Demographic and social trends will have a significant impact on the workforce in the coming years. Thus, in today's struggling global economy, it is more important than ever that organizations leverage the knowledge, skills and abilities of all workers--from all generations. By capitalizing on the strengths and values of different generations, HR leaders can create a competitive advantage.
For the first time in history, four generations work side-by-side in many organizations. The working generations span more than 60 years, including so-called Traditionalists, Baby Boomers, Generation X and Millennials/Generation Y. All bring different experiences, perspectives, expectations, work styles and strengths to the workplace. Despite the perceived "generation gap" from differing views and potential conflict, organizations--and especially HR--have the opportunity to capitalize on the assets of each generation for competitive advantage.
Predictions in Workforce 2020 (published in 1997) focused on demographic change as a major global force shaping the world economy. (2) More than a decade later, SHRM's 2008 Workplace Forecast upholds these predictions with key demographic trends: 1) the aging population, 2) retirement of large numbers of Baby Boomers, 3) generational issues and 4) a greater demand for work/life balance. At the same time, the loss of talent due to the retirement of older workers will likely drive an increased focus on skills, labor shortages and retention strategies for the current and future workforce. (3)
Thus, in their respective industry sectors, HR leaders have the opportunity to create competitive success by strategically managing generational differences in terms of differing experiences, values and expectations. While not inclusive of all generational workplace issues, this article provides perspectives for HR and organizational leaders on selected key aspects of the multigenerational workforce and offers recommendations, primarily for U.S. organizations.
Today's Four Generations
Generally, the concept of a "generation" is attributed to social scientist Karl Mannheim from his work in the late 1920s. (4) Grounded in shared life experiences and defining historical and cultural events during individuals' formative years, each generation has different collective memories, expectations and values. As such, a generation is defined as an identifiable group that shares birth years and significant life events at critical developmental stages. (5) At the same time, it is very important to avoid stereotyping people from different generations. For example, research shows that people born at the beginning or end of a generation (referred to as "tweeners") can exhibit values and attitudes from two different generations. (6)
Generalities about generations can provide insight on values and expectations in the workplace. The oldest generation, Traditionalists (also known as Veterans, Matures, Depression Babies) grew up following the worldwide economic depression, with World War II as the major event in their childhood. They view work as a privilege and have a strong work ethic grounded in discipline, stability and experience. (7) The Baby Boom generation, born after World War II, is the largest generation in the United States and has had a significant impact on societies worldwide. Defining events of this generation include the space race, rock and roll, and women's liberation. Baby Boomers tend to be idealistic, driven and optimistic. (8)
Different experiences have shaped Generations X and Y. A much smaller generation than the Baby Boomers, Gen Xers were known as "latch-key children" with both parents working. They grew up during the time of high divorce rates and massive job layoffs of the 1980s. They are independent, creative, skeptical and distrustful of authority. In contrast, the younger generation (known as Millennials, Generation Y, Nexters) experienced terrorist attacks in their formative years, including September 11th, and technology has always been a part of their lives. They are confident, team-oriented, patriotic and social minded. Since their parents typically planned their activities, they are accustomed to having structured lives. (9)
An extensive study on generational differences found that leadership style preferences are reflected in selected admired leaders of each generation. Baby Boomers, for example, prefer leaders who are caring, competent and honest, as reflected in their choices of social leaders: Martin Luther King and Gandhi. Generations X and Y want leaders to challenge the system and create change: Ronald Reagan, Tiger Woods, Bill Gates. Each generation ranked honesty, competence and loyalty among the top leadership qualities, with honesty being the most important. For HR and organizational leaders, this means that firms need to recognize and understand the differences and similarities among generations regarding leadership qualities when it comes to the creation of leadership development programs for current and future leaders, for example (see Figure 1). (10)
Figure 1 | Four Generations in Today's Workplace Generation Percentage Assets in the Leadership Style of Workplace Preferences Workforce Traditionalists 8% Hard working, Fair, consistent, Born 1922-1945 stable, loyal, clear, direct, Ages 63-86 thorough, respectful. detail- oriented, focused, emotional maturity. Baby Boomers 44% Team Treat as equals, warm Born 1946-1964 perspective, and caring, mission- Ages 44-62 dedicated, defined, democratic experienced, approach. knowledgeable, service- oriented. Generation X 34% Independent, Direct, competent. Born 1965-1980 adaptable, genuine, informal, Ages 28-43 creative, tech flexible, results- no-literate, oriented, supportive willing to of learning challenge the opportunities. status quo. Millennials Born 14% and Optimistic, able Motivational, 1981-2000 Ages increasing to multitask, collaborative, 8-27 rapidly tenacious, positive, educational, technologically organized, savvy, driven to achievement-oriented, learn and grow, able to coach. team-oriented, socially responsible. Source: Author compilation from several sources. (11)
As highlighted by AARP in Leading a Multigenerational Workforce, intergenerational dynamics offer organizations a highly competitive advantage. That is, management can use different perspectives, strengths and unique values to positively influence the bottom line in key areas: corporate culture, recruitment, employee engagement, retention and customer service. (12)
Yet, while it is commonly held that each generation has highly different values, there are similarities. For example, in a groundbreaking research study, the Center for Creative Leadership surveyed more than 3,000 organizational leaders over a seven-year period to learn how organizations can effectively use similarities and differences among generations. A key finding of this research was that the top three values of all generations were family, love and integrity, although they demonstrated these values in various ways. From a managerial viewpoint, this information is very helpful in better understanding the root cause of differences, misunderstandings and conflict in the workplace. (13) In fact, studies in organizational and human behavior find that people seek similar factors in the workplace, and these commonalities can be leveraged to bond employees in support of a company's mission, vision and goals. (14)
Further, with skills shortages commonplace today, domestic and global organizations must focus on workforce optimization for bottom-line results. Predicted demographic changes highlight the importance of managing talent of all generations (see Figure 2). In the United States, for example, projections indicate there will be 10 million more jobs than workers by the year 2010. According to the Organization for Economic Cooperation and Development (OECD), working-age populations will decline by 65 million in the industrialized nations of OECD members, such as the European Union. At the same time, worker migration worldwide will likely create a highly competitive global labor market at least until the year 2016, when all Millennials will have entered the workforce, alleviating worker shortage in the developed world. (15)
According to the Pew Research Center, by 2050 in the United States, working-age adults will make up 58% of the population, down from 63% in 2005. Also, depending on economic factors, a greater share of workers ages 50 and older may stay in the workplace longer than in the past. (16) Thus, a renewed focus on training older workers will no doubt become a greater part of talent management. Projections such as these indicate that demographic changes will be substantial, requiring that HR and organizational leaders thoughtfully examine strategic optimization of their human capital.
Figure 2|Demographic Workforce Predictions
Workforce 2000 Workforce 2020 * The population and workforce will * As retirement ages become grow more slowly than at any time increasingly less predictable, since the 1930s. workforce planning will become more uncertain. * The proportion of women and * By 2020, according to the minorities in the workforce will U.S. Census Bureau, the rise dramatically. proportion of women in the workforce will have gradually increased to about 50%. * The average age of the population * The continued presence of and workforce will rise, and the top-level older employees may pool of young workers entering the cause dissension among their labor market will shrink. middle-aged subordinates eager for promotion. * The workforce is aging and thus * Older workers will need becoming less willing to relocate, different benefits, such as retrain or change occupations, yet elder care programs. the economy is demanding more flexibility. * Need to recognize the importance * To increase workforce of a flexible workforce through participation, firms and company and national policies governments will need to (e.g., flexible workforce programs, accommodate unconventional revised pension systems, promotion working arrangements to of retraining and lifelong encourage people to return or learning). remain in the workforce (e.g., parents, older workers). * Immigrants will represent the * The U.S. population and largest share of the increase in workforce will gradually the population and the workforce become more ethnically since World War I. diverse. Sources: Author compilation from several sources. (17)
In recent years, the concept of generational differences as a legitimate workplace diversity issue has gained increasing recognition. SHRM's director of diversity and inclusion initiatives, Shirley A. Davis, Ph.D., points out that in the United States, discussions of workplace diversity tend to focus on topics of race, ethnicity, gender, sexual orientation and disability. "However, in all parts of the world, there is another category of diversity that cannot be overlooked: multigenerational diversity. Today, there are greater numbers of workers from each age group that bring both new opportunities and challenges. If organizations want to thrive in this competitive environment of global talent management, they need employees and managers who are aware of and skilled in dealing with the four generations that make up the workforce."
The existence of four generations is a major factor in talent management. In its "Competitive Workforce" category, SHRM's Human Capital Leadership Awards Program recognizes organizations with workforce readiness efforts aimed at anticipating and meeting current and future business needs in a changing economic climate. In 2008, Sodexo, Inc. was a finalist in that category for its innovative strategies in multigenerational talent acquisition and engagement. Since recruitment and retention of a multigenerational employee pool are key to Sodexo's
, HR leaders at the company's U.S. headquarters in Gaithersburg, Maryland, launched a multifaceted recruitment initiative. For example, Sodexo established a presence on social networking sites such as YouTube and LinkedIn to attract younger workers and created a new recruitment initiative aimed at veterans that translates military experience and skills into civilian jobs at the company. As a result, in 2007, there was a 24% increase in the number of job applicants, including a 38% rise in minority candidates and a 32% increase in gender diversity. (18)
"At Sodexo, understanding what drives each generation, and what their underlying experiences are, is the key to creating a cohesive work environment where our people feel valued and empowered to work together effectively," said Dr. Rohini Anand, Sodexo senior vice president and global chief diversity officer. "This appreciation of generational diversity, and initiatives customized to meet the needs of each generation, allows each group to fully contribute and be a part of the growth and success of the organization." Clearly, organizations that proactively use the strengths of different generations in the workforce are best positioned for success.
Ethics and Generational Differences
A recent SHRM white paper, Ethics and Generational Differences: Interplay Between Values and Ethical Business Decisions, examined how different generations approach questions of integrity and purpose. The authors point out that "with value systems and motivation at the heart of ethics--and divergent value systems seemingly inherent within the four generational groups--the existence of varied ethical perspectives among co-workers is not a surprise." They emphasize that understanding differing viewpoints on ethics in the workplace will help organizations make sound ethical business decisions. (19)
A common complaint among generations focuses on work ethic. Much of this conflict stems from how the term work ethic is defined and interpreted. Traditionalists and Baby Boomers may criticize the two younger generations about their lack of work ethic, with the oldest generation considering a strong work ethic as demonstrated by being part of the organization (and physically present in the office, in terms of actual hours) for long periods of time. Baby Boomers consider a combination of factors, such as collaboration, teamwork and meetings, as evidence of work ethic. In contrast, Generation X and Millennials see work ethic as working hard--often autonomously--and having a positive impact on the company, while also living a full life outside of their job. Views on the issue of respect also differ. Having "paid their dues," the two older generations expect respect from Generation X and Millennials--yet, the two younger generations consider that respect is earned by making a strong contribution, not by the passage of time. (20)
Despite these differences, research shows that no matter one's age, people value achievement, balance and responsibility and want credible, trustworthy leadership. (21) Such commonalities are important for HR to emphasize in the workplace. As highlighted in Figure 3, there are various actions that HR can take to help build stronger alliances in the workplace that both nurture and clarify ethical issues for workers of all generations.
Figure 3 | Ten Key Points for Ethical Business Management
1. Develop an internal campaign, with ethics as the #1 value for the organization and employees.
2. Avoid stereotyping employees according to their generation.
3. Clearly identify the priorities of the company and then link them to the priorities and values of employees to support business decisions.
4. When possible, learn the values and motivation of employees and then connect them to individual and organizational goals.
results, not on methodology (as long as it is ethical). All groups want to contribute and achieve but may do so differently.
6. To make ethical guidelines relevant to everyone, establish ongoing training and support sessions.
7. Look for commonality among employees of different generations.
8. Embrace diversity of opinion and methodology.
9. Err on the side of more communication, such as using more types of media: face-to-face meetings, e-mail blasts, etc.
10. Remember to respect the dimensions of differing generations (age, technological savvy, alternative work experiences, innovation, etc.)
Adapted from: Guss, E., & Miller, M. C. (2008, October). Ethics and generational differences: Interplay between values and ethical business decision [SHRM White Paper], Retrieved from www.shrm.org.
Engaging the Millennial Generation
The Millennial generation challenges organizations, HR and managers on many levels. The literature points out that this generation can be "high maintenance," and yet, when companies provide the resources and flexibility to be creative, Millennials also can be highly productive. To attract, engage and retain Millennials, organizations must understand what types of work environment and learning experiences they want.
If organizations do not adapt their corporate culture to fit the needs of this large generation, this may have detrimental results in terms of hiring, productivity and retention.
These "digital natives" quickly learn and multitask, prefer to work collaboratively with others and thrive on immediate feedback. Although Millennials do not want to be micromanaged, they want clear directions and managerial support and also demand freedom and flexibility to do work at their own pace and in their own way. They want increasing responsibility but need coaching on time management. They are committed to the company "long term"--meaning about a year or two. Such apparent contradictions can boggle the minds of managers from older generations. The key is to build solid relationships by getting to know them, listening and spending time with them. For this "education is cool" generation, managers will want to provide coaching and resources to meet employees' learning goals. From an HR policy and program viewpoint, it is best to avoid the "one-size-fits-all" philosophy. To attract and retain Millennials, organizations need to be willing to customize schedules, work assignments and career paths. Millennials will look to their managers to help them balance work and other commitments. Managers must focus on performance and consistently provide constructive feedback, praise, recognition and rewards. (22) Companies that are successful in attracting Millennials are creative in their culture, HR policies, programs and work environment. A survey by Human Resource Executive, in partnership with the Great Places to Work Institute, identified "18 Great Companies for Millennials." Facets of corporate cultures sought include:
* Management's actions match its words.
* Employees are appreciated for good work and extra effort.
* Employees are involved in decisions that affect their jobs or work environment.
* Employees are treated as full members of the company, no matter the position.
* Promotions go to those who best deserve them, and the company culture is a team or family environment.
Marriott International Inc., for example, offers workplace flexibility--a benefit highly sought by young employees. In its "Teamwork Innovations" program, employees are encouraged to identify and eliminate redundant work. At one Marriott hotel, teams were able to cut 40% off the time that it took to turn over a shift and, with this time savings, were allowed to leave early. At the same time, Millennials like to work for "cool companies." In Portland, Oregon, the Umpqua Bank has internet cafes, coffee bars and couches where customers can relax and watch TV. Some branches even offer yoga and movie nights and have a water dish outside for dogs. The "cool factor" attracts both customers and young employees from high school and college. (24) As portrayed in these examples, organizations that strategically energize their company culture and effectively use the talents and drive of the Millennial generation will have a competitive edge.
HR Policies, Benefits and Programs
Over time, the multigcnerational workforce will influence the organizational work ethic, perceptions of organizational hierarchy, work relationships and ways of managing change. The literature suggests that as a result of differing experiences and perspectives, strongly held attitudes and diverse motivators, there will be an impact on two specific areas of human resource policy and employee development: retention and motivation. (25) To successfully retain and leverage talent of all generations, the following studies represent the growing foundation of evidence to make changes in company culture, HR policies, benefits and programs.
No matter which generation, the work environment tends to either attract or repel individuals. An exploratory study examined dimensions of employee fit with work environments and the impact of employee job satisfaction and turnover intention among different generations. The findings suggest that employees in the Baby Boom generation value work relationships as a contributor to employee satisfaction, whereas for Generations X and Y, the work environment fit (potential for career growth, decision-making opportunities, autonomy and job challenge) is a primary retention factor. (26)
Work/life balance is a key commonality among the four generations. A recent study that explored generational effects on work-family conflict in the United States suggests that changes reflect family and career stage differences. For example, "family interfering with work" has changed over time for Generation X and Baby Boomers but stayed at the same level for Matures, perhaps due to having fewer family demands (empty-nest family stage). Generation X and Baby Boomers value work/life balance, growth opportunities and positive work relationships. The implication is that managers and HR professionals will want to consider generational differences in work/life program design and monitor patterns of program use by different generational groups. (27)
In a study by the Boston College Center for Work & Family, thought leaders identified top trends that will affect the future of work/life: generational diversity, followed by global challenges, older workers, increasing stress levels and technology blurring. The increasing number of older workers is now a high-profile issue, with the aging workforce a challenge in the United States as well as in Western Europe and certain Asian countries, such as Japan. Companies must find ways to address the needs of various age cohorts based on their different life stages--for example, by keeping in mind different values and life experiences of the workforce when designing strategies that enable all employees to work together productively. (28)
Talent retention can be improved through different approaches to communicating and rewarding employees, using high-tech tools and employing a more high-touch approach where the manager-employee relationship is focused on more personalized rewards. By developing more unified and compassionate workplace cultures, organizations will be more attractive to people of all generations. (29) Such studies provide valuable insight and information to HR professionals to assess HR policies and programs for the multigeneration workplace (see Figure 4).
Figure 4 | HR Policies and Programs for the Multigenerational Workforce HR Policies and Examples Programs
Work/Life Benefits Flexible hours, telecommuting, family leave, work/life balance policies, allowance for religious holidays, etc. Rewards and Compensation, rewards programs Recognition Health Care Long-term care, dependent care, elder care, EAPs, wellness programs Training and Professional development, mentorships, temporary Development work assignments, job sharing Succession Planning Formal leadership development programs, temporary work assignments Sources: Author compilation from two sources. (30)
Global Generational Trends
Research reveals that comparable generations in countries outside of the United States have both similar and distinct generational workforce issues. As a result of technology, the world is smaller, with greater access to information, products and services, contributing to broadening world views. At a Boston College Global Workforce Roundtable, it was noted that there appears to be a global convergence of attitudes among people under the age of 30. These young people, who do not yet have an agreed-upon identifying label (such as Millennials in the United States), have a global perspective, with a focus on quality of life, engagement in consumerism and a strong drive for personal and professional development. (31) Yet, this may not accurately portray attitudes of young people raised in rural and poor areas with limited exposure to global influences from television and the Internet. (32)
In contrast, the perspectives of older generations are strongly distinguished by local context. That is, these generations are highly influenced by culture, economics and events from their respective experiences, and they bring these view-points and values to the workforce. In China, for example, education was limited from 1966 to 1978 as a result of the Cultural Revolution. But for that event, many Chinese workers would likely be in senior leadership roles in organizations today; now, in contrast to their global peers, this group lacks education and experience. Cultural viewpoints also influence the workplace. In India, the concept of hierarchy has traditionally strongly influenced business decisions, such as strategy, promotions and communications. Yet, in today's Indian workplace, older workers view hierarchy as more important than do people of the younger generation. (33)
Additionally, it should be noted that the concept of the Baby Boom generation exists only in the developed world, with other nations not having the concerns resulting from this large generation. For example, many countries (e.g., Latino Christian, Arab and African nations) did not have a significant reduction in fertility rates, nor did they embrace factors such as access to contraception, the changing role of women in society and more recent focus on work/life balance. (34)
Finally, for the multigenerational workforce in Europe, the literature is rather limited. However, a new study from the Journal of Managerial Psychology explored workplace learning, organizational commitment and talent retention among European managers across generations. The results show that younger generations have stronger learning orientation and lower organizational commitment than older workers. Important practical HR insights include focus on offering leadership development, fostering learning goals and organizational commitment, and managerial emphasis on learning--all key retention factors for the younger generations. (35)
Three Key Management Strategies
1. Organizational communication: This key strategy is important to retain talent and avoid potential conflict. A SHRM survey revealed a number of ways to successfully work with a multigenerational workforce, with communicating information in multiple ways, such as oral and written, as the most successful. Different generations have varying levels of comfort with technology, such as e-mail, while others prefer face-to-face communication. Other approaches found to be successful include 1) collaborative discussion, decision-making or problem solving--providing an opportunity to express respect and inclusion of all employees; 2) training managers on dealing with generational differences; 3) team-building activities; and 4) creating mentoring programs to encourage workers of different generations to work together and share experiences. (36)
2. Succession planning: HR and organizational leaders must be aware of the internal talent pool, encompassing all generations, from which possible successors can be selected and developed. Regarding age-based demographics, HR needs to have a basic understanding of the different values and work attitudes of each generation--important information for cultivating and sustaining a preferred corporate culture. (37)
3. Mentoring: The goal of this strategy is to help ensure the transfer of knowledge from one generation to the next. As older workers look toward retirement, mentoring can be an effective vehicle to capture organizational knowledge. Structured mentoring programs are well suited for knowledge transfer. An important step is to survey the younger workers, learn their goals and developmental needs, and then pair them with more experienced employees. Also, using a variety of mentoring models is helpful. Examples include one-on-one mentoring sessions, senior leadership discussion panels, group mentoring programs and even "speed mentoring," where employees sit with organization experts and ask questions. Another model increasingly used is senior staff and leaders coaching younger employees in the onboarding process. This process begins in the hiring period and can last for up to a year, giving younger workers direct attention and professional development early in their career. (38) The following mini-case study presents a successful mentoring program.
Mini-Case Study: Mentoring Between Generations Launched in 2001, the AARP award program "Best Employers for Workers Over 50" recognizes organizations with best practices and policies that address issues affecting the aging workforce and creating workplace opportunities for all. In 2008, the YMCA of Greater Rochester was ranked 4th out of 50 companies for this award. (39) In the last six years, the YMCA of Greater Rochester has had a formal mentoring program-Mentoring Across Generations-as part of its professional development curriculum. Vice president of human resources, Fernan R. Cepero, PHR, credits its success to the company culture, stating, "Throughout its 155 year history, the organization has focused on leaving a legacy and creating a legacy between generations."
The mentoring program enhances the professional development and personal growth of both the mentor and the mentee. It helps employees understand cultural nuances, gain expertise in a specific discipline and provide ideas and inspiration about career paths. It also exposes employees to different paths of the business and various management levels. As exemplified in the short example from the YMCA of Greater Rochester, mentoring-a critical component of succession planning--builds leadership capacity by increasing the professional strength of the organization's employees.
Dan Friday, a member of Generation Y and buildings and grounds director at the Monroe Family Branch, was new to his position. Tom Ward, buildings and grounds director at the West-side Family Branch and a Baby Boomer, volunteered to mentor Dan, remembering what it was like early in his own career. Over several months, their mentoring relationship developed. As Dan attests, "Tom has coached me on all sorts of issues-from mechanics to staffing. He introduced me to the Association of Facility Engineers, where I've met some very interesting building mechanics and learned about construction projects that I am now considering for improvement to my facility." In fact, Tom has become much more than a mentor. He has helped Dan strip and wax floors, troubleshoot treadmill problems, and even filled in as pool operator when Dan was out for a week. At the same time, Tom has benefited from this relationship. As a subject matter expert, Tom has gained immense personal and professional satisfaction from seeing Dan grow and succeed in his leadership role.
As Mr. Cepero emphasizes, "Mentoring builds strong intergenerational working relationships, strategic use of intellectual capital and increased retention, and, at its core, ensures a continuous flow of knowledge management across generations."
As HR professionals work to optimize talent in their respective organizations, research shows that it is critical to leverage the strengths of each generation. Whether in a domestic or global organization, HR has the unique opportunity to create a competitive advantage by guiding policy and program development and management strategies to increase attraction and retention of the four generations in today's workplace.
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People of all generations and at all levels want their leaders to be credible, trustworthy, dependable, farsighted, encouraging and good listeners. (1)