Workforce restructuring – a leadership challenge for the 21st century

The phrase “Demography is Destiny”, attributed to the 19th century French philosopher Auguste Comte has been a popular saying to describe shifts in politics or in the relative power of nations.  Typically when the phrase is used, particular attention is   placed on changes in population growth and the relative change in the ethnic mix within society.

The 21st century is experiencing a shift in demography unlike any other previously experienced.  In the year 2000 in developed countries – the percentage of people over 60 was equal to the percentage of people under 15 for the first time in history. By the year 2050, the percentage of people over 60 is forecast to be 34% vs. 16% for those under 15.  If demography is destiny, what does this mean?

There are many implications for society as a whole including such major issues as social security and health care – among others.  There are many doomsday sayers to be found about this topic, but I tend to side with Michael Hodin of the Global Coalition on Aging, who I invited to be a keynote speaker at the ESMT Annual Forum with ILA conference last year in Berlin.  Michael Hodin believes that this demographic shift actually represents a golden opportunity if governments, business and civil society deal with the change in a positive way.

In this blog I would like to focus on the impact on businesses and organizations.  Their workforce will continue to grow older – reflecting the general shift in society at large.  What does that mean for the way that businesses go about organizing the way work is done?

At a minimum, corporations will be faced with the new issue of attracting and retaining older employees.  Most emphasis in the past has been squarely focused on the younger workforce.  Older workers tend to have a very different set of priorities than younger workers.  For instance, they tend not to be as focused on career advancement.

Secondly, the massive number of retirements that threaten to take place in the next ten years as the baby boomer population quits the active workforce, is forcing businesses to think about how they can ensure the retention of valuable knowledge inside their organizations.  At an insurance company I was recently working with, they mentioned their concern about their actuarial department.  Apparently it takes seven years for a young actuary to become experienced in all the necessary aspects of the business.  At this insurance company, a good portion of their employees in the actuarial department are set to retire in the next five years.

Businesses which are considering creating a more age-friendly workplace are well advised to actively include their older employees in the re-structuing effort.  As common sense as this advice may sound, more often than not, such restructurings tend to be carried out by HR specialists who are mostly in their 30s and 40s.

How effective inclusion can be – was made manifestly clear at an EVAA (European Voices for Active Ageing) event in Bologna last year.  As a board member of World Café Europe, e.V., I helped to design and organize the special event held in Bologna, Italy where workers 50+ were invited to talk about the future of Work.  Approximately 100 participants took part in the dialogue.  They represented several companies and were both white collar as well as blue collar workers.  The average age was 55 and was evenly divided between men and women.  The purpose of the event was to understand what should happen in the workplace from the perspective of the older workforce.

In a four hour dialogue, this group was able to come up with an entire overview of the changes that needed to be made. Below is a mind-map summary of the recommendations made by the group.

Bologna Mind Map

The recommendations matched many of those being made by  headhunters and think tanks today.  

The difference of course, is that if you let your own employees come up with recommendations and solutions, they will be a lot more committed to putting the recommendations in place.  In addition it creates awareness and understanding for the intracacies of structuring a workforce which may have as many as 5 generations.  The following graph underlines the level of motivation that the participants at the EVAA – Bologna event had as a result of their participation in this dialogue.

“The principle of co-operation, spontaneous or concerted, is the basis of society, and the object of society must ever be to find the right place for its individual members in its great co-operative scheme. There is, however, a danger of exaggerated specialism; it concentrates the attention of individuals on small parts of the social machine, and thus narrows their sense of the social community, and produces an indifference to the larger interests of humanity.”

Auguste Comte