Special Article (January-2018)
Article of the Month - January 2018
Designation : - Managing Partner for
Organization : - KPMG LLP
2018 - World of careers; Millennials or mature workforce?
Do we see 2018 to be turning directions in terms of careers? An emphatic Yes! As talent war (Sourcing, Attraction, Pay, Performance and Retention) continues unabated, so would costs and talent management concerns. As organizations attempt to reconcile expectations of a workforce with those of organizational performance expectations, talent specialists will start looking for options. One option that is likely to take center stage would be careers! Yes, careers that would converge between millennials and mature workforce. Perhaps more than ever before, employers need flexible approaches to hire, train, and retain key employees. They want innovative ways to use contingent workers, retirees, and alumni to keep businesses operating at peak efficiency, writes conference board. Can mature workers be counted on to contribute as much to their company's bottom line as younger hires? More than evidence issues to deal with have more to do with perceptions and pre - conceived notions on ageing workforce. "You know how these 50 years olds react?" Asked an HR head of a large automotive - tech client in a problem statement conversation last evening when dealing with a change management challenge. It is not about whether this HR head is right or wrong about their company's ageing workforce. It's a simple question, but one that has too often been shrouded in myth, not fact.
What motivates the mature worker? How does an employer harness its commitment for the good of its broader workforce and the company's bottom line? Does engagement change as an employee contemplates retirement and, if so, how does that change affect his or her work and the greater goals of the company? What can be done to maintain a positive level of engagement? Whether employees are young or old, they need to feel their skills have meaningful impact at their jobs or through social service. They need to actively engage and showcase their contribution in comparison to their peers to be respected. For mature workers, engagement in the workplace can also be defined in terms of what they teach younger colleagues, not just what they have learnt in the past but the art of learning. But differences in learning styles may impede the knowledge transfer companies need to thrive.
A research titled, "Bridging the gaps, how to transfer knowledge in today's multigenerational workplace", shows companies how to effectively share expertise across their workforces while avoiding ageism. It is designed to help them understand generational learning styles and preferences, and choose the best transfer methods for their needs. Engagement is not just a one - way street, however. The mature workforce initiative by conference board found that companies can enhance the commitment of older workers by continuing to actively manage them, which many fail to do. "We don't hold mature workers accountable, and we don't develop them. But mature workers are here to stay and are likely to become a more substantive challenge in the active but not employed workforce management domain."
Lynda Gratton and Andrew Scott in SMR 2017, in "The Corporate Implications of Longer Lives, write, "People are living longer and working longer - but few organizations have come to grips with the opportunities and challenges that greater longevity brings". Risks tend to play a dominant role when corporations experience a need to manage workforce likely to be around for a longer period with varying levels of competence, updated skills and demonstrated capabilities for future use. Across the world, people today are living longer, reason beyond health - reasons that include happier life styles, more consumerisms, greater creature comforts and better life with families. "Whether it is in the United States, China, or Rwanda, average human life expectancy has increased over the past few decades. Life expectancy in India has increased by more than 10 years in the past 20 years. However, life expectancy in India still falls short of most developed and developing nations; the infant mortality rate is 3 times higher than China's and 7 times higher than the U.S. The World Health Organization (WHO) defines life expectancy as; "the average number of years a person is expected to live on the basis of the current mortality rates and prevalence distribution of health states in a population" According to the latest WHO data published in 2015 life expectancy in India is : Male 66.9, female 69.9 and total life expectancy is 68.3 which gives India a World Life Expectancy ranking of 126. If life expectancy continues to grow at the rate of two to three years every decade, as it has done over the last 150 years, then a child born in Japan in 2007 will have a more than 50% chance of living past the age of 107. Under the same assumptions, children born in that year in most of the advanced economies will have similar odds of living past their 100th birthday. There is growing awareness that increasing longevity will have major implications for how people manage their work lives and careers. Rising life expectancy means the level of savings required to provide a reasonable income for retirement at age 65 is becoming increasingly infeasible for most people. From a conference board perspective, "No organization can thrive on the talents of one generation of workers, alone. But having a multigenerational workforce is not a guarantee of success either. Companies can and should leverage the strengths and skills of all workers, and build bridges for cooperation, mutual learning, up skilling, employability between the generations". Gratton and Scott predict that, given the average level of savings in advanced economies, many people currently in their mid-40s are likely to need to work into their early to mid-70s; many currently in their 20s (many of whom could live to be over 100) will be working into their late 70s, and even into their 80s. Across the world, people are becoming more conscious of their lengthening working lives - but frustrated by their working context. Our research suggests that while people know they will have to restructure their lives and careers, corporations are unprepared. Indeed, corporations have been somewhat inconsistent in their reaction to greater longevity. On the one hand, many executives are excited about the possibilities of tapping into the estimated $15 trillion of spending power of people over 60; on the other hand, few have taken full account of the opportunities and challenges longevity brings to their own workforces."
There is also a power dimension play, when dealing with mature workforce. Having spent a life time in roles that has provided them an opportunity to command, control, engage and motivate they are now replaying it, albeit, in the digital era. In SMR 2013, How to Overcome a Power Deficit - Jean-Louis Barsoux and Cyril Bouquet write, "At some point in their careers, many executives find themselves short of the power and influence they need to get their jobs done effectively. Fortunately, these problems can usually be remedied. Anyone can experience being stuck with a power deficit. Many factors can leave executives ignored or sidelined. Demographics (migrants, cultural compatibility (Canada calls it "Need for Canadian Experience" to enforce a ceiling) race, ethnicity, gender or age) can contribute to the power deficit predicament. So, can inexperience, poor reputation, transitions, job attitudes, negative experiences, personality, socio - economic background, training or outlook. It can happen to people with high potential, and it can happen to executives who are already high performers. You may be an indispensable part of your team but a power dynamic within the larger organization because you're stuck in a specialist position or a peripheral unit. You may be a star in one organization and find yourself seated at the "kiddie table" at your next company. It's difficult for executives to be heard when they lack legitimacy with the boss or fellow team members. Lack of legitimacy may be based on a weak or unproven track record, but it may also stem from a perceived lack of commitment, character or cultural fit. The problem with unfavorable perceptions is that they tend to become self - fulfilling. Or you may even find yourself catapulted into the top job but lack sufficient credibility to lead effectively". It is time to think in favor of identifying market places for careers that is inclusive of millennials and mature workforce. McKinsey Consultants Lowell Bryan, Claudia Joyce, Leigh Weiss make a business case for Talent marketplaces. "Law firms and other professional - services groups, academia, career staffing firms and R&D units often have informal talent marketplaces where senior people try to find the best junior employees and the best junior employees can choose the most attractive assignments. These marketplaces generally follow informal rules of conduct and work best when the market members are fewer than 100 and know one another". Market places could be at one end simply a choice strategy to bring together top talent and at another level an opportunity to attempt talent auctions. As talent becomes visible they are now keen to maximize their market price and increase their chances of hitting a jackpot."
Employment among people aged 55 and older had increased to an all - time high of 40.4 percent (Bureau of Labor Statistics, 2010). Data from the U.S. Census Bureau suggest that, by 2016/18, one-third of the total U.S. workforce will be age 50 or older, and will increase to 115 million by 2020 (U.S. Census Bureau, 2010). The growing number of older people, in concert with the trend to continue working at older chronological ages, is resulting in a shift in workforce demographics. In 2003, 13 percent of the workforce was age 55 or older, and this was projected to increase to 17 percent and 19 percent in 2010 and 2050, respectively (Bureau of Labor Statistics, 2010; Fullerton & Toossi, 2001). This increase comes at a time when the entry - level workforce is in rapid decline, and the age of retirement is increasing from 65 to 70 years (Bureau of Labor Statistics, 2010). During this same time period, labor force participation is expected to decline or remain the same in the 16 to 54 age group, with the growth in the labor force coming from the increased participation of persons age 65 and older (Eyster, Johnson, & Toder, 2008). These demographic trends are even more pronounced in Europe and Japan (Nyce, 2007).
India has a unique issue. With a greater unemployment rate amongst millennials, mature workforce may need to give way to younger workforce to gain employment. In the complex corporate world, which involves thousands of professionals and managers, the best approach is formalizing the talent marketplace - that is, a managed marketplace, with free market supply demand, created to bind the interests of individuals to the interests of the company in a commercial context. A formal talent marketplace doesn't come into existence naturally; a company must invest in it, through it supply of a distributed workforce, to ensure that it makes a fair exchange of value to both parties in a transaction - otherwise, it will fail. Formal talent marketplaces can develop around seasoned workforce, customer domains, market segmentation, functional areas, geographic preferences, social attitudes, work environment or managerial roles. Large companies with a formal talent marketplace include BoA, American Express and IBM. They believe there are sure shot conditions for success". For example, a talent marketplace isn't for all types of employees as we research today. But there is every indication that the top 20% of all talent will be searched and offered through a free market enterprise driven market place. "The majority of those at most companies are workers in the traditional sense : individuals who have skills that are largely interchangeable and can be managed adequately through line supervision. These employees might operate a large bank's call center, work in a big - box retailer, or drive a truck for a logistics provider - jobs where the work is tightly managed to specified processes.
For such employees, the traditional line - driven approaches still work. Talent marketplaces also may not be necessary for smaller companies and for companies that are less global and have fewer organizational silos, because these types of organizations find it easier to allocate talent effectively."
In a world, where Millennials are said to have arrived and are becoming a part of a critical workforce segment, there is no denying the definite presence of a very large and growing workforce population of mature, experienced and seasoned workforce (life time learning, skills and maturity) who would need to be harnessed for knowledge transfer, mentoring, young talent development and definitely some direct contribution. It has some way to go and we will cover a wide variety of opportunities and challenges through 2018.