How to master the 4 elements of employee retention

More than 47 million American workers quit their jobs in 2021, with resignations being highest in the tech and healthcare industries. Leaders, analysts, and the media dub this 'The Great Resignation,' but it comes down to a reckoning of what the future of work is going to look like—and whether you’ve built the kind of culture and benefits that make your team feel valued. According to an analysis by MIT Sloan, a toxic workplace culture, more than any other factor, drives people to leave.

So the real question is, what makes people stay? Yes, short-term benefits or bonuses may work for a little while, but as a leader, you have to think about the bigger picture. 

We approach employee retention with a broad, inclusive lens that focuses on growing our team and giving them an environment where they can thrive. 

In my experience, people stay for four reasons:

• Compensation

• Purpose 

• Autonomy

• Impact

Keep in mind that even if you get all four right, it doesn’t guarantee you’ll retain every employee—we don’t always get it right, either. But if you can consistently deliver on all four, you’ll build a culture where every employee feels like they can succeed.

Let’s dive into what each of those reasons looks like in practice:

1. Be straight up with salaries

Start by getting the bottom line right every time.

At Hotjar, we’re fully distributed around the globe, which makes the question of compensation that much more complex.

Instead of trying to optimize for every single locale, we base all of our salaries on the upper quartile of the technology industry in London. Whenever we hire for a new role, that’s where we start, making sure we’re offering a salary band in the top 25% of the market.

More importantly, we make that salary band transparent on every job description, so every candidate walks in with all the information they need to feel empowered.

To double-check what a fair compensation looks like based on the role, function, and company size, we use a company called PayScale. It’s important to make sure there is a structure to every salary band and a reason behind it you can back up with data. 

To me, that’s especially critical because that way, there are no advantages to someone who is a better negotiator or self-advocate. Partially because this penalizes women and minorities, and also because if you’ve gone through a rigorous hiring process like ours, I want you to know that you’re getting the best offer we can make—not that you’d get 10% more if you asked.

2. Set a strong, company-wide purpose

Why do you come to work every day? It’s not just for a salary.

You have to provide your team with a company-wide sense of purpose, a 'why' for logging on each day that goes beyond clocking in and clocking out.

In Simon Sinek’s book The Infinite Game, he calls this the 'Just Cause,' which describes a statement of purpose that’s so inspiring and compelling that your team feels motivated to continue pushing through whatever challenges you may encounter. 

For a 'Just Cause' to work, it has to be:

• For something: a positive and specific vision of the future

• Inclusive: every employee can contribute to the creation of this future

• Service-oriented: benefits customers and society at large, not just the company

• Resilient: this vision stands regardless of political, cultural, and societal changes

• Idealistic: it’s big, bold, but ultimately achievable

At Hotjar, our mission is to make the web a better place.

Our product was originally designed to improve web experiences, which at the surface may not seem like a just cause.

But dig one level deeper, and you can see how that step creates a much more enjoyable experience, and that joy can spread to improve the world in a significant way.

I find it so inspiring to know that every day I’m working on making the world a little bit better—and I hope my team finds it inspiring, too.

3. Build autonomous teams

We’ve all had that manager or teammate that is constantly pinging you on Slack or coming over 'just to check on things.' It’s exhausting, not to mention unproductive.

If you’ve hired the right people, it’s your job as a leader to step aside and let them perform.

The best way to encourage autonomy, I’ve found, is by structuring the team so that each person has everything they need without necessarily including a manager.

In marketing, we organize our teams not by channel or skill set like content, paid performance, or creatives in separate groups but cross-functionally into squads, much like an engineering team.

This way, every team has a content marketer, a copywriter, a designer, and a performance marketer in the same group, with one clear objective they work on together. 

No one reports to anyone else within that group. Each team is expected to operate with full autonomy to execute on their objective, so that hierarchy doesn’t get in the way.

4. Make it easy to see the impact

Every company goes after ambitious goals. But it’s not always clear how those goals translate to what an individual contributor might be doing, especially for more junior staffers.

At Hotjar, we set three company-wide OKRs—objectives and key results—that cascade down into every department and every team. Everyone knows exactly what those are, and we choose three on purpose so we can focus our efforts around what matters.

For marketing, I interpret those OKRs into manageable sections of what marketing can contribute each quarter. After that, though, I leave it up to my teams to determine which piece of those objectives or key results they’ll tackle and how they plan to measure their performance against it. 

That way, they can see the growth and change they’re creating as a result of the work they’re doing. Who doesn’t want to know they’ve made a difference?