Speciality Chemicals

The multi-generational workplace: A simple solution?

Patrick Ropella of the Ropella Group asks how the fine and speciality chemicals industries can attract the leaders of the future

According to UN data, there will be a shortage of 10 million workers in the US leadership pipeline by 2015. But is this potential shortage a global challenge, or is it limited to 'developed' countries? How does it affect the fine and speciality chemical industry - and what does your company need to know?

In a survey conducted by the Ropella Group in September 2011, we found that a shortage is already affecting the fine and speciality chemical industry in the US. As many as 66% of the companies that responded said that they are currently experiencing an executive and/or 'specialised skills' employee shortage already.

A global survey of leaders from other countries conducted by experienced, executive-level recruiters, found divided opinions. The executive shortage is seen as a significant problem in Brazil, which is regarded as an emerging economy. Experienced executive recruiters realise that the development pipeline simply cannot match the economy's speed of growth.

Multi-region clients, eager to recruit and retain future talent, are seeing a potential shortage across South and Central America. In Mexico, however, the potential shortage is not regarded as a general issue, except in specific industries including technology and the sciences.

In Europe, some countries share the same problem of a potential worker shortage. German-based recruiters are facing a shortage of leadership supply from 2013, when more people are expected to leave the workplace than there will be young people starting to work. The gap is widening and the work supply is also shrinking with accelerating speed.

There is a different situation in the post-Soviet countries. After the political changes in 1989, baby boomers, heavily burdened from the Communist system, often lacked the language skills, education or experience to face new challenges. They were soon replaced by very young Generation X managers, despite the latter's near total lack of managerial experience.

Twenty years later on, the top managers are now often in their 40s or even their late 30s. Therefore, the expectation is that most people in managerial positions will not need or expect to retire in the next 20 years. In that region, the flow of candidates is very strong. The significant issues are their quality and motivation.

Chemicals companies, like others, will increasingly face global recruitment issues

For Asia, the shortage is not yet a major issue, because of the increased flow of inward talent. Asians are also considered to be more open to relocate for good career opportunities.

Our survey also indicated that companies in the fine and speciality chemicals industries are expecting further personnel problems in the future. Of those surveyed, 66% that felt that a future shortage can be expected and these were not all the same ones that indicated current shortages.

As developing countries follow the trends set by developing countries, so these issues are expected to eventually affect all regions. Even where there is no shortage of people, there is an expectation of a future lack of executive talent and longevity. Managing multi-generational recruitment and expectations will become a global challenge.

Challenges & opportunities

The different expectations of Generation Y compared to previous workers will lead to new challenges and opportunities. Grooming this generation for executive-level positions may need creative solutions. Our survey of fine chemical and speciality chemical companies revealed several challenges in the US that must be considered when hiring either Gen X or Gen Y.

Some things that more than one company indicated was that these generations (particularly Gen Y) are overly concerned about their own self-interest, are spoiled and overconfident and do not work very hard. Yet they expect to be promoted quickly. Some survey-takers also revealed that these newer generations tend to have poor social and ethical skills. These qualities could easily narrow the pool of top talent when trying to fill a job opening.

A couple of problems that will especially affect the chemicals industry in the future are that it may take longer to develop the leadership to the satisfactory skill levels necessary. Due to economic strain, many companies have reduced their training of future leaders. Some leaders taking our survey indicated that, because of the self-centeredness of many Gen Ys, it will become harder to tell, when hiring, who is going to be committed to the company and who just wants a paycheck.

Globally, challenges vary by country and region. For example, according to Generation Y: What They Want From Work, a report by TalentSmoothie, members of Gen Y who grew up in Asian countries show different preferences and expectations of work to those who grew up in the US or Europe. This is usually attributed to the differing cultural or economic conditions.

Australian companies expect challenges at all levels, driven by demographics and expectations of advancement, while recruiters in Brazil see separate challenges at the mid-level management level. Companies in the Czech Republic generally recognise that fresh blood brings fresh ideas, which is seen as an essential fuel for new ideas and stronger competitive advantage.

In the developing countries, such as South America, less flexible labour laws by comparison with those of North America and Europe and traditional organisational cultures may become a problem when hiring Gen Ys. Asian companies may face the greatest challenges as they tend to be more centrally controlled, with greater emphasis on being in the office, reports and time-tables, and loyalty is often treasured above performance.

Generation Y workers demand work-life flexibility from their employers

Recruiting & retaining Gen Y

More than half of Gen Y employees believe they will not stay with their current employers for the remainder of their working life, compared to 62% of Gen X and 84% of Baby Boomers. In fact, our survey revealed that a number of fine and speciality chemical executives said that a good number of Gen Ys will probably not even plan to stay for more than one year.

In 2010, an Oxygenz research project led by global Workplace Innovation to understand how important the future workplace is to generations in the workplace, 'What Does Generation Y Expect From Their Future Working Environment?' surveyed more than 5,000 people. These included over 3,000 18-25 year-olds in the US, the UK, Germany, India and China, plus over 1,250 26-35 year-olds and over 350 36-45 year-olds for further context. The key expectations were:

• Office location: There is a preference for an urban life with work and home in close proximity
• Flexibility: Gen Ys prefer a flexible working environment, including the option to work remotely
• Social environment: Gen Ys see the office as an extension of the home environment, mixing business and social life
• Gen Ys expect break-out rooms and a coffee shop

Successful approaches used by global companies include providing more information, promoting discussion and executive coaching. Other incentives used by successful companies, though not reflected in our survey, include extended maternity leave, social networks, childcare facilities, and sabbatical as standard option.

Our survey revealed three additional things that currently seem to be working well to motivate Gen Xs and Ys. This includes being able to see progress and having a plan for future opportunities, a good work environment and salary. Whilst this is still a developing area, other prime incentives used by some companies with success in the fine and speciality chemical industries include:

• Flexible working schedule (41%)
• Career development (66%)
• Tuition reimbursement (83%)
• Opportunities for self-expression (25%)
• Home office options (41%)
• Technology for remote working options (66%)

More than financial returns, Gen Ys want work/life balance opportunities, such as flex-time and working from home. 66% of the fine and speciality chemicals firms we surveyed agreed. Because many families are working two or more jobs, some companies have found that flex-time, working from a virtual office or sliding start times works well for them. They also appreciate a balance between family, work and hobbies. Time off as a reward is greatly appreciated.

Companies are also introducing employee academies, providing constant education options, and offering job rotation to gain the broad experiences and expertise required for future leadership roles. One fine chemicals company in our survey indicated that they have an off-site place for employees to talk about what the employer can do to help them toward their personal objectives. This special place helps employees to talk more freely.

In general, Gen Ys place strong emphasis on balanced work ethics. As well-educated people, they are demanding more flexible work concepts. Recruitment challenges will come from matching more home-oriented candidates with more firm-oriented positions. Flexible, innovative companies that consider Gen Ys' needs will be better positioned to attract good management-potential employees and retain them.

Traditional management styles may not be effective. What needs to change? And how will these changes affect other employees? Company and country culture will drive management change. For example, whereas a team-sport management style may work in the US, European companies and management can be more conservative.

However, one global necessity for dealing with the multi-generational workplace in the chemical manufacturing or research industry will be the need to become more open and flexible. Managers will need to develop people, provide room for self-expression, and understand how to deal with different employees' styles.

Interestingly, many managers apparently find Gen Ys easier to work with than Baby Boomers, according to research conducted by Leadership Management Australasia (LMA). LMA's Generations Leadership, Employment & Direction (LEAD) survey also found that "large numbers in all generations don't want to work with, or report to, Baby Boomers in the future - a response that included Baby Boomers".

Ropella - Talent shortage already affecting fine and speciality sector

Ideas & options

The following are some ideas and options, based on understanding how these new professionals think and successfully integrating new methods with existing staff priorities. 

Open discussion and interactive management is vital. Whilst operational tasks will continue to depend on 'bricks and mortar' buildings, it is likely that executives in global organisations will increasingly work from a home office or, indeed, from anywhere and at any time. An effectively communicating executive will need to communicate with staff in different time zones, in the evening or early morning, out of 'regular' business hours.

Gen Y employees need targets and goals, and want their work monitored and followed-up, anywhere and at any time. With strict goals and targets, it does not matter where or when the employee works, as long as he or she gets the work done. Successful managing such employee interaction will be a necessary challenge, as Gen Ys are effectively setting the trends.

Also key are flexible office hours and working locations. Gen Ys' reliance on technology, and belief in working flexibly any time, any place - and being evaluated on work production, not on how, when or where they got it done - will affect overall corporate business operations. Gen Ys expect an office desk, but also want to work remotely. Managing the virtual workplace and virtual worker will be a new challenge.

In the Czech Republic, a home office is regarded as a valuable benefit, and part-time positions are relatively rare. New management may need to be more flexible. Asian companies, by contrast, may need to adapt from their current centrally controlled culture, with its emphasis on strict working hours and detailed management reporting.

IT will play an increasingly important role in supporting the chemical business process and enabling companies to work efficiently with decentralised structures. Virtualisation (online communication, remote access and networking) is a trend that has become more mainstream, in part through the recent economic downturn, when cost-cutting became crucial in order to survive.

That said, there may be a generational reaction against the always-available mentality driven by the 'Blackberry culture'. Some Gen Ys have watched their parents' generation become obsessed with a 24/7 work culture and may rebel against that notion, while continuing to want to be socially networked at all times.

Flexible and creative HR policies are important to the generally self-driven but team-oriented Gen Ys. Demographics will limit the supply of prospective talent, which will increase the power of Gen Ys. Employees will not be as readily replaceable as in the early 2000s, and companies will need to invest money and effort in employee retention and incentive schemes.

International chemicals companies, and those looking to expand globally, necessarily must attract the best ideas and Gen Y talent. Members of this generation are constantly learning, experiencing, doing, developing their team, creating and contributing. This ongoing activity does not tolerate selfish thoughts, unethical behaviour or outdated ideas. However, all generations will need to feel able to access equal treatment and equal opportunities.

Expanding companies must look globally for talent

Social media cannot be ignored. Gen Y grew up online. New management will be expected to talk to employees in a more relaxed and open environment, using social media. Communication will be interactive, flowing in both directions. Alternative management structures, such as the virtual office, may flow more easily from new organisations rather than those already established.

Chemical manufacturing companies willing to be an attractive employer and attract the top employees will need to change their management communication structure. Social media is becoming a central part of how people receive information, so firms need to take this seriously to be noticed by the new generations.

Fine and speciality chemical companies will benefit from their ability to be more flexible, and allow rapid changes in management structure. However, alongside flexibility and adaptation, Gen Ys are drawn to companies perceived as being well-placed globally as a known brand.

Companies that concentrate on branding and corporate recognition through peer networks, as opposed to traditional advertising and company-produced literature, will be seen by Gen Ys as progressive and trustworthy. And the rigid hierarchy of large, global companies will be challenged by the need to be flexible and to incorporate rapid change. Effective tracking processes will be a necessity for managing a virtual workforce. Executive management will need to be educated and effective with interactive communications, including social media.

Conclusion

Long-term employees with different work concepts and processes will need training and coaching, while creating multi-generational teams will allow the merging of different expectations and goals.

Every employee, from any generation, has unique needs and skills and each one needs to feel valued. It is interesting that our survey showed that some leaders in the fine and speciality chemical industry did not seem to be aware of any differences between the generations. You can probably also be sure that they are going to have some surprises in the future when quality leadership may not be found within their ranks. 

A dangerous mistake is the illusion of creating programmes to retain people. Low or high retention levels are nothing more than the effect caused by the whole practice of people management within the company. If it is efficient, retention is consistent.

That may sound simple, but effective people management involves at least eight sub-systems: recruitment and selection, compensation, performance appraisal and feedback, training and development, organisational climate, career planning, internal communication and quality of life.

New generations have always changed management structures and that will continue to happen.   Ultimately, many of the things seen as essential to Gen Ys are also seen as important - albeit less so - by Gen Xs and Baby Boomers. By creating the right environment for Gen Ys, fine and speciality chemicals companies will be able to provide an environment that works equally well across the new, multi-generational workforce.

 

From Online Issue: December 2011