And the young will lead the old: managing age diversity

@IE University

Managing age diversity: Innovation in workplace organization is called for to bring out the positive potential of a greater generational mix in the office.

If all goes according to plan, there will soon be nothing remarkable about living to be 100 years old. Besides continual advances in treatments for disease, medical researchers are busily searching for the keys to longer life, if not eternal youth. In a recent experiment on mice, scientists in the Netherlands kept the animals from ageing by sweeping away cells that had entered a dormant state by injecting them with a peptide, making old fur regrow and eyes sparkle afresh.
This boosted longevity is already having far-reaching implications for our societies, government policymakers and the workplace. As life expectancy continues to rise, it becomes increasingly impractical and unaffordable for people to retire at the ages they have up to now. And as the work force ages, organizations will come under pressure to change their working practices and approaches to management, performance management, promotion and reward to accommodate this change.

Organizations will come under pressure to change their working practices and approaches to management, promotion and reward.

In the United States, the median age of employees rose from 37.7 years old to 41.9 in two decades from 1994 to 2014, reported the Bureau of Labor Statistics. According to the UK’s Department for Work and Pensions, the over 50-year-olds will comprise one third of the working population by 2020.

Companies and other organizations can expect to have increasingly age-diverse workforces. The next generation of managers will need to understand how to recruit and upskill an age-diverse workforce, how to promote effective communication within multigenerational teams, and how to support the extension of employees’ working lives while looking after their health.

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Good management of age-diverse workplaces requires an acceptance that different age groups may bring different qualities to bear. 

But then again, the workplace itself could become very different. Indeed, will it be a place at all? The rise of the Internet of Things (IoT) — the connection of a huge range of devices, sensors, and machines to the web — will enable infrastructure to be designed and operated in a more integrated way. Currently, 99 percent of physical objects that may one day be part of this network are still unconnected. It is estimated that by 2020, 200 billion objects will be part of the IoT (26 smart objects for every person on Earth).

Students enrolled in IE University’s Bachelor in Business Administration learn directly from business leaders and industry experts who are on the front line and having to deal with global changes and challenges. Technological change and these altered human circumstances are an invitation to drive innovation and redefine traditional ways of understanding how business and companies operate.

What has previously been seen as the natural order of things, in which the middle-aged tend to manage the next generations from positions of authority, will give way to a mosaic hierarchy in which age and responsibility are not synonymous. At the same time, there are signs that this can create difficulties in workplaces. According to a study published in the Journal of Organizational Behavior in 2016, in companies where the size of the age gap was larger between younger managers and older subordinates, employees tended to report more negative emotions, such as anger or fear.

What has previously been seen as the natural order of things will give way to a mosaic hierarchy in which age and responsibility are not synonymous.

Florian Kunze and Jochen Menges, who surveyed almost 8,000 employees at 61 German companies, suggest that these disgruntled older employees need a way to express their feelings, rather than bottling up resentment. Participatory structures could be devised so that old-timers, whatever their actual rank, can share their accumulated wisdom.

A new, less vertical approach to business structures could change the whole idea of what promotion means, with people finding their place in accordance with what they can and cannot offer. This could help to defuse the problems brought about by the so-called Peter Principle, under which “in a hierarchy, every employee tends to rise to their level of incompetence”.

A new, less vertical approach to business structures could change the whole idea of what promotion means.

Formulated by Dr Laurence J Peter and Raymond Hull in the 1969 book of the same name, the Peter Principle explains how an employee is typically rewarded for being good at one thing by being promoted to a position in which they have to perform a different task. And unfortunately, if they are not good at this new task, it is probably the post in which they will remain stuck on the career ladder.

A bigger spread of ages in a working environment may present its challenges, but it could also unlock our set thinking and lead to a fertile period of organizational innovation.

**Written by: The Report Company – for IE University