Companies' most neglected resource for success

November 7, 2013: 11:33 AM ET

Many companies overlook one of the most closely connected and valuable networks available to them: ex-employees, retirees, and even former partners and clients

By John Hagel and John Seely Brown

FORTUNE -- When Procter & Gamble (PG) needed a leader to guide the company back to growth in a hyper-competitive environment, it turned to someone who knew the company intimately -- an alumnus.

Having left the company just a few years before, A.G. Lafley was, like many alumni, uniquely suited to help his former firm. He came into the job with a wealth of tacit knowledge -- the "know how" rooted in experience -- and a deep connection to the organization.

Many companies overlook one of the most closely connected and valuable networks available to them: ex-employees, retirees, and even former partners and clients who already have experience with the organization. These alumni know the capabilities and the culture of the organization and the industry while also bringing outside expertise and connections that current employees might not have.

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Few companies do this well. Instead, we tend to think of alumni networks in the context of universities. Even among universities, few engage alumni beyond fundraising and, to a lesser extent, recruiting, networking, and career services. Likewise, top consultancies maintain alumni networks, but few do it in a way that delivers real benefits to participants and the firm.

Some of the best models for alumni engagement come from the non-academic, post-graduate programs focused on public service (Coro Fellows Program in Public Affairs), public education (Broad Residency), and technology (Singularity University). These programs include a formal training component and often place participants in temporary job assignments. However, the organizations also focus on shaping a sector and developing a network to amplify their influence. These goals provide a rationale for a structured alumni program.

An alumni program has to create value, such as continuing education or skills development, job placement and recruiting support, mentoring and reverse mentoring -- for the participants as well as the organization. The Coro Fellows Program in Public Affairs, which is designed to train leaders in civic and nonprofit work, offers an Alumni Toolbox to help past participants refresh their skills and gain new ones and learn new techniques from other alumni. The Broad Residency uses alumni advisors to guide current fellows both in their on-the-job challenges and in career planning.

In several major cities, the local Coro Leadership Network hosts quarterly speaker events. The Broad Residency builds on the relationships formed over the two-year fellowship with an annual Forum where alumni come together to participate in discussions on education.

An alumni program that encourages both past and current employees to work together across organizational boundaries is more likely to succeed. Exposing alumni to the biggest challenges and concerns the organization faces can encourage participants to self-organize -- into working groups or even business ventures.

The self-directed Singularity University alumni groups keep the school's globally dispersed alumni (approximately 85% from outside the U.S.) engaged and moving forward on their specific initiatives after the 10-week summer program ends.

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For companies, the alumni program that will have the most enduring impact -- a network that the company can turn to for resources, expertise, and partnership -- also requires time to develop. As a first step, companies can invite alumni to manage significant parts of the alumni activities, from moderating discussion boards to planning events. The Coro National Alumni Association has a 30-member board to guide its efforts. Singularity University has appointed alumni "ambassadors" in 40 countries who organize local activities and meet-ups. Alumni of the Broad Residency review the thousands of resumes submitted to the program each year and participate in recruiting (approximately half of accepted residents come from alumni nominations). Broad alumni also help plan meetings for school administrators and superintendents from the program and teach formal sessions at the two-year education program.

For many organizations, regardless of size or mission, alumni represent the best, closest network of resources. Through a diverse network that creates opportunities for all participants, a company can learn and develop new abilities faster, exactly the type of learning organizations need. But encouraging individuals to participate in such a community requires a deliberate effort.

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About These Authors
John Hagel III and John Seely Brown
John Hagel III and John Seely Brown

John Hagel III is co-chairman and John Seely Brown is independent co-chairman of the Silicon Valley-based Deloitte Center for the Edge, which conducts research to support corporate growth. Hagel has nearly 30 years experience as a management consultant, author, speaker and entrepreneur. From 1984 to 2000, Hagel was a principal at McKinsey & Co., where he was a leader of its strategy practice. Brown is a visiting scholar and advisor to the provost at the University of Southern California. He was the chief scientist of Xerox Corporation and the director of its Palo Alto Research Center. Brown holds several patents and was inducted into the Industry Hall of Fame in 2004.

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