The Drivers of Employee Loyalty in Today’s Workplace

Walt Disney once said: "You can dream, create, and build the most wonderful place in the world, but it requires people to make the dream a reality."

It is a commonly accepted fact that employee loyalty today plays a central and pivotal role within the success strategy of any organization aiming at long lasting market presence, regardless of size and activity sector. But what is it exactly that makes job loyalty such a powerful and critical topic in today’s ever-changing business environment?

Job loyalty stands for the relationship between an employer and an employee, more precisely, “an abstract, often unwritten contract, in which the employer agrees to provide the materials and resources the employee needs to get the job done, matched by the employee’s agreement to work at an optimal level to fulfill the goals of the company”, states Dr. David G. Javitch, internationally recognized author on key management issues and President of Javitch Associates Management consulting firm in Newton, Massachusetts.

Some 20 or 30 years ago, loyalty was not a debatable subject; the “Job for Life” notion was still a reality and an employee would get hired and stay with his company until retirement. Not anymore. Editorial Director of Harvard Business Online (the daily destination site for business professionals and leaders), Paul Michelman, states as per a report on employee loyalty by Walker Information that 36% of U.S. workers say they plan to leave their current organization within the next two years. Moreover a recent research report by the Middle East’s #1 job site Bayt.com titled the 2008 Human Resource Review shows that in the Middle East, the average professional has changed jobs in the past 5 years at least once, and very often more than that.

With elevated local and global competition, increased and more widespread information via the internet, increased labor mobility and rampant restructuring at both the economic and corporate levels, job markets operate very differently nowadays to the way they used to in the job-for-life decades. Moreover, booming economies in the Middle East, specifically the GCC economies, have meant that employees have access to wider employment options and opportunities. Employee loyalty has hastily become a rare and precious commodity that is to be proactively nurtured, cultivated and managed.

What are the benefits of employee loyalty to companies in general and how does it contribute to the success or failure of business organizations today?

At the most basic level, your workforce represents your organization on a daily basis when interacting with customers, be it via face to face encounters, telephone calls or e-mail correspondence. The way you treat your employees is often reflected in the way they in turn treat your customers. If an employee is generating negative feelings towards the company, customers will invariably recognize this and have second thoughts about a confirmed or potential sale. If, on the other hand, an employee is committed to his/her company, they will treat customers with dignity and respect and will project genuine enthusiasm and passion for their company which will directly encourage similar feelings towards your organization from your customers.

Moreover, loyal employees with a long-term commitment and tie to their companies realize that one time sales are not enough for a company to generate revenues consistently. They recognize tha t the secret to sustained success lies in establishing long-term value relationships with customers by satisfying all their needs and exceeding their expectations, which in turn translates to increased sales, additional job security and increased employee loyalty.

What else is in it for you, as a company, other than the very direct impact on profitability?

Reduced turnover rates have a powerful impact on company culture and morale. As you wave farewell to the costs and hassle of new job postings ads, executive search firms and prolonged and expensive interview, orientation and training processes for new employees, your corporate culture becomes more stable and you reap the rewards of having a tried, tested and true workforce. Employees recognize the rules, mores and values of the company, are familiar with each other and with their roles, and the unnerving, unsettling effects of constant staff churning, disequilibrium and turnover are avoided. With a loyal workforce you can be assured you are unerringly where countless other companies would wish to be every minute around the clock.

An extensive recent HR survey conducted by the Middle East’s #1 job site Bayt.com entitled Employee Loyalty in the Middle East shows that 64% of employees in the Middle East region feel loyal towards their jobs. So what is it exactly that triggers employee loyalty? What is it that pushes employees to like, engage with, respect and commit to their companies on a long-term basis? The following are just some of the essential drivers of employee loyalty in an organization:

• Being conscious of the company vision: Employees feel much more involved, engaged and trusted when top management regularly shares the company’s vision, mission, direction and important decisions with them.
• Owning a career, not only a job: Employees who feel that their job is an important milestone along a rewarding career path are more motivated to perform well, engage in their work and invest in the welfare their company.
• Feeling part of a bigger scheme: According to Corporate Connections, a publication from the office of Corporate Relations at Emory University, “a varied corporate philanthropy plan is an effective tool to retaining employees”. Belonging to a company that is publicly committed to society’s well-being and knowing they are an integral part of a larger goodwill effort, reinforces employees’ commitment to both their jobs and their organizations.
• Getting fair remuneration packages in light of their job duties: It might be true that money can not buy loyalty but not paying your employees what they are worth can definitely chase them away.
• Feeling empowered: Having the opportunity to share their thoughts and ideas and the authority to take decisions that relate directly to their roles are great boosters for both self esteem and job loyalty.
• Being positively challenged everyday: Believing in your employees’ capabilities and setting high standards for them to meet is key to elevating motivation levels and positive feelings about their jobs.
• Receiving proper training and development: Employees tend to put more effort into their jobs when they feel valuable to their company. If you invest in your employees (trainings, seminars, skill development…) and cater to their professional needs, they’re most likely to invest right back in their jobs, thereby producing more revenues and committing to their jobs even more.
• Being recognized and rewarded where relevant: A simple word of recognition for a job well done can do wonders for an employee’s morale . Companies that recognize and reward their employees’ contributions routinely and systematically have already curtailed one of the main reasons for staff turnover.
• Maintaining strong relationships with Management: This does not entail merely the direct boss but the upper hierarchies as well. Employees feel much more sheltered knowing their work and contributions are recognized throughout the organization in the circles that matter and that all work relationships are solid and healthy.
• Maintaining a work life balance: This has become increasingly important in today’s workplace. Companies that encourage a healthy lifestyle and accommodate for different priorities are most likely to expect improved motivation and productivity levels amongst their staff.

In conclusion, far from being a luxury, employee loyalty is an essential commodity in today’s corporation and a measure of organizational welfare that cannot be ignored. The good news is that companies that are attuned to this important barometer of corporate wellbeing and gauge and monitor internal loyalty levels periodically, putting studied and proactive programs in place to cultivate and encourage employee loyalty, are able to benefit from increased profitability, reduced turnover and higher staff commitment, productivity and morale.