Managing an ageing workforce – key issues for your organisation

 

The challenges of managing an ageing workforce have been put firmly under the spotlight with the news that the age limit on student loans has been lifted to encourage over 60s to go back to university and retrain.

Added on 18 March 2013 by Erika Lucas

Managing an ageing workforce – key issues for your organisation

The challenges of managing an ageing workforce have been put firmly under the spotlight with the news that the age limit on student loans has been lifted to encourage over 60s to go back to university and retrain.

The impetus behind the initiative is that today’s employees will be required to work well past conventional retirement age – and that those who keep their skills up-to-date will be better placed not just to maintain their ‘employability’ but also to make a meaningful contribution to the organisations they work for now and in the future.

It’s certainly true to say that the country’s future economic success will depend partly on the skills and contributions of older workers. By 2020 a third of the UK’s workforce will be over 50 and the old will outnumber the young for the first time in history. Older employees do of course have an invaluable contribution to make but an ageing workforce presents challenges as well as opportunities for organisations. They need to find the best way of exploiting the mix of talent available in the business develop strategies to meet the differing needs and motivations of older and younger workers and create cultures where the generations are able to work together harmoniously.

So how well prepared is your organisation for managing an increasing number of older workers – and what are the key issues the business should be thinking about? Ashridge’s Sophy Pern and Sue Honore share their ideas:

1. Bridging the generation gap

Recent research conducted by Ashridge revealed significant differences in the way older managers and Generation Y employees approach the world of work. The global survey of managers and graduates shows that the generations have very different strengths. Older workers have the experience to judge risk and influence people effectively and are skilled at negotiating their way around the ‘internal politics’ of the organisation. They place a strong emphasis on experience teamwork and respect. Their younger counterparts are technology-savvy individuals who learn fast are skilled at building powerful external networks and are hungry for rapid career progression. Work-life balance is important to them as is public recognition of their achievements. These differences mean that the two parties are looking at the world of work through different lenses and often struggle to work together effectively as a result. Organisations need to find ways of overcoming the ‘them and us’ attitude and helping the generations understand and learn from each other better.

2. Transferring knowledge effectively

Older employees have a wealth of knowledge and experience to pass on to their younger colleagues. They are also the holders of ‘corporate memory’ – the useful tacit knowledge about what’s gone before what’s worked and what hasn’t that isn’t written down or recorded anywhere. Organisations need to find creative ways of ensuring that this valuable knowledge and experience is passed on to others and not lost. Involving older employees in apprentice or graduate training programmes is a great way to transfer knowledge as are internal coaching and mentoring programmes. It’s important to recognise that older employees won’t necessarily have the experience to ‘teach’ or ‘coach’ others – and that Gen Y employees may not immediately understand the value of the skills and knowledge being offered to them. Of course the younger generation also have skills they could pass on to their older colleagues – such as working virtually building networks and making effective use of technology. Mutual mentoring programmes are a good way to ensure important knowledge is transferred between the generations.

3. Making the best use of older talent

Organisations need to think creatively about how to make the best use of the mix of talent in the business. They need to monitor the skill profile of the workforce on a regular basis to make sure they have the right skills in the right place at the right time. This means thinking creatively about how older workers can best add value to the business. How could their jobs be redesigned to make better use of their skills and experience? What kind of roles will work best for older employees who want to work more flexibly but still want challenging and meaningful work? How can the business ensure up and coming talent isn’t frustrated by lack of opportunity to progress because older employees are staying longer in senior roles? Project contract or consultancy roles can sometimes provide the answer to these challenges – as can job-shares across the generations – although the solution will look different for every business.

4. Helping older workers retain status

Older workers often struggle with the notion of a shift to part-time or a sideways move because they fear they will lose their hard-won status. They still want to be respected as experts in their field or to be seen as ‘wise elders’ who have valuable knowledge and experience to share. This problem is likely to be more acute in organisations that are very hierarchical and where job title and grade are strongly linked to an individual’s power and standing. Organisations need to ensure that older workers who are down-shifting or moving out of operational roles still feel valued and respected even if they are no longer working at the sharp end of the business. Moving someone into an advisor or Non-Executive Director role for example allows them to maintain status while also enabling the organisation to benefit from their input at a strategic level. It’s important to recognise that being a good ‘wise elder’ is very different to being a good corporate leader and that employees may need some help to make the adjustment successfully.

5. Keeping skills fresh

There’s a tendency for organisations to take their foot off the gas when it comes to learning and development opportunities for older workers. It’s assumed that because they’ve been there done it and got the T-shirt they don’t need to learn anything new. The reality however is that older employees want development just as much as younger recruits. If they are to continue to make a valuable contribution they need to refresh old skills and learn new ones (how to make the most of IT and social media for example). The business needs to encourage older workers to take regular stock of their learning and development needs and to embrace the opportunity to learn new skills. Most older employees will actively want to keep honing their talents – they have a vested interest because it keeps them employable. Some may be resistant because they feel they are already competent – in which case the organisation needs to demonstrate the business need for the training and explain what the advantages (both corporate and personal) will be. It’s important to recognise that older employees may favour a different learning style to their younger counterparts and that learning interventions may need to be designed to take account of this.

6. Managing performance and expectations

Open and honest conversations about performance and career expectations will ensure there are no surprises on either side and will also help inform succession planning within the business. It’s important to recognise that people have different reasons for wanting to continue working and are motivated by different things. Some employees will have a financial imperative to continue working while others may value the social interaction and mental stimulation work brings them. Some employees may be able to sustain high performance well into their careers while others may lose their spark and need guidance about how their role or hours might be adjusted or how they could work more effectively going forward. The key is to treat people as individuals and not make assumptions about what their needs drivers and abilities are. It’s a mistake to assume for example that older employees are not prepared to be mobile. They may in fact be more willing to relocate or take on a global assignment than younger workers with family ties. Good quality on-going dialogue will ensure the business has a handle on what makes its older employees tick so that it can tailor reward packages appropriately and keep people motivated engaged and adding value to the business.