As Baby Boomers delay retirement in record numbers, organizations are facing a unique leadership challenge - how to effectively lead an intergenerational workforce where no one seems to be retiring as predicted. With people living and working longer than ever before, organizations must adapt their leadership approach to thrive in this new reality.
Today we will examine the research on multi-generational workforces and the leadership strategies needed to maximize the potential of an experienced, long-tenured labor pool.
Demographic Shifts Driving the Phenomenon
Research shows the retirement landscape has transformed due to rising life expectancies and a shift in how older Americans view retirement. According to the U.S. Census Bureau and Bureau of Labor Statistics, these demographic shifts are creating an experienced labor pool unlike anything seen before:
Americans aged 65 and older comprised 15% of the U.S. population in 2010 but are projected to grow to nearly 24% by 2060. As the population ages, more mature workers will remain in or return to the workforce.
The average retirement age has been rising for decades and is now around 66 according to Gallup surveys. Only 27% of Baby Boomers surveyed said they plan to retire by age 65 or before.
84% of workers aged 50-64 reported in an AARP survey they plan to work past traditional retirement age or re-enter the workforce after retiring for various reasons including improved health, interest in staying active, or financial needs.
These trends mean organizations must prepare for an experienced labor pool where the average tenure increases dramatically and a wide range of generations work side by side for longer. Leadership strategies that once focused on succession planning and knowledge transfer now need to maximize engagement and innovation across all employee generations.
Benefits of Multi-Generational Teams
While the longevity of employees presents challenges, research also shows ample benefits that wise leadership can cultivate. Multi-generational teams blend the strengths, perspectives and skills of people from different stages of life and career experience:
Mature employees offer deep institutional knowledge, strong work ethics, proven job skills, emotional intelligence, and client relationship management abilities built over decades of experience according to various studies on generational diversity in the workplace.
Younger employees infuse teams with contemporary skills, flexible thinking, comfort with new technologies, and fresh perspectives on problems and customers according to scientists studying cognitive skills and generational differences.
When different generations collaborate, it can stimulate creativity and innovation through the synergy of varied strengths and aptitudes, studies from MIT and Stanford have found. Diverse teams exposed to multigenerational viewpoints tend to solve problems more effectively.
Clearly, the aging workforce presents both opportunities and challenges that demand leadership focused on inclusion, engagement and continuous learning at all career stages. The following sections will explore specific strategies organizations worldwide have adopted.
Rethinking Performance Evaluations
Traditional performance evaluation approaches often fail to appreciate the unique strengths older workers cultivate. Forward-thinking companies restructure evaluations to provide fair assessments that also foster continued growth at all ages. For example:
At Roche, one of the largest biotech employers, managers work with employees to set multi-year goals focused more on improving skills or taking on additional responsibilities versus annual production quotas that may disadvantage older contributors.
Starbucks tailored its evaluation system to recognize leadership abilities, fostering talent development, and mentorship as important metrics for long-tenured employees seeking new challenges within their roles.
Microsoft added evaluation criteria focused on advancing diversity, equity and inclusion efforts that value the depth of understanding about different generations and cultures employees gain over many years of service.
With adjusted criteria, mature talent stay engaged through new stretch assignments and skills acquisition within their overall career pathway rather than feeling stagnant if measured by traditional production metrics alone. Performance management thus facilitates not just assessments but ongoing growth mindsets across all generations.
Revamping Succession Planning
When workers remain in roles longer, succession planning approaches need revamping to focus beyond individual role replacement. Looking firmwide at critical capabilities and rotational opportunities helps retain institutional knowledge within the organization. For example:
At AARP, which relies heavily on the experience of its mature workforce, leadership maps core organizational competencies to identify which roles require deep expertise developed over long careers. They then cultivate communities of practice and rotational assignments to spread this knowledge organization-wide.
Australian bank ANZ built a mentoring program where incoming and outgoing employees in the same job families partner for 6-12 months. Older staff guide the transition while passing along client relationships and insights to successors before formally stepping away.
Global consultancy PwC created an executive-level Exchange Program placing a mix of experienced directors and incoming vice presidents together on lateral assignments. This transfers wisdom across business units in an immersive experience benefiting both parties.
Such whole-of-organization succession models share deep expertise across the business to offset longer average tenures in specific roles. They tap the full potential of experienced talent through gradual knowledge transfer versus an over-reliance on direct replacements.
Accommodating Changed Needs Over Time
As lives and families evolve, mature workers' interests change, requiring flexibility from employers. Enlightened companies thoughtfully accommodate evolving needs through various benefits, schedule options, and even second acts within the organization. Some examples:
Unilever Malaysia's Flexible Career Options allow staff to shift to less demanding roles, reduce work hours if caring for dependents, or take unpaid career breaks before returning in a new capacity.
Ernst & Young LLP's ALIGN program helps employees transition gradually into retirement through leaves of absence, part-time work, or project-based opportunities that still tap their expertise.
At Aflac, any employee with over 20 years' tenure can apply for a paid sabbatical and still receive benefits like tuition reimbursement if pursuing additional education or training for a future role.
These types of benefits recognize employees' lifelong attachment while accommodating stages of life that shift for workers staying decades in an organization. They engage mature talent through flexibility tailored to their evolving needs versus one-size-fits-all programs.
Fostering Dynamism Through Culture Change
To fully benefit from multiple generations collaborating for longer, organizations must cultivate inclusive, adaptive cultures continually innovating work itself. Flexwork policies allow blending perspectives from any location. Learning and development emphasizing modern skills keeps all staff growing. For example:
Dutch design firm Arcadis launched an Empower program with leadership training, skills academies, androtation opportunities for all generations to try new areas and roles within flexible schedules.
Japanese automaker Subaru revamped its yearly learning catalog with online, collaborative courses on everything from strategic thinking to artificial intelligence. Staff voted on new topics to keep everyone engaged through self-driven development.
Norwegian software company Visma blended on-site and remote work arrangements through an Activity-Based Workspace redesign. Teams collaboratively plan work approaches leveraging each other's backgrounds, skills and work modes for maximum synergy.
These cultures of continuous adaptability help organizations energize employees who stay for life by reframing work itself around inclusion, learning, and cross-pollination of experiences versus longevity alone. They unleash discretionary effort from all generations through a relevant, vibrant experience.
Conclusion
As developed nations experience a significant longevity revolution, organizations must rise to the challenge of effectively leading intergenerational workforces where employees remain engaged for entire careers spanning multiple decades. Those who rethink traditional practices will unlock tremendous value from mature talent who can nurture an adaptable culture of learning and mentoring across all generations. With inclusive performance evaluations emphasizing growth, succession planning focused on gradual knowledge transfer, accommodations for changing needs over time, and vibrant work experiences leveraging diversity of perspectives, companies can continue unleashing discretionary effort and maximizing potential from their increasingly senior staff. Those that cultivate multi-generational collaboration through relevant experiences and opportunities will thrive in the era when no one retires as predicted. The successful organizations of the future will be those defining engagement and fulfillment at all career stages.
Jonathan H. Westover, PhD is Chief Academic & Learning Officer (HCI Academy); Chair/Professor, Organizational Leadership (UVU); OD Consultant (Human Capital Innovations). Read Jonathan Westover's executive profile here.
