The Great Resignation is real. At the start of 2021, 40% of employees thought about quitting. Between April and September, more than 24MM turned those thoughts into action.
You don’t want your people to be in either of those stats. You value them and their experience, so you work hard to ensure that the most common causes of attrition – poor wages and benefits, toxic culture, worries about job insecurity, and feeling unappreciated – are not issues in your business.
And you don’t stop there. You offer opportunities for professional development, and you’re investing more than ever in innovation.
But if you believe new research published in the MIT Sloan Management Review, your investment in innovation is causing your people to quit.
Are resignations the price you pay to be innovative?
According to the study’s authors, “high levels of innovation” is the third-highest predictor of attrition behind only toxic work culture and job insecurity and reorganization.
“In the Culture 500 sample, we found that the more positively employees talked about innovation in their company, the more likely they were to quit.”
They go on to explain that “Staying at the bleeding edge of innovation typically requires employees to put in longer hours, work at a faster pace, and endure more stress than they would in a slower-moving company. The work may be exciting and satisfying but also difficult to sustain in the long term.”
Ok, fair. But let’s dig a bit deeper.
The three most innovative companies in the Culture 500 (the dataset used for analysis) are Nvidia, Tesla, and SpaceX. At least two of those (Tesla and SpaceX) are infamous for their toxic work cultures, to the extent that lawsuits are pending against both.
That’s especially important because “Toxic Corporate Environment” is the #1 predictor of attribution in that it is “10.4x more likely to contribute to attrition than compensation.” The #2 predictor, “Job insecurity and reorganization,” is only 3.5x more likely to contribute to attrition, and innovation is 3.2x more likely.
Sure, the data says that innovation is a predictor of resignations. Still, I think the reality is that companies are using “innovation” as an excuse for their toxic work cultures. It is toxicity, not innovation, that is causing people to quit.
Resignations are the price you pay for pretending to be innovative
Far more common, at least in my experience, is that companies and leaders that engage in innovation theater are far more likely to lose people due to “innovation.”
Here’s how it plays out:
- Innovation events give people hope. Hackathons, shark tanks, even ideation sessions create the impression that the company is serious about innovation. The company’s investment of time and resources into these events sends a message that it wants to hear employees’ ideas and is willing to invest in the good ones and see them through.
- Innovation training gives people skills and changes their mindsets. Incubators, accelerators, and one-off trainings in topics like design thinking and lean startup teach employees how to innovate and give people the experience of innovating. Through that experience, people realize that they are creative, have good ideas, and can drive change. They begin to see what is possible and believe they can make it happen.
- Everything goes back to “business as usual,” and people are left disappointed and disillusioned because the company wasn’t committed to anything beyond an event. People are also left newly aware of the possibilities and empowered to take advantage of them. They realize that the company is all talk when it comes to innovation, but they have the power to walk. And they do.
You’re doing the right things. Now keep doing them.
Your investments in professional development and innovation are spot on.
And, In the near term, they will lower attrition and help you attract phenomenal talent,
But if you want to keep your people for the long term, you need to keep investing in professional development and innovation.
Design hackathons and shark tanks with a plan for what happens after the event, how people will stay engaged, and how the company will continue to see and learn from the resulting projects.
Run incubators, accelerators, and trainings and give people permission to apply the methods and tools in their day jobs, reward them for using what they learned and teaching others, and hold managers accountable for supporting and encouraging these new behaviors and mindsets.
These are just a few ways you can be innovative AND retain your best people. I’m sure there are lots more.
What are they? How are you being innovative?