In February 2023, Susan Wojcicki stepped down from her nine-year tenure as CEO of YouTube, with former chief product officer Neal Mohan taking her place. She wasn’t alone in leaving a leadership position in a Fortune 500 company.
In the first quarter of 2023, 418 CEOs left their positions, perpetuating an economy of fluctuating leadership and high turnover. This shuffle of corporate leaders places stress on companies’ vision, culture, and policies, making it harder for them to retain their cultures.
Some business executives can resign without worrying about paying bills and their future financial prospects. They may leave their job with many connections and rich job offers. They’re not resigning for the same reasons as low-wage workers: inadequate pay, long hours, or harsh working conditions.
So why do leaders leave, then? It’s because of burnout sweeping the workforce and a lack of decent work-life balance.
Then what’s the key to strengthening leadership retention? Some of the best employee retention strategies for those at the C-suite level include keeping them challenged, improving their work-life balance, and improving their working environment.
The Fall of Leader Well-Being
One of the major reasons for the lack of retention among leaders is that their well-being is falling. Not only that, but the challenges of leadership are also increasing, and for many, their high salaries are no longer worth the stress. In fact, according to Yale, chronic stress can shorten someone’s lifespan. “A lot of people have felt on a gut level that stress makes us age faster, and our study shows that that is true,” said Yale psychiatrist Zach Harvanek. We can hardly expect people to ignore that feeling.
Running a company carries considerable strain, seeing how business leaders are responsible for thousands or millions of workers. Then you have to factor in the lingering effects of the COVID-19 pandemic, along with resigning workers and growing inflation.
In 2022, Deloitte partnered with the research firm Workplace Intelligence to survey 2,100 employees across the English-speaking world. They found that 70% of C-suite employees are “seriously considered quitting for a job that better supports their well-being.”
Workplace Stress Up Five Percent During the Pandemic — and Greater for Executives
Not only did COVID-19 usher in the age of remote work, but it also increased workers’ daily stress levels by a significant percentage, CEOs included.
Executives must make risky decisions regarding remote work. Though perceived as more productive, remote work can have harmful effects on a company’s employees, like causing a general feeling of social isolation.
This can put more pressure on the employer, who may not have enough knowledge about the day-to-day lives of their employees to adequately help them. When employees are more stressed, they perform worse and adversely affect the company, and that will translate into even more stress for the leader.
Not only that but unless their hours are being set, work is constant for executives. They also have to be responsible for not just their own career but their employees’ too. If the company falters, the executive will likely take the brunt of the blame.
As the Great Resignation makes it harder to attract loyal, qualified workers, greater stress is put on business leaders and recruiters. Consider that there have recently been more than 10.1 million open jobs across the U.S. and 6.1 million hires.
Abundant jobs aren’t an idle threat for CEOs, who must compete to hire the best workers. The normalization of online job websites like Indeed, Glassdoor, and LinkedIn has allowed for an overabundance of applications for very few jobs. Having hundreds apply for the same job can be detrimental to CEOs because the stakes of hiring the wrong employee are significant. And if the wrong people are hired, that can damage the company’s well-being.
CEO well-being has much to do with a company’s success or failure. Executive culture demands 24-7 contact with those in the business. So, if anything goes wrong, the CEO will hear about it from major stakeholders soon.
C-suite employees have a lot to deal with, and that’s wearing down their desire to stay in their positions.
However, certain strategies may increase their willingness to stick around.
How to Retain Leaders and Their Employees
One good tactic is encouraging them to improve the quality of their personal life, which will reduce the pressure on them. Individual executives can easily improve their quality of life outside of work.
Mark Zuckerberg cited the importance of time spent with friends and family, as well as time on personal interests, as de-stressors. Bill Gates preached a love of bridge and Catan. Alphabet CEO Sundar Pichai plays cricket, and Warren Buffett jams on the ukulele. For top CEOs, hobbies and good relationships with family are crucial to finding stability when working life becomes chaotic.
Another way to help leaders is by prioritizing their work-life balance, which can ease the pressure they’re under. For instance, they can be assigned set working hours, so they don’t stay at work longer than they must. Defining working hours is crucial to work-life balance, as burnout is directly correlated with lower worker retention.
Another tactic would be ensuring the C-suite employee doesn’t try to take on everything simultaneously. According to Catalina Schveniger of Catalina Consulting, “Leaders thrive on adrenaline, a certain level of stress (either self-inducted [sic] or real) comes with the territory.”
“Where it goes wrong is that leaders feel they need to be the ‘know-it-alls’ and don’t rely enough on the collective wisdom of their teams, don’t delegate enough and therefore put too much load on their mental and emotional plate. Kindness to self starts with vulnerability.”
It might be difficult for someone in a leadership position to shake the sense that they need to be the person doing the most important tasks. However, encouraging them to delegate will help take some of the workload off of them. It will also help train lower-level employees, making it less likely that the leader will have to shoulder more responsibilities later down the line.
While it might seem like it’s going against the idea of ensuring CEOs and executives aren’t overworked, keeping them challenged is another critical consideration. Staying in the same position, regardless of high pay or success, may leave them feeling stagnant.
A well-challenged executive will feel they still have much to learn and are confident they can perform the task successfully. By providing the CEO with opportunities for growth, be it economic growth for the business or focusing on improving the company’s culture, it will be easier to keep them around.
It’s also a good idea to be mindful of employee retention strategies. These strategies are usually targeted at entry-level employees. These employees, who can be hired and trained by many competing companies, are difficult to keep in a poor working environment.
When worker satisfaction is high, they’re much more likely to stay. Employee satisfaction can be managed through greater feedback, collaboration, and attention to work quantity. Valuing this kind of positive change within the company’s culture can encourage both the company’s employees and executives to stay.
If the environment is one of growth, executives may be more inclined to remain and contribute. It may also reduce the rates of quiet quitting, where employees do just enough so they won’t be fired. But otherwise, they’re still doing the bare minimum.
The Great Resignation of Women Leaders
Susan Wojcicki’s exit from YouTube is indicative of Fortune 500 companies hemorrhaging women leaders. In technology, the ranks are even thinner. The likes of Meta, Yahoo!, and IBM have all been influenced by resigning women leaders.
Some women leaders leave because they want to make a difference somewhere else. Meta’s former Chief Operating Officer, Sheryl Sandberg, cited this as her reason for leaving the company after working for it since 2008.
For others, resigning from an executive position is an opportunity for career development. Marissa Mayer left as CEO of Yahoo! to develop a new startup, Sunshine Contacts, which focuses on contacts, data groups, and integrating artificial intelligence. Definitely a far cry from running a company mostly known for its search engine.
“We know women leaders are as ambitious as men, but they’re leaving their companies at the highest rate we’ve ever seen, and at a higher rate than men are leaving,” CEO and nonprofit founder Rachel Thomas said in a 2022 interview with Forbes. This change is particularly dangerous when women are already underrepresented in leadership. Only one in four C-suite leaders are women; in 2020, only around 27% of Fortune 500 company boards had female members. The next year, that number grew to 31%, still significantly behind the lion’s share of male leadership.
A considerable reason for women resigning from leadership roles is workplace microaggressions. Forbes defined this phenomenon as the “Great Breakup,” where women leave to find other jobs that meet their needs. Though women are just as likely as men to strive for leadership roles, women are two times as likely as men to be mistaken for a lower-ranked employee.
Per a report by Linkage that surveyed more than 3,000 women, those ascending to leadership positions are less likely to recommend their employer as a good place for women leaders to work. Similarly, women executives were more likely to believe women in their corporation have fewer chances for upward career growth.
- Support development opportunities that consider women’s experiences
- Support programs for creating and maintaining positive and effective teams
- Give women-led teams autonomy and flexibility
- Train leaders to be advocates and coaches for others
- Decide the specific causes behind women are leaving
- Sponsor a healthier workplace culture
- Teach allyship and sponsorship
Work Environment Is Crucial to Leadership Retention
The experiences of women leaders and other top executives, managers, and CEOs all have overarching similarities. Women who leave their leadership roles are likely to cite a poor working environment. Such an experience leads to feelings of burnout and eventually resignation, with the hope of finding a better work environment in a more comfortable workplace.
While stress and burnout aren’t the only factors challenging leaders to resign, they’re still major factors. To keep a top executive, their responsibilities and work environment must change. It’s paramount to look at a company’s culture and employment policies. If a greater emphasis is put on work-life balance and reducing leaders’ stress, companies may be able to hold onto their leaders.
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