Retaining Your Top Talent By Developing A Growth Mindset

In today’s competitive job market, retaining top talent is more challenging than ever. While compensation and benefits play a critical role, long-term employee retention increasingly depends on deeper cultural factors, such as opportunities for growth, learning, and personal development. This is particularly the case with the Millennial and Gen Z employees who represent two dominant generations in the current workforce and who prioritize continuous learning and growth over traditional perks. Adopting a culture focused on both individual and company growth will keep these employees engaged and unleash new innovation and productivity.

In fact, I would argue a growth mindset is one of the often-overlooked strategies for talent retention in any industry, but especially in ones where it is more difficult to attract and retain younger workers. In this month’s post, I would like to discuss how to cultivate a growth mindset across an organization.

What is a Growth Mindset?

A growth mindset is a concept popularized by the world-renowned social psychologist Carol S. Dweck in her seminal work, Mindset: The New Psychology of Success (2006). It asserts the belief that an individual’s skills, abilities, and intelligence can be developed through effort, feedback, and learning. A growth mindset contrasts with a fixed mindset, which views these qualities as innate and unchangeable. A person with a growth mindset displays the following characteristics by attitude and behavior:

• Embrace challenges. Individuals with a growth mindset consider challenges as opportunities to grow rather than threats to avoid. For example, they would volunteer to lead a new project outside their comfort zone, knowing it will stretch their skills.
• Persist through setbacks. Individuals with a growth mindset persevere despite difficulty and use failure as a learning tool. For example, a software developer has received multiple rounds of code rejections, but they kept trying using the feedback to make modifications until they released a successful update.
• Value effort. Individuals with a growth mindset believe that consistent effort is essential for growth and mastery. For example, a marketing professional dedicates a certain amount of time each week to learning new analytics tools so that they can help improve the company’s product campaign performance over time.
• Learn from feedback. Individuals with a growth mindset view feedback as constructive rather than personal. For example, a project leader adjusted his communication style based on the critical input from his team members. With the change, he was able to better support team collaboration.
• Find inspiration in others. Individuals with a growth mindset see other people’s success as a source of motivation and learning rather than competition/threat. For example, a junior salesperson constantly seeks mentoring and guidance from the top performers in his department to improve his own performance.
• Believe in ability development. Individuals with a growth mindset believe that abilities can be developed and, therefore, they invest their time and energy in developing their skills through training and learning, not just relying on their innate talent. For example, an HR generalist without a technical background chooses to attend a data analytics course so they can better understand the HR data presented to them.
• Welcome learning and change. Individuals with a growth mindset are curious, adaptable, and open to new ideas and ways of thinking. For example, a team is planning to transition to agile methodology, and one member has been actively researching the best practices to help guide others through the change process.

How Does A Growth Mindset Support Talent Retention?

The positive association between a growth mindset and organizational outcomes has been well supported by decades of research in developmental and social psychology. Without going into the detailed findings from different academic studies, let me summarize and highlight a few prominent impacts when a growth mindset is embraced by both organizations and individual employees.

• Increased motivation and resilience. Employees with a growth mindset view effort and hard work as a pathway to mastery rather than a sign of inadequacy. So, when it comes to learning new knowledge or a new skill, they are more motivated to engage in deeper learning and seek feedback. In times of challenges, these individuals show more resilience and will persist through obstacles.
• Enhanced psychological safety. A growth mindset fosters psychological safety — the feeling that it is okay to make mistakes and learn from them. This fosters a sense of belonging, trust, loyalty, and a stronger emotional connection between the employees and their organization, which can significantly boost retention.
• Enhanced engagement and productivity. Employees in growth-oriented environments feel more challenged, supported, and valued, which translates into higher engagement. Engaged employees are more productive, less likely to burn out and less inclined to seek external opportunities.
• Increased innovation. A growth mindset encourages risk-taking, experimentation, and learning from failure, which are key to innovation. Employees in such environments are more likely to take initiative without fear of being penalized. This can lead to the development of unique products, services, and processes that will keep the organization competitive in a rapidly changing market.
• Increased job satisfaction. When employees feel that their growth and development are valued, they are more likely to explore new roles and challenges within their company, which helps enhance their job satisfaction while creating a strong internal talent pipeline. A growth mindset also promotes continuous learning, collaboration, and career development, leading to higher job satisfaction and lower turnover rates.
• Stronger leadership and talent development. Leaders with a growth mindset tend to model the behaviors they wish to see in their teams. They are more likely to coach their employees, provide constructive feedback, celebrate effort and improvement, and create opportunities for professional development. This leadership style not only motivates employees but also cultivates future leaders who will continue to promote a culture of growth and learning.

How Can You Foster A Growth Mindset Within Your Company?

To foster a growth mindset within your organization, here are a few actional steps for you to consider.

• Provide continuous learning opportunities. Encouraging a growth mindset starts by making learning a core part of your workplace culture. This means offering structured development programs such as job-skill training, mentorship programs, and cross-functional learning opportunities. In addition to technical skills, soft skills like emotional intelligence, communication, and adaptability are equally important to develop. When employees know they have access to resources to grow, they are more likely to invest in themselves and take ownership of their development.
• Encourage open communication. Open communication fosters psychological safety — employees feel safe to voice opinions, own mistakes, and ask questions. This is crucial for a growth mindset because learning often involves making errors and seeking help. Leaders and managers can support this by regularly soliciting feedback, holding open office hours, and creating structured forums for idea-sharing and reflection. The key is to use feedback as a development tool, not a critique of character or competence.
• Recognize and reward effort. Many workplaces only celebrate outcomes — landing a big client, closing a deal, or hitting a target. However, in a growth mindset culture, it is equally important to recognize effort, persistence, and progress. Doing so helps reinforce the idea that improvement comes through consistent hard work and learning, not just innate talent. Recognition can be informal, like a a shout-out in a team meeting, or formal — creating a performance review system that includes effort and learning goals. Even a recognition program highlighting “Most Improved” or “Biggest Learner of the Month” can shift the focus from pure achievement to continuous learning and growth.
• Model growth mindset behaviors. Leaders play a pivotal role in shaping organizational culture. When they show vulnerability, admit mistakes, ask for feedback, and talk openly about their own learning journeys, they signal that growth is valued. For example, when a manager shares a failed initiative and explains what they learned from this experience, they are telling their employees that mistakes are not something to be hidden, but a pathway to growth. By modeling growth mindset behaviors, leaders can empower their followers to do the same.

By gaining a solid understanding of a growth mindset and integrating the above practices into your day-to-day organization and people management, you will create a workplace where leaders value progress over perfection, celebrate resilience, and view challenges as learning opportunities and feedback as fuel for growth. When employees believe they can grow, improve, and succeed through effort and learning, they will become more engaged in their work and committed to stay. In return for your investment in a growth mindset, you will likely see better organizational outcomes and higher retention.

Jia Wang is a professor in the Department of Educational Administration and Human Resource Development at Texas A&M University. Her research focuses on international and national human resource development, organization crisis management, and learning within organizations.