Early this year Silicon Valley started buzzing about talented workers heading back to the comfort zone: from smaller, edgier companies to bigger, more established ones.

It was a classic flight to labor market safety. As the U.S. economy threatened to dip into recession—potentially taking riskier, entrepreneurial companies out of business—talented workers, fearing for their jobs, made a temporary migration to safer havens.

Emphasis on the word temporary. Once the economy starts to recover, these very same workers will likely again be tempted by smaller, faster-growing companies. Not just for the equity stake and entrepreneurial atmosphere, but for the professional development opportunities. Countless surveys show that talented workers at nearly every level of the organization rank professional growth well above compensation. But helping talented professionals develop is something big companies don’t always do so well.

Most big companies focus on attracting and retaining talent and forget that helping employees grow in their professional careers is precisely the best way to appeal to and hold on to them. Consider how most of us manage our own careers. We look for companies that provide opportunities for us to learn, develop and succeed. When word spreads that a company is a place for talent to thrive, we seek that company out. Once hired, we become less vulnerable to competing offers: we know our value in the labor market increases most rapidly where we can develop our abilities the fastest. Developing talent is the best way to attract and retain it.

At most big companies, unfortunately, talent development begins and ends with formal training programs. These have their place, but talented workers learn best and fastest not in classrooms but by interacting with diverse people in varied and demanding situations. Some of those people are inside the four walls of the enterprise, to be sure, but many more of them work outside the company in broad talent networks that don’t map to any one institution or geography. By deliberately building talent networks beyond their own four walls, companies can help attract best-in-class business partners and provide maximum opportunity for their own talent to develop more rapidly.

Top line growth is also crucial for talent development. Relative to their slower-growing peers, growth companies more frequently place their employees in new and challenging roles. Low- growth firms are often vulnerable to talent erosion as employees seek more rapid development opportunities elsewhere—precisely the difficulty Silicon Valley incumbents will reencounter as the economy reheats.

Talent issues have rightly moved to the top of the senior management agenda. Talent is both scarce and a source of competitive advantage. Being a safe haven for talent in a down-cycle economy may help big companies feel like they’re getting the talent they need. Once the economic cycle turns, however, big companies will need more deliberate efforts to develop their talented employees.

Lang Davison
Editor at large