The Berggruen Institute's Dawn Nakagawa recently spoke with LinkedIn co-founder, Reid Hoffman.
Technology-driven change is transforming the economic landscape and our social values along with it. What do you see as the most important upcoming changes to the economy and to labor markets in the coming years?
There are two key technological forces. The most important fundamental change is the acceleration of networks in various areas, industries and regions, globally. The increased connectivity has increased the spread of capital and has made it much easier to do business across borders. Amazon, Alibaba, and LinkedIn are examples of this. New networks are springing up and spreading quickly such as Airbnb, Lyft and Uber. A second fundamental technological force is increased automation and the development of powerful new software tools. These tools expand the capability of machines both to work autonomously and to enhance worker productivity. So these forces are changing the patterns of work production, work distribution and work consumption across the economy
Recently there has been robust public dialogue about the potential for machines to permanently replace human labor. What do you think about concerns that technology will leave a lot of people out of work and further exacerbate inequality?
The effects of technology, especially in terms of rapid globalization, are going to be widespread. Technological development and deployment continues to accelerate. There will be serious impact upon the work of the middle class. As with past technological revolutions, I also believe that the middle class will be able to adapt and adjust. The question is: How do we make that journey back to a balance less painful and more productive? It is our responsibility as a society to figure out ways to deploy technology that benefits the middle class and alleviates the pain of disruption. Unlike some of the voices in this debate, I believe that technology can be a force for good, providing many new opportunities to enhance and amplify capabilities that are uniquely human.
What role does government have in easing and facilitating the transition?
Part of a government's function is convening leaders to consider challenges, ideate and build out solutions. Governments can support the development of alternative industries with various incentives. The conditions that favor entrepreneurship need to be fostered -- for example, this correlates to appropriate immigration policy. I am not in favor of government intervention that tries to prevent these new ideas that the market clearly likes and that provide employment. We need policies and programs that enable people to take their own adaptation in hand. We need to invest in technologies that amplify human capacity, not replace it.
In The Alliance: Managing Talent in the Networked Age, you describe a "tour of duty" approach to the employer-employee relationship. Explain briefly how this differs from today, and why it is necessary in the networked age?
Because of all of the changes we have previously talked about, companies have to operate differently today, and people have to act like the entrepreneurs of their own careers. In the past, individuals and companies envisioned a lifetime mutual commitment. That's not realistic anymore -- nor is it in the interest of either party. So both parties need a more adaptable way to engage each other and co-invest over shorter periods of time for mutual benefit.
But doesn't entering into such a short-term relationship rely on a much higher level of transparency and honesty than we see in the hiring process today? How do we change that?
It has to start with leadership -- the CEO -- creating a culture of much greater transparency and honesty. Many employer-employee relationships are built on a lie that starts from the first interaction: neither party automatically conceives of the relationship as something that will last a lifetime, but both interact as if it is. This lie of omission bases the relationship on distrust. It is possible to create organizational culture characterized by a much higher degree of trust, and the Alliance provides frameworks for managers and leaders to do so. At LinkedIn, one of the questions we ask candidates is: "What do you want your next job to be?"
Making this shift common practice will require a much more open conversation within society about what one should expect from one's career, about how companies need to operate, and about how markets work.
Research has found that millennials have a different concept of a "successful" life than did the previous generations. Material wealth is less significant than having impact and participating in projects that they believe to be important. Do you think they are ready to engage this way?
Yes, they are quite well equipped for transition. They understand adaptation and flexibility. They are mission-driven and generally do not expect to be with the same company for years and years, so they get it. However, they can have a tendency to be too transactional and can underestimate the need to actually follow through on the "tour of duty" once they have committed. Trust flows both ways and betraying it can have negative ramifications for their own goals.
In this networked, information-abundant, mobile world that never powers down, how does Reid Hoffman find peace? What tactics do you use to keep from burning out?
I believe in active rest. I usually allocate time each week to work on topics outside of the normal workflow. These topics can be multi-year strategies for work, theories of how the world is changing, or just something refreshingly different or new. The work can be either disconnecting from communications and thinking quietly with books, paper, and pens -- or sitting with a few friends and colleagues for an intense conversation. This activity -- taking the time to think broadly, and generally on new things -- helps rejuvenate me.