Danielle Rios, 28, has it all - a BS degree in computer science from Stanford, a great track record as a software developer for IBM, and the energy and savvy to market herself. With all that going for her, Rios could be a free-agent winner in the new economy, adding value by juggling different projects with different firms. Or she could have her pick of well-established corporate launch pads for her career.
But for the last three years, Rios has worked with Trilogy Software Inc., a small, rapidly growing software firm based in Austin, Texas. Trilogy is on the cutting edge of sales-and-marketing software, and Rios is part of a team that shows potential customers how the software can work for them.
Joe Liemandt, 30, founded Trilogy in 1989, after dropping out of Stanford only a few months before graduation. To finance the startup, Liemandt charged up 22 credit cards. If Trilogy were to go public today, analysts say, it would be valued at more than $1 billion. Four years ago, Trilogy had 100 employees; today it has almost 1,000 - and plans to add another 1,000 before the summer of 1999. But to call Trilogy workers "employees" misses the point. They're all shareholders. They're all managers. They're all partners. That's how Liemandt, Trilogy's CEO, has chosen to run his company - and that's what makes it successful.
Liemandt knows that Trilogy depends on talented people. He also knows that people can go anywhere. Which means that his biggest competitive headache isn't companies like SAP AG, Baan Co., and PeopleSoft Inc. - businesses he has to face down in the marketplace. His biggest worry is holding onto people like Rios. "There's nothing more important than recruiting and growing people," he says. "That's my number-one job."
It's a seller's market for talent. People with the right combination of savvy and ambition can afford to shop for the right boss, the right colleagues, the right environment. In the old economy, it was a buyer's market: Companies had their pick of the crop, and the question they asked was "Why hire?" Now the question is "Why join up?"
As a result, the economy is fostering new kinds of organizations with new kinds of practices and operating rules for pulling people together. These companies offer many of the advantages of free agency: flexibility in how, when, and where you work; compensation linked to what you contribute; freedom to move from project to project. But they also offer the advantages of belonging to an organization in which mutual commitment builds continuity. They are the enterprises of the future.
What makes them so different? Consider again Danielle Rios and Joe Liemandt at Trilogy. In the old economy, Rios and Liemandt would have been on opposite sides of the table: employee and employer. They'd be there for years, locked in their conflicting roles. Liemandt would want steady, reliable work from Rios. Rios would want a fair wage from Liemandt and an opportunity to move up the company ladder. In the new economy, Rios and Liemandt sit on the same side of the table. And they've joined together - for a time - to create new value.
Ask leaders what their biggest challenge is, and you get the same answer: finding, attracting, and keeping talented people. Ask talented people what their biggest career challenge is, and you'll hear the same refrain: finding good people to work with - and to work for.
For Liemandt and Rios, and for everyone in the new enterprises of the free-agent economy, the crucial questions are: What leads them to work together in the first place, and what keeps them together? Here are the six "social glues" of the company of the future.
Money Makes It Mutual
The world is awash in money. Venture capitalists are pouring funds into startups at a ferocious rate. In 1997, for example, venture-capital firms raised $10 billion. That same year, 629 companies went public, with a total valuation of more than $39 billion. The stock market has softened in recent months, but it's still way up there - making possible a previously unthinkable market for acquisitions and IPOs.
All of this money has had an unavoidable impact on the job market, where money is a powerful motivator. Freshly minted MBAs from leading business schools are commanding a premium from blue-chip consulting firms: Signing bonuses and first-year salaries often run higher than $120,000. And the pay packages that large, successful companies are putting in front of their most talented executives are critical in the rapidly escalating war to keep talent - or to steal it away. Not long ago, in the kind of deal that one usually reads about only in the sports pages, one of Wall Street's premier stock analysts landed a one-year, $25 million contract - a $15 million increase over his 1997 pay package.
But for most people who are trying to decide which company to join, the name of the game today is stock options. Chalk it up as another legacy of Microsoft and that company's now-legendary cadre of millionaires: Across the landscape of the new economy, young, well-educated, talented businesspeople are joining up to get a piece of the action. They're willing to forgo larger salaries at bigger and better-established firms in favor of stock options in upstarts that may be worth a great deal down the road. The result: Even small, little-known enterprises can compete for top talent. In fact, startups promising high risk and huge gain are winning.
"Obviously, it's not just compensation that motivates people to come to work here," says David Stewart, 30, head of human resources at Tripod, a Web company (www.tripod.com) based in Williamstown, Massachusetts. "But stock options are a big motivator." Founded in 1992 by Bo Peabody, then a 19-year-old Williams College student, Tripod launched its site in April 1995. Today the company employs 60 people, produces one of the 10 most heavily trafficked sites on the Web, and boasts more than 2 million members. To keep ahead of the competition, Tripod depends on talent.
Stewart doesn't have a classic high-tech background. Before coming to western Massachusetts, he was a lawyer in Montreal. He had worked his way through law school in Toronto by doing stand-up comedy at night. In January 1996, his wife, Margaret Gould Stewart, was offered a job as creative director at Tripod. (Now 27, she has risen to become Tripod's vice president of media and community development.) Stewart recalls that he pulled out a map and tried to locate Williamstown on it. He couldn't.
His wife accepted Tripod's offer, and Stewart followed her to Massachusetts. He joined a small law firm in North Adams, about 10 minutes from Tripod. Almost inevitably, Tripod became one of his clients; Stewart saw huge possibilities in the startup, and he wanted in. "Because there was a lot of buzz around the company, people thought, 'Hey, this stock could be worth something someday,' " Stewart recalls. In August 1997, he decided to take a job in Tripod's human-resources department - a big career change. The salary at Tripod was a little lower than what he'd been making at the law firm. But the company included a "decent-sized grant package." If it weren't for the options, he might not have made the switch. Now, says Stewart, "when you combine salary and options, I make more than I did at the law firm."
Money played a similar role in bringing Kara Berklich to Tripod as the company's director of communications. Berklich, now 26, graduated from Williams College in 1994, worked as a consultant in Cleveland for six months, and then returned to Williamstown to join Tripod. She knew Bo Peabody from her college days and would have joined up right after graduation — but at that point, Tripod not only couldn't offer options; it couldn't even offer a livable salary. When Tripod was able to put together a package that included options, says Berklich, the company suddenly became much more attractive. "You think that eventually those options will become publicly traded stocks, whether through an IPO or through a buyout by a public company," she says.
Stewart and Berklich bet right. Last February, Tripod was bought by Lycos, one of the contending search engines-cum-Web portals, for $58 million. After the acquisition, Lycos stock rose by some 25 points and reached a high of 107. About six months after the acquisition, Lycos's stock split. Stewart and Berklich have had their Tripod options converted into Lycos options - an arrangement that will nevertheless bind them to Tripod for some time. "I continue to receive options in the company that continue to vest," says Berklich. "Lycos remains a really terrific financial opportunity."
Of course, underlying the popularity of stock options are three simple propositions about the nature of competition today. First, the real competition is over talent. Second, if you want to attract and keep talent, you have to pay for it. And third, if you want talent to work for your organization with the enthusiasm that comes with ownership, then you have to trade equity for it. These days, money does more than just talk. It creates glue.
Mission Makes a Difference
Xerox Parc guru John Seely Brown said it best: "The job of leadership today is not just to make money. It's to make meaning." When it comes to attracting, keeping, and making teams out of talented people, money alone won't do it. Talented people want to be part of something that they can believe in, something that confers meaning on their work and on their lives - something that involves a mission. And they don't want that mission to turn into the kind of predictable "mission statement" that plasters many a corporate-boardroom wall. Rather, they want spiritual goals that energize an organization by resonating with the personal values of the people who work there - the kind of mission that offers people a chance to do work that makes a difference. Along with the traditional bottom line, great enterprises have a second bottom line: a return on human investment that advances a larger purpose. A powerful mission is both a magnet and a motivator.
Meet David Bellshaw, 37, who six years ago joined Isaacson, Miller, a Boston-based boutique head-hunting firm. Isaacson, Miller has undertaken various head-hunting tasks - including, for example, placing Dave Olson as CEO for Patagonia Inc. But the firm has carved out a special niche for itself by advancing women and minorities into executive positions and by finding leaders for a wide range of civic organizations and not-for-profit enterprises.
Bellshaw launched his career at the California office of Heidrick and Struggles, one of the leading head-hunting firms in the United States. When his wife, Ava, got into the Tufts University School of Medicine in Boston, Bellshaw considered several jobs with big firms in that city. But tiny Isaacson, Miller - smaller then than its 50-person staff today - stood out. A major reason why he joined up was "the company's unique mission," he says. "We are vicariously saving the world through our clients. That's a very, very strong pull for me."
Isaacson, Miller isn't just a head-hunting firm - it also helps its clients understand their own unique missions. The firm applies a mixture of psychological counseling and missionary zeal, while being attentive to the practical realities of good management.
Bellshaw comes to this calling naturally: His father was a Baptist minister, and so was his grandfather. "I rebelled against my background, and I still do - very actively," Bellshaw says. "But in some funny way, given my genes and upbringing, my work is a secular way of doing what my family has done. Two generations of ministers, and I broke the mold. Yet there remains a mission-driven theme in my life."
In his six years with Isaacson, Miller, Bellshaw has matched some high-powered people with some great organizations. One assignment: to find a new dean for New York University's Wagner School of Public Service - a place that trains the very sorts of civic leaders whom Isaacson, Miller recruits. The assignment wasn't easy. The school needed someone who combined administrative skills, a deep knowledge of both the public and the not-for-profit worlds, and an ability to define the future challenges of civic leadership - especially in the New York City area, where most of the school's graduates work.
How did Bellshaw begin? By sending an 11-page "Invitation to Apply" to 100 potential candidates. Among those who are rumored to have responded were former Colorado Representative Pat Schroeder and former Ohio Governor Dick Celeste. After an intensive search, Bellshaw selected Jo Ivey Boufford, then a high-ranking official in the U.S. Department of Health and Human Services and the U.S. representative on the executive board of the World Health Organization. Why choose Boufford from a list of such prestigious candidates? According to Bellshaw, not only did she have a proven track record as a manager, but she also had both a demonstrable interest in public service and the "New York-style gutsiness" needed for the position.
Another assignment: to find a new head for the Lovelace Institutes, a biomedical-research institute based in Albuquerque, New Mexico. Founded more than 50 years ago, Lovelace had seen its mission lose focus, and it needed a leader with the vision to set a new course and the management skills to implement the necessary reorganization. Bellshaw's pick to lead the institute: Robert Rubin, who had been the vice president of research at the University of Miami, where he had a reputation for taking risks and for demanding results. Soon after joining Lovelace in the fall of 1996, Rubin devised a solution to its problems: Completely reorganize the institute, rename it the Lovelace Respiratory Research Institute, and turn it into a national respiratory-research center. He plans to make Lovelace the leading authority on every aspect of research into respiratory disease.
How deep is David Bellshaw's commitment to Isaacson, Miller? Last May, when his wife accepted a medical residency at the University of California at San Francisco, Bellshaw had to make another decision: Would he leave the firm for a larger, more traditional head-hunting outfit in California - one that could pay him a lot of money? Or would he strike out on his own? In the end, Bellshaw says, the power of Isaacson, Miller's mission won out. He came up with a third option: He opened a new, West Coast office of the firm.
"It was a chance to do something that was interesting on a moral dimension, as well as an opportunity to build an office," he says. "The result is a blend of mission and market. With this job, I have all the mission of the best not-for-profits, and I also have all the rigors of the corporate world."
Learning Makes You Grow
In a knowledge-based economy, the new coin of the realm is learning. Want to build a business that can outlive its first good idea? Create a culture that values learning. Want to build a career that allows you to grow into new responsibilities? Maintain your hunger to learn - and join an organization where you'll be given the chance to learn continuously.
It's a proposition that fast companies have already figured out: Talented people join up in order to learn. Of course, part of the lure of learning goes back to the first "glue" - money. Learn more now, earn more in the future. But again, money is only part of the story. Talented people also want intellectual challenge: They like being explorers on the frontiers of the knowledge economy. And as apprentices have known for centuries, it's easiest to learn on the job - by working directly with people who can teach you and who are committed to the same goals you are.
Consider John Jordan, 40, director of electronic-commerce research at Ernst & Young LLP's Center for Business Innovation in Cambridge, Massachusetts. The center, which houses 35 people on two floors in an office designed with the ultramodern look-and-feel of a learning laboratory, functions as an in-house research and brainstorming facility for the 82,000-person, $9.1 billion global accounting and consulting firm.
If learning is a core competency, then Jordan already possesses it. Consider his degrees: a BA from Duke in political science and history, an MA from Yale in ethics, an MA and a PhD from the University of Michigan in American studies. But all of that education left Jordan hungry for something else: an understanding of the real business world. He could have opted for independence - freelancing for several clients - or he could have chosen to pursue various consulting roles. At the center, Jordan found the perfect blend of intellectual stimulation and real-world application, and an environment that keeps him glued to interesting people.
Part of the learning comes from contact with supercharged experts. "Working here has given me a rich Rolodex," Jordan says. "I'm invited to participate in a lot of stimulating conversations that I wouldn't take part in otherwise." The center taps various fields to bring in visiting fellows: a neuroscientist, a science-fiction writer, a provocative business-school professor, a magazine editor. "It's a group that I could never assemble on my own," says Jordan.
Being part of a high-powered think tank hasn't deprived Jordan of his autonomy. He largely designs his own goals, and he works to achieve them at a comfortable pace. And he's enlarged the scope of his work. "The brand called John Jordan has limited viability," he admits. His new brand has a much wider appeal.
Another part of the learning comes from the quality of the problems that cross Jordan's desk every day. The center acts as a kind of filter - screening out trivial issues and letting through only the hardest conceptual challenges. "The institutional affiliation gives you the leverage to do things you couldn't do on your own," he says. "The learning curve is so steep - I'm learning too much here to make going out on my own an attractive option."
Jordan's boss is Chris Meyer, who is himself an accomplished learner: Meyer, 50, graduated from Brandeis University, studied economics for two years at the University of Pennsylvania in its PhD program, and earned an MBA from Harvard Business School. As the director of the Center for Business Innovation, Meyer recruits people who want to learn from one another - a process that makes Ernst & Young a desirable place to work. "People are attracted to the company because working here helps them become better than they could be otherwise," says Meyer.
Through its cutting-edge innovations, the center also offers its people a window onto the future. "By coming here, you're learning not just how to identify the issues of the future but also how to do the work of the future," Meyer says. "Working in the knowledge economy requires the ability to recognize patterns, to share ideas with people inside and outside your organization, to maintain relationships with people who have common interests, and to pull value out of those relationships." Learning how to master those skills may be the most important kind of learning there is.
Fun Makes It Fresh
When people work as long and as hard as they do in today's competitive companies, when the line between huge financial success and total economic failure looks as thin as it does today, there's only one thing that can keep the energy in a workplace flowing: fun. Very simply, if work isn't fun, it won't attract the best talent. The lesson is so obvious that it's easily forgotten: Friendship and camaraderie are basic adhesives of the human spirit.
When David Stewart made the decision to abandon his legal career, one of the things that attracted him to Tripod was its convivial atmosphere. "We're in this little town," Stewart says, referring to quaint Williamstown. "We have a really cool office space on the top floor of a big mill, with a lot of people who wear shorts and T-shirts all the time. It's very relaxed."
Look at other high-tech upstarts, and you're likely to see the same thing: hard work harnessed to shared enjoyment. And you don't need to be in high-tech for this glue to work.
Nancy Deibler, 50, manages Sprint's small-business-sales division in Kansas City, Missouri. There, more than 150 people sell telecommunications services to smaller businesses. It can be tedious work: The salespeople work eight-hour shifts, making cold calls - the kind of job that can turn into a grind, resulting in high employee turnover and a lot of customer dissatisfaction.
But Deibler and her crew have found a way to counteract the tedium. They've created a strong rapport within the team by building fun into their work - and as a result, Deibler has been able to attract and keep top performers. "Many of us really look forward to going to work because of the other people on the team," Deibler says. "We relate to and get along with each other as friends."
Making fun a legitimate part of work isn't all that difficult, Deibler says. For example, Deibler's team might leave work at 3 p.m. to go bowling. "After doing something like that," she says, "the difference that it makes is measurable, and it lasts for weeks." Add baseball games, cookouts, goofy hats, evenings of karaoke, mock casinos, zany sports, dressing up staffers in costumes to deliver morning coffee to salespeople - a host of ways to introduce positive energy and a spirit of playfulness into the all-too-often all-too-serious work world. Deibler knows that all of this may seem hokey to some people - and she doesn't care. "It lifts productivity," she says.
But if you want to see what fun looks like both as a way of working and as a business, visit Playfair Inc., a Berkeley, California-based international consulting firm that devises innovative team-building and stress-reduction programs. Its distinctive business model: Celebrate wackiness, incorporate zaniness into the work process - and in short, have fun. Playfair's clients include FedEx, Dupont, AT&T, Charles Schwab, and the Young Presidents' Organization - not exactly the kinds of places where you'd expect to find a lot of blue jeans-wearing, pizza-eating, fun-loving business types playing a game for laughs. Yet since its founding in 1975, Playfair has proven that there's real bottom-line value in putting fun into the workplace: Fun attracts talent, and it improves productivity.
Terry Sand is Playfair's "senior vice empress" — an intentionally irreverent title for an exceptionally talented woman. Sand, who is in her forties, has a master's degree in modern dance and theater from UCLA, and began her career performing in films and commercials. A founding member of several improv-comedy groups, she won San Francisco's All-Pro Comedy Award in 1984 and went on to become a popular local-TV personality.
Then, in 1986, Sand was diagnosed with systemic lupus, a painful arthritic condition. "TV is very stressful," Sand says. "I love it, and I still do it for fun sometimes, but having it be your career - basing your life on ratings - is extremely high-stress. I couldn't do that and also do the healing I needed to do." Still, Sand noticed that whenever she had the opportunity to conduct a comedy class or workshop, her condition would improve. "To stay alive, I had to figure out how to make a living and have fun," she says.
Playfair provided the answer. Sand joined the firm's small roster of keynote speakers and trainers in 1989, and now she uses comedy and performance to convey Playfair's insights about the power of fun to improve teamwork and productivity. Meanwhile, the opportunity to perform and practice her comedy has served as important therapy for Sand: Her disease is in remission, and she's had no significant relapse in seven years. "My relationship with Playfair lets me be more of who I can be," Sand says.
Playfulness is almost always purposeful, the people at Playfair argue. A great company will harness people's natural spirit of fun and focus that spirit where it can do the most good. "Like children, adults play to learn - and learn through play," says Sand. "There's a profound purpose to it."
Pride Makes It Special
Why choose to work for this company rather than that one? Why attend one college rather than another? Why root for this team rather than that other team? The answer is elemental: We all like to be affiliated with an organization that feeds our sense of pride.
It could be because the place is hip: Talk to the staff people at any House of Blues club, and you'll hear about the pride they take in their company's way of doing business. Or it could be because the place is proper and precise: Talk to the concierge at any Four Seasons hotel, and she'll tell you how proud she is to work for an organization that delivers world-class service. "The few, the proud, the Marines" could be rewritten as a recruiting slogan for any great enterprise that uses its prestige strategically to attract and keep great people - the kind of people who will build on that sense of pride and enhance that sense of prestige.
Pride was a key factor in bringing Kevin Perry, 28, to Red Storm Entertainment Inc. 15 months ago. Red Storm, a Morrisville, North Carolina-based software-development house that creates and markets multimedia entertainment products, including interactive computer games and board games, has already scored a number of accolades in the game industry. Last summer, Red Storm released Rainbow Six, an action-strategy game that was the genesis for the novelist Tom Clancy's recent book of the same name - the first time that a book has been derived from a game. (The book, published this year by Putnam, has topped both the New York Times and USA Today best-seller lists.) Red Storm will release three new games by the end of 1998, and eight more games are incubating for 1999.
Amid all of this creative energy, Perry enjoys a plum assignment: He leads a team charged with creating a new interactive computer game, ruthless.com, which should be out this season. The game, says Perry, replicates the big-money world of modern corporate raiding, blending high-stakes strategy with low-down ruthlessness: "It combines the crushing grip of business expansion with rapier-like strikes of deceit, dirty tricks, and outright crime," he says.
But fast action isn't the only thing that makes Perry proud to be part of Red Storm. He had his choice of firms - including the choice not to commit to any one shop. What made Perry choose to join this company was the fact that Tom Clancy not only works with Red Storm - he also founded the company and chairs its board. "This is a cool place to work," Perry says. And Clancy's involvement "really helps us make a splash. People know that Red Storm is not some flash in the pan run by a 16-year-old out of his garage. Tom's association with the company really opens a lot of doors."
Red Storm Entertainment is quickly gaining a reputation not just for its bread-and-butter Tom Clancy military-strategy games but also as a top-notch developer of other kinds of computer games. The company is riding a virtuous circle: As Red Storm's reputation rises, it attracts more talent (like Perry) - and the more talent it taps, the more its reputation will continue to rise.
A different kind of pride attracts talented people to venerable institutions like Goldman Sachs, Yale University, General Electric, and Covington and Burling, a prestigious law firm in Washington, DC. What these institutions lack in hipness, they more than make up for in old-fashioned prestige. Membership in these enterprises confers status - and status is a form of capital.
But beware: The cycle can shift into reverse if an organization's prestige degenerates, leaving a once-proud brand in its place. Unless a firm continues to add real financial value - or is grounded in a strong ethical mission, in mutual learning, or in fun and excitement - what's "hot" or prestigious today can become unfashionable tomorrow. Status can turn stagnant, and no one wants to be affiliated with an organization that has lost its vital energy. When that happens, talented people can be as easy to lure away as they were to lure in - and the best people are usually the first to go.
Balance Makes It Sustainable
Talk to almost anyone in any company at any level, and you'll hear the same words: "I love what I'm doing, but I'm way too busy to get a life." Equal parts boast and complaint, that is the most pervasive refrain of the new economy. The problem is balance - or, more simply, sanity. And it's the last, but perhaps most important, adhesive that companies are using to lure and keep talented people. The best enterprises know this, and are winning talented people by offering balanced work.
Easy to say it, easy to promise it. What distinguishes the best companies, however, is not that they recognize how important balance is to attracting talent - it's how they create such balance in their organizations. Not long ago, any decent listing of "great places to work" would identify companies large and small that offered a preset "Chinese menu" of programs for balancing work and life: maternity and paternity leave, company-sponsored day care and elder care, regular retreats and periodic sabbaticals, flextime and even flexplace. In the new economy, the kind of balance that attracts people isn't a set of programs. Rather, it's a way of doing business. Balance is deeply embedded in the company's core - a compelling part of its corporate DNA.
Consider Great Plains Software, a leading vendor of financial- management software for midsize companies. Great Plains is headquartered in Fargo, North Dakota, in a two-story office building wedged between corn fields and a bingo parlor - not exactly a hip location. But Great Plains has attracted, developed, and retained some of the most talented people in its line of business. With 850 employees, the company has a turnover rate of 7% a year, which is almost unheard-of in the famously volatile software industry. Great Plains also has a robust revenue stream - bringing in almost $86 million in fiscal 1998, up 50% over 1997 - and a roster of loyal customers, including Adidas, the Detroit Lions, Cinnabon Bakeries, and the Girl Scouts of America.
What's the secret? Great Plains not only offers a balanced life - it lives one. Tami Reller, 34, has been with Great Plains since she graduated from Moorhead State University in Moorhead, Minnesota, in the spring of 1987. Her career with the company, where she began as an intern, is one long testament to the value of flexibility. "I was amazed at the company's level of commitment to helping interns succeed and stay with the company," Reller says. Her first assignment was in the company's finance operation at its headquarters in Fargo. Then she moved to San Francisco to train in sales. After seven years there, Reller felt ready for a move into the ranks of corporate management - but she didn't want to leave California. No problem: Great Plains didn't want her to leave the company either, so it gave her a senior position in corporate marketing and allowed her to telecommute to Fargo - and, by the way, to finish an MBA while working part-time for three months.
That arrangement lasted until 1996, when, for family reasons, Reller moved to Minneapolis. Still no problem: Now she directs finance and investor relations from there. The next development: In a few months, Reller will give birth to her first child. Is she worried about balance? Not a bit - Great Plains lets its people take voluntary time off while keeping benefits.
"For me, balance means having the flexibility to choose what to accomplish and how I want to accomplish it - in my career, my job, my personal life," Reller says. "It's not simply an issue of not working 8-to-5. It's the ability to accomplish the big things in life - like finishing an MBA or having a child."
The Great Plains approach is to hire the best people it can find and then to give them maximum freedom to get their work done - however, whenever, and wherever they choose to work. "We have really smart people who know what they need to accomplish," Reller says. "You find a way to get the work done in the hours that you need. Sometimes that's 30 hours a week; sometimes it's 70 hours a week."
Doug Burgum, 42, Great Plains's chairman and CEO, explains how the system works. "We put people through a vigorous hiring process and through a lot of interviews. Once they're part of the team, we say, 'We trust you.' From day one, you get a key to the building. You get a laptop. You become an equal member of our community, and we trust that you're going to pull your weight."
None of that happens by accident. When Burgum began with the company in 1983, he understood that it needed something more than good software to become competitive. Great Plains's edge would be in the quality of its people - in their ability to provide first-class customer support and to develop strong relationships with suppliers and vendors. How do you attract the best people when your headquarters is in Fargo, North Dakota? By recruiting carefully, selectively, and rigorously - and then by giving those you hire the power to organize their work by themselves.
"Balance is not about taking off the day when your kid gets sick," Burgum says. Any company can give employees that sort of flexibility. "Balance is what's needed when your kids are playing in a softball tournament, and they really want you to be there. We want parents to be able to say yes to their kids. There's a huge amount of value in giving people the opportunity to say yes to things that are important to them but that may conflict with their regular working hours."
For Burgum, the idea of balance goes deeper than simply juggling tasks and appointments. "It's important to have flexibility over a life span or a career span," he says. "There has to be a deeper level of personal satisfaction, a sense that things are all right. If you can help people find that level, they tend to stick around." Burgum is proud of Great Plains's extraordinarily low turnover. "That's no small accomplishment in an industry where so much of a company's assets are linked to individual employees' knowledge," he says.
The 21st-Century Company
What do all of these new enterprises have in common? They are only as good as their most talented people. And they don't take the loyalty of those people for granted. They understand that talented people have never had more options. So these companies have developed strategies to recruit and keep people from whom they want total commitment.
What do the joiners have in common? They could have gone anywhere. They had their pick of the best. Many could have successful careers as free agents. They've chosen to join up - to commit themselves, at least for a time - because the mix of social glue in one organization was overwhelmingly strong.
The big change today, then, is not the absolute demise of loyalty in the workplace. Nor is it the evolution of free agency into the only way that people can work. The basic facts of work life are the same as they've always been: Everybody works for somebody or something - be it a board of directors, a pension fund, a venture capitalist, or a traditional boss. Sooner or later, you're going to have to decide whom you want to work for. And everybody works with someone else. The linkage may be tight, or it may be loose. But you've got to decide who to work with, as well as how strong the bonds of mutual commitment will be.
The big change is in the amount of choice and the variety of experiences available in today's workplace: Talented people are actively shopping for colleagues and bosses who meet their needs and match their values. The market for talent - the sellers of it, the buyers of it - is the most vital market in the modern economy. To attract and keep talented people, companies today are not just experimenting with how they approach the competitive marketplace of goods and services. They're also experimenting with how they approach the competitive marketplace of talent. Companies are testing the attractiveness of various combinations of social glue, and they are recognizing that unusual benefits attract unusual people - and that what works in one industry, or at one time, may not work in another industry, or at another time. Deployed carefully, these social glues become stronger through use: Each can attract talent in a way that makes an enterprise even more attractive to the same kind of talent in the future.
More fundamentally, companies are experimenting with a new operating system for the employer-employee relationship - one to replace the old set of practices that put employers and employees on opposite sides of the table. The model for the organization of the future aims to create tangible and intangible value that both sides can share and enjoy. It accepts as a core reality - rather than as a pleasant fantasy - the old saw that a company's people are its most important asset. And it builds on that reality to create a way of working that is profoundly human and fundamentally humane.
It is a revolutionary notion: Collaboration and mutual advantage are the essence of the organization. They can create flexibility, resiliency, speed, and creativity - the fundamental qualities of the company of the 21st century.
Robert B. Reich (firstname.lastname@example.org), university professor of economic and social policy at Brandeis University and a former U.S. Secretary of Labor, is writing a book about the work of the future.
A version of this article appeared in the November 1998 issue of Fast Company magazine.