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Succession Planning

Published July 2010

Succession Across the Generations

 

  Stephen Xavier and Sharon Doyle

The media and some talent professionals have hyped the need for companies to adapt to younger employees. However, in the process of making concessions, some organizations have lost sight of fundamental talent management principles, particularly succession planning, which includes actual readiness, not just generational adaptability.

This oversight will spell disaster when baby boomers — temporarily halted by diminished retirement portfolios — finally depart the workplace. Companies revising proven systems and processes to provide special accommodations for young employees should not neglect high-potential leadership development, preparing for the next round of talent warfare by ensuring bench strength for today and tomorrow.

Baby boomers number 76 million, and millennials — also called Generation Y — 75 million, but there are only 41 million Gen Xers. Gen X eventually will have to replace retiring boomers, and there just aren't enough of them. When the recession ends and baby boomers retire, this demographic problem could turn into another economic disaster. Yet there are some boomers who failed to adequately save for retirement and will continue to work into their 70s and beyond. What should their contribution be, and are Generations X and Y prepared to learn from, and ultimately manage, this aging generation effectively?

"There is much talk about 'getting people back to work,'" said Devon Scheef, co-founder of The Learning Cafe, a California-based training company. "But hiring managers don't set out to hire 80 people. They want 80 people with specific skills. The questions are, what training do the millennials need, what leadership competencies does Generation X need so they can replace the boomers, and how can we retain both Generation X and the millennial generation to avoid wasting investments in training? Organizations are not paying enough attention to the middle of the talent pipeline."

Generation X: Ready or Not?

According to stereotypes, boomers think Generation X needs a stronger work ethic, and Gen Xers see the boomers as self-absorbed workaholics. The facts are less concrete, and ultimately generational diversity must be leveraged to enhance the leadership pool.

Gen Xers, born between 1965 and 1976, range in age from 34 to 45. Corporate America's C-suite is currently about 60 percent boomers and 40 percent Gen Xers. But there is a problem. "Some boomers are going to remain in the workforce a lot longer," said Jonathan Magid, co-author of Why Leaders Fail. "As a result, increasing numbers of high-potential Gen X executives may bail because they feel they have no place to go in their organizations. Talent management professionals need to be mindful of turnover among executives who have significant executive experience but perceive themselves to be blocked."

What could motivate and retain Generation X? "We look for opportunities to grow and achieve and to be rewarded for achievement," Magid said. "If opportunities, growth and rewards are not forthcoming, we conclude that we're expendable."