Adopt a 3-Pronged Strategy for Future-Proofing the Workforce

About 10,000 Americans reach age 65 every day, according to the Pew Research Center. Many of these individuals are employed—and planning to continue working for several more years. Others will retire, but the days of predictable retirement at age 65 are long gone, making it harder for companies to plan for aging workers’ departure. This poses a dual dilemma for employers: Will large numbers of experienced professionals leave, taking institutional memory and expertise with them? And will the workplace need to adapt to a workforce that spans five generations, including younger workers facing limited upward mobility?

Chances are that larger organizations will see both scenarios play out, making it essential that companies adopt a three-pronged strategy for future-proofing the workforce: Preserve the expertise of longtime employees; anticipate and fill skills gaps, and provide viable career paths for younger employees.

“Aging will affect every aspect of business operations,” according to Paul Irving, writing in the Harvard Business Review. From facility design to the structure of benefits and compensation to hiring and talent management, all employees will feel the impact of older employees remaining on the job longer—as well as that of potentially large numbers of top-level employees retiring.

Planning ahead and implementing a training-based solution can help organizations adjust to the changing needs of both employees and the organization.

1. Implement a knowledge transfer strategy

Despite the aging of the workforce, researchers Peter Berg and Matt Piszczek found that few companies are developing younger and middle-level employees and ensuring that they have the skills needed to replace older workers. They found that “top management was concerned more with headcount than with skill management,” and therefore let attrition whittle down the numbers of employees—without putting strong knowledge transfer protocols in place to ensure smooth operation as highly skilled (and expensive) experienced workers left.

They suggest that the result will be “larger numbers of unqualified individuals being moved into key positions.”

Some companies have responded by introducing initiatives that might induce older workers to stay on longer, such as offering reduced hours or bringing retiring workers on as consultants to ease the transition. In both of these scenarios, the older workers’ departure is imminent and they actively pass on their knowledge and help train the employees who will take over.

Other companies have seen successful knowledge transfer in mixed-age teams where older workers help younger employees build their skills. And some supervisors are proactively attempting to document specific rare and essential skills to ensure retention and transfer of company-specific knowledge. This documentation can form the basis of training as replacement workers move into the vacated positions.

Berg and Piszczek found that the most successful knowledge transfer occurs in companies that intentionally track and monitor employees skills, which can be done efficiently with a talent management system.

2. Adopt a talent management strategy

A talent management program can help managers track employees’ skill development, identify skill gaps in individuals, and anticipate skill gaps that will occur when older employees retire.

A crucial component of talent management is collecting and using data. These data might enable a manager to plan a learning path for an individual employee, offering that learner opportunities to learn new skills and advance.

But there’s a strategic angle as well: Talent management can provide the manager a bigger-picture view of the skills of an entire team. This information can be used to identify vital skills that reside with only one or a few employees, enabling managers and L&D teams to develop training to get additional employees up to speed on key tasks or specialized knowledge areas.

In one program Berg and Piszczek studied, “Supervisors regularly assessed how many people in their unit were capable of doing each job, how important each role was to the organization’s success, and how likely it was that someone could take over a job if the employee currently in it left.” Resources were then directed to training employees on the skills that were both essential and rare.

Though in many companies talent management is part of the human resources department, L&D teams can and should play a role. The task of training employees to mitigate existing and anticipated skills gaps is squarely in the learning domain.

Providing opportunities to learn new skills and take on additional responsibilities is also vital to both retaining younger workers and maintaining an organization’s readiness and competitive edge.

3. Provide advancement opportunities

It’s becoming increasingly clear that “neglecting career advancement, or being unable to provide it, can lead to employee attrition, especially among high-potential workers,” researchers Nicola Bianchi, Jin Li, and Michael Powell found.

In organizations where senior managers show no inclination to step aside, the traditional promotion path might not be available to younger stars. Rather than force out valuable, experienced employees, “expanding career capacity—putting more positions at the top—creates advancement opportunities without losing what’s already there,” they wrote. But too many executives can cause a whole new set of problems.

That’s where managers need to get creative in offering professional development opportunities. A company with a proactive talent management program can tap high performers, develop their potential, and reward them with increasing responsibility and upward mobility. This is true even if older workers do not retire; adding challenges and creating new job roles that offer added responsibility can motivate employees, even when a formal promotion is not available.

It’s also possible to create advancement paths in other ways: Some companies ease senior leaders into post-retirement careers as consultants. Others try rotating responsibility, where top performers take turns or divide leadership roles. Another choice might be planning for growth from the outset, where a corporation intentionally creates new departments, divisions, or areas of expertise that need leaders. This creates a constant supply of opportunities to allow high-potential employees to shine.

Whether an organization faces the potential loss of seasoned employees through retirement or seeks ways to motivate and retain younger workers, future-proofing the workforce is essential. This is best accomplished through developing training and professional development paths for top performers, and proactively ensuring knowledge transfer and continuity of vital skills.

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