Staff Retention & Leadership

Staff Retention & Leadership

Introduction: This topic is easily one of the most discussed areas I came across: how to keep good staff engaged, loyal and productive. Retaining loyal and dedicated staff poses a significant challenge for many organisations.

The most common approach to improve staff retention and engagement seems to fit into the “external” category, i.e., rewards and incentives, such as bonuses, gifts, time off etc., however, to resort to a cliché, this is ignoring the elephant in the room, which is the nature of the relationship between an employee and their direct line manager.

Research, notably from Gallup, sheds light on a critical insight: “70% of the variance in team engagement is determined solely by the manager”, that is, 70% of employees resign due to strained working relationships with their direct line managers.

Gallup’s surveys of over 100,000 employees in more than 2,500 diverse businesses show that “managers trump companies.” Employees’ immediate bosses have far more impact on engagement and performance than whether their companies are rated as great or terrible places to work.

Assuming you accept this research, and if you find your staff attrition rates are exceeding your industry standards, then logically you would look the leadership skills and knowledge of your leadership team if staff retention is a problem.

Bosses Matter: Bosses matter. A lot! Robert Hogan concludes from numerous careful studies, including the Gallup surveys, “people do not quit organisations, they quit bad bosses”. Harmonious working relationships fosters loyalty, engagement, and productivity. When the relationship between employees and their direct line managers is strained, the outcome is increased staff turnover.

What To Do

Leadership Development: Investment in leadership development programs is a proactive measure any organisation can adopt to improve the quality of their leaders. But, not just any leadership program. It needs to be one that understands research-backed insights from psychology, the science of human motivation and peak performance and apply them to building loyalty and improving productivity.

Research has shown how to elevate the performance of every single employee – we don’t have to guess, we know. Fuelling people’s psychological needs by ensuring they are growing at work, feeling connected to their colleagues in a genuine way, and having some say in how they do their jobs. Any effective leadership development program should have these concepts as their foundation, i.e., an absolute focus on the quality of the working relationships, an autonomous-supportive work environment and staff being trained in their role to a high standard and given opportunities to improve, be it through training, mentoring or peer collaboration.

Leadership Selection: One of the most important decisions organisations make is who to appoint as a manager or leader. Take the selection process seriously and focus on their leadership knowledge and skills beyond the usual motherhood statements, such as being “passionate” about leadership or having an open-door policy – look for specific behaviours and identify any gaps and address them early.

Prefer appointing managers and leader from within your organisation. People from within have absorbed the cultural standards and their strengths and weaknesses are known. The challenge with hiring a leader externally is that they can appear to be a near perfect person at the time of hiring – you don’t really know them – and it turns out afterwards that they have the same ratio of strengths and imperfections as the rest of us.

A suggestion that is a bit different, is to get the future team member of the new leader to have a say in the selection process, or at the minimum, get their opinion. This not only taps into the need for autonomy and having a say, but it also gives you some buy-in from them for the new leader. This buy-in has the effect of the team being more invested in making it work, as opposed to the team adopting the attitude that their leader has been foisted on them by people who don’t have to work with the new leader every day.

Staff Survey: Conduct an anonymous survey that is straightforward and not too burdensome on the staff. I recommend asking staff to rate their job satisfaction on a scale of 1 to 10, then get them to list 3 things they like about working at the organisation and 3 areas where there could be improvement. The final question is “If your leader faced a re-election to their role as leader, would you re-elect them?”

Exit Interviews: Whether you think you have a leadership problem or not, exit interviews should be attempted on all exiting staff and preferably by an independent person. This will give you authentic and genuine insights into the reasons behind staff departures that may not be easily shared within the confines of the organisation. Understanding the causes of staff departures is instrumental in shaping targeted strategies for improvement.

Conclusion: There are many reasons why people resign from their job, however, by far the main reason is due to the nature of the relationship between them and their direct line manager or leader. Thus, logic dictates that if you have a staff retention problem you should look at the quality of your leaders. Personally, I think you just assume all leaders can improve their skills and knowledge and as such, I would implement an ongoing leadership program on-site. Staff surveys and exit interviews can be helpful, and a rigorous leadership selection process can be adopted, one that has a preference for internal candidates where possible.

About the Author:

Christopher Apps is an Organisational Psychologist and the owner of Fermion. He stays updated on the latest psychology research and shares evidence-based insights. The focus of Fermion is "Psychometric Testing for Recruitment" and “Recruitment to Retention: How to Select Good Staff & Keep Them”. If you would like to learn how to select good staff and keep them, please feel free to contact us at Fermion.

“Learn from the mistakes of others. You can’t live long enough to make them all yourself.”

Eleanor Roosevelt.