by Jon Flaherty, Chief Executive Officer – Americas, Revolent Group.
The tech sector is infamous for its high attrition rates. Recent research by LinkedIn reveals that the average turnover for tech roles currently stands at 12.9%. While salary and bonuses will be important, money isn’t everything. The shifts in priorities we’ve seen during the pandemic and the “Great Resignation” have shown us that today’s professionals are looking for more than just a paycheck from their employers. This has put a spotlight on the empathetic leadership style, as it can go a long way toward retaining tech talent.
What Is the True Cost of Employee Retention?
If you have recently hired a tech specialist, chances are they’ll leave within the first two years. It’s nothing personal—even household names like Zoom and Reddit are struggling to hold onto their employees for more than 18 months on average. The cost of replacing just one employee is staggering—ranging from one-half to two times their annual salary, according to Gallup. Plus, the more senior the role is, the higher the cost of replacing it.
While there are many reasons why an employee might decide to leave (salary and benefits often being top of the list), staff can also leave due to an unsatisfactory working culture that doesn’t provide them with enough autonomy and flexibility. With the current skills crisis to contend with, especially in the increasingly sought-after cloud technologies, employers simply cannot afford to overlook making improvements to their working culture. One effective way of doing this is by rethinking your leadership approach.
Employees Want A Leader Who Cares
We often make the mistake of assuming that our employees leave because they are better paid elsewhere. While this is true for some, it’s also true that people want to belong to an environment where their voice matters, their contribution is valued and where they can see clear career progression opportunities ahead of them. Taking up a better offer elsewhere is often the result of these expectations continuously not being met in their current workplace.
This, in essence, is the sort of working culture that an empathetic leadership style can help you achieve. In fact, as many as 90% of U.S. workers surveyed by EY believe that empathetic leadership increases job satisfaction. A further 79% believe that it also decreases staff turnover. The same survey also found that roughly half of the respondents chose to leave their role because “their boss wasn’t empathetic to their struggles at work or in their personal lives.”
As business leaders, we have to think about profits and productivity. However, empathetic leadership places priority on ensuring that everyone feels valued and heard, which in turn boosts your profit and productivity—not least through reduced attrition rates.
Empathetic leadership isn’t an innate ability; it’s made up of a set of attitudes and values that are put into practice every day. If you want to become a more empathetic leader, here are some top tips.
• Treat everyone fairly—be open and transparent. Fairness is crucial to fostering an inclusive work environment and becoming a more empathetic leader. Sometimes, this requires some personal adjustments. In other instances, it’s a question of implementing new processes that offer more transparency and allow you to track the progress of different tasks, giving praise where praise is due—and to the right people. If you have a hybrid work setup, it’s also important to ensure that members of your management team are aware of “proximity bias,” which could lead them to unconsciously favor employees they can see in the office and interact with in-person over those who are working remotely.
Regular one-to-ones between managers and employees are important, as are regular open communication channels that allow you to share and discuss any changes across the business. This could be an internal newsletter, a town hall meeting, a Teams chat or an email. In fact, the more different channels you have for communication, the better.
• Establish clear career progression routes. Many employees leave not only because they can get paid better elsewhere but because their progress has become stilted. Make sure you have clear career progression routes established and signposted across your business and time allocated for employees who wish to do additional training. In doing so, your employees can take more charge of their personal career development journey. If you’re looking for certain skills, you could establish learning journeys around these, which is a win-win for you and your staff.
• Ask your employees for their ideas and opinions. When Covid-19 restrictions first started, I’m sure most of us tried to boost team morale by implementing informal “coffee over Zoom or Teams” sessions, which often led to awkward conversations. Equally, you could hire an external consultant to give you the best tips for boosting engagement and productivity, but even the best approaches may not work for your particular work context. I’ve found that the best ideas often come from within. Conducting regular employee engagement surveys (say, twice a year or once a quarter) to measure how engaged, stressed, motivated or isolated your employees feel can go a long way—as can asking them for ideas on how you could improve their working lives.
• Follow promises through with action. If you’re implementing surveys, make sure you’re always following up on any suggestions or new initiatives with concrete action. Be ready for open and honest conversations, even if they’re difficult (another marker of an empathetic leader). When your employee engagement survey results come in, have a company-wide call and share your findings. There’s always room for improvement, so don’t be dismayed by any negative comments. Use this as an opportunity to show that your employees can be honest with you and that you’re serious about taking their concerns on board. This can make them more confident and more likely to share other ideas going forward, even if they go against the grain—which is great for innovation and so crucial in a fast-changing sector like ours.