The impact of demographic change is one of the most important issues facing organisations – but it is also one of the most misunderstood.

The modern workplace now features four, sometimes five, different generations all operating together. Each comes with their own experience, skills, desires and demands, but meeting these often competing viewpoints can be a challenge.

Think about how often you hear stereotypes about different generations. Gen Z (those born between 1997-2012) are entitled and unable to deal with negative feedback. Millennials (1981-1996) just want to work from home all the time. Gen X (1965-1980) and Boomers (1946-1964) can’t deal with technology.

Are any of these actually true? And if they are, what are the macro reasons behind them and how can firms navigate these differences and unlock better collaboration across generations?

This was the theme of a recent Managing Partners Forum webinar, featuring a keynote speech by leadership coach and intergenerational expert David Haylor.

Stereotype or fact?

Haylor began by listing some of the common intergenerational complaints businesses see, starting with work behaviour.

“Post-covid, and with younger generations generally, there is a view that basic communication skills like eye contact, handshakes and being able to use the phone are lacking,” he said.

“Then there’s a view that people – particularly younger generations – are more sensitive to feedback and dealing with issues in the workplace. This manifests itself in two different ways. Some young people are seen as being overly challenging and opinionated, while others retreat into themselves and disengage,” added Haylor.

One senior managing partner who spoke to Haylor admitted being ‘incandescent with rage’ at a trainee with six weeks experience who challenged his processes. While this wouldn’t have happened several years ago, the macro environment in which younger generations are growing up (more about this later) makes it much more likely to happen now.

Another perception is that younger generations have a sense of entitlement, wanting to work when they want and being more likely to take time off sick or for anxiety. Haylor revealed that there is no data to support this – so why does this perception persist?

For Haylor, understanding this and then creating more effective intergenerational relationships requires understanding the societal, economic and technological context we’re all living in.

Changing lived experience

“Here is a quote from a leading headmaster who loves his job: ‘I have never before in 20 years seen this level of apathy among the teenagers I work with’. Clearly something is changing, but what?” he asked.

According to Haylor, the educational and parenting context we live in has changed. Teachers now have to cajole, persuade and encourage students to do things. The days of obedience are long gone. Instead, education is collegiate, with people encouraged to debate, be heard and have an opinion from a young age.

“There are positives to this, such as inclusivity, creativity and open discussions. However, when you hit the reality of hierarchical workplaces, you have challenges. Someone who has never experienced a directive – do this now – will struggle. This isn’t their lived experience,” said Haylor.

“The society we live in has shifted dramatically and this has a knock-on effect on the business environment. When you go through extensive change at pace, it is very hard to process. On a human level, it is emotionally challenging to adapt especially as you get older,” added Haylor.

Different generations experience change in different ways. Take the pandemic. For older generations, the 18-24 months of lockdowns was relatively insignificant, barring serious illness. For most, it was irritating, but represented a small portion of working life and their character, background and sense of self as an adult didn’t shift.

Conversely, the oldest member of Gen Z would have been 23 when covid hit. Their experience was completely different, argued Haylor.

“There is an old quote from Napoleon: ‘If you want to understand a man, you need to understand what was happening in the world when they were 20’. Our baseline expectations of the adult world occur in that window,” said Haylor.

Human skills and artificial intelligence

“Those things that build your confidence and communication skills occur in that window, such as building relationships, living away from home, first jobs. These milestones were stripped out of the lived experience of that generation, yet they were still expected to go to university, apply for jobs, start work – but all in a hybrid environment that further distorted their emotional development. And we wonder why there are gaps in their experience,” he added.

This lack of human skills is an issue across generations. Those in their 30s and 40s are finding that hybrid working means their human skills are getting rusty. They might not be as good at managing a room as they used to be. However, in an age of AI, these human skills will be critical. Can you go out and convince that client to work with you rather than someone else?

Another contextual factor is the financial crisis. Younger generations have no experience of a boom period. All they have seen is stagnation, recession and the occasional anaemic growth. Working hard, climbing the career ladder and getting bonuses is not the economic context they have lived. For older generations, recent decades have been more of a grind, with ever decreasing returns on effort.

In turn, this has affected our motivations. The average age to buy a house is now 33 and Gen Z are far less likely to have children than previous generations. What drives them to be ambitious is not what drove previous generations.

The same can be said of those in the middle generations, who are under increasing financial, emotional and societal pressure.

“How we live our lives as an older generation has very much changed from what Managing Partners and boards have as a lived experience. 75% of leaders will exist in dual income households where both partners are working full-time at similar levels of importance to the household. You still have childcare and older care responsibilities, of which costs are rising exponentially. Childcare costs alone are up 60% in the last 10 years,” said Haylor.

“The level of pressure that puts on your leaders is extensive and most firms are yet to reorganise their benefits packages in a way that helps leaders lead,” he adds.

The ultimate effect of artificial intelligence on employment is still unknown, but we do know that it is creating disparities between generations.

A recent Harvard study looked into the impact of AI and early stage careers. It found a 22% drop in graduate hires over 18 months in organisations that had invested in AI publicly.

“Younger generations will be using AI every single day. They see the productivity impact from that and wonder why their leaders aren’t using it. They understand that technology means that their skills have a very short shelf life and that they need to grow and develop quickly. That’s why you see some people move on quicker – they feel they need to keep growing. AI throws a hand grenade into career progression,” said Haylor.

What can firms do?

The context and challenges around intergenerational workforces are many. So what can firms do to create better relationships?

A good starting point is understanding each generation’s motivations. Gen Z are just trying to find a future they can believe in. Millennials are struggling to juggle child care, adult care, and affordability with work demands. Gen X are hoping to get to retirement with limited impact before everything falls apart, and Boomers are often blocking change they don’t understand – both intentionally and unintentionally.

For Haylor, dealing with this is about having a mindset and alignment reset.

“Do your leaders understand the world they are in now and the pressures on their people? Look at your culture, processes and how you operate. Are you aligned with reality, the people you have now and the purpose they are working towards?” he asked.

Then, take practical steps to bring your people together. The more collegiate your leadership style, the more comfortable younger generations will be and more confidence they will build. Help your leaders adapt by facilitating training towards a more collegiate approach.

Embrace the future and be adaptable. Gen Z understands that their future is unpredictable, but what they want is a firm that embraces that and is willing to change.

As Haylor ended: “Lead the world that is, not the world we wish it was”.

If you are interested in learning more about the issues shaping firm’ people agendas, either through an in-person presentation or event, please contact Tim Skipper, [email protected]