Jun 22, 2022

How to Win Talent and Restore Loyalty in the Workplace

The following commentary, written by AIMCo CEO Evan Siddall, was published in the Globe and Mail, June 12, 2022.

A historic shift has begun. After a decades-long global economic expansion that saw the value of work decline relative to return on investments, the balance of power is shifting between capital and labour. In these waning days of the COVID-19 pandemic, it may now even have swung in favour of employees.

Today, employers are facing a crisis of loyalty. Pent-up frustration, latent turnover and the growth of the work-from-home economy have coalesced into a “Great Resignation.” According to a recent Bank of Canada survey, 19 per cent of Canadians expect to quit their current job in the next 12 months — the highest level since the survey began in 2014. Entrepreneurial ventures, “side hustles” and increased leisure time reminded our colleagues that they can make different choices. People’s emotional connection to work has faded.

This has been a long time coming, with several factors scrambling the implicit contract between capital and labour. In recent years, workers have experienced real declines in minimum wages, while productivity has outpaced wage growth.

Outsourcing and the increased use of temporary staffing firms have further eroded the employer-employee bond, commoditizing people and reinforcing a transactional labour economy.

Let’s face it: Employees are disloyal to employers because they’ve been treated disloyally.

The pandemic has shown us that companies have neglected employees and loyalty at their own peril.

Wage inflation is accelerating as employers scramble to retain workers and preserve office space while employees reject “presenteeism” and insist on greater flexibility. Leaders now fret about the “new normal,” “Future of Work,” “Workplace 2.0,” and “hybrid workplaces.” However, the solution is much more involved than whether to insist that employees devote two or three days per week to their offices.

As our economy has matured, jobs require more intellect and nuance. Workers are more skilled and more capable. They don’t need to be told where and when to do their jobs. They resist micro-management and are able to work with reduced supervision. We need to look past obsolete models of hierarchical control adapted from military command for a manufacturing economy.

People want purpose-driven work. Dan Pink identified three factors — purpose, autonomy, and mastery — as the core sources of employees’ extra discretionary effort in his 2009 book, Drive: The Secret of What Motivates Us. It is the combination of these three drivers that increases productivity, instills a commitment to customer service and creates fertile ground for innovation.

And they find the most value and satisfaction in their work when we, as leaders, trust them to do it well.

Four key elements reinforce a culture of trust and respect:

1. Let employees choose: Work is personal. It is a huge mistake to dictate working conditions to employees. Task teams to be deliberate about determining the kind of collaborative work best done in person. Work that supports apprenticeship/learning, team alignment and innovation/brainstorming are often, but not always, examples. We have asked our teams to define how they choose to collaborate. The decisions are ultimately theirs.

2. Measure what matters: Performance management should never have been about management-by-line-of-sight. Use an outcome-based goal-setting methodology to ensure people leaders and employees are all focused on the same measurable goals. Give feedback often, and far more frequently than monthly check-ins.

3. Re-train people leaders: The potential weak links in this new system are managers’ bad habits. A “results only” mindset requires them to unlearn old ways. Moreover, heading blindly into new workplace conventions is reckless without a new, coherent support system. That may mean looking outside your organization for help to train people leaders.

4. Flatten the organization: Consistent with more employee autonomy is a lighter managerial hand. We have also therefore adapted our organizational structure by increasing people leaders’ spans of control (number of direct reports). This gave us the opportunity to “high grade” our management cohort and lighten managers’ touch.

Employees just want a little respect. Both Steven Covey and Richard Branson have been quoted as saying, “treat your employees the way you want them to treat your customers.”

Employers ought to trust their employees to make decisions that will allow them to do their best work. 

Rather than scrambling haphazardly to block the exits, we intend to light the way to the entrance, allowing us to attract and retain the strongest calibre of colleagues who will help us continue to deliver superior results for our clients and their beneficiaries — in this case, the people of Alberta.

It’s actually that simple.