Filling the Baby Boomer Vacuum

Millions of people are retiring from the workforce in the next two decades. Implementing a common business language can facilitate the transfer of knowledge and skills from seasoned employees to incoming generations

Immediately following the Second World War, the baby boom began in 1946 and continued through 1964. During those 19 years, in the USA alone, 76 million people were born. According to projections based on the U.S. Census, an average of 4.6 adults will turn 65 each minute in 2007. In 2025, an average of 8.0 adults will turn 65 each minute. (See Diagram 1.) The demographic shifts coming to North America and Europe in the next two decades will be profound. How organizations choose to identify their highest priority talent and knowledge management concerns today, and focus on the greatest potential problems will play a significant role in their long-term survival and growth. A critical component in facilitating this transition is the deployment and support of a common language for issue resolution across the business. Only by embracing a shared platform for addressing open issues, bridging gaps between levels of subject matter expertise, will organizations be able to ride the wave of this workplace transformation.

Even with advances in healthcare, the “retirement” age, as calculated by the Bureau of Labor Statistics, has remained fairly stable over the last 20 years. There are signs that it may be starting to increase, but certainly not enough to offset the number of people projected to leave the workforce in the next 20 years. As they walk through the door and into their retirement years, they are taking with them, not only subject matter knowledge and skills gained over a lifetime of employment, but also a vast array of implicit knowledge gained through navigating the work environment and resolving business issues. The person who discovers a business process shortcut and refines it over years, without sharing that knowledge in a meaningful way, may be crippling the effectiveness of that process the day they leave. Depending on the realm of expertise, the implied knowledge of an organization can represent up to 70% of its competency assets according to Canadian researchers. The issues revolving around the identification, the representation, the sharing, the validation, the re-use and the evolution of valuable knowledge are thus critical for organizations. The coming crisis is not one of talent management, but rather the vacuum created by departing baby boomers is forcing a market-wide talent transformation.

In the corporate world, many professional occupations also have a disproportionate number of older workers, particularly those requiring postgraduate degrees. The opportunity costs for these high-wage earners leaving the labor force is greater than for most other occupations. Only one third of businesses in the USA have analyzed their workplace demographics and made projections about the impacts of retiring workers. Many organizations are only now beginning to ponder the implications of their most seasoned employees leaving, while facing the demands of a new generation of employees who are seeking a higher degree of access and involvement in operational decision making. Strange as it may seem, the needs of one could be married neatly to the demands of the other with appropriate planning and forethought. If we need to prepare the workers of tomorrow for more senior roles, far earlier than in the past, why not create an environment in which the exchange of learning through structured coaching and mentoring is the order of the day? This work should be conducted in and around the needs of the business to ensure relevancy and engagement. It should also be conducted in such a way that the transfer of knowledge and skills has an explicit return on investment. In some organizations this approach is already underway.

The TVA (Tennessee Valley Authority) is America’s largest public power producer. Through a network of 158 municipal and cooperative power distributors, it serves eight million customers across seven states through the efforts of 13,300 employees. With a capacity of 31,000 MW delivered via three nuclear plants,11 coal-fired plants and 29 hydroelectric dams, the TVA faces one of the most complex workforce transitions in the coming years. The average age of their workforce is 47 and fully one third of which will be eligible for retirement within the next five years. At the TVA they found that risk was greatest in specialized technical positions and in problem-solving strategies. This process also revealed that current procedures were sometimes weak; there was also a reliance on experienced personnel rather than strong processes and detailed plans. To combat the risk of losing a significant amount of tacit knowledge, the TVA has developed a Knowledge Retention Program. Several of the core ways in which they are installing this program are through coaching, shadowing, mentoring and apprenticeship programs. These link more junior employees with more seasoned employees, and stress opportunities for multi-skilling and cross-training.

According to the Bureau of Labor Statistics, more educated workers have a tendency to stay in their careers longer. Factors producing this affect are: greater job satisfaction, the costs of lost income in leaving the job, strong social connections, as well as other factors. At the same time, however, these workers often have better pension and health benefits than other workers enabling them to retire younger. Something needs to keep their attention while the exchange of learning takes place. The difficulty is that for many people knowing how to transfer their knowledge to others is a skill they may not possess. Strategic workplace initiatives are crucial key targets for this kind of in-place transfer of knowledge. These initiatives are highly visible and, as such, will demand more from their participants in a public domain.

As mentioned earlier, the new generation of employees is looking to make a significant impact in the workplace while many of the soon-to-be-retiring generation are looking to leave a positive legacy. The Center on Aging & Work conducted the National Study of Business Strategy and Workforce Development in 2006. In this study, they found that these two groups of employees had areas of common ground which could serve the basis for meaningful, transformational, relationships and exchanges. In Diagram 2 (below), you can see the area of that common ground. The implication of this commonality is that by engaging these seemingly widely divergent employee groups in endeavors that stress the need to take initiative, organizations can reap significant returns. It is therefore incumbent on current organizational leadership to seriously consider how they can use the needs of the business today as a conduit through which the learning of the past may be transferred to the leaders of the future.

“The technology industry has demonstrated that high technology, when used properly, is a key competitive advantage that can positively impact the long-term growth and success of organizations across our economy, from financial services and healthcare to transportation, manufacturing, education and scores of other industries,” said John Venator, president and chief executive officer of CompTIA. “But a skilled and experienced workforce is required to assure that technology is used properly.” No amount of technology can fill the gap of lost human capabilities. Software companies and hardware companies alike are realizing this on a regular basis. In order to maintain a skilled workforce, focus on transfer of knowledge through business result-oriented actions is essential.

A large software producer has launched simultaneous programs to connect senior research fellows with incoming software engineers in order to “bake” quality into their efforts and fight the disconnections and errata that creep into code when many resources work on sections in isolation. At IBM, under Louis Gerstner, a program called Extreme Blue was created that even precedes employees coming on board. Its focus was on having prospective interns (and eventual employees) work on critical issues with senior researchers to experience the value of joining IBM and consider a career with the organization. In this case, the bridge from the past to present was being created as part of a global talent management effort, not driven solely by a concern to foster and support knowledge management.

Critical to this issue, a resolution-based approach to workplace transformation is the initial identification and prioritization of the most germane issues to business performance. Conducting an organization-wide Situation Appraisal can galvanize all groups of employees to that end. During this process, teams of cross-generational employees can identify and probe the concerns of the business and consider how they should be resolved. Jointly, they would then determine whether the concern reflects a problem to be corrected, a choice to be made, or an action to be taken. They may also discover that more separation and clarification may be needed. Based on this sorting of issues, the teams would reflect on their relative importance to the business (based on supporting guidelines driven from strategic statements, functional strategies, business plans, operational plans and financial data) and would prioritize them in order to maximize their impact. Correspondingly, the senior leadership of the business might choose to turn the cross-generational teams loose on the organization’s previously established strategic project portfolio.

A key skill in organizing this effort is without question, project management. The ability to define goals, structure the work, assign responsibility, schedule resource and activities, and manage risks is critical. Aligning long-standing project managers with newer project associates will facilitate the transfer of best practice methods and techniques. Another aspect of project management as a method for change is how scalable it is. It may be applied to simple issue resolution and to large scale, organization-wide, culture change projects. In every case, it will be necessary to identify which process steps will be useful. To resolve a complex and poorly understood concern may require the use of all the basic steps of a problem analysis or decision analysis process, or even several processes (for example, finding the root cause of a problem may then lead to choosing the best way to fix it; and making sure the solution is implemented successfully may require effective risk mitigation techniques). In each case, the cross-generational teams would be expected to determine what is already known about the concern and the amount of additional analysis needed for resolution.

Other concerns may require only those techniques needed to gain understanding and commitment to action. For example, alternatives may have already been offered for a capital acquisition but objectives may not be fully understood. Or, a cause may have been accepted as most probable for a market failure of a new product launch but it may still need to be confirmed. In all cases, the work will require planning and analysis. And in all cases, a common language is necessary so the work of transferring subject matter-based knowledge and skills is not impeded by confusion over issue resolution approaches.

Clear, shared, systematic, approaches for making thinking visible for problem resolution, decision making, risk management, opportunity development and project management are critical to ensure the success of this workplace transformation. Each process should be designed to meet the demands of the issue to which it is being applied. Each process should be repeatable. Each process should be consistent. To meet these criteria, each process should also be founded on the principles of best-practice thinking and should engage, through meaningful questioning approaches, the experience of all participants and not only those with perceived subject matter expertise and domain mastery. When you consider the issue resolution processes at work in your organization, do they meet these criteria? If not, your employees, regardless of generation, are experiencing impediments to the ready exchange of ideas in their daily work. Impediments that will be amplified as more senior employees retire or withdraw from the workplace.

At the individual level, knowing how to transfer one’s own knowledge remains challenging. Knowledge-transfer aptitudes and structuring competencies are not innate. Moreover, those who excel in their field are not necessarily aware of the manner in which they perform their work. Tacit knowledge is challenging to externalize. Most of the time, experts use their knowledge ‘’live’’ and rarely have the opportunity to consciously reflect upon what they are doing. Basically, they cannot verbalize what they know. Critical projects, ongoing problems, key decisions all could serve as the background for an effective transfer of knowledge and skills required for the long-term health of organizations. By forging a strong working relationship between the incoming and outgoing workforce generations, this changing of the guard may unleash an era of unexpected innovation. The key component is to create a foundation of commonality through which this transformation may occur. Systematic, rational and visible approaches for exchanging ideas and addressing meaningful business issues are the answer.