Gratitude: A Critical Strategy for Talent Retention

At TNM, we believe gratitude has the power to improve every part of our lives. Yet, it’s often overlooked as a strategy for keeping top talent. While career growth, pay rises, and development opportunities are vital, they aren’t always enough to keep your best people in their roles – That’s where gratitude comes in.

When we talk about gratitude, we don’t mean the ubiquitous courtesy ‘thank you’ at the end of every email. We’re talking about a permanent aspect of culture that is driven by leadership throughout the organisation which facilitates meaningful ways to reflect on, and show appreciation for, people’s contributions. This focus on gratitude helps address talent retention challenges at their core.

Below, you’ll discover why it’s important, and a number of talent retention best practices you can start today.

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Why gratitude should be a business priority

It might feel like common sense, but research has shown that workers who feel appreciated and show gratitude to others are happier and more connected to their work, supporting talent attraction and retention efforts. A Melbourne University study uncovered that:

“There is convincing evidence to show gratitude interventions promote wellbeing in many different samples and settings. The results also suggest that employees gain benefit, in the form of greater job satisfaction, through belonging to a workplace culture that endorses gratitude (Emmons, 2003).”

Unsurprisingly, gratitude has a positive impact on how much effort employee’s put in, and how willing they are to stay in a role. Glassdoor’s Employee Appreciation Survey found over half (53%) of employees would stay longer in a job if they felt more appreciation from their manager while a study by the Society for Human Resource Management revealed that 68% of HR professionals believed that employee recognition had an impact on talent retention. Furthermore, 81% of employees also admitted that they are willing to work harder when their manager shows appreciation for their work, while only 38% who would work harder for a demanding boss. This highlights the importance of gratitude for critical talent retention.

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How to use gratitude for talent retention and growth: tackling talent retention challenges

All of the ideas below are quite simple to implement, however success rests on any acts of gratitude being heartfelt and genuine each and every time. When done authentically, these practices foster a deeper sense of engagement, supporting critical talent retention and enhancing talent attraction and retention across the organisation.

Talent retention best practices: Incorporate gratitude into 1:1 meetings and performance reviews

For this to be effective, managers need to be specific, going into detail about what was done well and why, and telling the employee how their efforts made them feel – reassured, relaxed, and confident. This is meaningful as it ties gratitude to something they’ve personally invested in and encourages them to strive for this in the future.

Managers can then use a gratitude lens to talk about challenging projects or situations, asking questions such as:

• What did this challenge teach you about yourself and others?
• What did you learn that will help you do things differently next time?
• Has the challenge uncovered something you are grateful for within yourself or external to you?

Build a culture of gratitude for critical talent retention

Cultural change around gratitude may take longer, but it has more sustainable, and far-reaching results. Gratitude at work (communal gratitude) encourages pro-social behaviour by improving feelings of self-efficacy and self-worth. Essentially, the ‘spillover effect’ of gratitude sees: “Individuals become more trusting with each other and more likely to help each other out,” according to Forbes.

This approach is among the most impactful talent retention best practices, as it addresses common talent retention challenges and bolsters talent attraction and retention across the organisation. The more appreciation that is shown, the more it is replicated, creating a self-sustaining behaviour that embeds itself in the organisation’s culture. Gratitude is infectious, and according to the Melbourne University study, the effects of this contagious nature can influence job satisfaction for every employee in the organisation.

In particular, gratitude that is expressed publicly is incredibly powerful. Start by encouraging people to show appreciation when giving project updates, even for the smallest things like covering while someone had to go off sick, mucking in when it gets busy, jumping in for a high priority project, or sourcing hard-to-find information.

Leaders can then encourage gratitude on a communal level by:

• Setting a regular day each week for showing appreciation to others via an internal communication channel such as Teams, Engage (Yammer), or Slack.
• A weekly thank you video from the CEO or directors which calls out people’s achievements.
• Adding a permanent agenda item for messages of gratitude/recognition at the start of all-hands or department-wide meetings.
• Allocating time each month or quarter for people to hand-write thank you notes to someone who made a big difference to them.
• A surprise thank you lunch (paid for by the company) every so often – unexpected treats are valued by employees, and bring people together.

Equip leaders and managers with the right mindset and tools

Leaders may be grateful at heart but may not know how to communicate their gratitude meaningfully. Developing this skill is essential for critical talent retention, as it addresses talent retention challenges that often arise from lack of recognition. They may need coaching to establish their own gratitude mindset so they can do the same for others. Peer coaches or executive coaches can help through tailored coaching tools and exercises such as our gratitude journal prompts that encourage leaders to:

1. Be thankful for the smallest things.
2. Show gratitude for the first things that come to mind and then go deeper.
3. Show gratitude for others by asking themselves “How can I go beyond ‘thank you’ to show appreciation in a way that is meaningful for that person.”
4. Take care of yourself and get enough sleep – it’s hard to be grateful when you’re hungry, tired, and unwell.

When leaders cultivate these practices, they strengthen talent attraction and retention by fostering a workplace culture of genuine appreciation. If they’re at a loss for words? This HBR article has some conversation openers.

Show appreciation when things don’t go right

Whether because of internal issues or external factors beyond our control, sometimes work doesn’t turn out as we expected: a marketing campaign doesn’t hit the mark, the sales team doesn’t make their targets, or a new product isn’t a success.

Still, showing gratitude in these moments is essential for critical talent retention, as it confronts talent retention challenges by ensuring employees feel valued even when outcomes fall short. Rather than admonishing employees who have put in a tremendous amount of hard work and creativity for a failure or poor outcome, leaders have an opportunity to make appreciation-based project debriefs a permanent part of their processes. It’s a time for them to sit down with employees to recognise their efforts, and reflect on what went well, what didn’t, and the lessons they can be grateful for.

Emphasising gratitude during difficult times enhances talent attraction and retention, strengthening your organisation’s resilience and overall success. The gratitude initiatives outlined above are simple and cost-effective, but as the research shows, the benefits are long-lasting and prevent you from losing the talented people on whom your organisation’s success depends.

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Interested in finding out more?

TNM Coaching develops leaders of all levels in the organisation, resulting in well-rounded, prepared leaders capable of building happy, productive teams.

If you would like to explore how we can support talent retention in your organisation through training and coaching, we’d be delighted to share our insights and experience with you – simply book a discovery call for a no-obligation conversation with one of our team.