Business

5 reasons why companies should launch an alumni network

Shot of a group of businesspeople sitting together in a meeting; alumni networks

Alumni networks can benefit organizations in multiple ways. Image: Getty Images

Uxio Malvido
Head of People & Culture, Chief HR Officer, World Economic Forum
Jaci Eisenberg
Head of Alumni Relations, World Economic Forum
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  • Companies that create alumni networks of former employees can reap benefits when it comes to recruitment, collaboration and improving their offering.
  • Keeping in touch can also encourage alumni to return to work for an organization, often bringing new ideas, experience and contacts that they can combine with their existing knowledge of the business to great effect.
  • As the World Economic Forum launches its own alumni progamme, here are some great reasons to keep in touch with former employees.

For many, the word “alumni” might evoke a sense of belonging to one’s alma mater – fond memories of rich intellectual discussions, the big homecoming game, friends for life – and continued reminders to stay connected with and support your university.

Over the past two decades, however, corporations have started to launch alumni networks for their former employees. There was a particularly noticeable uptick in such efforts after the COVID pandemic, according to PeoplePath, an alumni management software provider, and the University of British Columbia’s 2022 Corporate Alumni Benchmarking Report.

Here are the five main reasons why the World Economic Forum is launching its own alumni programme, and why we think other organizations should consider doing the same:

1. Make departures a natural part of the employee experience

Today, talent is constantly on the move. Most of us will have multiple jobs during our lifetimes thanks to the rise of skills-based organizations. Some people will even develop multiple careers with the emergence of the multi-stage life. Career transitions and professional breaks are becoming the new norm.

In this context, preparing for employee departures can become a critical component of a well-designed talent management strategy. Traditionally, employers have thought about how they welcome employees into their organization, and how to manage the employee experience. Departures may not be organized with as much care, however.

That’s a critical mistake. The “peak-end rule”, documented by Nobel laureate Daniel Kahneman, tells us that people remember an experience based on how they felt at its peak and at its end. Not focusing on the exit can leave a less than optimal impression among leavers and ruin a well-crafted employee experience.

2. Use rehires for talent acquisition

At the Forum, former employees have made up 14% on average of our global intake over the last three years, according to our internal figures. We expect our alumni programme to nudge this figure up even further.

So-called “boomerang hires” – leavers that return to a company at a future date – often possess a wealth of both internal and external knowledge, making them a very valuable resource. They bring new skills and resources developed at other organizations, together with their previous knowledge and experience of their current organization’s culture, processes and internal network.

This speeds up their workplace contributions, reduces hiring costs and improves the average retention rate. EnterpriseAlumni, an alumni management software provider, reports a 44% higher retention rate for alumni rehires after three years of service than for new hires over the same time period.

Alumni can also be a key part of your employer brand, thought to contribute as much as nearly half of an organization's overall score on Glassdoor. A rising tide lifts all boats: when the reputation of the organization is strong, so too is the reputation of each individual alumnus. Academic Maria Gallo makes this point compellingly in her book, The Alumni Way, writing about universities: “As alumni, we are also lifelong shareholders in our alma mater. As an alumni shareholder, we have a vested interest in the reputation and advancement of our university.”

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3. Tap into your best advocates

Your former employees know why the work you do is important. After all, as employees they were ambassadors of your organization’s mission, vision and bottom line. This doesn’t have to stop once they leave for new pastures. Through carefully calibrated communications such as a regular newsletter, you can empower your alumni to continue advocating for your organization.

Ex-employees are also valuable mediators between their former employer and their new careers and knowledge. Alumni can identify mutually beneficial opportunities and unlock partnership discussions in their new roles. They can share updates on industry trends, contributing trusted information to your business intelligence efforts.

At the very least, forward-thinking organizations should actively cultivate relationships with alumni working with their clients. EnterpriseAlumni reports that 83% of alumni would do business with their former employer and 79% would refer business to them.

4. Foster a community of common purpose

In their 2018 Corporate Alumni Network Benchmarking Report, PeoplePath and Cornell University identified five drivers of engagement in alumni programmes: pragmatism, mission, social connection, product focus and career development.

Alumni networks have the potential to support all these drivers, but there is a particularly fruitful opportunity to provide meaningful connection around the mission of the organization and the social connection woven by this common mission. A mission-driven employee will not become a mission-less employee when they depart – their mission-focus will continue drive them in their new careers.

5. Improve your own organization through alumni feedback

A final reason to invest in your alumni relations is to be able to factor in their views as you develop and test new ideas and products or as you transform your own organization.

This step requires companies to formally structure relations with their alumni, just as you would do with any other key stakeholder group. After all, your alumni know you well and they most likely have ideas on how you could do better.

Have you read?

At the World Economic Forum, we attract some of the brightest global talent to our mission of improving the state of the world. We know that commitment to this mission follows our alumni wherever they go next. Your organization hopefully already supports employees that want to develop their careers, but by keeping in touch with them if they leave, you can continue to benefit from their experience, skills and passion – and perhaps even welcome them back one day.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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