Companies are trying to retain employees through better pay, flexible working conditions, and emphasis on the corporate mission. These are not proving successful because the real problem is people’s engagement with the work they actually do. This piece identifies what companies should focus on in their attempt to retain key talent: make the work itself more interesting, link the individual’s work to the mission, and build learning into that work.
In the aftermath of Covid-19, many companies have boosted pay, and offered greater flexibility in order to recruit and retain the best people. At some, senior leaders have attempted to inspire employees by emphasizing a corporate purpose or mission, in the same hope.
But these initiatives haven’t had much impact on aggregate quit rates. The data shows that U.S. employee turnover was rising steadily before the pandemic and then spiked in 2021. Meanwhile companies that tried to attract people with promises of higher pay and/or greater flexibility are finding it harder to keep those hires: A recent Harris poll indicates that 20% of employees who left their jobs in 2021 to join other companies for those reasons now regret their decision.
Sure, we want the basics. We want to feel safe in the workplace, have the resources we need to be productive, be rewarded fairly, and have some flexibility in where, when and how we do our jobs. We like working for companies that take values seriously. But while these factors can make the difference between employees being satisfied or dissatisfied, they are not enough to drive high levels of loyalty and retention.
In our work with clients, we see companies taking three actions to create purposeful work for their employees:
1. Make work interesting.
It’s hard for employees to find purpose in their work, if they are bored doing it. Employees need to devote most of their time to challenging and enjoyable elements of their jobs and as little time as possible to mundane tasks.
Technology can help. Consider Walmart. The world’s largest retailer is spending millions on “smart assistants” to make stores run more smoothly. These new technologies allow Walmart associates to minimize the time they spend on monotonous and repetitive tasks, like cleaning floors and checking inventory on the shelf, and dedicate more time to elements of the job for which they are uniquely qualified: serving customers face to face on the sales floor.
Walmart has seen these measures yield measurable results. For example, over the last 4+ years, the company has experienced significantly lower average attrition of managers, according to research available in a subscription newsletter from Revelio Labs, versus the retail industry overall, which has seen attrition rates upwards of 23% for distribution positions and 18% for corporate management positions.
2. Connect jobs to the company’s mission.
To stick around, employees must believe that they play a role in completing a worthwhile mission. Employees must feel connected to their work and the mission it supports.
USAA is a case in point. The San Antonio-based financial services company has taken steps to consciously connect its workforce to its mission of serving military members and their families. Thousands of USAA employees have gone through mock boot camps, complete with drill sergeants and physically demanding tasks. This unique training not only helps employees understand the culture of the military, it connects them to USAA’s mission.
The results for customers and employees have been impressive. USAA’s Net Promoter Score — a measure of customer loyalty — is four times higher than the industry average. Furthermore, 87% of USAA employees indicate they are proud to tell others that they work at USAA. And when employees are asked what makes USAA a great place to work, the company’s mission stands out as the prominent reason.
3. Build learning opportunities into work.
No one wants to feel like they are stagnating in their jobs. Most employees want the opportunity to learn and grow at work, every day. Employers need to build continuous learning and growth into every employee’s job.
Shopify, a multinational e-commerce company headquartered in Ottawa, Ontario, lives by the motto: “Build for the long-term. Thrive on change. Be a constant learner.” In 2018, the company introduced two parallel career tracks, an individual contributor track and a manager track, to foster an environment on continuous learning. This framework allowed Shopify to adapt career paths to each employee’s strengths and life circumstances. It also offered employees the flexibility to move across disciplines and roles and even switch “tracks” in order to find roles that feel most exciting and meaningful to them. As a result, employees at Shopify can continue to learn, every day on the job, be it as a staff UX researcher or project team leader at the company.
The framework has proven to be a big success, thus far. In comparison to other e-commerce and technology companies, Shopify has significantly higher employee advocacy, as reported by Glassdoor. And its employee retention rate is the highest in its peer group.
In our experience, these actions can go a long way in making work purposeful, resulting in higher levels of workforce productivity, more loyal employees and much lower employee attrition.
Today’s satisfied but unengaged worker is someone else’s future employee. To remain committed to their employer, employees must believe: My work has purpose and I find purpose in my work. In differentiating themselves, companies should focus less on providing greater pay, flexibility, and benefits, which will increasingly become standard practice. Instead, they should turn their attention to improving the intrinsic value of work itself. If they do, they will discover that purposeful work is the new secret weapon to winning the war for talent.