Waking Up – Are Millennials Killing Employee Loyalty or Could They Be the Answer to Saving It?

I’m fresh off of an energizing event as part of an accelerated leadership program developing top employees for leadership roles across our company. What struck me in wrapping up my own journey on this program was the average tenure of the participants, most of whom are Millennials – on average, 10-15 years with the company. Most joined right out of college or even during college through structured internships. This reality raised the question in my head – are Millennials really lacking employee loyalty?

Of course, taking the sample set of visibly highly valued & invested-in employees – from expatriate opportunities to challenging positions engaging senior leadership to world-class trainings around the globe – is distorting. The fact is, investing heavily in <1% of the company cannot be scaled to the rest of the employee base. What about the other 99+% of the employee population?

When we reflect on employee loyalty, we often think of a 1950s concept of employees remaining at the same company for entire careers, often staying in the same roles for many years if not decades and essentially providing a stable base of labor, minimizing turnover costs.The primary sectors for employment were industrial and agricultural. What’s changed since the 1950s?

One might argue a whole lot has changed, actually. The era of the pension is over. The ability of an employer to guarantee life-long employment at one company? Almost completely gone. The growth rates of the 1950s successful corporations have shifted from industrial and agricultural to technology today. As many of us have read about the culture in tech, the idea of a 9-5 job has been declared essentially dead, as well, assisted by the availability of mobile technologies. And yet I was shocked to learn that Netflix – which has prided itself on turning over employees whose skillsets are no longer relevant in very clear culture statement and a book written by its former Chief Human Resources Officer - is investing heavily in employee learning. Why are so many employers still stuck with a 1950s concept of employee loyalty? How do we evolve the culture to fit the reality in 2019?

Outside the lack of incentives to stay at one company as they once existed, there are many attractive benefits of changing jobs or employers frequently – first and foremost, the ability to obtain higher compensation and a better skill set to set oneself up for the future. According to a recent ADP Research Institute Report, workers in the IT industry see a 9.7% wage increase for switching jobs versus staying put, bolstered by a strong economy. Rather than staying in 1 role for many years and more or less restricting one’s skill set, the 21st century workplace has put value on a diversification of skill sets to adapt to changing business conditions, especially with technology developing and entering the world place at an extraordinarily fast rate in the past few decades.

As a people leader, I focus much of my energy on attracting, developing and retaining the best talent across the company – so how do I adapt as a leader to an environment where employees have every incentive to leave and my levers for retention are seemingly ever dwindling? Examining Netflix as a case study, how do I keep the skill sets on my teams current while still investing in employees?

First and foremost, we must compensate employees based on the value they drive for our companies. Loyalty for loyalty’s sake only goes so far – if we want to keep the best talent, we need to be competitive in the segments we serve from a compensation & benefits perspective. But in an environment to keep base costs in check, what other levers do we have as leaders to attract and retain our employees?

What I have found to be even more compelling as a retention tool are not expensive trainings or expatriate assignments, massive raises or bonuses. Instead, it is what we could call “employee experience” – the interactions with an employee from their first touchpoint with a company for an interview all the way through the exit process when she or he is departing (clue per this Harvard Business Review article: all your other employees are watching how you treat employees who decide to leave). In between, it’s everything from our ability to articulate a vision that the team can feel a part of to how we set priorities & clear expectations with our employees to how we respond as leadership when members of our team are having issues outside of work. Do we as leaders make time to understand what motivates our employees and set up opportunities and incentives accordingly? Across the lifecycle of being an employee, there are thousands of opportunities to create either a positive or a negative employee experience. Interacting with various sectors, I have seen leaders who are absolutely extraordinary about creating an outstanding employee experience and yet many, many others who simply do not focus on it at all or others who place little value on it defining their organization’s success.

Employee experience ties back to the quality of the leaders companies promote and hold up as role models, which I have seen over the past 4 years on an accelerated leadership program. I would challenge every organization to look at their slate of leaders and assess – is this a person that talented, committed employees want to work for because they get the opportunities to grow their skill sets and leadership capabilities under their leadership? Are they willing to champion the best compensation for their best talent? Do our leaders understand and ensure their teams are working consistently with their personal values? In other words - are we building leaders that we ourselves would want to follow? Or do our leaders focus instead more on their own career aspirations and successes (or, in a tough climate, power and self-preservation) than what brings out the best of their employees’ and the overall company?

A great employee experience is very much within reach – but it requires a cultural shift from a 1950s construct of transactional stability for loyalty to investment in cultures that and leaders who promote a customer-centric approach to employees and make companies a great place to build a 21st century career. And as a pleasant side effect, we might end up with happier customers, too.

Please note: the views expressed in this article are of the author's personal perspective only. Your comments and feedback are welcome!