As the waves of Baby Boomers hit the shores of retirement, businesses and government agencies across the United States face huge talent shortages. While the Baby Boomer generation has 76 million members, Generation X following it numbers only 50 million. So, if you think finding qualified workers is tough in today’s low unemployment environment, hold on because it’s going to become much more difficult.
Furthermore, it’s costly to replace experienced workers. Studies from groups like the Society for Human Resource Management’s (SHRM) and the Center for American Progress estimate that replacing an experienced worker can cost 20% or more of the individual’s annual salary in turnover-related costs. They note added costs in the range of 30 to 50% or more for jobs requiring specialized skills, advanced training or extensive experience.
Here are some steps to help you prepare your business for the changes ahead.
- Find the critical succession needs in your workforce.
What are the key positions in your business? Are internal candidates ready and able to fill them? Focus on the gaps.
- Gain insights from your best up and coming talent.
Studies highlight how interests and values of younger workers differ from those of Baby Boomers. Ask your most promising talent how they see the future. What are three things that will prepare them to advance in your organization? What are three actions that will be especially useful to retain them? How can they help attract and retain other strong performers like them?
- Tap best practices so you don’t reinvent the wheel.
Since all sectors of the economy face similar challenges, you can learn from many sources. For example, the professional associations of managers from city, county, and special districts throughout the U.S. have banded together to develop shared coaching and career development services. Using webinars, web-based resources, and volunteer senior professionals as coaches, these programs provide cost-efficient support 24/7 for up and comers. (See http://icma.org/coaching, as an example.)
Identify firms in your field that have successful talent development programs. Find out how their initiatives might serve your needs. Explore potential collaboration opportunities.
- Take an integrated view of recruitment, training, and retention.
Too many succession-planning efforts take a piecemeal approach, simply reacting to needs as they arise. Instead, take an integrated approach where you look at the whole process of recruiting, developing, and retaining key talent. Link these efforts to your organization’s overall mission and what you hope to accomplish. Establish talent development as everyone’s job and invite all of your team members to contribute to its success.
- Rethink and restructure how you do your work.
The dramatic shifts in workplace demographics will require changing how we do business. Businesses in especially tight employment markets, like coastal areas where retirees with assets bid up housing prices beyond the reach of typical working families, need to be particularly creative.
Where you face employment gaps, develop systems and use technology to leverage the expertise of skilled workers. Chart out your current methods of doing business and engage your team to develop new approaches.
- Put your customers to work for you.
Often your customers can be a solution for you. For example, when we started the company that became E*Trade, we offered investors ways to buy and sell stocks via their personal computers rather than through brokers. Independent investors wanted to be in charge of their own investing and liked doing the work themselves. The business saved labor and overhead expenses.
Customer service is a tough issue for many businesses. Customers frequently know more and expect more than entry-level customer care workers can deliver. Firms like Experts Exchange, started in San Luis Obispo, California (www.experts-exchange.com), provide an organized forum for professionals to ask questions and for volunteer experts to answer them.