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Culture, THE GREAT RESIGNATION, and Organizational Psychology



Adapted from LinkedIn. See original post here.


I recently shared a quote from Dr. Courtney Keim, an industrial/organizational psychologist and assistant professor of psychology, in which she compared her job as an organizational psychologist to that of a clinical psychologist. Essentially making the connection that often the presenting issue in an organization is typically caused by an underlying issue that needs to be addressed. The job of the organizational psychology professional is to get to work with an organization to get to the bottom of the underlying issue. While those issues aren’t homogenous across organizations what we’re seeing in the job market today is showing that there are certainly underlying issues to be diagnosed that are presenting as record numbers of employees quitting their jobs. In August 4.3 million employees left jobs voluntarily in the US, which was a new record. That is until the very next month when the record was broken again at 4.4 million voluntary resignations. [1]


We’ve sprung a leak.


The current state of the job market has publications like Fortune and the Wall Street Journal running headlines like “How Maslow’s ‘hierarchy of needs’ could be the key to stopping employees from quitting” and “How to Quit Your Job Gracefully.” As a member of the Great Resignation contingent and an organizational psychology professional, these headlines keep grabbing my attention. Even just this morning I read one of the most intense headlines yet “Loving Your Job Is a Capitalist Trap” which I assume is at least a little bit tongue in cheek, but the sentiment persists. As people began to see the value of freedom and autonomy throughout the pandemic there has developed a shift towards meaning and away from traditional structure in the workforce.


The “capitalist trap” article ran in the Atlantic and notes that “75% of college-educated workers believe passion is an important factor in career decision making. And 67% of them say they would prioritize meaningful work over job stability, high wages, and work-life balance.” [2]


When dissecting the numbers there are several contributing factors. Finding childcare has been a massive set back to many people re-entering the workforce since some employers announced mandatory return to office policies. Flexible schedules that allow for more family time, or more personal time in general, are beginning to be an important consideration for many job seekers but especially for families with children. The inability to find childcare or having children in hybrid schooling scenarios means that in many cases parents cannot balance regular office hours and responsibilities of parenting. This sacrifice disproportionately affects women in the workforce and undoubtedly means qualified talent is not being utilized.


In a market short on qualified applicants or at least a market that is highly competitive, creating flexibility to allow more professionals with children in the workforce benefits everyone.


However, it’s not just parents in the workforce seeing the values of flexibility and the importance of personal time. People across all demographics had time to reconsider the place that work holds in their lives. The pandemic made possible a societal existential crisis. People talked more about physical health and mental health, saw friends over Zoom and struggled to maintain sanity, and ultimately had the chance to step out of the office and reevaluate priorities in their lives.


This great existential crisis became a great reevaluation. The great reevaluation became the Great Resignation. For many it was the added time every day lost to commuting, for some it is as simple as loads of laundry that got switched mid workday, many new Peloton junkies (guilty) found that a hard ride after a hard meeting cleared their head and without detriment to productivity.


Then it ended.


When it was time to come back to the office it felt like something was taken away from us. For many, this became the catalyst for re-envisioning the work week and the work environment. For employers currently looking to remain competitive in the market this is an opportunity to take note of this trend. To attract the best talent, to keep talent engaged, to reduce turnover it could be time to put an increased focus on personal fulfillment and freedom/flexibility as a means of job satisfaction.

The pandemic made possible a societal existential crisis. People talked more about physical health and mental health, saw friends over Zoom and struggled to maintain sanity, and ultimately had the chance to step out of the office and reevaluate priorities in their lives. This great existential crisis became a great reevaluation. The great reevaluation became the Great Resignation.

This gets murky in the typical corporate space because as we move out of quantifiable data (turnover rate, retention rate, etc…) and into the philosophical realm there is less black and white data by which to make decisions. Furthermore, the decisionmakers around company policy, however highly intelligent and talented in their roles, are not always the most qualified to parse through growing awareness of what Abraham Maslow called “self-actualization” needs. If you aren’t familiar with Maslow’s hierarchy of needs, it is a classification of needs of human beings. In its most simple form, it breaks down to basic needs (food, water, shelter, safety, health, etc.), psychological needs (relationships, prestige, accomplishment, etc.), and self-fulfillment needs (achieving one’s true potential or ideal self).



Over time employers have provided more of each section as a means of attracting labor. The industrial revolution provided little by way of safety and positive working conditions, but OSHA and the Bureau of Labor Standards before that established safety standards in the workplace. Further progress up the “hierarchy” shows the benefits of belonging and teambuilding in business environments. That focus fostered more creativity and commitment within organizations. It seems that technology has made the step into self-actualization inevitable. The writing is on the wall, or pyramid, so to speak. Decisionmakers can look to the past to prepare for the future. As society and technology progress, business environments move further up Maslow’s pyramid.


So how do we begin to offer “self-actualization” or development of the employee to their true potential as benefits of employment?


Let’s take Maslow’s humanistic psychology approach and jump right over to organizational psychology. In 1959 Dr. Frederick Herzberg presented research that looked at motivation in a similar way as Maslow but in adapting it to how we work he broke the categories down into two sections. [3] First, hygiene factors, such as salary, job security, status, benefits, safe working conditions are considered things that whenever absent cause dissatisfaction. These represent the bottom of Maslow’s pyramid. Herzberg classified the opposite side of hygiene factors as motivators. Motivators are those self-actualization factors such as challenging work, recognition, responsibility, meaningful work, importance to the organization and opportunity for personal growth. Motivators increase satisfaction as a result of the job or the work itself. Whereas hygiene factors do not supply greater satisfaction or motivation because they are not considered a part of the work.

This is an interesting take.


Essentially the research suggests that if you want to build job satisfaction it has to involve the work itself and how it relates to personal growth. Which is a different perspective than just throwing money at the problem. As pointed out this week on Character Lab by I/O psychology professor Louis Tay, money only buys happiness up to a certain point [4]. We’ve known this for a while, but money is quicker and easier albeit less effective long-term.

We have free snacks, coffee, ping-pong, beer gardens, and fun company sponsored events but when was the last time you looked an employee in the eye and asked about what is meaningful to them?


Does that feel uncomfortable to consider?


It could be that all our “fringe benefits” are the result of our discomfort with meaningfully addressing the human part of human resources, but 92% of employees claim they would stay with a company is bosses showed more empathy [5]. The truth is for many leaders it is easier to write a company check than it is to ask several questions to gauge how people are feeling. Don’t get me wrong a company party where the boss picks up the tab IS still fun (I’ll take all the holiday party invites that you’ve got). However, employee data suggests increasingly feeling more isolated at work and less a part of something collaborative and community driven and regardless of salary, benefits, company parties, etc. People who feel that they belong are more likely to stick with an organization.


Recent studies suggest that perceived organizational support (POS) and leader-member exchange (LMX) have significant impacts on turnover intention and presenteeism [6]. Another study [7] shows strong correlation between the quality of LMX and the amount of employee satisfaction and motivation an employee has in the workplace.


So, it’s more than just asking. It’s asking and actually giving a… real concern for the well-being of employees. It’s difficult to change any process but more and more it appears we need to adapt to the changing job market. “What we’ve always done” worked so well for Kodak, Nokia, Blockbuster… I can keep going. What can you consider doing to keep your best talent? I few suggestions, if I may:


Build Belonging

  1. Team building and communication training for teams. How we talk to each other builds or breaks a team.

  2. Leader Member Exchange – LMX. Start talking to your people.

  3. Show appreciation.

Increase Perceived Organizational Support

  1. Are people getting what they need to be successful? (Hint: You need to ask.)

  2. Training is support – Good training increases loyalty by 10% [8]

  3. Resources are support

  4. Feedback is SUPPORT.

Collaborative Culture

  1. Do your values represent what is meaningful to your employees?

  2. Are you aligned with your vision/values?

  3. Would your employees agree? (You should ask this one too.)

  4. Is this Great Resignation a good time to evaluate “what we’ve always done?”

  5. Don’t just file away exit interviews. That’s good data!

Flexibility and Freedom

  1. Hybrid/Remote work. From a recent post I saw on LinkedIn: “If you don’t let people work remote someone else will.”

  2. Flexible schedules.

  3. Policies – What rigid policies can you let go of?

Shameless plug incoming, you’ve been warned! I started Paramita because I care deeply for the well-being of my fellow beings. I also really like business. It is endlessly gratifying to improve the bottom-line for the company while improving job satisfaction for members. If you are seeing hints of culture misalignments, disengaged employees, or increased turnover feel free to contact Paramita at www.paramita-consulting.com/contact-us and we can set up a free 30 minute discussion.


And as always, as the tagline states, keep pointed “toward perfection.”

Rhett



Resources:

  1. https://www.bls.gov/news.release/pdf/jolts.pdf

  2. Cech, E. A. (2021, November 12). Loving your job is a capitalist trap. The Atlantic. https://www.theatlantic.com/culture/archive/2021/11/danger-really-loving-your-job/620690/.

  3. http://www.netmba.com/mgmt/ob/motivation/herzberg/

  4. https://characterlab.org/tips-of-the-week/the-money-trap/

  5. https://www.hcamag.com/ca/specialization/reward-recognition/10-warning-signs-your-employee-is-about-to-quit/233959

  6. Wu, TJ., Yuan, KS. & Yen, D.C. (2021). Leader-member exchange, turnover intention and presenteeism– the moderated mediating effect of perceived organizational support. Current Psychology. https://doi.org/10.1007/s12144-021-01825-1

  7. Malik, Maria & Wan, Difang & Ahmad, Muhammad & Naseem, Muhammad & Rehman, Ramiz. (2015). The Role Of LMX In Employees Job Motivation, Satisfaction, Empowerment, Stress And Turnover: Cross Country Analysis. Journal of Applied Business Research. 31. 1987-2000. https://doi.org/10.19030/jabr.v31i5.9413.

  8. Daniel Dietz, Thomas Zwick. (2020). The retention effect of training: Portability, visibility, and credibility. The International Journal of Human Resource Management. https://doi.org/10.1080/09585192.2020.1737835

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