Why people are leaving your company
The great resignation revealed a deeper truth: people leave managers, not companies. Understanding the leadership failures that drive attrition is the first step toward retention.
Every time a high performer walks out your door, it’s rarely about the money—and almost always about the leadership blind spots you’ve chosen not to see.
Why people are leaving your company
Key takeaways
- You can’t afford to ignore the fact that only one out of the top eight reasons people leave is about compensation—the rest are leadership and culture issues you can address without spending more money.
- If your managers aren’t having ongoing, meaningful conversations with their teams about growth, autonomy, and challenging assignments, you’re leaving the door wide open for your best talent to walk out.
- You need to relentlessly communicate your company’s purpose and help every employee see how their daily work connects to it, because a clear, magnetic purpose is a powerful retention tool—especially for younger generations.
...And what you can do about itThe labor market is currently very tight in many places. It is hurting performance of companies. In my conversations with CEO’s and their teams I often hear: we could produce more, we could do much more, if only we had more people with the right competencies.
For continuity reasons and value creation, it’s therefore critical to keep your backdoor closed. Avoid losing the people that you really want to keep. Forget the official exit interviews for a minute. McKinsey recently published the eight most important reasons why people are really leaving. They’ve conducted this survey in April 2022. Just look at the conclusions first.
Out of the eight most important reasons, only inadequate compensation has direct financial impact for a company! While the other seven reasons can be also be addressed through other actions.
Let’s look at just a couple of the other reasons. For instance: lack of career advancement (41%). Are your managers in an ongoing conversation with their people? Do they know what really keeps their people awake at night? Are they assigning challenging projects to their (top) talent? Are they providing opportunities for adequate autonomy so employees can expand their skill set? Invest in these actions and better retain your best.
Let’s take a look at Lack of meaningful work (31%). What is the purpose of your company? And do you communicate it effectively? If your people go to work in the morning and really know deep inside how their contribution that day makes a contribution to the company’s purpose, that does make a difference! It may be obvious for you, but do not underestimate how often you need to repeat it before it sticks. We know from research that the younger generations find a sense of Purpose important. And it’s confirmed again in this survey. So, the question is: is your company purpose clear? Is it magnetic for your people?
Don’t retain your (best) people only by paying them more money. It’s a trap and it destroys value. Yes, sometimes increasing salaries is a part of the best solution. But other initiatives such as Leadership Development, Executive Coaching, reconnecting to the company Purpose will produce better results. These actions create more value and are cheaper too! A double-edged sword.
The real cost of attrition isn’t measured in salaries, but in lost trust, broken purpose, and the silent exodus of potential that leadership failed to nurture.
Over to you.