Recession Affecting Retail Hiring Trends

During 2008, the retail industry satisfied an immediate labor demand by hiring highly educated workers.  Unfortunately – that only solved one half of the problem.  

 

While executives are well aware of the global economic recession’s affects on sales and profitability, few may realize the full implications for their workforce.   

 

A trend emerged in 2008 of highly educated workers taking positions in hourly customer service positions.  Last year, more college educated workers were hired into retail sales positions than any another other occupation. 

 

This trend poses problems.  While immediate labor demand was satisfied, hiring college educated workers into these roles only shifts the labor challenge from today…to tomorrow.  When the recovery begins, retailers can expect to see high turnover as these workers return to their pre-recession occupations. 

 

What can retailers do?  Three things:

 

1. Determine Your Impact – Collect data to determine how this industry-wide trend is showing up in your stores.
2. Monitor Turnover Data – Monitor turnover for this worker sub-group.  Watching the trend may give you an opportunity to prepare replacements.
3. Hang On To Them – Collect information from the sub-group to see what it would take to retain them, if not in their current position, possibly in another.

Critical Position IT Pulse Survey

Demographic trends are colliding with a global economic recession – how will this affect the supply of critical information technology workers is unknown.

 

Many are aware of the demographic trends affecting information technology occupations.  An abundance of senior workers nearing retirement and surprisingly, a dearth of younger workers entering the field. 

 

While the current global recession has tempered demand for IT projects, what will the supply of critical IT workers look like as the economy exits the recession and demand for IT projects rises?

 

Will we satisfy demand with senior workers? 

This response trades one problem for another.  While demand is satisfied, a knowledge retention problem is created for tomorrow as these workers WILL retire.

 

Will younger workers gravitate to the technology field? 

Without younger workers, the labor supply for future vacancies will likely be insufficient.

 

To understand the affects of demographics trends and the global economic recession we are initiating a monthly information technology workforce pulse survey.  Each month, the results will be distributed via email and published on our website. 

 

The survey is 6 questions and will take less than 2 minutes to complete – yet the collected responses from IT executives, like you, will be eye-opening!

 

We are releasing the survey in a few days and hope you will participate.  If you would like to be included on the distribution list, please drop me an email.

 

All the best,

 

Eric Seubert

Principal

Talent Strategy Advisors, an affiliate of Discussion Partners

937-239-0988

Email: eseubert@talentstrategyadvisors.com

Learning as Competitive Advantage in the War for Talent

After posting this blog, I’ve continued to come across some interesting talent practices in this space, so I have continued to ‘update’ as information comes across my ‘virtual desk.’  I’ve choosen to group the new information under the original post so that you can see how the ideas have continued to develop over time. 

As I said in an earlier post, I am convinced that learning will be a source of competitive advantage in the war for talent.   Tough sell, I know . . . but only if you think of learning in a traditional context.  We need to broaden our thinking . . . Need examples?

Finding talent and training them your way:  If you have read anything about the demographics, you know that there is a talent shortage brewing.  One way to open up the talent pipeline is to position yourself differently at the source. 

Leaving nothing to chance, IBM has invested serious dollars in the development of a Services Science, Management and Engineering (SSME) curriculum at North Carolina State University and UC Berkeley.  While many companies make their presence felt on the university campus, few approach the depth of IBM in creating and delivering curriculum designed specifically to support their business . . . a great bet given about 50% of their revenue comes from areas it considers to be in the services arena.  In this case, IBM is certainly accelerating the time to effective deployment of college talent . . . one could argue that they are using the college years to ‘train’ and ‘on-board’ even before students are employed.  Talk about speed . . . what a concept. 

This is game changing play in that it alters the relationship between academia and corporations from one that supports research, facilities, and scholarships, to one that drives specific education content.   Companies like IBM, BMW, and Credit Suisse are opening up the talent pipeline by tailoring courseware in graduate and professional schools.  Supporters argue that students are better prepared for work when the curriculum is full of real-world applications.  Critics suggest that this is an important step which may serve to compromise academic independence.  But let me add this thought . . . what critics have not considered is the impact the demographic changes are going to have on the talent supply for the faculty pipeline.  Just as this is an unabashed opportunity for corporations to co-opt a talent pipline . . . it is an opportunity for Universities to leverage an educated, experienced workforce in the same way.  As a large group of boomer faculty move to retirement, Gen X’s opt out of tenure race in favor of more attractive corporate opportunities, and Gen Y’s politely decine the opportunity to pursue advanced degrees, the academic pipeline is getting thinner too.  What better way to open up the talent pipeline for the University, then to create a stronger relationship with the corporate world to draw back their talent at a time when they will need it too.

But this is not just a talent play for knowledge workers.   The energy industry, for example, is scrambling to find enought talent to plug critical shortages in the skilled trades as boomers reach retirement age.  Their issue is perhaps more complex than others in that they have to overcome is the perception that ’trade careers’ are less rewarding financially and from a career advancement point of view.   While a college education can be a wise choice, for some the opportunity to learn a skilled trade while you earn an income can be a viable rewarding alternative. Using techniques like YouTube and MySpace videos and celebrity endorcements from people like Mr. Rowe, from Dirty Jobs, companies are trying to reach young Gen Y’s with a different kind of message.  Similarly, companies like W.W. Grainger is investing in technical education programs around the country.  Others are dipping into high schools and even elementary schools with trade friendly programs. 

Extending the Learning Network: Wondering where to locate your corporate headquarters . . . how about your R & D facility?  or a small start-up or a remote workforce?  Why not do what Express Scripts, Inc. did and locate your new HQ on the campus of the University of Missouri at St. Louis . . .blurring the line between University and Corporate work even further.  In 2006, Clemson entered into a similar arrangement with BMW AG when they opened up a joint automotive research-and-education center in Greenville, S.C.   Again, what an interesting way to open up the talent pipeline with a ready population of students as a potential workforce.  Or think about the R & D possibilities . . . what a wonderful way to accelerate your innovation engine by leveraging the intellectual talent available at the university.   What’s in it for corporate employees?  Well, a campus atmosphere and access to University resources like the gym and day care centers.  An interesting way to recruit an experienced boomer population who want to segway into retirement near a university or a Gen Y population who never want to leave.  It’s not a hard sell. 

On the skilled trade side, think about deploying your learning organization on the road . . making it available to pools of ready talent.  Michael Arndt, the training director for the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the US and Canada, launched a pilot program for National Guardsmen awaiting discharge. And apparently the Union is also purusing an opportunity to offer a mobile welding program to the Marines. 

Making it Easy to Transition Careers. . Inside the Company:  One of the trends I think we will see accelerate is career switching . . . particularly as Boomer’s contemplate how to wind down their careers, as Gen X’ers contemplate their middlessence, and Gen Y’s explore what it means to work.  Making it easy to explore, learn and transition to different careers without leaving the organization can be a powerful tool in the talent wars and a way to keep important intellectual capital inside the company.  Companies like Accenture, IBM, Verison Communications, Inc., Microsoft, and Dow Chemical Co. are offering employees an opportunity to transition without leaving.  What a powerful way to keep top performers, keep them engaged and leverage what they know in a different way.  Companies offer a range of services including things like: competency and personality assessments, internal career counselors, and web based programs to transition. 

Are you prepared to deliver against your future talent needs?  How will you compete for talent . . . In what ways is your organization going to leverage learning opportunities?

10/28/08 Additions:

Learning as a way to Negotiate Through Tough Times:  Toyota, like the other major auto makers is facing tough economic times as credit remains tight and gas prices fluxuate.  But instead of displacing employees for a short term economic gain, they’ve taken the long view.  Toyota decided to use the manufacturing lull to invest in training.  By using this time to invest in developing individual and organizational capability, they have positioned themselves for effectively for the long run.  And imagine what this type of commitment has on engagement.  Already, Toyota has seen results . . . employees have used the downtime training time to redesign their manufacturing process, identifying opportunities to reduce costs and improve the quality of the product. 

Making it Easy to Transition Careers . . .from outside the Company:  This week Sara Lee announced plans to offer a new program called . . . ‘returnships.’  Using input from the Women’s Executive Network, they are in the process of developing an internship program for transitioning midcareerists who are interested in full time opportunities.  What a wonderful way to help potential employees segway back into full time employment or transition into new careers . . .while learning new skills and networking.  These paid internships are designed to last four to six months in a broad range of corporate positions, including marketing, R& D, and technology.  Small commitments to learning can turn into great long term employee investments. 

CEO Imperative – Talenet Readiness – The Essential Strategic Intent

 In a period of global, recession it is easy to ignore the very real phenomenon of imminent  talent shortages.  As we enter the next decade, a perfect storm is descending on enterprise ability to access and retain the necessary talent to promote success.

 

nGenera research begun in 2003 suggests the following 5 trends  cannot be ignored as companies attempt to secure necessary skilled resources. 

 

 

The Aging of the Worldwide Workforce

 

The workforce is Aging,   in the United States, the fastest growing segment of the workforce are those over the age of 55.  The situation is similar in most developed countries.  Yet most Talent Acquisition and Development  processes target the younger worker between the ages of 22 and 35.  The ability to retain, and in point of fact access the talents of older workers is an enterprise Must!

 

Declining Employee Engagement

 

Worldwide those who would state they are “highly” committed to their companies is 21%.

The question for all companies is can an enterprise grow and sustain its business case if only 21% of its employee population is highly committed.  If the obvious answer is NO, why do companies continue to appear to take their employees for granted?.  nGenera research would also indicate that during this recession we can anticipate an even further decline in employee engagement.

 

Development of Talent

 

The first expense cut in any recession is usually Training.  What nGenera research suggests is that these cuts come at a time when investments are called for in all domains.  Our leaders for the most part have developed themselves.  This is a phenomenon of the Boomer and Older Generation X age cohorts and one that will be intolerable for the Generation Y incumbents.

One can quarrel with the bluntness of this statement but nGenera research supports this point of view.

 

The rain of the Perfect Storm will impact this area as well as a.) the demands on leaders are becoming more complex necessitating a renewed commitment to development, b.) the aspirations of Generation Y have as a core-expectation enterprise commitment to their development, c.) the paradigm shift that suggests that the enterprises now have to perceive themselves to be in the Education domain as Academia endeavors will not be sufficient.

 

Motivation of the New Workforce

The most generous interpretation of of the current portfolio of motivational vehicles is they are insufficient based on the emerging Demographic trends.  The demands of the new workforce will compel both practice and program modifications to human resources services. 

 

nGenera research Health Care insurance is a dominant desire for all employees, economic recognition for high performance is no longer a aspiration  it is a demand, the usefulness of long term incentives for Generation Y is questionable given what they initially see as tenure expectations, and all age cohorts are desirous of flexible time arrangements with their employers.

 

The Optimum Culture

When the Culture of an enterprise is an  outcome lacking foresight  there is risk.  The unplanned therefore uncontrolled evolution of cultural vagaries may  result in optimal conditions, but just as easily create  a situation that is not conducive to enterprise values nor strategic mission.

 

Over the decades much has been written of, and spoken about culture, its importance,  intrinsic value, and strategic necessity yet the ability to influence, truly influence a culture remains elusive.

 

nGenera Research on Top 10 Management Challenges for the New Workforce

 

1.      Replenishment and Deployment – The ability to attract and retain sufficient numbers of skilled employees throughout  the Enterprise.  For many companies this will be a daunting task.  A case in point is Essar which has grown from 20,000 to 60,000 in 3 years!  55% of their employees have less than 2 years of tenure.

 

 

 

 

2.      Multi-Generational Value Proposition-For the first time, commerce now has 4 separate and distinct age cohorts coexisting within an enterprise. It would be intellectually dishonest and moreover a risk to assume that a “One Size Fits All” human capital posture is feasible. For example the constitution of the GAP has 157,000 employees the vast majority of whom are Generation Y yet their leaders are predominately Gen X and Boomers.  To be successful, the GAP must address the needs of its Customer and Employee base simultaneously.

 

3.      Robust Leadership Pipeline-The ability of an organization to assume “if cream does not rise to the top on its own we will buy more cream” is unworkable in the new Talent marketplace.  The  smaller numbers of Generation X managers when combined with aspiration levels that are substantively different than Boomers and Millenials will represent a compelling challenge.  The abdication of an organization in favor of predominantly self-directed leadership will likely be a self defeating response.  As would be the ignoring the Retention potential Development has for Boomers and affiliation quid pro quo of Generation Y incumbents.

 

4.      Critical Success Factor Reconstitution – The French were embarrassed during World War II when the Germans ignored the Maginot line.  A possibly overly dramatic analogy: but what nGenera research suggests is that the Competencies we currently assess, and periodically develop for, have been deemed suboptimal for the new Talent marketplace.  Noteworthy deficiencies are truly Global Orientation complete with cultural awareness and linguistic abilities, a Strategic Mindset that can identify the “next big trend”, Collaborative Behavior that is inherently persuasive vs. a “follow me model”, and Staff Development abilities that are Sensei in vs. Supervisory positional in orientation.

 

5.      Knowledge Management Mindset and Tools-Despite the existence of institutional memory preservation tools, the discipline and mindset to use them are lacking in most enterprises. This deficiency will be exacerbated by the restructuring aligned with the current recession and will be dramatically compounded by the imminent retirement of Traditionalists and Boomers.

 

6.      Reward Misalignment – The current focus of Total Rewards Design on Regulatory Compliance and Philosophy of Compensation being plotted between  Market Average and 75th percentile is emerging as problematic.  An enterprises inability to recognize that Long Term Incentive 5 year vesting is a disincentive for Generation Y, that High Performance employees know who they are and eventually feel marginalized by similar recognition as their less performing peers, that the tolerance of Compression with the hope that it will be a “secret” is insulting, and that there are those who would gladly forgo monies in favor of generous Health Care or a Flexible work schedule, will present  significant barriers in the future.

 

7.      Retention on Boomers-The undeniable truth is that there are more Boomers than there are Generation X workers Practices that suggest an employee should be thought of as being on the downward side of an Employment Curve at age 55 or even 65 is to ignore the demographic reality and opportunity prevalent in the sustainment of these incumbents.   nGenera research indicates that despite this intellectual awareness the progressiveness of practices to preserve this talent pool and candidly does not rise much above happy talk.

 

8.      Attraction and Retention of Generation Y-The point of view that “given time they will think just like me” has its limitations.  nGenera research suggests a more appropriate approach is to embrace the differences endemic to this cohort and create programs that are respectful, motivational, and flexible.  nGenera research indicates that there are many companies that are creating innovative approaches to attract and retain Generation Y’s as they recognize that a “one size fit’s all” approach is self defeating.

 

9.      Employee Engagement Improvement- Of paramount importance in the emerging Talent Marketplace is the improvement of Employee Engagement, a task made more difficult during recessionary times.  nGenera research indicates that Engagement goes well beyond the efficacy of Human Resources programs.  Our research suggests what appears to be lacking is awareness of the differences in aspirations and elements of the value proposition that are truly motivational.  Even sadder, our research indicates that there is a perceived lack of respect for an employee as an individual in many companies.  As the recession dissipates if there is no proactively to address this situation, the opportunities prevalent in the marketplace will create the phenomenon of “it is not that I am not working, or not working hard, it is I am not working for you”.

 

10.      Capability on Demand – the emerging Talent Marketplace will soon move beyond Job descriptions, Career Stages, and Alternative Sourcing.  Alternatively nGenera research indicates that the definition of “work” will be reinvented and so will the definition of “worker”.  The nGenera point of view is that the new model will be Talent Capability on Demand supported by sophisticated Collaborative Tools and Technology Platforms.  The reality that we see as imminent is the strategic use of employees, contractors, aligned SME’s (i.e. thought leaders, retirees who possess a certain skill), vendors, and the world at large as accessed by the Internet will become the Future State Employee

 

We are entering a new and exceiting period in Human Capital management requiring new mental models and innovative programs to promote Enterprise success.

 

Talent Practices for a Tough Economy

11/09/08

In the course of my normal early on-line shopping for the holidays, I ordered shoes from Zappos.  Being curious, I followed the CEO on Twitter.  For those looking for a great example of how to talk about tough issues with employees check out the CEO blog at Zappos.  This is a company known for developing an exquisite culture of customer delight that extends back inside the company.  They have just had their first lay-off in 9 years and it hurts.  But they’ve done a beautiful job of articulating (inside and out) why they are taking this action now, their financial condition and what they expect in the near future, and how they are going to treat their employees.  Most notably, the are: (1) providing higher than normal severance for ‘short-term’ employees, and (2) assisting with COBRA benefit payments for those impacted employees.  Equally important, they are encouraging people to ‘talk’ or in this case ‘twitter’ about the situation inside and out of the company.  I was struck by the outpouring of care for impacted employees that was coming from the loyal customer base.  As I have said before, as employees, we can deal with tough issues if (1) we understand the logic behind the decision, and (2) believe impacted employees are being dealt with in a caring and compassionate way.  I look forward to continuing our relationship Zappos . . . I’m impressed. 

8/28/08  Update

When I wrote this blog, I thought I had a very nice array of talent practices.  After posting it, I’ve continued to come across some interesting talent practices, so I have continued to ‘update’ as information comes across my ‘virtual desk.’  I’ve chosen to group the new information under the original post so that you can see how the ideas have developed.  Interestingly, the most active searches by readers have been in the compensation space . . . so I’ve added some examples as the financial performance information has evolved through the back end of this year.

Jim Borgman’s cartoon in the Chicago Tribune last week was priceless . . . because it spoke volumes.  Set aside the question of are “we really in recession or just how bad is it,” the current US economy presents some significant challenges for organizations.  So what are some of the interesting ways organizations are responding:

Recruiting Previously Unavailable Talent: Seizing an opportunity is easier said than done.  But for financial institutions, this is the time to recruit top talent . . . talent you could not touch before. And none know this better than the Chicago financial market.  Wall Street talent who would never have considered career opportunities in Chicago are now finding the comfort of a steady security and commodity market attractive.  Seizing opportunity is not just about sourcing talent from organizations in distress.  Employees impacted by rising cost issues and unrealistic organizational demands are evaluating their current employment propositions very carefully and making strategic choices about their future.  Gas prices and long commutes give way to considering attractive opportunities to work closer to home or even in the home.  Even the most resilient of road warriors are looking for relief from the grind of tough air travel while suffering the burden of over restrictive cost cutting travel policies.  Indeed, this is the time to put your unique employee proposition to work in the recruitment of talented employees.  This is a great time to strategically up-skill the organization.  Likewise, internally it’s a time to make sure that you are not eroding what is important about your employee proposition as your own organization responds to tight economic times — your ability to recruit and keep top talent is most certainly at risk. 

Changing the nature of work: Law firms are not known for their innovation, particularly when it comes to a very traditional career path . . . but even that is changing.   In tough times, organizations tend to farm out project based or seasonal work more aggressively rather than hire regular employees to manage through what appears to be a limited engagement.  But leveraging consulting from traditional legal firms can be quite expensive.  Enter a new kind of law firm — Axiom, Outside GC LLC and Phillips & Reiter PLLC are examples of legal organizations who act more like talent brokers than law firms.  What’s different?  Well at Axiom, lawyers are employed full time and receive benefits, but no pay between assignments.  According to the Wall Street Journal, the cost to clients is about 50% less than traditional law firms.   So what’s attractive from an employee point of view?  Some people are in transition.  But even more people are thinking about alternative work arrangements wanting a break from the pressure of traditional large organization career.  Others are ‘slash workers’ and want project based opportunities while they pursue a variety of different work experiences.  Others simply want more family time.  And some are Gen Y’s right out of law school who are looking for engaging opportunities right out of the box.  I think we will continue to see more ‘talent brokerage’ with high end niche knowledge workers as a way to flex talent pools in general and as a way to tap into top talent who are in transition in a cost effective way.  This is, of course, a type of workforce in transition . . .meaning, most hiring managers have not yet caught up to the real nature of the talent opportunity and are still thinking of ‘brokered talent’ as low level temps. And time will certainly tell, but I think we are seeing an important talent trend emerging. 

Offering Flexible Work Place Practices:  Tough economic issues have offered flexibility advocates a golden opportunity to push new work place practices into place in ways that demographic challenges of the talent pipeline have not.  Helping employees squeeze more out of a tight family budget have prompted a whole range of flexible workplace practices.  Examples include . . . “4 day work weeks” or other forms of compressed work weeks and regular telecommuting or “work from home Fridays,” or van pools.  Talk about taking work at home to the next level, at Write2Market, an Atlanta based marketing firm, employees must ask permission to ‘drive into the office’ for work.  There are even novel programs like “bring your child to work.”  While I certainly applaud flexibility, there some challenges.  Woe to the manager who uses this as an excuse to abuse employees . . . disengagement will certainly follow.  Thank you Jim for your comic reminder.  Likewise, flexible practices can be great solutions when they are not imposed.  Bringing your child to work is not appropriate for every environment . . even in the same organization.  And requiring all employees to work from home on Friday’s without thought to customer needs, is not an effective long term business response.  ‘Rigid workplace flexibility’ becomes an burden when it is not driven by real employee need and does not effectively facilitate the requirements of the business.  Flexible workplace practices are just that . . . they are supposed to be flexible and they do require a plan . . . a plan that serves both the organization and it’s employees.  And finally, managers often need help understanding how to effectively manage in flexible arrangements. 

Changing the Compensation Game: Need to put a bit more skin in the game to accelerate growth in a tough market . . . well, Skyline Construction, Inc.  offered managers an opportunity to pick their own salaries with in a range.  The deal?  The lower the salary, the bigger the shot at a large bonus.  What’s different? Skyline let their managers put a portion of their salary at risk.  The idea has proven popular . . . now in its second year, 12 of 15 managers choose lower salaries this year, increasing their personal motivation to succeed. 

A while back Best Buy, started an experiment in performance management called ROWE (results oriented work place).   No more fixed schedules, no mandatory meetings, no impression-management or forced face time . . . Best Buy reshaped it’s work place practices to focus performance on output instead of hours worked.  Putting employees in charge of their own work — time, place, and results – places responsibility where it belongs.  Yes, it means managers need to be crisp and focused when developing performance objectives, and that’s not a simple task.  But look at the results — productivity is up 35%, average voluntary turnover has dropped dramatically, and employee engagement is up.  What started as an experiment is now becoming the norm. 

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Broadening the Benefit Portfolio:  Not a surprise, in an effort to keep top talent who may be challenged by difficult commuting conditions, organizations like Grossbard & Associates are offering just a little extra in the paycheck to offset rising gas prices.  Some companies are increasing their mileage rates in reimbursement policies while others are offering higher cost of living raises.  EFC International is being even more proactive by subsidizing employee fuel costs on a ‘miles commuted’ basis.  Maritz, on the other hand, decided to offer employees a discount on Sam’s Club memberships as a way to help employees access lower prices at the pump.  Finally, TransitCenter, Inc. helps employees use pre-tax dollars to pay for parking and public transportation needs. 

In some cases, simply having access to benefits is important . . . especially for an employee population who may impacted by downsizing.  Companies like Starbucks and Border’s who offer benefits to part-timers fill a very important employment niche.  Paying attention to employees well being in tough times pays off.  They tend to be more committed and engaged.

“Off-boarding” with Care:  Sometimes the business is such that we need to say good-by, even to valued employees.   I am convinced that how we transition people out of the organization speaks volumes to those impacted — those who are left inside as well as those who are leaving us.  One of my clients has changed their HR job to include ‘on-boarding and off-boarding.’  Putting the same amount of care into helping people transition in and out of the organization can pay large dividends in your ability to attract and keep top talent over the long haul.  And who knows, today’s internal talent may be tomorrows key client.  Off-boarding with care, also keeps current talent engaged.  We can handle tough news . . . if we think it’s fair (meaning we understand the logic behind the decision)  and it is handled with compassion.  It’s important to remember, whether employees continue with us or leave us, they will always be alumni of our organization.  And those alumni can be valuable long term assets for the organization.

Finally, when we change the composition of our workforce, let’s remember to also think about the impact of the re-structuring on the work of the organization.  This is where I put the plug in for all of those who are left absorbing additional work when we loose valued colleagues.  Doing more with less?  Not really . . .there’s a limit to what any organization can do with resource constraints. So when re-structuring think not just about those who leave, also think deeply about the impact to those who stay.  Remember to also take work out of the system. 

As culture expert Edgar Schein reminds us, what leaders do in ‘tough times’ often speaks more loudly about the character of the organization than what leaders do in ‘good times.’  And employees do listen . . . very carefully . . . and take action on what they see. 

What is your company doing in these tough times?  In what ways are you seeing companies respond to the challenges of this economic climate?

08/11/08 Addition: Listening to What Employees Think

A survey in USA Today’s weekend addition asked: Should employers help workers with surging gas prices? Interestingly the responses were . . . 66% with a “no” response, 32% with a “yes” response, and “2%” don’t know.  What do you think?

08/12/08 Addition:  Changing the Compensation Game

Today’s Wall Street Journal reports more changes in compensation.  Given the economic and company performance turndown, one would expect that bonuses would follow.  Not so . . . according to Mercer and Hewitt. In an effort to keep top talent and employees engaged,  companies are still offering large bonuses.  In fact, the number of companies who offer one time bonuses has increased.  So, what’s changed?  Well, employers are starting to use their dollars more wisely, reserving the bigger payouts for higher performing talent.  Instead of rewarding the broader population with the usual average ‘feel good’ bonus, companies are going for ‘higher highs’ and ‘lower lows’ to distinguish and drive increased performance in tight economic times.  For example, highest rated workers may see upwards of 14%, while average workers may see 3.5 to 3.8%.  For the average workers, inflation, gas, and grocery increases may simply eat up any gain in the paycheck.  What’s your company doing?  What are you seeing and hearing in the area of performance management?

8/15/08 Addition:  Changing the Structure of the Organization

Doing more with fewer staff?  Very interesting article in the Wall Street Journal again today.  Dana Mattioli reports on a new ‘tough times job trend.’  Companies are not eliminating jobs altogether . . . they are creating what I call “job mash-ups.” In this case, they are combining job levels and types into new mash-ups. . . and yes, you guessed right. . . at lower salaries.  In an effort to stretch their assets, companies are combining jobs vertically . . .and horizontally.   

Not a surprise, tough economic times prompt us re-think the fundamentals . . . and one of those fundamentals is how the organization is structured.  It’s the moment to confirm what is core to the organization and what should be left behind.  It’s an opportunity to reinvent the what and how of work . . .to eliminate the redundancies . . . or streamline.  What’s interesting about the trend is the blurring of functions and roles . . . offering people an opportunity to develop cross functionally by moving into white spaces or to seize more senior roles based on capability or appetite.  Job mash-ups have real appeal from a development point of view.  And sometimes, job mash-ups propel us into finding new growth engines for the organization. . . opportunities we could not have imagined until we see what could be combined.

Having said that, what is disconcerting about the trend is the potential for abuse.  Jobs poorly combined don’t help the individual or the organization.  Pushing employees far beyond their capabilities leads to burn-out, turnover, and taint your ability to recruit top talent.  Can one experienced professional do the work of a team — not without changing performance expectations or the fundamental nature of the work itself.  So my challenge to HR is to act as that ‘voice of reason’ for those who don’t have a voice in this conversation. . .make sure ‘mash-ups’ make sense for everyone.

8/20/08 Addition:  Creating Employee Engagement: A Reason to Believe in the future

“Ford Offers Workers a Ride” . . .  interesting article in the Chicago Tribune today.   One of the toughest ‘sells’ we make is not to customers but to our own employees, particularly in tough times.  And Ford is certainly weathering some tough times.  The hard part of the ‘sell’ to employees is creating confidence in the future . . . as Rosabeth Moss Kanter says, when you are in the middle of a turnaround, everything looks like a failure . . . (and I’ll add my own thoughts here) because you aren’t close enough to the future to touch and feel it.  So Ford is doing just that!  It’s giving employees a reason to believe in the future.  In an effort to engage employees, they are letting them drive their new vehicles around the test track.  Pulling 4,000 of their workers from their Dearborn HQ desks to the test track, Ford hopes to show employees that their new models are going to put them on the road to success.  Engaging employees by letting them ‘touch, feel, and drive’ the new 2009 to 2010 vehicles, Ford hopes that they will then ‘talk up’ the vehicles to others . . . engaging their social network as a potential growth engine.  Giving people evidence of a positive future serves to reinforce confidence which can become a powerful platform for positive performance.  And as Kanter says, confidence can become infectious!

8/26/08 Addition:  Paying Attention to Employee Mental Health

Today’s Wall Street Journal article on health by Elizabeth Bernstein was a good reminder that in tough economic times people get worried . . .and that fear will work its way into the organization in unexpected ways.  As the economy continues to tighten, people worry about job security for themselves and other family members, their ability to pay the mortgage or other loans, the cost of gas and just plain living expenses. . .never mind worrying about the value of their homes and their ability to pay for college in the future, and so on.  Not everyone can handle stress effectively and we may see it in general morale, illness or absenteeism, productivity, or disengagement.  This is the time to pay attention to the subtle and not so subtle changes in those around you.  HR can take the lead.  Look for the warning signs that something might be wrong and offer access to the various policies and program available inside the organization . . . options might run from expressing concern to changes in workload, vacation, fitness programs, unpaid time off, employee assistance programs, and so on.  If you are tempted to ignore it . . . remember, morale issues are contagious. 

8/27/08  Addition:  Workforce Planning

What have you done to protect your talent today?  In general US companies are not giving much thought to workforce planning according to a new Watson Wyatt study, referenced on Workforce Management.  Meaning, they are not giving much thought to protecting their talent should the economy worsen . . . protecting key talent when times are bad, you say.  Indeed, this is not about restructuring or downsizing the organization.  This is about identifying critical constituencies (those essential to the core of the business) and putting contingency plans in place to make sure you don’t loose them . . . period.  And a lack of planning puts US firms at a disadvantage to their global counterparts.  Asian counterparts for example have been dealing with this issue for some time . . . currency crises, coups, or just plain competition for the same key talent across Asia Pac.  According to the same study,  84% of employers in Asia-Pacific and 80% of employers in Europe have workforce contingency plans in place.  Do you?  If you don’t do workforce planning in the tough times, when the good times come again you will be at a distinct disadvantage . . .chasing top talent paying premium dollars.  When you loose top talent, you have also lost the seeds of your future growth.  So, I ask again . . . what’s your organization doing?

8/28/08 Addition: Senior Leader Compensation

Finally, some interesting compensation information on the senior leader front as challenging financial results continue to pour in through the back half of the year.  We are starting to see more interesting compensation plays . . . ones that are more closely tied to performance . . . ones that are giving higher highs and lower lows . . . ones that are extending senior leader time horizons beyond the quarter or year in an effort to drive effective long term performance.

Starbucks just announced that it will slash bonuses for senior leaders this year as it continues its reassignment program in an effort to increase profit.  According to the WSJ, Chief Executive Howard Schultz will not get a salary increase this year . . . nor will any US employees Vice President and above given year-to-date performance.   Moving lower in the organization, eligible district managers, store managers and most coffee-roasting plant workers in the US will get a 3.5% annual pay increase.  For all employees in the US, the plan calls for a 2% flat salary increase for those whose performance is at the meet or exceeds level.  This excludes store baristias who are on a separate compensation plan that adjusts salaries on a 6-month basis.  Now that’s a statement. 

Might I add as we move toward year end, the company to watch on the Senior Leader front will be American Express.  You may remember Amex received well deserved praise for their CEO compensation play at the beginning of the year.  They have given CEO Ken Chenault an options bonus schedule based on clear aggressive financial metrics over a 6 year time horizon.  The financial hurdles as laid out are quite high for EPS, revenue and ROE, and a lesser performance will only give him a fraction of the total grant.  Furthermore, the total return to shareholders must be at least 2.5% above the S&P 500 average — so he cannot simply ride the market.  A senior leader compensation play clearly tied to performance over time – what a concept. 

8/28/08 Addition: Off-Boarding with Care

Earlier I wrote about the importance of ‘off-boarding’ with care.   There are times when we need to say goodbye to valued employees . . for a variety of reasons.  In those cases, it’s our hope that at some time down the road, our paths will cross again. 

The best examples of off-boarding come from companies trying to keep top talent . . . in the hopes of their return.  Deloitte and Touche (USA) makes it easier for employees to return after career breaks of up to five years, whether family or education related, by offering a range of benefits like . . . access to the company intranet, subsidized training to keep skills current, access to a mentor or career coach.  Cost effective, the program costs a fraction of the cost to recruit and develop a new employee.   Likewise, Gensler welcomes talent back via a return program . . . symbolically welcoming talent back with a ‘boomerang.’  Other companies keep in touch with previous employees through formal alumni networks using vendors like Select Minds. . .while others leverage grassroots social networks that spring up when companies are forced to downsize groups.

Increasingly we need to be comfortable with the fact that talent is unlikely to stay with us for their entire careers . . . there will be a series of ‘on and off ramps’ for a variety of reasons . . . some company driven others will be driven by individual needs and wants.  Keeping in touch with great talent can be a source of long term competitive advantage.  Whether employees continue with us or leave us, they will always be alumni of our organization.  And those alumni can be valuable long term assets for the organization.

9/13/2008 Addition: When Times get Tough, Increase the Travel Budget

I just returned from the Network Roundtable meeting and had an opportunity to listen to Larry Prusak talk about the power of culture and networks.  A colleague asked Larry a question . . .”in tough economic times, what would be your #1 recommendation for the organization.”  His reply . . . increase the travel budget.  Interesting . . .certainly not what most organizations do.  First thing to go is the travel budget.  His point, if knowledge is truly the driver in your growth engine, why would you cut the travel budget ?  Knowledge is massed in networks where people share trust, perspective, and a culture over time.  Knowledge is a social thing . . . not an individual thing . . . which requires care and feeding.  The cost of knowledge is the ability to create shared experiences so that people can share . . .absorb . . .and build anew.  Can technology do this for us . . . yes, to an extent. . . it can certainly accelerate information sharing and even knowledge development.  But ‘being together’ is key at critical points is key to a network’s ability to develop trust . . . enable collaboration . . . create knowledge . . . to drive innovation.  It’s hard to create a shared culture of ‘asking for information and sharing knowledge’ when you are physically isolated. 

Ok, so who really does that in tough times . . . well MWH Global did.  In fact, they rearranged the travel budget . . . they decreased executive travel and increased travel at the mid-level in the organization where the dollars could have the greatest impact.  And the outcome . . . a measurable increase in organizational capacity and ultimately revenue.  Interesting indeed.  What do you think? 

10/28/08 Addition: Leveraging the lull to develop skills and spark innovation

Like many of our organizations, Toyota is facing a significant lull in manufacturing for a significant portion of their workforce.  With a tight economy and changing gas prices, Toyota like the other car makers is experiencing the same challenges as the other auto makers.  Their response to that challenge is what makes them unique.  Rather than send workers home like the other auto makers, Toyota is keeping their workers on the line to sharpen their skills and look for innovation opportunities.  And they are already seeing the potential cost savings benefits to keeping employees engaged in processes they have redesigned.   What a concept . . . use short-term idle time to keep employees engaged, trained, and looking for incremental productivity savings and innovation opportunities. 

The Information Technology Perfect Storm

The concept of workforce planning has been a core Information Technology (IT) initiative for quite some time. For the most part, it is a mathematical or formulamatic exercise focused on predicted labor growth minus anticipated departures equals hiring needs. Oftentimes there are bells and whistles in the process: but if we are being candid, the above, for the most part, constitutes a workforce plan.

 

This calculation was easier to do over the last four years during the recession, but as you will see, the ability to create a meaningful workforce plan is becoming a very difficult challenge for IT managers.  The complexity is derived from the reality that as we move further into the new millennium, we are encountering a labor market “perfect storm.” This phenomenon can be attributed directly to the shifting demographics of both the domestic and global workforce, post-recession increase in enterprise growth opportunities, and diminishing levels of employee commitment. The storm becomes even more intensified due to the ever-increasing emphasis on globalization coupled with the demand that IT professionals be “innovative” while staying within budget.

 

To read the rest of this artilce, click here

 

 

 

 

 

 

Speeding Up Talent Globe-Hopping

Globalization and the increasing pace of business are reshaping a key aspect of talent readiness: International assignments.

Since 2000, global assignments shorter than 1 year have nearly tripled – rising from 10% to 27% of assignments. That is one finding of the latest Global Relocation Trends Survey Report by GMAC Global Relocation Services, released in 2007. A 2006 survey by ORC Worldwide, TheMIGroup and Worldwide ERC found a similar trend: 60% of 530 multi-national employers surveyed reported an increased in short-term expatriate assignments lasting 3 to 12 months.

At the same time, U.S.-based companies are finding that a global presence can be a buffer against fluctuations in the domestic economy. Two examples are General Electric and IBM. GE reported that more than half of its revenue last year was generated outside the United States, and IBM’s non-U.S. business accounted for 63% of its 2007 revenue. That’s good news for employees’ 401(k) accounts as well for CEO bonuses and shareholder returns. Even middle-market companies are seizing these opportunities to tap new sources of revenue. In March, KPMG’s Global Enterprise Institute announced survey results showing that 58% of middle-market executives plan to expand their global presence within 5 years.

Yet global leadership isn’t created overnight. The groundwork must be laid well in advance.

There is a growing business case for making the investment in preparing candidates for short-term global assignments. Shorter postings mean less disruption to the employee’s work and family lives. A shorter global assignment is also less expensive and less complicated from a compensation and benefits perspective. The approach also benefits the talent pipeline. Companies can cycle a greater number of employees through shorter international assignments. A candidate being groomed for a global leadership role can take on two or three relatively brief assignments in the same amount of time that they previously would have spent in one location. All of this is consistent with the adaptability and agility that characterize Next Generation Enterprise organizations.

From a recruiting and retention perspective, the prospect of short international assignments within career path options holds tremendous appeal for the Generation Y or N-Gen employees – those under age 28. Our 2007 Re.sults report Project YE: Engaging Today’s Young Employees found that Generation Y employees scrutinize learning and development opportunities when choosing to join – or stay with – a company. They also want more frequent and shorter rotational opportunities. Our 2007 research report Harnessing the Global N-Gen Talent Pool noted that N-Gen is arguably the most relationship-driven generation in history. Providing suitable N-Gen employees with a short international assignment at the appropriate point in their career will help them build the kind of network they will need for a subsequent global leadership role.

In preparing candidates for global assignments, employers often focus primarily on selecting candidates and then addressing the tax implications and logistics of their assignments. What is often given short shrift is the process of “seeding” candidates. We see great value in integrating preparation approaches into performance, learning and talent processes.

Does your company currently do any of the following to prepare future short-term expatriates?

·        Create global awareness and networking opportunities: While the GMAC survey showed that 80% of companies surveyed offer their employees formal cross-cultural preparation for international assignments, only 21% of those companies made the training mandatory. Companies can hedge against that risk by creating global awareness early in candidates’ careers with learning programs and information. These offerings can whet employees’ appetites for self-directed development in this area.

·        Build global acumen into performance goals: Providing global awareness performance goals, development opportunities and feedback can initiate an employee’s journey toward a short-term global assignment. Assigning an employee to a global project is an effective way to help them build global contacts and expand their cultural horizons. This approach can also give a company an early indication of who is most suited for short-term global assignments.

·        Link global assignments to talent and succession planning: Including relevant global assignments in the talent management and succession planning processes is a way to ensure that earlier learning and development efforts bear fruit. Importantly, integrating the assignments into these processes can bring rigor to the approach and ensure that the international assignments are aligned with critical business objectives.

Starting these efforts early and providing an ongoing focus will help ensure that you are selecting the right candidates and maximizing your company’s investment in short-term global assignments.

The Silent Generation Meets Generation Y: How to Manage a Four Generation Workforce with Panache – Part 1

Introduction Managing a multi-generational workforce is a challenge that many organizations are facing today.  Shelly Schmocker, Vice President of Global Talent Management at StepStone, says that effective workforce planning strategies will require a shift in thinking from the topic of the “aging workforce” and instead address issues related to the “multi-generational workforce”.  Companies are stepping back and looking more holistically at how to develop programs and deploy technology that will speak to four distinct generations in the workforce.  Each age group requires a different approach when designing career and compensation strategies, performance motivators, and addressing learning styles.  The biggest challenge, however, is how to effectively encourage collaboration among the four different generations of workers (cohorts). Tom Casey, Senior Vice President of BSG Concours, made the following comments to preface further discussion on this topic.  

• We can no longer think about human capital challenges purely in the context of the aging workforce.
• We can’t just think about what we can do to make Generation Y (aka millennials) happy in the workforce.

 Instead, we need to answer the following question.  “How do we best manage four active generations of workforce cohorts with differing expectations?”  The answers to this question – and much more – will be revealed in this HCI white paper, based on the Human Capital Institute webcast, The Silent Generation Meets Generation Y – How to Manage a Four Generation Workforce with Panache.   A Chorus of Corporate ConcernsBaby Boomers’ views of Gen Y’s in the workplace include some of the following generalizations: 

• Gen Y’s don’t have loyalty to the company
• They have poor communication skills
• They are impatient and they don’t respect authority
• They spend too much time online
• I (Boomer) can’t get them to accept my job.

 Gen Y’s certainly don’t look like “us” (Boomers) and their experience and background’s are vastly different than that of a typical boomer, according to Tom Casey who described himself as a “typical” Boomer.  Casey is 58 years old, has 4 grandchildren, draws two pensions and works 100% (full-time) in the workforce.  His approach to work has been shaped by events and values that are very different than those that influenced Gen Y.  Casey cautions that no matter the role in your company, you will be managing Generation Y workers in the future and the task will be challenging.   Echo of Concerns returnedThere are an equal number of generalized perceptions about Boomers that are held by Gen Y’s: 

• They are inefficient
• They don’t respect me
• They assume that I’m interested in the career path that “they” have chosen for me
• They are obsessed with face time and have too many meetings
• They don’t give me (millennial) the latest technology and they don’t use technology effectively

 The real issue that underlies generational stereotypes is that there’s incomplete communication between differing generational groups.  Casey used the analogy of the game “telephone” in describing just how jumbled communication can get between differing generations.  One party speaks into the line and the other party either can’t hear the message or hears it incorrectly.  The breakdown in communication happens in both directions and leaves both parties feeling frustrated. One “War Story” helps to put into context why Gen Y individuals are so different than Boomers.  Casey noted an interesting tactic that some recruiters have used with success in hiring Generation Y workers. Recruiters have discovered what Casey described as the “DaVinci Code” for recruiting Gen Y workers.  Gen Y’s are very family-centric and one way to win them over is to involve their family in the hiring process.  This approach is not without its drawbacks, however.  Some employers are finding that once they’ve involved the family in the recruiting or hiring process, they’ve hired the whole family.  It is not uncommon to hear stories of parents calling employers to find out why their son or daughter got a poor performance review.  Obviously, this is not an experience that many Boomers can relate to; in fact Casey stated that in a poll of Boomers, some 60% felt that they would have been better off without parents at all.  

The Silent Generation Meets Generation Y: How to Manage a Four Generation Workforce with Panache – Part 2

Four Generations in the workforce

Figure 1 illustrates the numbers of each of the four generations currently represented in the workforce.  The four groups are: Traditionalists, Boomers, Gen X, and Gen Y.  Generation Y represents the largest number of workers in the workforce, with even greater numbers than the large Boomer representation.   By examining different generational perceptions, the most obvious question from each cohort about the other is, “What are they thinking?” The only way to really arrive at an answer is to examine what the expectations are from each cohort.  Every generation has different expectations and employers know what has shaped many of the experiences and expectations for traditionalists, Boomer, and even Gen X.  Companies are still trying to figure out what the expectations are of Gen Y, and this will be something companies will need to keep working on for some time.   

Shifts in Labor Force Comparison

Management of human assets is the priority right now, according to Tom Casey.  Companies that think they can manage the expectations of four cohorts using a homogenous model are in for a shock.  It is time to throw out the one size fits all model of talent management and embrace a more flexible model approach that is sensitive to each cohort.             
Figure 2 is a graphical representation of different generations of workers over a span of 60 years (1970- 2030).  The graph shows that traditionalist (mature) workers are going to be around for a while and Boomers are going to be around for quite a while longer.  A multi-generational workforce exists now and companies must think about the four cohort groups and their expectations in order to keep them in the workforce and productive.  “If you aren’t struggling to get good people, or people at all, you will be,” states Casey.  Those who reside in the C-suite can no longer get by with “happy talk” in response to human capital management.  The homogeneous human capital management model of the past simply will not work with such diverse cohorts in the workforce – flexibility needs to be “burned in” to the human capital management model.   

Ethnic & Racial Diversity

The bar chart in Figure 3 represents the two major ethnic minorities in the U.S. and their representation across each of the four generational cohorts.  Casey states, “diversity in the workforce is not just a number, it is a reality; companies have been paying lip service to diversity in the workplace for years.”  Just how diverse the U.S. population is can be illustrated by what’s happening in the current presidential elections.  For the first time in history, the Democratic Party is likely to nominate a woman or a person of color as the Democratic nominee.  It is time to recognize that the U.S. is a very diverse nation and that diversity in the workplace is a topic of great importance.               

Increasing Educational Achievement

The proportion of college graduates in the United States is increasing. However, the percent of graduates as compared to overall population is problematic. Consider the following statistics: 

• Currently between 25-30% of the U.S. population attains a college degree.

• In the future two-thirds (66%) of all new jobs created will want college grads to fill them.

 It is not difficult to see the problem here for employers.  Not only will there be a shortfall in the number of college graduates to meet demands, but there is also going to be a severe shortage of graduates with “requisite skills.”  The ramifications of the “skills shortfall” are already being felt by companies.  Tom Casey warns that HR professionals need to look at this issue directly and acknowledge that their companies will need to get focused on education.  Companies will need to fill a larger education role in teaching skills to employees through training and development.  Casey points out that companies of any size “will need to get serious about training and development – you are in the education business.”  “Please do not underestimate the contribution that doing this well will contribute to your employee brand”.  

Greater Responsibilities in the Workplace

In addition to a deficit of skilled, educated employees in the workforce, companies are now dealing with the challenge of employee commitment. Statistics show that for both male and female workers, there is a decline in the level of responsibility that workers want to take on in their careers. Boomers joined the workforce with the expectation of getting more responsibility and moving up the career ladder. “It was the reason we went to work,” says Casey.  Attitudes about allegiance to work started to change with Gen X workers and now that Gen Y’s have entered the workforce, the change is even more dramatic.  Taking on more responsibility is a “huge” issue for Gen Y workers; for them it is all about flexibility.  Restlessness and a desire for mobility are more important to Gen Y.  Companies are figuring out that they must respond to this new paradigm and that the generation that “lived to work” is a thing of the past.  As companies scramble to find numbers of workers with requisite skills set, flexibility will become part of the talent model; figuring out just how much flexibility they can “burn in” to their organizations is a direct response to the changing expectations of young workers.  Work and career flexibility are “non negotiable” for many millennials.   

Growing Shortage of Workers in the U.S.

According to a 2005 Labor Force report, a projected shortfall in workers is imminent in the U.S.  It won’t just be the U.S. that will struggle to find skilled workers; developing countries like India will also face shortages. The more specialized the skill set that is needed, the more difficult it will be for companies to attract workers with appropriate skills. Demographics, skills and education are all factors that will contribute to the labor shortages which will have differing impacts by industry segment.  Figure 4 illustrates the continuing trend of worker shortages by year.                

The Silent Generation Meets Generation Y: How to Manage a Four Generation Workforce with Panache – Part 3

Experiences of the Four Generations

In order to understand the distinctions between the four generation cohorts and understand what is driving their expectations, one must examine the historical, cultural context that shaped each cohort.  Figure 5 shows each of the four generations currently in the workforce.       

Traditionalists  Traditionalists, born between 1928 – 1945, were raised in homogeneous families and neighborhoods.  This generation witnessed the rise of the white collar job and a strong commitment to higher education. Traditionalists have a respect for authority and place a lot of value in receiving financial rewards and having security.  A good example of the focus on security needs can be seen in how important health care is to this generation.  

Boomers  The baby boom generation, born between 1946 – 1964, was shaped by the Vietnam War, the Civil Rights movement and the assassinations of Martin Luther King, John F Kennedy, and Robert Kennedy.  Boomers are more suspicious of authority than their parents as a result of events like Watergate and unpopular wars.  Boomers are competitive by nature, but they do show some commitment to making a better world.  

Generation X  Generation X’s were born between 1964 and 1980 – the oldest Gen X’s are in their early 40s now.  This generation saw the end of the Cold War and the fall of the Berlin Wall.  They were the first to experience high divorce rates amongst their parents, and most had some exposure to parents or relatives losing jobs to the recessions of the 1980s and 1990s. The growth of the Internet and global access to information created a generation that is information rich.  Generation Xers asked the question, where can I get the information?  Generation Xers are self-reliant and have clear tribal affiliations.  To illustrate the importance of the tribe to Gen X, Casey recounted a story about how one of the Big Four Accounting firms planned to recruit and hire several Generation X accountants.  The firm was interested in hiring three Gen X employees, but was aware that the three were part of a tribe of six individuals who were very close.  In an effort to hire the three desired individuals, the accounting firm made offers of employment to the entire tribe of six friends.  The accounting firm was unsuccessful in hiring any of the six individuals, however, because the firm had failed to realize the existence of a seventh member of the tribe.  All were lost to a competitor firm who had been successful in wooing the entire group.   

Generation Y  Generation Y, born after 1980, is challenging traditional hiring and recruiting practices.  Companies don’t have a lot of experience with this generation and are still figuring out what motivates this group.  There will be a struggle for some time as to how to manage Generation Y, which comprises not only the largest consumer group but the largest employee group as well.  Gen Ys are the children of the Boomers and the siblings of Generation X.  Generation Y’s are very upbeat and optimistic despite having been exposed to routine violence in schools, and terrorism. Events such as the Columbine school shootings and September 11th terrorist attacks created an almost constant state of vigilance for many of these young people.  Exposure to technology became ubiquitous for this generation and the comfort level with the use of technology is unprecedented.  The family-centric model created a very pro-child environment; Generation Y listens to their parents and respect authority. Generation Y are pro-learning, spiritual by nature, socially conscious and have very high self esteem.  They like to be mentored by Boomers rather than peers; and while they have a high respect for older and more authoritarian role models, they don’t have a high regard for organizations.  As a result of the culture and influences that have shaped Generation Y, they are trustful of authorities, respect their parents as role models and recognize that work is just one priority in life, not the priority.  The diversity in background, experience and expectations of the four generational cohorts, require different approaches to managing them in the workplace.  The key to managing different generations lies in understanding the drivers of the differences and leveraging unique characteristics to create win-wins for employees, their cohorts and their employers.  Managing the multi-generational workforce requires that each distinct cohort in the workforce be considered individually from the standpoint of career expectations, mobility, development and recruitment.  To ignore the needs and wants of one cohort over another is a very risky practice.