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  • Writer's pictureDr. Babette Sonntag

Innovation: A booster for corporate culture and employee retention

Updated: Jan 3

People putting hands together
Motivation through innovation

Why is it important for companies to run innovation activities? Of course, they need to be technologically competitive. To be successful on the markets. So that they can generate sales and build or keep a strong brand.

But in my opinion that's not all:

Active innovation management promotes corporate culture as well as the motivation and retention of employees!

It is very diffucult these times to find skilled professional staff. The search for the right people is time consuming and expensive. So it´s a success factor to keep the best people who are already working for your company. A fact that is often underestimated: Strong innovation management can keep doubting employees, who might look for a new challenge, in the company and at the same time revive motivation and enthusiasm.


In my opinion a strong innovation culture includes the following points:

  1. Freedom: The freedom to be able to present crazy ideas or unconventional approaches without being criticized. The freedom to make decisions independently in your area of expertise. Freedom of expression.

  2. Openness: The openness to admit your own misjudgments and allow completely new perspectives.

  3. Acceptance: The acceptance of basically welcoming everyone with their ideas, no matter what their field or background.

  4. Appreciation: The active appreciation for the commitment of every individual who works for innovation and in the spirit of innovation and this culture supports. "Thanks!" say, give positive feedback - that's part of it.

A strong innovation culture gives employees the opportunity to acquire expert knowledge in a technical topic - ideally with personal motivation and interest. Maybe also as an add-on to their main area of responsibility in the company. This way, employees feel appreciation and can actively shape their professional careers.

Working on an innovation project can also be used as an employee development tool in case there is currently no chance of a promotion due to a bad economic situation for example.

Particularly creative people can try out new working methods in an innovation environment that is different to their daily business. In this way, they can escape the restrictive feeling of having to move within fixed processes and rules.

Because in an innovative environment many different ways of thinking, perspectives and skills are explicitly encouraged to develop new approaches. A strong innovation culture also offers diversity. This means that people don't get bored so quickly in well-trodden tracks.

Employees who believe they are stuck in a career dead end always have the chance to discover new opportunities.

A strong spirit of innovation helps avoiding at least the #1, #3, #4 and #7 of the following reasons for quitting:

Graph about the reasons people are quitting their jobs
Why people are quitting their jobs

What are success factors for this?

Ideally, there is a general agreement to be able to use x% of working time for innovation. Innovation should not be viewed as a hobby that employees can pursue after work or on weekends. It must be part of the work.

Every idea, every commitment, should be proactively valued. This includes positive feedback, broad communication about the contributions and achievements of everyone involved

Innovation work should be rewarded. In a material/financial way if possible. But in any case through visibility and positive feedback. Because by doing so people can position themselves as an expert and be perceived as such.

And finally one advice:

To get a feel for how much your employer cares about employee retention and company culture, take a look at the importance that innovation plays in the company. It´s less about whether there is an explicit unit of innovation. I'm thinking more about what freedom and support is given to an employee who, for example, wants to pursue an idea for improvement and whether there is an appreciative relationship and a positive way of dealing with different opinions and views in the company.

Want to read some more? Here are some interesting links:

Study about the trend in Germany to quit the job without having a new position (German):

Top 8 factors for people leaving current jobs in the US: 8 Top Employee Retention Factors (

Some employee rentention stats, US-based (English): 16 Employee Retention Statistics to Know in 2023 | TrueList

Please note: This text is translated into English by using Google Translate - I apologize for any mistakes in this text I may have overlooked.


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