It’s not a Great Resignation–it’s a Great Rethink
The pandemic has turned the labor market on its head, leaving job seekers with the upper hand and companies wringing their hands over a labor shortage that is endangering their ability to function.
In their anxiety over how to retain and attract employees, many companies are adopting quick-fix solutions like raising salaries and improving benefits. While these are welcome, they fail to acknowledge much deeper reasons for the Great Resignation, as it is being called–reasons that go to the root of what it is to be human.
A better description of this phenomenon would be a “Great Rethink” in which we are all rethinking our relationship to work and how it fits into our lives.
Yes, many people are quitting their jobs for better offers or opportunities elsewhere–but others are leaving because they are experiencing a crisis of meaning. The pandemic has been a time of deep personal introspection and reassessment, and it has caused people to see how precious and fragile their lives are. People have looked at their jobs and thought: I want meaning and purpose in the work that I do, and I am not finding it here.
There is abundant research to show that employees of all ages want jobs that are not merely interesting and reasonably compensated, but meaningful and purposeful. A recent McKinsey survey of employees found that 89% desired a sense of purpose at work.
Recognizing how much both customers and employees value a sense of purpose, many companies have developed and promoted inspiring purpose or mission statements. It’s no longer enough to build and sell cars. You must instead purport, as Ford Motor Company does, to “build a better world, where every person is free to move and pursue their dreams.” It’s no longer enough to sell coffee. Like Starbucks, you must “inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time.”
Unfortunately, few purpose-driven companies actually deliver. They talk glowingly about purpose in their internal and external communications, but when it comes to specific decisions and policies, including those that bear on workplace conditions, companies act in ways that seem far from enlightened.
In 2019, the Business Roundtable, a group of CEOs from America’s biggest companies, issued a formal statement on “The Purpose of a Corporation” in which it pledged a commitment to a multi-stakeholder view of business. Gone were the days when companies would prioritize profits above all else, the executives vowed. Instead, they pledged to deliver for all stakeholders, including employees and communities.
However, a year after the roundtable’s statement, in the midst of the pandemic, most big companies didn’t seem to have departed much from business as usual, or to have changed their policies to benefit employees–or any stakeholders other than investors. As the Washington Post reported in late 2020, many of the country’s 50 biggest companies earned profits even as a majority of them laid off employees.
Not all companies have underperformed in this area. In recent years, I’ve gone inside a select group of companies that practice what I call “deep purpose.” Firms like Etsy and Gotham Greens actually walk the talk, embracing purpose as a foundational operating principle and embedding it throughout their organizations to structure decision-making and work processes. Etsy made commitments in three areas related to its purpose (diversity, environmental responsibility, and empowering people), reporting publicly on its progress. Gotham Greens has embraced a revolutionary business model that reinvents agriculture to be both more sustainable and supportive of local communities.
Unsurprisingly, employees notice these efforts. As leaders at these firms routinely tell me, they have a much easier time than their peers retaining top talent. Deep-purpose firms are also much better at recruiting talented people and enabling them to thrive. Employees at these firms told me that they regarded their work as meaningful because they believed in the organization’s reason for being and saw a connection with their own personal purpose. This in turn led them to take pride in their jobs, to trust their organizations, and to feel a strong sense of community at work. Because deep purpose firms also tend to allow more autonomy on the job, employees felt more creative and empowered and they enjoyed their jobs more.
Infuse purpose with historical depth
Leaders often presume that if we come up with high-minded language, they’ll inspire others. In truth, words themselves usually carry little meaning on their own. Employees often find purpose more authentic when leaders connect it with history, and when they tell powerful, credible stories about the purpose’s rationale and impact.
Toymaker LEGO did this to memorable effect as part of its extraordinary revival during the 2000s, connecting its purpose back to its founder’s founding spirit inscribed in the phrase, “Only the best is good enough.” Employees became more invested in the company’s success, even to the point of holding leaders accountable for living up to LEGO’s historic values.
Make it personal
Leaders often articulate a purpose for organizations, forgetting that employees have personal purposes of their own.
Companies like Microsoft that explicitly tie the organization’s purpose to those of employees have an easier time bringing the purpose alive in employees’ daily work. Microsoft did that in part by creating a forum called Microsoft Life that celebrates employees, their personal missions, and their work at the company.
Rewire your enterprise around purpose
Leaders often regard purpose in a limited way as either a marketing or human resources exercise. Companies that go deepest with purpose take a much more comprehensive approach, treating purpose as an operating system and embedding it in processes, organizational structures, and culture.
Global professional services firm EY adopted a system of metrics to spur behaviors associated with its purpose. “Companies really have to be able to show what they’re doing,” EY’s CEO Carmine Di Sibio told me. “They get into trouble when they talk a lot about purpose and it’s just talk.”
Imagine what it feels like when everything about your work ties back in clear, even obvious ways to your purpose. That’s what employees at deep-purpose companies experience on the job.
It’s encouraging that some CEOs—68% of those queried in one survey—are placing “more emphasis” on purpose, but that’s not enough. For purpose to feel genuine and meaningful, they must live it in their daily work, hold others accountable for acting in ways congruent with that purpose, and bring it alive for their workforce.
Let the Great Rethink begin, as we all imagine a new workplace that inspires us.
Ranjay Gulati is the Paul R. Lawrence MBA Class of 1942 Professor of Business Administration at Harvard Business School. He is the author of Deep Purpose: The Heart and Soul of High-Performance Companies
More must-read commentary published by Fortune:
- Former Ukraine prime minister: Only together can we defeat Putin’s plans for global autocracy
- The Biden Administration: How not to impose sanctions
- Offices are obsolete—and so are the managers who insist you must go back
- How the European gas market fuels Putin’s obsession with Ukraine
- The Great Resignation calls for a Glorious Re-Engagement
Never miss a story: Follow your favorite topics and authors to get a personalized email with the journalism that matters most to you.