Working on the Boomer Retirement Problem

Businesses and organizations have seen it coming for years. In the next decade, aging Baby Boomers will retire from mid to upper level management and executive positions in virtually every sector of the economy- potentially creating a leadership vacuum that could disrupt continuity. Many have started taking action through succession planning strategies that call for early training of high-potential staff and are beginning to adapt to generational differences in the workforce. “The key is to be strategic and look further up the organization than the current vacancy when filling key management positions,” said Burbank City Manager Michael Flad, who’s implemented a ten point succession strategy that focuses on retention, and placing employees on a path to promotion early on through training and leadership programs. The City of Burbank, like other local governments, has already experienced an outpouring of baby boomers (one of the perks of working in the public sector is retiring at an earlier age) and is actively addressing the potential loss of institutional knowledge when valuable workers leave the organization. “It’s a numbers game. There’s a huge gap and it’s a big challenge. There are just more baby boomers than there are qualified employees to replace them,” said Flad, adding that over the last five years the number of Baby Boomers employed with the city that have retired has more than doubled. In technical fields such as civil and electrical engineering jobs at the city, the issue is especially problematic, he said. In the private sector companies are also preparing for an exodus of talent. “It’s a discussion we’ve been having internally,” said Janice Blakely, 45, National Sales Service Manager at Bobrick, a manufacturer of bathroom products in North Hollywood. “We’re seeing those challenges on the horizon and we’re making sure we have a steady stream of talent that is prepared with the institutional knowledge as we move forward.” Bob Oedy, an organizer with the International Brotherhood of Electrical Workers (IBEW) Local 11, which has more than 7,000 members in the greater Los Angeles area including the San Fernando Valley, said the issue is also affecting the electrical construction industry but is exacerbated by the fact high school graduates are increasingly choosing white collar industries over skilled trades and there are not enough people entering the industry to satisfy the demand. “The challenge is attracting new entrants to the industry,” said Oedy, adding that IBEW offers training and apprenticeship programs to prepare future electrical workers. The union also conducts large-scale focused marketing campaigns to attract new recruits. As part of Burbank’s succession strategy, and to avoid young employees from being thrust into management positions without the adequate skills, Burbank reached out to Woodbury University in recent years to develop a unique custom training program. The curriculum was designed in collaboration with the city’s administration to hone supervisory and leadership skills in first-line supervisors, and mid to upper level management. The six week program – where employees selected by the city attend sessions for half a day, once a week ¬– is now in its third cycle. “The program has been so successful that Woodbury is now in talks with the city of Glendale about possibly starting a similar custom program there”, said Don St. Clair, Vice President, Enrollment Management and University Marketing. Glendale, he said, is also facing similar challenges when it comes to retiring Baby Boomers. At the manufacturing company Bobrick, a management training program that recruits employees straight out of college and lasts from 6-18 months has been crucial to the company’s effective succession planning. The training seeks to give young recruits a full picture of how the business works through hands on experience in all departments, said Blakely. Afterwards, Bobrick rotates managers to other positions within the company every 2-3 years, and makes sure they work hand in hand with older, soon to be retiring superiors, to help them further grasp all aspects of the business. With each rotation comes a salary raise keeping younger employees motivated, engaged and constantly challenged, she said, which fits into their retention strategy. Businesses and organizations today need to entice and keep younger workers, and start them on a path to leadership roles early on, said Flad, a member of Generation X, who says he’s the poster child for Burbank’s success in this regard. Flad was groomed to take over retiring Baby Boomer Mary Alvord’s job as city manager. After years of working for the city and five years as the Assistant City Manager, the Council appointed him to the job six months prior to Alvord’s retirement in order to allow even more time for on the job training and coaching. When he was promoted in January 2009 however, there was no one qualified to fill his shoes as assistant manager, which demanded strategic thinking and flexibility, he said. “The key is to be more strategic and to play to Generation X strengths,” he said and used a football analogy to illustrate his point. “If you’ve been a running team and you suddenly find yourself with a bunch of wide receivers, you can’t keep being a running team, you have to be flexible and adapt.” In this case the city decided that changing the organizational structure was the best long term move for succession planning and the assistant manager position was eliminated. In its place two deputy city manager positions were filled by younger employees, which the city hopes will become department heads down the road. “It requires a different skill set to integrate Generation X and Millennials into an organization,” said Dan Goetz, President CEO of UltraViolet Devices, Inc. a company with 75 employees in Valencia, who’s also had to be flexible and adapt to the changes in the workforce. Through what he called company cultural trainings, the organization has worked to familiarize itself with the needs of the different generations, and is working to create mentoring relationships that include objectives for transfer of knowledge. “Millennials are not motivated by traditional things,” he said. “They’re looking for faster more sophisticated tools and technology, and want quick rewards and recognition. It’s the ‘I want it now’ attitude,” he said. This contrasts with Baby Boomers, which he said tend to think more in terms of long-term reward. Younger generations are also expecting more flexible hours and more time off, Goetz said, and are changing the status quo for businesses as employers are having to face an evolving environment for everyone, in order to retain valued employees. “I’ve had to look at revising our policies on telecommuting and work flexibility in order to create an environment that is exciting and enticing to younger generations,” he said.