Stop Trying to Retain People. Do This Instead. (ft. LinkedIn's First CHRO)

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What if everything you know about keeping your best people is wrong? I know that sounds crazy, but Steve Cadigan was LinkedIn's first ever CHRO. He helped them scale from 400 to 4,000 employees through one of the fastest growth runs Silicon Valley has ever seen. But his take on retention...

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may shock you a little bit. It actually even may make you a little uncomfortable. In this segment, he breaks down exactly why chasing retention is a losing strategy, and he also breaks down what Tesla, college basketball, and a Vegas buffet all have in common. I know, it sounds crazy. He also talks about what the best leaders are doing instead. Let's get into this week's growth segment with Steve Kanigan.

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When I hear your line, retention is dead, growth is a new loyalty. I get excited. I do. But there's another part of my brain that says, like, I'm wondering what other people are thinking about that, right? Because you get the resistance of, well, we're going to pour into these people and we're going to develop them. Like, what if they leave? What if they get really, really good and they go work for our competitors? Like, how do you overcome some of those things when you're really thinking about building a career around growth and specifically growth towards what that person wants to accomplish?

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Yeah, great. This is great. And this is top of mind for everyone. Most of the leaders I talk to are really frustrated with the length of time people are staying in their organizations today, which, by the way, in the United States for people that, you know, the whole aggregate of the labor pool, call them professional workers, right now it's about four years. Okay, that's the length of time. Now,

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That that's not a shocking number. Like I can deal with people staying four years, but when you look at the 20 to 35 demographic, it's about 2.2 right now. Okay. So wait, we just finished your new higher orientation and you're out. And that by the way, is the median, which means half the demographic is of that pool is less than two years. So in Silicon Valley, you know, software engineer, you know, the median tenure is around a year and a half. And, you know, we don't celebrate 10 year anniversaries.

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10 months, you're still here. Can I give you a hug? Like, it's great. But here's the truth. Um, that I think is really important for, for leaders to understand is, um, in a world that's changing really fast today. Okay. You need new people and new ideas and new perspectives. Um,

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dare I say, a diverse workforce. You know, like, it's kind of been a taboo word with this new administration, but new people with new ideas and new ways of solving problems is a competitive advantage. People who've been solving problems the same way, who've been reading the same playbook, are disabling your capacity to face a new frontier. And the greatest example of that is Tesla.

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Right now. So you've got a part-time CEO who's got six other jobs. He's a little bit of a maniac. You've got a company that's been around less than 25 years that is worth more than Ford, Toyota, Honda, GM, BMW, and Mercedes. Worth more than them combined. Okay? Wow. And now why is that? Because the market believes the new player that's bringing a new, refreshing outlook that didn't hire a lot of people from industry.

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you know, 100-year-plus companies,

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is the company that can out-innovate people who've been doing it the same way. So that's my first play to sort of knock down the people like, you know, we've all been taught the teams that win are the ones that stay together the longest. Well, that's not true with Tesla. They're destroying this old, stayed. You know, Ford versus Ferrari has a great scene, you know, when Carroll Shelby goes into Mr. Ford's office. He goes, that folder you're touching right there, it touched 16 hands before it got yours. We are not going to win the race with that kind of thinking.

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Um, and, and so, you know, getting, getting down to brass tacks, it's still frustrating. You know, why would I develop these people if they're just going to go? Because they're going to go, they are going to go. And if they go out as angels that you made better, they're more likely to refer people here. And here's the, here's the hard reality for a lot of business leaders.

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Thanks to Indeed, thanks to LinkedIn, thanks to the internet, I can see, my kids can see, your employees can see more opportunity than any time in history. And if you were a crusty, frustrated CEO who's probably in their 60s or 70s, if you could go back in time,

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and start your career, and every day see hundreds of opportunities, you're telling me you'd still be working in this bank, you'd still be doing the same thing? No, you wouldn't. You would have been tempted to go to the, it's like eating at your home and never going out to dinner, and then you go to Vegas and you go to the buffet and you go, whoa, I can have all that stuff? I want to try the shrimp. I want to try the king crab. Of course they're going to do that.

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So, you know, what I try to say is prepare for it. And the greatest metaphor for that right now, I'm a huge sports fan. I love college basketball. Right now, if you're a college coach in football or basketball in the United States, you know your best player is going to be there one year.

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You know, and something amazing happened this past year. Indiana won the football championship in your backyard. Yes, they do. And Michigan won the college basketball championship. Indiana had a 60% roster turnover and Michigan had every new, every starter was brand new to the school that year and they won a national championship. And now they're, they're a coach is left to go coach the Mavericks. But we've, that's never happened before. So what's happening? Well,

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Those sports coaches realize if I only have players for one year, I need a simpler offense and a simpler defense. Okay. So what does that mean for business leaders? If you know people aren't going to stay for 10 years, you can't have jobs that take five years for someone to learn. You just can't. You're going to have to re-engineer your offense. You're going to have to say, if this job takes someone three years to figure out, I need to change that job. So it takes them three months or six months. And yeah, it may be hiring and yeah, it's hard and yeah, it's different. But,

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But if you do that, you're onboarding people faster and creating a new value chain system. And that's kind of fun. It's fun. But yeah, it's hard. And I think that's the exciting way that I try to mitigate the frustration is, listen.

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Do you think people will stay? I asked him a simple question. All right, people are leaving fast. Do you think next year it's going to change? Do you think in five years, 10 years, something's going to happen in the global economy that's going to say people, we're going to go back to people staying their whole careers in a company. Will that ever happen? And the answer is always, of course it won't. Okay. So what's it going to take for you to change your strategy to expect people won't stay?

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Right. That's called playing offense, expecting them to try to retain them. I think retention is defense. It's total defense. Um, and, and that's why, and you know, a little bit ahead of our times, but building LinkedIn and the sales leader I was telling you about Mike, he began every interview with, what do you want to be doing when you leave the company?

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And people are like, what just happened here? You're doing my exit interview? I haven't even got a job offer yet. Like, we know you're going to go. It's Silicon Valley. You're not going to stay. That's okay. Let's be honest, right? That's like you saw. It's the opening of my book. Like, let's start from there. And I believe if you help someone realize, I'm going to get you on your journey, whether it's here or somewhere else, they're going to give you the X factor. And even if they go, they're going to be an angel for you referring their friends, right?

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Yeah. Yeah. And then maybe there's a bridge program where they come back and help with projects and help with other things. That's really great. Correct. Correct. And that's, you know, a bridge program. Another way of saying it, it's an alumni program. Right. I deal with hospital systems all over the United States. I mean, this is a this is a domain where failure is just not an option. I mean, medical care, a health care system is really in code red right now in the United States.

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higher nurse turnover, early retirements for doctors, fewer people going into those professions. I mean, we've got a serious issue. So I go into these hospitals and say, what's your biggest? Oh, nurse turnover. I was like, okay, so why are they leaving? Oh, because they can be a travel nurse and make four times as much in the next town over. And I said, so, okay, well, why wouldn't they do that? So then I go to them, well, why don't you get in the travel nurse business? Why don't you keep them?

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on your payroll and allow them to go do that, and then they don't have to leave your domain. And by the way, no one wants to be a travel nurse forever. They're going to want to come home and either have kids and have a stability with school system or be close to mom and dad or whatever.

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And they look at me just like, what? No, we don't do that here. I'm like, well, why are you so limited? You broke their brains, D. You broke their brains. Like, I got the answer. And then it gets worse, Tony. Then I go, okay, so your biggest operational stress is people. How many people on your board have talent experience?

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Krispy Kreme donut. Nobody. And, you know, I've done this in major hospital systems, basically voluntarily. I will do that for free. You put me on your board, and I will bring a strategic perspective to your biggest problem. Are you ready for that? It's like, no, we'd rather have the sugar high of your presentation than just go back to, you know, what we know.

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And that gets, this is back to like, I still, I've been talking about this for five, six years. And still I feel like a lot of organizations are on the recognize we have a problem phase, not ready to make a change because they're so set in, you know, when you're under stress, most of us default to what we know, you know, that's true. And few of us say, I need a new approach. Right. And it's not till you really fail or the house is on fire. Oh, maybe I need something different. And even though I see it coming, they're not ready for it.

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Yeah. That makes me wonder. I'm thinking back to my sales days. It's like when I would go into, even now when I go into an organization, one of the things I'm assessing is, and I don't know a better way to say this, like how much pain are you in? Is the pain of staying the same greater than the pain of change? Because if it is, you'll take the leap. If not, you'll just complain about it and you'll complain about it, but you won't actually do anything different. So yeah, that's interesting.

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Well, that was Steve Cadigan, LinkedIn's first ever CHRO. If that hit home with you, the full conversation is on our channel. He actually goes deep on what broke first at LinkedIn during their hyper growth phase, how they built the culture from scratch, and why the leaders who are winning right now are actually hiring for learning velocity and not current skills. Find it wherever you're watching or listening. And if this episode was useful, make sure you share it with one person on your team who needs to hear it. And that's how we grow. I'll see you next time.