Leadership best practices to build team loyalty
A decade ago, this question could have been answered quickly, with no ounce of thought. However, we live in an era that is defined by AI and rapid technological advancements coupled with shifting workforce dynamics. Today, one might question the relevance and existence of loyalty in workplaces. This question can be asked of employees and employers both. The pandemic years and the subsequent WFH models also added to this complexity.
Loyalty in today’s workplace
Loyalty was considered a cornerstone of professional relationships, but it is indeed undergoing a transformation in today’s world. The perspective of loyalty varies greatly across generations. I was recently talking to a former British colleague (who is “Gen X“), and he also felt that loyalty seems to be eroding today. Newer generations are displaying a more transactional approach to work and relationships. Now the point is, business owners also will struggle to reciprocate any loyalty in such uncertain business environments. In a way it’s a mutual phenomenon.
Today, Gen Z’s often hold the decision-making power with themselves while joining a company or even taking up a role. This is shaping the ethos of organizations. Their mindset is a marked shift from the traditional notions of loyalty. Long-term relationships and commitment with employers are no longer a criteria for them. Unlike older generations who valued loyalty and building enduring connections, younger professionals are more restless and have a more transactional mindset.
Does Loyalty even matter?
So, does it still matter? Is it still feasible in this world that is apparently dominated by transactional relationships?
Well. Personally, as a “Gen X”, I feel it matters a lot.
However, Data speaks differently. A Future Forum research from last year showed that 95% of employees are open to looking for a new job this year. Astounding, right?
Employee retention may acquire a whole new paradigm. 83% of businesses expect to invest more into retention in the next 12 months than they did in the last 12 months (Lattice, 2023). Even with all the layoffs last year, keeping the right workforce is still key. Loyal teams exhibit higher levels of engagement, productivity, and commitment toward organizational objectives. Their presence fosters a positive work environment, teamwork, and reduces the disposition to explore alternative opportunities, thus cutting down on turnover expenses of companies.
The evolution of loyalty reflects the shifting values of today. While it seems like loyalty is fading, it’s vital to note that notions of loyalty are evolving rather than vanishing. As workplaces evolve, understanding and adapting to it will be essential. While certain tech and new age businesses are seeing a lot of turbulence, there are several companies and businesses which still operate in traditional ways.
So, loyalty does matter for sure!
Employee Engagement and Loyalty
A Gallup State of the Global Workforce survey reported that only 21% of employees reported feeling truly engaged in their work. This statistic paints a stark picture of the prevalent disconnection and lack of commitment experienced by majority of the workforce today. The same survey also reported that more than half of employees expressed feelings of being undervalued, leading to heightened levels of stress, anxiety, and even resentment. The repercussions of such sentiments extend beyond mere emotional strain, adversely affecting physical health, productivity, and overall decision-making abilities. The higher an employee is in the “Maslow’s Pyramid” these sentiments play a larger role.
A McKinsey research delved deeper into the dynamics of employee engagement and revealed that nonfinancial recognition serves as a primary driver, accounting for over half of the engagement levels within an organization. This resonates with my own observations over the last few decades of leading teams, which suggest that an individual’s sense of value and respect within their professional environment significantly impacts their level of engagement and commitment. This has a direct impact on loyalty as well.
And clearly, employee engagement is not about team bonding events and parties. It has various nuances to it including leadership.
Leaders and loyalty
Let us now try and understand the role of Leaders in establishing a culture of loyalty in an organization.
When employees feel cherished and recognized by their leaders, they will invest themselves fully in their roles. This will also contribute to improved organizational performance.
To build loyalty, companies must adopt a culture of loyalty and engagement among their teams. An astounding 70% of the variance in team loyalty and engagement can be ascribed exclusively to the manager/leader (Gallup). This shows that building loyalty is not merely a desirable trait but an essential responsibility that falls heads-on on leadership.
Cultivating loyalty is not a task to be undertaken lightly as it is a journey that requires a lot of effort, authenticity, and a genuine commitment to fostering meaningful connections within the team.
Here are some leadership qualities that fosters a culture of loyalty in any organization:
Reliable Presence – Leadership is a commitment to showing up authentically and transparently for your team. Authentic leaders inspire trust and confidence by being genuine in their interactions. They also acknowledge their own vulnerabilities and foster an environment where team members feel safe. Leaders should constantly think about mutually beneficial relationships.
Genuine Concern – Though we feel we ought to be professional always, there are times when a genuine concern from a leader can go a long way. Beyond the confines of professional duties, leaders who take a sincere interest in the well-being and growth of their team members are the ones who have the best team. This includes actively listening to their concerns and providing support and guidance when needed.
Nurturing Trust – Trust is the bedrock of any successful relationship, and the leader-team dynamic is no exception. Leaders must consistently demonstrate integrity, reliability, and accountability in their actions, thereby earning the trust and respect of their team members.
In Summary
One must recognize that loyalty still holds significance, perhaps in a different form. Even if traditional notions of loyalty may be less prevalent, it will evolve to newer instances of commitment in the workplace. Loyalty can actually manifest as dedication to a shared mission, vision & collaboration. Building loyalty is a journey that unfolds over time. It requires patience, perseverance, and a genuine commitment to fostering meaningful connections within the team. By prioritizing authenticity, genuine concern, and trust, leaders can cultivate a culture of loyalty that not only enhances employee engagement and productivity but also fosters long-term success and sustainability for the organization as a whole.
