The Key to Employee Retention? Compassion!

If companies want to hold on to their best employees, they have a powerful (and free) tool at their disposal. They need to connect with empathy but lead with compassion. Here are some insights on how to do that.

A businesswoman listens intently to an employee talking.
(Image credit: Getty Images)

The “Great Resignation” shows no signs of stopping. In March a record 4.5 million workers quit their jobs, according to data released May 3 from the Bureau of Labor Statistics (opens in new tab). What does this mean for workers and the employers who want to keep them?

“In the era of the Great Resignation, there is a tool – a path – as old as humanity itself, which can be the most effective way showing employees that the boss really does care about their welfare and wants the best for them,” notes Jacqueline Carter, senior partner at Potential Projects, a global consulting and leadership development firm whose goal is “To create more human worlds of work.”

Their clients include Fortune 500 companies, such as Disney, Ikea and Unilever.

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Along with Rasmus Hougaard, their just-released book, Compassionate Leadership (opens in new tab): How to Do Hard Things in a Human Way, describes the steps that “break down walls of indifference and a lack of caring that in many ways still dominate American business,” Carter points out, adding:

“As the greatest expense for most business is personnel, it is critical that we retain good people. But far too many organizations fail to spot the wrong messages they are sending, fail to seize opportunities that will deepen bonds of trust. That’s what we have studied and developed practical, workable solutions,” she says.

So, just what is compassion? What are the consequences to an organization when management fails to understand this concept in today’s business world?

Compassionate Leadership gives readers tools, an insightful paint-by-the-numbers approach to becoming a more effective leader through understanding and implementing this vital concept. It is also a touching, inspiring read.

Failing to Understand the Role of Compassion Is Costly

“In any organization, a failure to understand the role of compassion will predictably result in the loss of your best talent and limit opportunities to manage change and innovation,” Carter says.

The authors explore compassion’s broad meaning and function in both society and business organizations. “It is wanting to be of benefit and is distinct from empathy, which is an emotion. Compassion is an intention – a desire – and we found that truly competent leaders connect with empathy but lead with compassion.

“It isn’t about being everyone’s best friend, or ‘being nice.’ Rather, it is about being able to show up as someone who truly cares, but is able to do and say the hard things that need to be done in a human way.”

In a sense, compassion can be defined as wanting to be kind, showing that you care and both asks and answers this question: “How can I help?”

As any HR manager will tell you, one of the reasons for the Great Resignation has little to do with money, but everything to do with the boss being a decent person (or not).

The authors make clear that, especially these past two years, it means being aware of the challenges facing employees, both on the job and at home. Compassionate Leadership gives readers an approach to showing that they care and are curious – truly want to know how their employees feel, what are their concerns and worries, truly wanting to know, “How can I help?”

“Compassion is the opposite of indifference, and it is one of the essential qualities that determine, whether one is a decent human being. A compassionate leader does not pretend to have all the answers. To the contrary, that leader will be fully present – physically and mentally – encouraging all involved to share their curiosity and points of view in problem solving. In a word, the compassionate leader is the very definition of caring transparency.”

Being Candid in a Caring Way

“Compassionate leadership,” Carter underscores, “does not mean simply telling someone what you think they want to hear. Rather, it requires the courage to step into things that are challenging. The compassionate leader is able to say what needs to be said in a kind and caring way. It is different from brutal honesty.”

Of course, there is a fine line between being candid and being accused of maintaining a hostile work environment or allegations of discrimination.

“The solution to this problem,” Carter believes, “is caring transparency and requires learning how to communicate those difficult things in a better way, and not avoid being clear out of fear of a lawsuit.”

She asks this question: “Would you like to work for a boss who only cares about production and not the welfare of employees? The choice is obvious, and our research proves that leaders who can do both – be goal-oriented and care about their employees – are far more successful.

“Employees are expecting to see more human leaders today, and we can train ourselves to be more compassionate in our daily lives. Additionally, these principles can be applied to our interactions with family and friends.”

Once you begin to read Compassionate Leadership: How to Do Hard Things in a Human Way, you will have a difficult time putting it down; it is so interesting and relevant.

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

H. Dennis Beaver, Esq.
Attorney at Law, Author of "You and the Law"

After attending Loyola University School of Law, H. Dennis Beaver joined California's Kern County District Attorney's Office, where he established a Consumer Fraud section. He is in the general practice of law and writes a syndicated newspaper column, "You and the Law (opens in new tab)." Through his column he offers readers in need of down-to-earth advice his help free of charge. "I know it sounds corny, but I just love to be able to use my education and experience to help, simply to help. When a reader contacts me, it is a gift."