positive about them. We're upbeat, we're motivated, we're engaged. If you could bottle that and make leaving as positive rather than perhaps what it is currently, which might well be a, Oh, thank God I'm out of that. Or alternatively, Oh, I'm sad to be leaving and I'm never going to see them again. And I'm never going to have a [inaudible 00:28:56] feel very sorry about it. So I think that's a lovely concept that you shared with me. And that's what it's all about. Really, isn't it, James?
James Sinclair (29:08):
One of our customers has hooked our system into their core HR that when you leave three weeks later, they can manually trigger sending you a gift card and a small gift. We hope you're fitting into your new role amazingly. If there's anything we can ever do, please feel free to reach out. Can you imagine going into a new job and your old manager sending you a, we hope you're doing amazing conversation? And what that manager's actually doing. He or she is leaving the door open. And I think that's where the intelligence is. How do I make it easy for someone to reply and be like, Hey, I would consider coming back. Or Hey, I have a referral. Or Hey, I have some new business. And so that human element, I think is everything.
Jo Moffatt (29:47):
Yes. Okay. We've run right out to time, but it's leaving the door open for either for people to come back or leaving the door and for people to introduce other people or make recommendations or referrals and it's in everybody's interests. Excellent. Thank you very much for listening. James Sinclair, chief executive at EnterpriseAlumni. Thank you very much for joining us and talking to us about the power of alumni networks and goodbye. Thank you.
Engage for Success Radio, raising the profile as employee engagement and shining a light on good practice. The people who believe there's a better way to work.
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