Saturday, September 23, 2006

Before you Pull the Rip Cord: Top Ten Reasons Why It's (Usually) Better for Top Talent to Stay at Larger Companies

After my last post discussing the Top Ten Reasons Why Top Talent Leaves Larger Companies (here if you missed it), several people commented that this was a helpful list which top talent could use as a "litmus test" to decide whether or not to pull the rip cord.

While this is true, I thought it was important to present the other side of the equation before all the highly talented people out there decided to jump ship from Microsoft, Dell, HP, and all the big consulting companies to join the next YouTube, MySpace, etc. The fact is that most highly talented people can get more done as part of a larger organization (with all its imperfections) than at a start-up. This is not a universal statement. Obviously, there are loads of examples where the "best-of-the-best" couldn't take being tethered down in a large bureaucracy, broke away, and -- indeed -- changed the world. Bless the entrepreneurs of the world (I happen to be one too). However, to be fair, before you tender your resignation, please review the following list of reasons why you might be better off where you are:

  1. Picking the next YouTube to join is Tough. If it wasn't, life would be pretty good for the VCs. They would be raking in the returns. Now, despite a previous post of mine in which I expressed a concern that not all people working at VC firms (especially at the junior levels) add tremendous value to their portfolio companies, the fact is that there are some pretty smart GPs out there at VC firms. And yet -- even these veterans of many a start-up occasionally make bad calls. The start-up thing is tough. Are you sure that you're going to be any smarter? Entrepreneurs are inherently optimistic (and, I'll say it again: thank God for that), which makes them not always the best judge. Here's a cautionary tale: George Sheehan left Andersen Consulting (Accenture) at the peak of his career to steer Webvan to a horrible and notorious death. Despite a brief sojourn with Siebel, his career has never recovered and likely never will.
  2. More Money may bring More Problems, but it's still More Money. Large companies, by definition, have more money to throw at new technologies or solving problems. Of course, they don't always do it wisely and there are many an example of them failing to recognize a trend that a smaller competitor capitalizes on. However, you are "top talent." If you figure out what you think your company should be doing, you should be able to persuade the key decision-makers to give you the money and to go out there and get it right. Although Microsoft hasn't always succeeded where it's thrown money at problems, look at what they've done with XBOX. Congrats to Robbie Bach.
  3. First-Mover is not as important as Fast-Follower. Incumbents -- with their money and talent -- can usually take a body-blow and come back much stronger. If you're a talented person working at Google a year ago and you were asked to beef up Google Video vis-a-vis YouTube, what an opportunity. That's what Jennifer Feikin got. And, she's making the most of it. Will it be a challenge to catch YouTube? Sure. But, there's nothing top talent likes more than challenge.
  4. If your boss sucks, you can usually move to a different area. A terrible boss is a killer for most highly talented people, no question. More people quit for this reason more than any other, in my experience. When you talk to them off-the-record afterwards, they describe the past few months as "soul-crushing" and other equally dire terms. However, the good thing about large companies is that you can usually arrange to move to a different area far away from the boss who is driving you nuts. I realize that, if the organization tolerates having this terrible boss, it says a lot about the organization -- and you might not want to be in a different part. But, these days, with a tight supply of talent and a big tent of people filling slots, you might want to not give up on a good thing with the company just because of one person.
  5. The People Who are Most Admired in Business Have Put Down Roots. I have a good friend of mine who has worked for 10 different companies in the last 12 years. Each time, I think he's moved up slightly on the pay-scale and with a little more responsibility and probably a better title. Many people have told me they think he's brilliant. These days, they say to me, you can't be loyal to your company and you need to look out for yourself. I just don't agree. Look at any list of the most admired business people and what do they all have in common: they've all put down roots and transformed that organization. Sometimes it's been a company they started (e.g., Bill Gates) and sometimes not (e.g., Jack Welch). I've yet to see a "career flipper" make the list.
  6. The Start-Up Thing is Tough. At my last company, VoiceGenie, I had the honor of being employee #20 and raising 2 rounds of VC money and building partnerships as VP of Strategy & BusDev. I remember we used to relish the start-up/outsider/raise the pirate flag over our crumby office mentality. And, it was great, learned a lot, and we were ultimately successful -- but it was tough. I'll get together with my former co-workers every now and then and one of us usually says, "I don't know if I could do it again, if you told me I had to go back and do that over." We competed against some great companies like Tellme and BeVocal. I think it's fair to say that everyone working in our industry thought we'd be acquired by late 2001. I still know many fabulous people grinding it out at Tellme and BeVocal and others. And, to them, I say congrats and see point #5 above. However, to everyone else thinking of leaving a big company, I say: you've got to be prepared to go in and grind it out for potentially many years. If you want that, great. However, changing the world in a big company might start looking a little more attractive.
  7. It's easier to find other Top Talent in Large Companies. This is another function of bigger numbers: you're bound to have other smart people that are fun to work with in bigger companies than small. Remember: top talent loves being with other top talent.
  8. Frustrating Bureaucracy can be Fixed. It's not fate that every large company has to have maddening bureaucracy. Hopefully, yours doesn't. If it does, the good news is that it can be fixed. Perhaps you're the person to do. Top talent never shies away from stepping up to clean a big mess. I've ended up talking a lot about HP in these pages in the last few weeks. Although I do not approve of Carly's leadership style, I think it's fair to say that the pre-Carly HP did suffer from frustrating bureaucracy. It appears that she tried to tackle this, with not much success. Hurd has definitely made strides in this respect.
  9. Make your Destiny. Top talent doesn't -- or shouldn't -- sit back and wait for HR or their boss to come to them to discuss their future career path within the organization. They should always be working off their own personal gameplan. It surprises me that only about 15% of hi-po leaders I work with have a more sketched out version of their careers 5 years from now. It's essential to do this if you haven't. You need to make your own destiny.
  10. You can change the World more. The fact is that top talent will change the world wherever they are, but, if all is right with your large organization, you can change the world faster and easier there. Good luck.

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Gautam Ghosh said...

nice list !

but it's not always that they leave for a startup

Sometimes they may leave because the values of the company may not gel with what they want out of life and the company.

Some people may want an industry change, some might want a responsibility scale up, and so on.

Eric Jackson said...

Hi Gautam:

Thanks for your comment.

Yes, you are right, the listing implies that they will leave a large company for a smaller one/start-up. Not everyone does, as you point out.

Values is an interesting one. I find that's a comment you'll hear in the exit interview but, if you dig a little deeper (and usually off-the-record), you find it's for another reason that was on the earlier list (e.g., bad boss).

Thanks again for stopping by and the comment.


Anonymous said...

Ok I found the follw up list and it is also a great 10.
While the list suggests that people move to startups, I thinking the basic idea applies to anyone that is consdiering leaving their large organizaton.