Improving Employee Retention Through Leadership Development
Millennials have gained a reputation as restless employees, who are willing to try new companies when they don’t get what they want out of their current employer. They might be, so to speak, the canary in the coal mine for companies that have issues with retention.
In order to retain both younger and older employees, businesses may need to spend more time figuring out what their workers want and then delivering it in an effective way. One thing that most workers want is an opportunity to advance in their career, thus leadership development is an important component of that.
Why Focus on Leadership Development to Improve Retention?
In a Harvard Business Review article, Gallup asked workers from different generations what they found extremely important about a new job:
- About 60 percent of younger workers said they wanted an opportunity to grow, and about half hoped to have a chance to progress further along in their careers.
- Baby Boomers and Gen Xers also found these factors important, but they didn’t put quite the same emphasis on them.
- Workers of all ages cared about management quality.
In a survey recently discussed by Eric Spicer of Arizona State University, employees said that leadership development opportunities can keep them more motivated and content. Spicer also discussed the fact that high turnover can significantly reduce profits and even threaten an organization’s sustainability. There’s little doubt that investing in leadership development helps improve employee morale and loyalty; at the same time, it helps companies enjoy a competitive advantage in the marketplace because of lower turnover and better management.
Developing Effective Leadership Development
According to McKinsey, most CEOs rate leadership development as a priority yet at the same time, very few CEOs are currently satisfied with their own company’s efforts. McKinsey offers these tips to develop effective leaders:
- Matching programs to real-world situations in a specific company
- Recognizing that changing behavior may require changing attitudes
- Measuring results and adjusting accordingly
Companies also need to recognize that every employee won’t make a great manager. According to Gallup research, companies aren’t always very good about selecting people to groom for management. Only about 10 percent of employees have the characteristics to become great managers, and perhaps another 10 percent could become decent managers with proper training.
Most companies do employ the next generation of great managers, but they probably only have a few. In addition, businesses have to understand that the most productive employee won’t always be the best candidate to manage other employees. Current managers need to recognize the characteristics of good managers and groom them appropriately.
Leadership Development is Not One-Size-Fits-All for Every Employee
Great potential managers may be rare; however, this news isn’t as bad at it seems. Harvard Business Review found that only about one-third of workers actually hope to get promoted to management, and far less have the ambition to occupy an executive suite. While most employees want a chance to progress in their careers and perhaps, become better leaders, they don’t all want to management to be the main focus of their job description.
Companies also need to retain key employees who will follow technical, training, or other tracks in their careers. To improve retention and employee morale, it’s best to focus on identifying potential managers and other key employees. Then businesses might prosper if they develop leadership programs with different goals for different sets of employees.
Proper Leadership Development Offers Companies a Competitive Edge
Most companies will benefit by figuring out what their own employees want out of their careers and then placing them in positions where they have a chance to achieve these goals. Leadership development programs might be tailored towards different business environments and different employees. When employees see that their companies invest in their own development, they are likely to invest more of their time and energy in that employer.