The key to talent retention and productivity?

We’ve all heard the phrase… “People quit bosses, not jobs.”

And there is some truth to this: a recent DDI study suggest that 57% of people quit because of their boss, and 37% reported considering leaving because of their manager. But it’s not the whole story.

Reflecting on my own experience of working within national and private healthcare in the UK, I remember two bosses who inspired a search for new job opportunities. Both managers presided over a fall in productivity and team performance: people were regularly off sick, demotivated, approaching burnout, or leaving. I stayed and endured because I was driven to create change by, perhaps naively, offering support and advice to these managers in the hope they’d transform their approach. These offers were shunned. But I stayed, because I had invested so much of my heart, got a sense of meaning from my own work and developed as a leader along the way.

During this time, I learned a lot about myself, developed skillsets that aligned with my motivations and natural talents, and (at times, painfully) improved my organisational skills. I was also recognised by my colleagues as an expert in my field and easy to get along with.  People came to me to discuss problems with patients, how to improve their interpersonal skills and to find an empathetic ear who would understand and recognise their contributions and talents. Although at this stage in my career I was not a leader but I was certainly growing into one.

To fill the gap left by these ‘bad managers’ and the toxic culture they produced, we turned to each other, connecting more deeply and cohesively, developing friendships and the level of interdependency necessary for high performing teams.  Our tyrannical managers were a common enemy who forced us focus inwards to look after each other and our patients, and encourage each other’s development along the way. Unfortunately, not every organisation is blessed to have a team like this.

Fast forward to today, and after several years of direct leadership experience, coaching and consulting, I’ve learnt that when it comes to attracting and keeping talented people who can transform a business, achieve goals and increase profitability, it’s more to do with the culture of the organisation, how willing they are to develop their people, and the style of leadership they promote, than their protocols, strategies, salaries and bonuses.

Hundreds of books, based on extensive research, show how culture and leadership are the drivers – or detractors – of attracting and keeping the most talented people. And let’s face it, without them, businesses inevitably suffer.

So… what culture does attract the best people, and what makes them stay?

In their 2016 book An Everyone Culture, Robert Kegan and Lisa Laskow-Lahey suggest that organisations prosper when they align their culture with humankind’s greatest motive: to grow. Indeed, the happiest, most fulfilled, motivated and innovative humans you will meet are those who are willing to grow, change, and develop continually. The wealth of developmental psychology knowledge available demonstrates that our development from zygote to death never actually ceases, even when close to death the brain is attempting to make new neural connections. We are designed to learn.

Despite the evidence above, organisations traditionally go to great lengths to create more defined pipelines of development and hierarchal structures that allow individuals to climb the ladder, hopefully achieving promotion after promotion, increasing salary and responsibility along the way. This system has its place in certain task or results-oriented organisations by creating what seems like a practical way to achieve myriad individual tasks and (hopefully) the desired results.

Yet, we know that bonuses reduce performance, that salary doesn’t create loyalty, that protocols kill creativity, and that often promotions can pull people away from using their natural talents where they feel the most competent, motivated, fulfilled, and interested.  People whose growth is supported, in turn will grow the business simply because they are more likely to find innovative solutions to the hardest problems and achieve the greatest results.

Robert and Lisa’s book provides evidence via the case studies of three highly successful companies that chose to align their culture with the natural human propensity for growth and learning to become deliberately developmental organisations (DDOs). The stories of these three companies – Bridgewater Associates, (the most successful hedge fund company of all time), Decurion Cinemas (the highest gross-per-screen cinema in America) and Next Jump (a highly successful travel company) – who took such a leap of faith is detailed in the book, but in short it seems that when you move your focus away from strategy and success and back towards developing people, it’s possible to achieve results that you didn’t think, or know were possible.

All three companies saw substantial drops in employee turnover and significant increases in productivity and profitability. What did they do to make this change? It varied, but Bridgewater for example, implemented radical transparency and feedback mechanisms, and cultivated a culture of continuous learning and improvement, resulting in higher employee satisfaction and retention rates. Employees felt empowered to voice their concerns and contribute to the organization’s evolution, fostering a sense of ownership and commitment.

What can leaders do to become a more deliberately developmental organisation?

Well to be honest, there is no one single answer. It’s about finding the right way for your organisation. However, remember that it’s also possible to be a DDO AND a conventionally successful company – the concepts can co-exist.

That said, here are some practical actions for leaders to create a more human development-oriented workplace that will attract and retain the right people.

7 Action Points for Leaders:

1. Create a culture of psychological safety: Foster an environment where employees feel safe to express themselves, share ideas, and take risks without fear of judgment or reprisal.
2. Promote authentic leadership: Lead by example, demonstrating vulnerability, empathy, and authenticity in your interactions with employees.
3. Provide opportunities for growth and development: Invest in training, mentorship, and coaching programs that support employees’ professional and personal growth.
4. Foster meaningful relationships: Encourage collaboration, teamwork, and social connections among employees to foster a sense of belonging and camaraderie.
5. Align organisational values with employee values: To foster a sense of purpose and alignment between personal and professional values.
6. Offer flexibility and autonomy: Provide opportunities for employees to have autonomy over their work schedules, tasks, and projects, promoting a sense of ownership and empowerment.
7. Celebrate achievements and recognise contributions: Acknowledge employees’ accomplishments publicly and privately to reinforce a culture of gratitude and recognition.

Making a significant improvement to talent attraction and retention rates is a far more complicated endeavour than salaries, perks and collaboration software. It also extends beyond bad managers. Real retention and productivity gains require leaders to gain a deep understanding of human development, organisational culture and leadership dynamics. By embracing a deliberately developmental approach and creating environments that actively drive employees’ growth and well-being, organisations can cultivate a loyal and engaged workforce who see learning as a key part of their job, creating a thriving business in return.

If you would like support in putting these principles into practice to create a prosperous, meaningful future, we’d love to explore this with you. Simply book a discovery call with one of our consultants.