Insights into Reasons and Solutions
In today’s rapidly evolving business landscape, retaining top talent is crucial for maintaining a competitive advantage. Despite this, many companies struggle with high turnover rates among their most skilled employees.
Let’s first consider some statistics:
- Approximately 3.5 million employees quit their jobs each month in the United States. This adds up to 42 million per year (U.S. Bureau of Labor Statistics).
- Around 50% of top employees worldwide quit each year (Gallup Institute).
- 77% of employee turnover could be prevented by employers (Work Institute, 2020 Retention Report).
- The cost of losing employees in 2020 exceeded $630 billion (Work Institute).
- The average cost per hire is approximately $4,129, and the average time to fill a position is 42 days (Society for Human Resource Management, 2016 Human Capital Benchmarking Report).
- 84% of CEOs have experienced turnover among their senior leadership team in the past five years (PwC, 2017 CEO Success Study).
- 50% of executives leave their positions within the first 18 months (Harvard Business Review).
- 47% of executives are actively seeking new job opportunities or are open to new roles (LinkedIn Talent Trends Report).
Why Top Employees Leave
The most common reasons cited for top employees quitting include:
- Poor leadership
- Lack of recognition
- Insufficient career opportunities
- Feeling that their work is not appreciated
(Source: Harvard Business Review)
If we consider that recognition, organizational culture, and career progression are typically overseen by leadership and management, one conclusion becomes clear:
Almost all top talent leaves because of poor leadership.
This signals an urgent need for change. Either business owners must appoint C-level executives with the right mindset and skills, or current leaders must recognize their responsibility in retaining top employees. One undeniable truth stands out:
The best employees leave first.
They are the ones most willing to act if they feel undervalued. They are also the most capable of finding new roles elsewhere. In fact, many are willing to accept lower pay if it means working in a better environment. Therefore, timely retention strategies are critical—unless an organization is willing to risk being left with only low-potential underachievers.
Proven Retention Strategies
To address this issue, experts recommend the following:
Recognition and Appreciation
Regular feedback and recognition help employees feel their work is valued. Companies should implement transparent reward systems that include both financial incentives and personal/professional acknowledgments. Public recognition, bonus programs, and career advancement opportunities are all effective.
Career Development
Providing clear career paths and ongoing training is essential. This includes regular workshops, mentoring programs, and hands-on project opportunities. Employees need to feel they can grow and that their hard work is recognized and rewarded.
Healthy Work-Life Balance
Flexible working hours and remote work options help employees stay productive and motivated long term. Initiatives such as part-time roles, wellness programs, and flexible schedules all contribute to higher satisfaction and lower turnover.
Effective Leadership
Leaders must be trained to lead with empathy and clarity. A good leader listens, communicates regularly, makes transparent decisions, and fosters a positive company culture—all of which strengthen retention.
Additional Measures
- Performance-Based Compensation: A fair and transparent pay system aligned with performance significantly boosts retention. Regularly reviewing compensation ensures competitiveness in the market.
- Teambuilding and Social Activities: Company events, group outings, and team-building initiatives strengthen team cohesion and foster a sense of belonging.
- Feedback and Communication: Open communication channels, employee surveys, and regular one-on-one meetings create a culture of trust and engagement.
- Support for Personal Development: Supporting personal goals—through coaching, training, or allowing employees to work on passion projects—fosters loyalty and personal satisfaction.
A Critical View from the Vienna International Management School
The Vienna International Management School offers a critical lens on these common recommendations.
- Language Matters: The school critiques the language of feeling—“employees should feel their work is valued,” “feel they can progress,” etc. These phrases, it argues, risk slipping into manipulation and illusion, rather than creating real value or opportunity.
- Leadership Growth: A major emphasis is placed on the personal development of leaders. Only through genuine growth and self-awareness can leaders gain credibility in both words and actions.
- Inclusive Development: Real respect for employees requires more than feedback—it demands inclusion. Employees must be part of the decision-making process, especially in shaping development initiatives.
- Rethinking Management Training: Traditional management schools, the Vienna Institute argues, focus too much on technical skills and tools while neglecting personal growth. In their words:
“A fool with a tool is still a fool.”
To address this, they’ve developed a comprehensive workplace evaluation framework that integrates all employees into the organizational development process. In addition, they are piloting a trademarked executive training program called:
Leadity™ — Leading by Personality
This program focuses on cultivating leadership through personality development, rather than just technical training—building leaders who earn the trust and commitment of their teams.
Dr. Imre Marton Remenyi is a psychotherapist, expert in personality development, and executive coaching.
He works in six languages.
For over 30 years, he has been guiding top CEOs, entrepreneurs, and leaders toward confident leadership with ease and passion.
office@remenyi.at
+43 – 676 382 9298
