Do your employees like working for you? If you’re not sure, you may want to find out. This month, some 3.1 million Americans will quit their jobs—a number that has been rising steadily since its low of 1.6 million during the Great Recession.
It’s good news for everyone that the economy is stronger—but bad news for business when employees, especially top talent, walk out the door. Research suggests that turnover negatively effects profitability, productivity, growth, morale, and more. And, the cost of a single lost employee can be as much as twice the exiting employees’ salary.
At Great Place to Work, we’ve spent the past two decades studying what makes a workplace one that people don’t want to leave. Among the list of the 100 Best Companies to Work For that we produce each year in partnership with Fortune magazine, voluntary turnover rates are about half that of industry peers. These companies also report stock returns nearly three times the market average, increased levels of innovation, customer satisfaction, productivity and more.
“one of the leading drivers of whether people plan a long-term future with their companies—above training, promotions and pay even—is a sense of meaning at work.”
What can we learn from these companies about what makes people stay on board? The answer might not be what you think.
1. Make sure everyone’s clear on “why”. Our research of the best companies, representing about 3.5 million U.S. employees, shows one of the leading drivers of whether people plan a long-term future with their companies—above training, promotions and pay even—is a sense of meaning at work.
As CEO, part of your job is to keep the vision and strategy of your company in front of ALL employees so it drives them in the same way it drives you. Your leadership team also should understand their role in helping employees feel excited to come into work each morning—because they’re fired up about what you’re doing together.
At WP Engine, a recognized Best Workplace from the tech industry, all employees receive financial literacy training, have a clear understanding of company goals and their role in achieving them, and are given monthly financial updates. This helps each employee see how they personally contribute to the company’s overall success.
2. Make culture a strategic priority. The top driver of employees’ intent to stay at their company is whether they believe it’s a great place to work. At the heart of a great workplace is employees’ deep sense of trust in their leaders, which is built by being credible, treating everyone with respect (no matter who they are, or what they do for the company), and maintaining an environment of fairness for all.
At Cisco, which has been named to every FORTUNE 100 Best list since 1998, Chairman John Chambers told us, “While some people view culture as not a key ownership requirement for the CEO, I respectfully disagree. I think it is the foundation.”
Building the kind of trust-based culture that’s needed to sustain a great workplace isn’t just your job, but the job of your entire executive team, and every leader and manager. And for this work to take hold, it needs to be a strategic priority for the entire organization.
3. Know where your leaders stand. Even the best workplaces have pockets of employees having a bad experience with their manager, and it’s in a CEO’s best interest to find out where this is happening so you can help those leaders improve. Not only will it make your employees’ lives better, but it’s good for business. Within individual business units, financial performance, innovation, productivity and retention are closely linked to whether people believe their immediate manager is a “For All” leader—that is, one who builds a consistently great experience for everyone on the team.
However, leaders who don’t know where they stand can’t become the leader their employees—and the business—needs them to be. This evolution starts with gaining an accurate understanding of employees’ actual experience of them, and then taking targeted action to make changes in response to that feedback. This way, leaders across the company can build the kind of workplace where all employees look forward to giving their best to each day.
If these ideas sound challenging, you’re right. They are. But given the many rewards to be had—from improved retention, to better financials, to simply doing right by employees—it’s a challenge well worth taking on.