Enough with the Retirement Statistics

How often have you been to a workshop, seminar, or address from your respective company where they do the following exercise, "OK everyone who has been with the company for 0-5 years stand-up (about 10% of those in attendance stand up), OK everyone who has been with the company for 5-10 years stand up (about 30% of those in attendance stand), and so forth. The kicker comes when almost half of those in attendance stand up for the 20 to 30 years of service announcement demonstrating how many people could be leaving the organization in the next 5 to 10 years.

Like John Stossel from 20/20 would say, "Give me a break!". I have done this exercise for the 4oth time now and I find this pointless. We all get that large corporations are facings succession planning issues with close to half their workplace retiring in the next few years. The challenge - brain drain from the company and no one to pick up the pieces. So, the major question here is what we choose to do about this people "crunch". What we find is many companies are choosing to focus more on the stats because the alternatives are much to costly to pursue. Lets examine some options:

• Job Shadowing (Internal) - A good option as it promotes from hiring within which can build loyalty. Minimal training as far as corporate culture goes and hiring within the business unit means objectives of the organization are also easy to grasp. Now for the bad - the domino effect. Anyway you look at it, you now have a position to fill somewhere else within the organization. If that position is filled from within, you are forced to find someone for the other hole you have created. Given this, many employees will also be hesitant to pursue such an opportunity given that their current job may not be back filled essentially leaving them to pick up the additional work. This is because many employers do not want the hassle of bringing someone else in to back fill when the term associated with job shadowing is often 6 months or less.
• Job Shadowing (External) - This would follow a competition whereby the previous employee is asked to stay and transfer knowledge. A good option as it diffuses the domino effect. Outside "blood" to the organization can be beneficial in new ideas, best practices, and a new outlook given previous experience elsewhere. Also, by having the previous employee stay while the new recruit adjusts, others can see why that individual may have been chosen over others (especially inside the organization). The bad - costs associated with training. Most organizations, like any business, realize that it often easier to keep employees rather than train new ones. Assimilation within the company, buy-in to corporate values and philosophy, and understanding business unit objectives all take time and money to implement. External employees can also face hostility from others in the business unit, especially when entering a managerial role. Companies are still faced with costs associated with overlap between someone coming in and the current employee till residing in the position. This often effects how much knowledge a company can retain given the budget allowed.
• Hiring Retirees - Has many advantages as you can move forward with filling positions but you also have a new functional employee who can help the business unit and take on some of the workload. The challenge here is this often takes creating a new position and thereby adding to the budgetary woes of the corporation. This is also often "band-aid" solution as the retiree often will come back on their own terms and schedule. They may become more interested in their own work versus transferring knowledge to the business unit. The terms of their return need to by crystallized.
• Regular Hiring: What about the tried and true practice of simply hiring when someone leaves? No overlaps means no extra cost, right?. The problem here is, at least for many employers, the talent pool is quite shallow (pun intended). With the amount of choices out there and the hunger to replace the baby boomers, people have their pick of positions. The environment for hire has to also be as appealing as the job itself. Training plan, support network, capability with the business unit and organization. This means that is their is a lack of the previous details, many will leave soon after coming in. Why not, when the supply of jobs is great. This means more costs to the organization with having to go back to the hiring process.

As you can see, costs plays a major role in filling the voids within an organization. This is why is often easier to talk about the problems versus trying to resolve them. Unfortunately, many will not have an option of waiting it out before others in the organization leave do to increased workloads because of non-hires and morale issues. So lets stop with the "years of service exercise" and start talking about how we are going to combat the problem.