Ideas for Leaders #480

How Early Work Experience Shapes Later Leadership Outlook

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Key Concept

The context of an employee’s first job — specifically, whether occurring in good or bad economic times for their companies — can have a surprising impact on subsequent performance. Employees who learn the skills and habits required to succeed during economic downturns are more likely succeed when the future matches their early work experiences. The reverse is also true: workers whose first jobs occurred during times of abundance encounter greater success in the future during economic upturns.

Idea Summary

Employees just joining the workforce will have different experiences in their first jobs, depending on the economic situation of the firm in which they land. This economic situation makes a major difference in the skills, habits and routines that these first-time employees develop. For example, new workers who arrive during good economic times will have access to high-prestige assignments that can build their skills and reputation — opportunities that are not available to those who arrive during economic downturns.

At the same time, workers who at the beginning of their careers join a firm during lean times may develop some important competencies as a result — for example, learning how to be adaptable and resilient, and working within economic constraints.

New research shows that because of the long-term skills, habits and routines ‘imprinted’ by these first jobs, employees are often more successful in later jobs if they encounter economic conditions similar to their earlier situations. In other words, employees who joined the workforce during tough economic times seem to perform better in subsequent jobs when the economy — or the firm — is suffering; similarly, employees whose early experiences in the workforce took place during boom times perform better in later positions when more resources and greater opportunities are available. In short, congruence between earlier and later experiences leads to subsequent better-than-average performance, while incongruence leads to below average performances.

The early experience of some employees take place in economic situations that are either extremely favourable — the boom times of the 1990s, for example — or extremely unfavourable — such as during the great recession of 2008. When this occurs, their performances as employees or managers in the long-term future are often below average. The reason is that extreme levels of scarcity and constraint or, on the contrary, abundance are rare. Thus it is unlikely that subsequent economic situations in which these employees are working are similar to the extreme situations they encountered in their first jobs. Since the experiences are ‘incongruent,’ and incongruent experiences lead to lower performance, employees who face extreme economic conditions in their early jobs may be doomed to perform at lower-than-average levels in subsequent positions — hence, what researchers refer to as ‘the curse of extremes.’

Business Application

To some extent, when hiring new employees, understanding the economic context of their early experiences can help predict the situations in which the candidates might better succeed. It can also help hiring managers discern the less-obvious skills and talents of a candidate — for example, the resilience and adaptability of candidates whose early work experiences occurred during economic downturns.

In addition, companies, especially those interested in developing long-term employees and future managers, will want to help their young employees avoid the ‘curse of extremes.’ There are several steps that can be taken:

  • Diversify young employees' early work experiences, giving them opportunities to work in situations that more resemble ordinary circumstances.
  • Counterbalance the imprint of good economic times by putting employees who start during times of abundance on one or two slower projects, along with the fast-paced ones.
  • Give employees who start during slow periods the opportunity to move onto fast projects as soon as work picks up.
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Authors

Institutions

Source

Idea conceived

  • February 2015

Idea posted

  • February 2015

DOI number

10.13007/480

Subject

Real Time Analytics