Contributor, Korn Ferry Institute
The Secret to Employee Loyalty
Daniel Goleman is a senior consultant at Goleman Consulting Group, author of the best seller Emotional Intelligence, and host of the podcast First Person Plural: Emotional Intelligence and Beyond. He is a regular contributor to Korn Ferry.
Employee loyalty: beyond profitability, it’s one thing most organizations long for. Companies want employees who are devoted to the organization’s success and who believe – even in the most tumultuous of times – that staying with the company is in their best interest.
For over two decades, Great Place to Work (GPTW) has evaluated and ranked companies for the 100 Best Places to Work list. Looking at millions of employee survey responses, they have discovered what makes employees remain loyal to the companies they work for.
While a variety of things matter to the employee experience (good pay, solid benefits, transparent communication, and strong leadership) GPTW has seen purpose rise to the top. According to their research, the degree to which an employee feels that their work has special meaning and isn't “just a job” has become one of the strongest predictors of pride and engagement.
“No one should be surprised by this,” remarked GPTW CEO Michael Bush. “Purpose might be the word of 2022. What do employees want? That. It’s on every leader to make sure every worker, regardless of role and location, understands how what they do affects your organization’s greater purpose. They need to know their work has meaning and matters—that they matter.”
This year’s #1 company on the 100 Best Places to Work list was Cisco Systems, a technology firm with close to 80,000 US employees. Among the many reasons Cisco was selected (strong diversity, outstanding benefits, and a hyper-focus on employee wellness) was their unwavering commitment to their purpose statement, “Power an Inclusive Future for All.”
On the surface, this purpose statement has little to do with their industry. It doesn’t talk about developing, manufacturing, and selling high-technology services and products. Instead, it articulates a grand and inspiring vision for the world.
When interviewed about how the company’s purpose and “conscious culture” play out in real time, Dev Stahlkopf, executive vice president and chief legal officer at Cisco, said it was “palpable in the company’s culture.”
“It means we share our technology and expertise to better the lives of those in our community,'' she said. “It means we partner with other organizations to address problems, such as global hunger. Looking inward, we want to unleash the full power of our employees to help ensure the company realizes its purpose.”
A look into Cisco’s purpose report confirms Stahlkopf’s claims. The report shows a stark commitment to environmental, social, and governance (ESG) goals and lays out the company’s evolving progress on everything from lowering emissions to getting more women and minorities into leadership. There isn’t one clear way Cisco “powers an inclusive future for all.” Instead, there are a variety of initiatives they have started and tracked throughout the years, including giving each employee 40 hours of paid time off to volunteer each year—a full week of time they can dedicate to the causes they're most passionate about.
In their Line Of Sight report, Korn Ferry points out that people tend to relate to their work in three different ways: “a job for tangible benefits, a career that advances power and social standing, or a vocation toward self-fulfillment.”
When a company, like Cisco, gets clear on their purpose and develops the initiatives and goals to actualize it, they create an environment where people not only get to secure their livelihood, but can also gain traction on their more far-reaching hopes and ambitions.
Ninety-seven percent of Cisco’s workforce agrees with the statement, “I feel good about the ways we contribute to the community,” and 98% are proud to tell others they work there. What’s more, in a moment when employees are resigning en masse, Cisco’s attrition rate has remained below 10%.
Like other companies on the 100 Best Places to Work list, Cisco may provide some inspiration on how to make purpose central to the culture and operations of an organization. At the same time, they confirm the pivotal role of purpose in securing that employee loyalty companies so desperately long for.