Understanding Employee Retention: People Are Loyal to People, Not Organizations
The Great Resignation which has occurred over the past two years is not just an abstract concept – it impacts our everyday lives. Lack of service (calling the customer service department of any major company results in a minimum of twenty minutes on hold), restaurants closing due to lack of sufficient employees, delays in residential construction because there aren’t enough tradesmen to do the work, wait times of months when ordering appliances – the list seems endless.
Whether the pattern of continued resignations will continue is not clear. But it appears we have moved from the Great Resignation to the Great Migration. Employees are still leaving their current jobs and moving on – either to a new organization, or more and more, to a new career. The medical field (especially nursing) is seeing medical providers leave in droves to different types of work. The same is true for education – where teachers are saying, “I’ve had enough!”
So it’s critical for organizational leaders to figure out (quickly) how to retain their current employees. If they don’t, a negative spiral can develop: marginally acceptable number of employees → increased demand on current employees → employees become stressed → some employees quit → more stress on administrators and remaining staff → negative relational behaviors increase → inadequate staff to meet daily demands → increased problems and complaints from customers → loss of customers → reduced revenue → inability to reward remaining employees with bonuses → disintegration of company culture and functioning → ???
One Problem: Misunderstanding Employee Retention
Obviously, there are numerous factors that have contributed to the current employment zeitgeist. One key component is the misunderstanding of what “keeps” employees at their current workplaces. This lack of accurate understanding has led to numerous actions by leaders to retain their current staff which have misfired, and thus, added to the ongoing problem.
1. More money, by itself, does not keep employees (for long). Decades of research have shown that money is a relatively effective short-term motivator, but is a poor long-term satisfier for employees. That is, if an employee gets a raise or a bonus, it will keep them for a while, but if other factors (stress, negativity, toxic leaders) continue, the employee eventually leaves. (Chapter 2 of our book The 5 Languages of Appreciation in the Workplace provides more than 50 research citations confirming this point.)
2. Connecting employees to the mission, vision and values of a company isn’t enough for employees to stick around. Simple logic helps here. Employees are people, not tools, resources, or work units. People are relational. While purpose and meaningful work are motivators, they are at a higher conceptual level than our daily social needs. We must remember that people are far more connected (and committed) to other people than they are to organizations. As Stephen Covey wrote in The Seven Habits of Highly Effective People, “Next to physical survival, the greatest need of a human being is psychological survival, to be understood, to be affirmed, to be validated, to be appreciated.”
3. When people are connected to others through positive relationships, they stay at their current job longer. A recent study by MIT found that during the recent Great Resignation, employees were over 4x more likely to leave their job due to a toxic work culture than for more money. Prior research found that 79% of employees who quit their jobs voluntarily cited not feeling appreciated as a key factor for their leaving. Another recent study found that 58% of employees report they would consider leaving their job if they didn’t feel connected.
The lesson to learn? If you want to keep the employees you have, you better pay attention to them as people. Create activities for team members to get to know one another better – bring in lunch, eat together, and answer some light ice breaker questions (“what did you do as a kid when it was nice outside?”). Don’t get together and talk about work! Utilize the resources we’ve put together to help them learn how to encourage and communicate authentic appreciation to one another. Focus on building personal connections between colleagues – doing so will yield all kinds of benefits – to the team members and to your organization!Tags: Employee retention, Great Resignation, loyalty
Categories 5 Languages of Appreciation, Appreciation, Managing By Appreciation, Workplace Culture