Most are familiar with the stages of grief that individuals go through during the grieving process. Similarly to grief, there are also stages an individual goes through when faced with change. Understanding the psychological steps involving organizational change management can help managers better assist employees through the change process.

Change vs. Transition in Change Management

One of the most important concepts to understand about the change process is that change and transition are not synonymous.

Change is situational whereas transition is psychological.

What this means is that change is a physical manipulation that occurs on the organizational level. On the other hand, transition is a psychological process that occurs on the personal level. Change occurs externally, while transition is internal. Failing to understand the difference between change and transition is a major contributor to change management failure. Understanding how employees react to and work through change and transitions will make change management more efficient for organizations.

In Managing Transitions, William Bridges outlines the three stages of transition: “Ending”, “Neutral Zone” and “New Beginning”.

The Ending Stage

The Ending is the stage where individuals are aware that there will be changes occurring and that the traditional way of doing things will no longer be the norm. It is important to properly convey this message to employees in order to avoid unneeded pushback. With the “Ending Stage”, be prepared for employees to experience denial, shock, anger, frustration, and stress. While most – if not all – of these feelings are seen as generally negative, they are part of the change process and should be embraced. The most important responsibility as a manager in this stage is to be supportive and communicate with employees. If employees feel supported and encouraged through the “Ending Stage”, they will move more quickly to the next stage.

The Neutral Zone

The “Neutral Zone” is comparable to being in limbo. Individuals have started to let go of the old way of doing things but haven’t yet adopted the new mentality or practice. With this stage comes ambivalence and skepticism. This is a good sign! These are indicators that employees have started to move on from the frustration and stress from the “Ending Stage” and are starting to have questions and mixed feelings about the new changes. At the very end of the “Neutral Zone”, individuals will develop feelings of acceptance. They will become content with the fact that the organization has let go and moved on from one process and are starting to move towards another one. During this stage, it is critical to encourage employees to ask questions!

The New Beginning Stage

The final stage in the change process is the “New Beginning” stage. In this stage, adoption of a new organizational practice or mentality is experienced. This stage starts with feelings of impatience. Though this may seem like a negative feeling, it means employees have fully moved on from old ways and are looking to adopt the new ones. Following impatience will come feelings of hope and enthusiasm. Capitalize on these feelings! Reinforce and reward this behavior as it will keep people motivated and excited to be involved in the change process.

While it can be stressful to juggle daily tasks along with the stress of carrying an entire group of employees through the transition process, it is essential in making it work. Understanding the three stages of transition will prove vital in improving the success of your change management efforts. And remember – telling people about change is not the same as implementing it.

We have previously discussed how change and change efforts are crucial for organizations to stay competitive and relevant in a rapidly evolving business world. However, according to the Harvard Business Review, 70% of change efforts fail.

Change can often be intimidating for everyone, but, as a manager or higher level employee, the pressure associated with change can be extremely daunting. For example, you experience your own stress and fears linked with the change along with the pressure of successful organizational change and backlash from your employees trying to adapt to change as well. You tried to do the best you could yet the change was not as successful as anticipated. Based on our research, we’ve compiled a list of ten reasons why your change efforts fell short of expectations:

1. You told people about the change efforts

Simply informing staff about change is not the same as implementing it. Many leaders of change expect a seamless transition as long as they give their employees notice regarding organizational changes.

In his best-selling book, Leading at a Higher Level, Ken Blanchard explains how this misconception is far from true. Telling people about a change is not actionable. It doesn’t involve employees, and it doesn’t create a path for people to follow. You can’t just tell people something is going to happen. You need to help and empower them through change.

2. You’ve failed to do your homework

While change is often necessary and strategic for the business, an organization can’t just decide to make a change overnight. It’s important to consider what resources are required to support the change. This could be technology, money, time, and talent. Too often we see change implemented while only considering a subset of the factors that need to be evaluated. Take the time to ensure that you have explored the effects of your change efforts from all perspectives.

3. You didn’t get people on board

Many change efforts fail because there is no strategic vision. If you tell someone they’ll be expected to change the way they’re currently doing something at work, they’ll likely feel overwhelmed and try to find every way possible to do things “the old way”. This can be a huge threat to productivity wasting unnecessary amounts of time and money.

Let employees know what changes are going to occur and why the organization has found the changes to be in the best interest of the company and its employees. Provide a roadmap for employees so they can understand the process and buy into the vision. It is easier to complete a successful change effort if the vision and direction is shared and clear from the top down and from the bottom of the organization up.

4. You didn’t provide proper leadership

It’s no secret that leadership is essential in every successful organization. Leaders carry more responsibilities and more decision making power. A leader is also responsible for leading their employees – especially through change. It’s important to be clear and consistent through the change process in order for employees to feel confident in their abilities to be successful through these change efforts. Leading by example is extremely effective when trying to help motivate people through change. Be sure you are encouraging and acting on the same change initiatives you are expecting your staff to embrace.

5. You weren’t there to address concerns

Because there are a lot of unknowns associated with change, employees are likely to have questions or concerns regarding the change process and what the future looks like for them. Transparency and open communication will go a long way with your employees. They’ll be less intimidated by the upcoming changes and will trust the management team and the process much more. This inevitably reduces pushback and ensures a more seamless change process.

6. You didn’t include the most important people

Often times the people who implement change are only slightly affected by the change. For example, when implementing a new data strategy, you may be affected by the way you’re getting information. However, the employees reporting to you may have to change the way they aggregate data, where they pull data from, and how they create their reports.

Instead of coming up with a plan about how you can help your employees through the change process, ask your employees to help you come up with a plan. By seeking help from those who will be directly affected by the change process you are going to have a better idea of how to combat potential issues.

7. You didn’t provide the proper tools

The higher up the org chart you go, the less you know about day-to-day operations. This a struggle many leaders deal with to understand what their direct reports are doing on a day to day basis. Because of this, it’s easy to overlook necessary tools to help employees manage change. Make sure you understand how the change will affect daily processes and be sure to provide proper training, programs, or technology that your staff will need to comply with the organization’s vision.

8. You weren’t cheering your people on

As mentioned earlier, many employees resist change because they are intimidated or don’t feel confident enough to tackle the challenges associated with change on their own. Be sure to walk your employees through change and encourage them to keep learning and master the new processes. This will motivate your people to adopt the new practices and keep trying to improve the organization.

9. You experienced death by 1,000 initiatives

This phenomenon was also discussed in Ken Blanchard’s book, Leading at a Higher Level. It’s important to keep the vision in mind and stay the path. Inevitably, challenges will arise and things may not go as planned. Don’t get bogged down by concentrating on every little detail. Instead, stay focused and prioritize accordingly.

10. You didn’t measure your progress

Change efforts takes time. It may feel as if the change management process is taking a long time with little progress to show for it. Be sure to measure progress along the way and share that with your team. This will keep people motivated and show that the combined efforts are making a difference in achieving your goals. Creating metrics for your change management efforts enables greater transparency for measuring success (or failure). By creating these metrics, it allows you to take corrective actions to ensure success is achieved.

Anything we missed? Anything you disagree with? Leave a comment and give us your thoughts!

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Organizational development (OD) is a field that helps improve organizational effectiveness with a major focus on change management and strategic initiatives. Put simply, OD helps organizations overcome challenges and maximize change at work. Organizational development is an area presenting one of the largest opportunities for companies right now. Unfortunately, organizational development is an area that is often under-prioritized and under-utilized.

How Does Organizational Development Manage Change?

Change is often intimidating, confusing and difficult, yet it is crucial for organizations to maximize change efforts in order to stay relevant and competitive. Utilizing organizational development strategies can help to combat the challenges associated with change while also leveraging it to make better business decisions.

OD specialists utilize industry research and data to create a strategic plan to help employees effectively work through new implementations. A new implementation could be anything from a new process to a new technology to a cultural change and anything in between. Organizational development takes into consideration how employees will react to change. There could be push back, fear, confusion, lack of productivity, loss in morale, injury and turnover all associated with major changes in an organization. When employees are made a priority during the change process, they are much better equipped to adapt.

OD specialists help combat any potential issues associated with organizational change and help employees make a seamless transition by minimizing the learning curve, improving communications, involving them in the change process and ensuring strategic alignment.

When Can Organizational Development Be Utilized?

Organizations go through changes efforts all the time with hopes of improving effectiveness and maximizing profits. However, these change efforts can be threatened if key stakeholders and employees are not taken into consideration when making significant changes.

OD Specialists assist organizations globally with:

  • Performance management
  • Culture change
  • Technology changes/implementations
  • Staffing changes
  • Downsizing
  • New training initiatives
  • Operational changes
  • Marketing and rebranding
  • Diversity initiatives
  • Mergers and acquisitions

Most (if not all) strategic changes an organization undergoes affects its employees. While it’s great to invest in new technology or processes, ignoring the impact these changes will have on employees is a recipe for disaster. It is imperative to properly assist employees through change in order to ensure the organization’s time and investment is not wasted. Organizational development specialists have the skills to assess an organization’s readiness and capability to change. Coupled with the organization’s readiness for change, the unique culture each organization possesses will impact what change management techniques need to be employed for maximum success.

The field of organizational development helps these change efforts run more smoothly, happen more quickly, and be more effective by investing in the well-being of an organization’s most vital asset: their employees.

We have previously discussed how becoming data-driven is essential for organizations in today’s digital world. In fact, the Society for Industrial Organizational Psychology listed maximizing data and applying analytics first in its list of the top 10 workplace trends of 2016. While learning how to maximize data and analytics to improve efficiency and make better business decisions is crucial for businesses to remain competitive, it is just as vital to properly acclimate and prepare employees for some of these changes.

In order for employees to optimize a data-driven environment, be sure to consider the following:

Give as much notice as possible

Any type of change, whether it be new technology or new processes, can be very intimidating. Giving too short notice or no notice at all can cause stress and anxiety for employees. The more notice you give to employees the more they can prepare themselves for whatever new implementation will be taking place. This will also be less disruptive and yield less pushback from individuals affected by the new changes being implemented.

Be transparent

Similar to providing notice, transparency helps for an easier transition when preparing employees for a data-driven culture. Employees are less likely to feel stressed or resentful towards management and the new process or technology. Being transparent also fosters trust. Individuals will be more open to new procedures when they feel they can trust the process and those implementing them.

Provide “The Why”

Humans are creatures of habit and are often resistant to change. Even if management knows new technology will make employee lives much easier and more efficient, employees may not see it that way. They may feel inconvenienced, intimidated, and frustrated. Explain to your staff why the change is being implemented and how it will improve the organization. Get people excited and interested to take on new challenges. The goal is to provide meaning for employees so they’ll be more likely to support whatever will be implemented.

Assess the organization’s data-driven readiness

It’s crucial to be aware of the state of readiness of your audience. For example, if employees are going to be using a new software, it’s safe to say there would be little to no knowledge abut this product. As a result, plan for that. Completely new technologies or processes require a more thorough preparation than small adjustments. Don’t just throw something new out to your employees and assume they’ll figure it out. Take the time to understand what people know and what they don’t know, then plan accordingly. Would you ever implement a new core without training your staff? Of course not. The same principle applies to your data and analytics projects.

Train and prepare

The level and length of training will depend on the readiness of those being affected by a more data-driven culture. For a small implementation, holding a short meeting for Q&A may be sufficient. For larger overhauls, formal training and guides are typically required. Regardless of the extent of the impact of change, providing as much information and background as possible is ideal.

Provide a support system

Like most groups, there are those who learn quicker or find new technology more intuitive than others. Similarly, there are those who struggle with change or aren’t quickly able to embrace new technology and processes. Try to find ways to create a support system in order to ensure a smooth transition and to avoid resistance. Providing mentorships or open-door policies for questions and concerns are ways to help make changes in the workplace easier and more effective. For systematic issues that a larger number of employees share, consider focus groups to understand the root of the problem.

Reinforcement is essential

Letting people know they’re doing well or that the new culture is providing a positive impact will go far with your employees. Reinforcement provides reassurance and lets people know they’re doing a good job. This helps to foster a unified environment and keeps people motivated and confident during times of change.

If you can apply these techniques during your data and analytics implementations, we have no doubt you can achieve greater buy-in and utilization amongst your staff. Like any other technology initiative or major process change, properly readying staff and supporting them throughout the effort is critical to success.

Not getting the most out of your data and analytics projects? Reach out to us and ask how we can help!

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Some of our more recent posts have included topics about employee engagement, turnover, Millennials, and other similar topics. They tend to have been focused more around the people that make up an organization. While The Knowlton Group’s objective is to help organizations become data-driven, we also recognize the importance of taking into consideration how some of these decisions impact employees and an organization’s culture.

What is Industrial Organizational Psychology?

Industrial Organizational (I/O) Psychology is exactly what it sounds like. It involves helping industries and organizations to improve their effectiveness through psychological principles. In other words, it is the study of people and behavior in a work setting. Although many people have never heard of I/O Psychology, it dates back to 1910 when the first I/O book was published.

Industrial Organizational Psychology is a very research and data-driven field. In fact, I/O professionals are highly sought out for their expertise. Companies like Best Buy and Target have in house I/O consultants to help manage and avoid a variety of organizational challenges.

How can I/O Psychology help my organization?

Because the industry is part of the field of psychology, many people assume I/O Practitioners and Psychologists provide counseling services. This is certainly not the case. Someone with a background in Industrial Organizational Psychology is hired to improve organizational effectiveness through techniques pertaining to business processes and the quality of employees’ work-life.

I/O specialists can assist companies improve, design, and evaluate programs and processes in key areas such as:

In addition to assisting with process management, I/O practitioners also help organizations by improving work-life for their employees by evaluating and providing insight on how to improve:

  • Engagement
  • Morale
  • Motivation
  • Rewards programs
  • Team cohesion
  • Retention and turnover
  • Work/Life Balance
  • Managing virtual teams
  • Employee health and wellness
  • Diversity

Industrial Organizational expertise can provide an immense impact in regards to helping organizations make data-driven, employee and culture-related decisions and provide a competitive advantage compared to traditional practices. An organization’s success is often dependent on the quality and well-being of its employees. I/O Psychology couples psychology and business to help organizations improve productivity and efficiency, increase profits, and avoid costly mistakes.

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Focus groups offer several opportunities to improve organizational effectiveness. In a previous post, we provided a basic introduction to purpose and process of leading a focus group. Before jumping ahead in this post, we highly recommend reviewing our introduction to focus groups.

Below, we address six great benefits and outcomes of leading focus groups within your organization.

1. Focus groups help improve employee engagement

Hosting focus groups sends a strong message to employees. It shows them that management cares enough to hear what they think. In a recent survey, 69% of employees said they would work harder if their efforts were recognized. Employees who feel their company is invested in them and what they have to say are going to reciprocate those behaviors and be more engaged at work.

2. Focus groups can help reduce turnover

Because employees are more likely to quit their jobs if they aren’t recognized and don’t feel valued, focus groups demonstrate to employees that they are being sought out to share their opinions. Knowing that the information they provide (anonymously) will be shared with upper management further reinforces the opportunity to be recognized and help the organization. When employees feel important, listened to, and valued, they are less likely to leave their employer. While it is important to recognize employees on a regular basis, conducting a focus group every so often sends an even stronger message to employees regarding the value of their voice within the organization.

3. Focus groups offer more accurate information

While utilizing surveys can be a very effective way to gather information, they do come with a host of obstacles. For example, surveys are often multiple choice questions with predetermined answers leading the survey participants to choose from only a few, very specific options. Focus groups allow for much more answers and feedback than a traditional survey. Often times, members of the group will report answers that someone creating a survey may never have considered to put on the survey.

Body language is also something that can be recorded in a focus group. A qualified facilitator can comment on the group’s body language and the overall mood of the group for each question. There may be instances where every single person in the session feels very strongly about something or instances where there were mixed reviews on a topic. Capturing the mood of the group and/or certain body cues can be invaluable when gathering feedback from a focus group.

4. Focus groups allow for clarification and immediate follow-up

Because focus groups are an open discussion, the facilitator has the opportunity to clarify responses. For example, if an employee says: “I think our reporting system is ineffective”, the facilitator can ask why and how the reporting system is ineffective. Surveys often gather opinions about certain topics, but struggle to ask the “why” and “how”. It is much more helpful to be able to gather the whole picture at once with a focus group.

5. Focus groups aren’t just a soapbox for employees – they uncover solutions

While it is important to understand the thoughts, opinions, concerns, and needs of employees, focus groups offer much more than that. Focus groups help to uncover problems and inefficiencies while also helping to uncover potential solutions. Management might think a new reporting tool is working great, but employees may be struggling with the new processes and procedures. Gathering suggestions to improve processes from the people who actually apply the process on a daily basis can tend to offer some of the best improvements and solutions.

When conducting focus groups, beware of the following:

  • Getting off topic
    • Focus groups are great because they are not highly scripted in structure. However, make sure to stay on topic in order to ensure the questions are being answered.
  • One person “hijacking” the session
    • Sometimes participants can get very involved and emotional during a focus group. Be sure everyone’s voice is heard and that it feels like a focus GROUP- not a one person show.
  • Accurately report what was shared in the session
    • When delivering the final report, it is extremely important to make sure all information accurately depicts what they group was conveying to the facilitator of the group. The facilitator must be unbiased and truthful when doing a write-up. Focus groups are about giving honest feedback even though this may contradict what some were hoping or expecting to see reported.

On the surface, focus groups may seem like an employee soapbox session, but don’t underestimate the valuable information a focus group can yield. Often times the cost of inaccurate or misleading information can be far costlier than hiring a professional. When done properly and professionally a focus group can provide instrumental information for an organization.

Interested in learning more about focus groups and how The Knowlton Group could help? Reach out to us using the form below!

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Many organizations overlook the benefits of conducting a focus group. Although they might appear to just be an open forum for employees to complain, a focus group is one of the most time and cost effective ways to gather honest information and feedback from employees. Though upper management consists of highly talented and intelligent individuals, they are often out of touch with daily processes and tasks that are affecting their employees. Focus groups are a great way to gather a snapshot of daily obstacles, areas for improvement, and potential solutions coming directly from those who know most day-to-day operations.

What is a focus group?

A focus group usually consists of one facilitator and anywhere from 6-12 employees. Sessions usually take place for 90 minutes but can also be extended to several hours. The general objective of a focus group is to get feedback from employees on a variety of topics. For example, a focus group can be formed to gather opinions about a new software program being used in the office. Focus groups can also be utilized to help improve retention, get feedback regarding onboarding processes, strategic plans, or for topic where feedback is wanted. Focus groups should feel relatively casual and open, as this type of atmosphere makes participants feel more at ease and are more susceptible to create discussion.

What is most important when conducting a focus group?

Once it has been established that a focus group will take place, it is important to give participants as much information as possible. Be specific about time, location, what will take place, and a brief overview of the topic. The more informed participants feel, the more comfortable they will be. It is extremely important that all participants are guaranteed anonymity. Without this, employees will likely feel uncomfortable and may fear backlash or repercussions from management, which will affect the quality of information gathered. The goal of a focus group is to gather a wealth of honest information in a short period of time. By interviewing people together, it also provides a better environment for openness, discussion, and brainstorming. Employees will not feel singled out and will be able to bounce thoughts and ideas off one another.

The role of the facilitator is critical. The best case scenario would include a third-party individual outside of the organization acting as the facilitator. Because this person would not be affiliated with the organization, participants would be less likely to fear backlash and would be more trusting of the individual. By having someone removed from the organization, more honest feedback is often provided. Difficult conversations can occur in focus groups; a facilitator with no affiliation helps promote open dialogue and limits “sugarcoating” of what’s really going on.

If an outside consultant is out of the question, utilizing someone as far-removed from the group as possible within the organization is ideal. The goal is to find the most neutral person possible to conduct the session. The key component of the facilitator is to ensure unbiased feedback. With smaller companies (less than 500 employees), most people know each other on some level- making unbiased, honest feedback more difficult to gather. Utilizing a professional is recommended as they are trained to be unbiased, protect the participants, and provide an accurate report to management.

Interested in learning more about focus groups and how The Knowlton Group could help? Reach out to us using the form below!

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In a recent post, we talked about employee retention and meeting employee needs more effectively. While it’s great to to be able to identify weaknesses and make changes along the way, sometimes starting strong with training can make an even larger impact when it comes to employee retention. In a prior post, we noted that 52% of organizational turnover occurs among first year employees with the cost to replace a Millennial employee climbing upwards of $25,000. Effectively training Millenials has never been so important to many organizations.

Techniques for Training Millennials

Effective training from the beginning is important as it can help organizations avoid much of the time and cost incurred due to turnover. Below, we discuss five techniques for effectively training Millennials specifically.

1. Outline clear expectations

It has been reported that only 50% of employees know exactly what is expected of them at work. Most people like to feel as if they know what is expected of them, but, for Millennials, this is especially true. Managing expectations properly ensures coworkers and managers are on the same page leading to higher efficiency and productivity.

Having clear expectations also allows employees to do their jobs more effectively as they are less likely to make mistakes or waste time asking questions that they are expected to know. Employees will then hold themselves more accountable while also feeling more empowered to excel in their position.

When training Millennials, defining clear expectations is critical.

2. Offer short, frequent feedback

A recent survey showed that 98% of employees will become disengaged when they have a manager who gives zero or very little feedback. While most organizations would report that they give feedback via annual or quarterly reviews, this is not necessarily the best type of feedback.

Especially for Millennials, formal, infrequent feedback is not particularly effective. There is a concept called “two second feedback”: instead of only giving feedback in an intimidating, lengthy meeting once a year, offer quick and frequent feedback to employees. Next time you pass an employee in the hallway, let them know their comments in this week’s meeting were beneficial to the project. If you expected more from a recent report, let that employee know you expect a more detailed report next time. Quality feedback doesn’t require a formal meeting with designated blocks of time; simply let people know how they’re doing when they actually complete the task. In other words, don’t wait six months to praise or critique employees.

Will this really make a difference?

A HubSpot survey reported that 69% of employees indicated they would work harder if they received feedback and recognition of their efforts. Whether it’s positive or more constructive feedback, employees will feel their work is recognized and valuable making them more likely to work harder and feel more satisfied.

3. Provide meaningfulness

Learning the various procedures, protocols, and steps of performing a new job can be exciting, intimidating, monotonous, frustrating, and encouraging. But after learning a new job and being able to master daily tasks, then what?

When training Millennials, tell them why they’re doing what they’re doing. How do their tasks contribute to the success of the company? Sometimes a job can get dull or feel as if one is simply reinventing the wheel. By providing meaning and importance to employees, they are more likely to stay engaged and motivated.

4. Plan for the future

Relating back to our analysis of how Maslow’s “Hierarchy of Needs” applies to employees, humans are intrinsically motivated to reach various milestones throughout their lives and to strive to be their best self. Therefore, most Millennials don’t expect their first, second, or even third job to be their last. They want to be constantly growing and developing professionally.

When training either a new or existing employee for a new job, demonstrate that they have the ability to move up within the company. Create achievable, measurable goals that employees are familiar with from the beginning. Spend some time succession planning and share that information with your employees. CUES estimates that fifty-six percent of employees expect a promotion within a year. That may or may not be reality for all of your employees, but at least let them know you’re invested in them and that they’re important to the organization.

Show your employees you want to help them succeed and excel within the organization.

5. Create a collaborative space

A collaborative work environment is something most Millennials value. We’re seeing more and more companies shy away from the cubicle atmosphere and move towards a more open, team-oriented environment. For new employees, this type of environment can feel more welcoming and enable them to ask more questions and learn at a faster pace.

A collaborative workspace also allows for proliferation of ideas and cultivate a more diverse mindset. Additionally, employees feel more in control of their jobs when they feel they can collaborate with others – further enhancing their confidence. With the ability to work with others, employees can brainstorm and utilize feedback from coworkers before finalizing projects. With 74% of Millennial employees expressing a desire to work with others, organizational culture is making a shift towards a more collective mindset.

Wrapping Up

It doesn’t require a training overhaul in order to make improvements to your current practices. Small, manageable changes to your organization’s training procedures can make the onboarding process much more effective and ultimately reduce turnover. By ensuring that Millennial employees are properly trained, they will become more confident, competent, productive, and excited about a future within your organization!

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One of our previous posts discussed turnover and the significant cost companies incur as a result of employees quitting their jobs. So what can management do to improve employee retention and minimize their turnover costs? A possible solution lies in one of the most famous psychological theories on motivation.

The “Hierarchy of Needs

Back in the 1940’s, a man named Abraham Maslow presented the idea of the “Hierarchy of Needs”. This concept explained how all humans have innate needs and motivations which help steer and dictate human behavior. Maslow utilized the idea of a pyramid to help better explain his theory. The “Hierarchy of Needs” begins at the bottom or base of the pyramid, and as each person achieves or meets that need, they move up each level to the top of the pyramid. For example, the base of the pyramid represents psychological needs. After one’s psychological needs are met, they can move up the pyramid until they reach the top, which is self-actualization.

Hierarchy of Needs and Employee Retention

Why is this Relevant to Employee Retention?

Maslow’s “Hierarchy of Needs” is an example of human motivation, something every human possesses (although you may argue some of your employees are more motivated than others!). Humans are motivated by these needs in many aspects of life – including their work lives. Because these needs are transferrable to the workplace, understanding these needs and motivations can help organizations improve employee retention by better understanding employee wants and needs. Below, we discuss how employers can contribute to each level of an employee’s “Hierarchy of Needs” and improve their rates of employee retention.


The physiological portion of the pyramid refers to the human need for food, water, air, clothing, and anything that would be essential for daily life. While a job doesn’t directly solve any of these issues, receiving a paycheck certainly assists with checking off most of the items on this list. Needless to say, if someone has a job, these needs are most likely being met, and therefore, one can move up in the pyramid to the next need.


After one has established they can feed, clothe, and provide shelter for themselves and their family, an employee is likely concerned about the “safety” portion of the pyramid. Typically, this section refers to personal and financial safety along with concerns about health and other safety nets. In the workplace, employees are going to want to be happy with their pay, benefits, PTO, and any other perks or benefits offered to them by their company. When the safety need is met, employees feel they are able to live a secure life and be somewhat prepared for the unexpected events life throws at us.

Love and Belonging

This next section of the pyramid refers to the basic human need for friendship, intimacy, and familial bonds. While at first glance this may not seem very transferrable, it is actually a very important aspect of the organizational atmosphere.

Employees want a connection at work. They want to form relationships with their coworkers and management, and they want to be able to feel supported. Utilizing two-way communication methods, open door policies and offering frequent feedback are excellent ways to promote this support. Company events and forming a collaborative atmosphere will help employees to form that connection they want to the people they work with and for.


After experiencing love and belonging, people become concerned with esteem. Everyone wants to feel valued, accepted, independent and competent. This is where proper training and continuous coaching comes into play. Properly train your employees so they can feel competent and confident in what they do. Give your team feedback. Training isn’t just a one-time thing; give your team feedback as much as possible. They want to know how they’re doing so they can continue to improve or know where improvements need to be made.


After meeting all of the previous needs, people reach the top of the pyramid: self-actualization. This occurs when one reaches their highest potential and becomes the best they can be. Give your employees the opportunity to excel and be their best self. Offer opportunities for further education or professional development opportunities. Give them the chance to get more involved with company, and encourage employees to get involved with sponsored charity work or events. Work on succession planning with your team. Plan out measurable goals and outline promotions or compensation accordingly.

In the end, successful employees create successful organizations. Give your employees the tools and opportunities to succeed and success will inevitably befall the company.

So, What?

After the lesson in Psychology, you are probably asking yourself, “why does this matter?”. Ask yourself this: why do people leave their jobs? It is because they’re not satisfied with some aspect(s) of the job. People want to feel fulfilled, and they ultimately want to be happy. Surveys show that employees are 15% more likely to consider quitting if they don’t like their work culture and 11% less likely to stay at their current position if they don’t feel appreciated or recognized.

There will always be turnover, but, if you work on fulfilling the needs of your employees, they will be less likely to leave. Would it be great to be able to offer the best pay and vacation packages to every employee? Yes, I’m sure they’d all love that! However, by coupling what you can offer financially with an obvious dedication to employee wants and needs, you’ll be able to see less turnover, higher employee retention and significant cost savings.

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