Interview with Andrea Plotnick, National Expertise Director for Organizations’ Effectiveness, Hay Group
What does the latest shift in demographics have to bring?
By Luis Fernando Arce, Chief Interviewer
An Interview about some of the major implications that the demographic shift in Canada will have for the business world and what some companies are doing to off-set said implications. Also, how leadership roles are emerging, being created and transferred as a result of this shift, while giving some suggestions for recent graduates and budding entrepreneurs.
… for the first time it looks like more people are going to be leaving than actually entering the workforce.
Can I get your name and title, please?
Andrea Plotnick. I’m the National Expertise Director for Organizations Effectiveness for the Hay Group.
I’ll begin with the obvious and broadest question: What are the implications from the latest STATS CAN report?
There are very broad implications. Talking specifically from a work perspective, for the first time it looks like more people are going to be leaving than actually entering the workforce. So, on the one hand, at the higher end, when the ‘grey-haired’ people start to leave, you’ll be losing corporate wisdom, some of the traditional competencies associated with people that have been in the workforce for a long time, like strategic orientation and visionary leadership – the kinds of things you can only gain through experience. And what’s happened is that in the 1980s many organizations got rid of that middle-level of management or streamlined it, to a great extent, so many employees today are not necessarily people that are ready to step into the executive role which require more ample capabilities.
How or why was that done in the ‘80s?
Cost savings. [Laughs]. Streamlining; cost-saving on the organization; looking for efficiency. But on the other hand it does mean that there are opportunities for people entering the workforce. What organizations need to do is figure out how they are going to accelerate the learning of people and how they are going to accelerate them being able to move into leadership roles when they are coming young and not with all the necessary experience and skills to be able to step into those roles.
Right. You’re speaking of ‘accelerator experiences’: what are those, exactly? Examples?
Well one of them is certainly mentoring the people that are coming in; being able to start planning in advance. We know this is happening: smart organizations are thinking strategically about what kind of experiences and skills and capabilities will be required in the future; about what employees will need to have to step into leadership roles; they are focusing on the high-potential people and are grooming them for the roles. Whether it’s mentoring, whether it’s moving people around within the organization so that they get a breadth of experience, whether it’s putting people into global roles or in charge of project teams so they start to get leadership experiences earlier and earlier – it’s just honing those leadership skills to the greater extent possible at a rapid pace.
Have you begun seeing these strategies being implemented in places?
Yeah we’ve seen them in some places. We’ve been talking about the need for talent and demographic changes for a long time, but for many years it was just talk; however, as it gets closer and closer, organizations are really starting to put paper to pen and think it through with a lot more detail. From our perspective, we are working with a lot of organizations that are thinking through succession planning and talent management. I’m seeing it personally in terms of work that I do.
Can you tell me a little about the work that you do specifically?
Well, I work at the CEO-level and front-line leaders, but also with board of directors: the work is basically thinking about what the organization needs to do to be successful not just today but well into the future – the skills and behaviour that people need to have – and then working with them to look at what the talent is within their organization so that they can start grooming those people for work that may not even exist today, but that will be created in the future. They’re being very strategic on how they develop people. In the past, what many organizations used to do is look at the people within their organization and just develop them into sort of a generic role; what we’re saying is you need to be a lot more strategic about it and look at the requirements of the organization first, then look at the talent you have in the organization and develop people specifically to fit what we call ‘mission critical’ roles – those really critical roles to be successful into the future.
So shaping people into more ‘honed and expert’ kinds of positions and titles?
Yeah, exactly! There are always going to be generic leadership capabilities, but there are also specific capabilities depending on the type of leadership roles that you’ll be called to step into. So it’s having a longer-term time-horizon around people and getting away from the notion that a portfolio owns the people resources. It’s taking a broader organizational view so that executive teams are getting together and thinking strategically about the whole pool of talent they have within their organizations and thinking how to move them around so that they have the breadth and development that they need to have.
Is there a certain age bracket, or certain departments that mentorship would be focused on?
At this point, it’s started in two places. It has started at the top, because those are usually perceived to be more ‘mission-critical’ roles in many ways, but also because that’s where you are starting to see the retirement happen. A lot of organizations are starting to get better at looking at people coming into their doors as well – making sure they are hiring the right people; but they are also thinking more broadly on how to develop people so that they have the right capabilities and not just leaving it up to chance.
I read in the press release that “the notion of expertise becomes a state rather than a trait. People don’t remain experts for long as technology comes and goes.” Could you comment on that, please?
Well, that’s absolutely true, because we are in a fast-pace, changing environment. One of the advantages that new entrants into job market have is that they are very nimble and very agile, used to working in a virtual world and used to collaboration and connections and fluid environments. I think it is an advantage, in many ways, to develop expertise and then, as the world changes, to develop new expertise. You have to be ready and able to take on new challenges and so forth, and in many ways the younger generation is better equipped to do that. What they lack, however, is the long term “executive maturity” potentially in that visionary thinking; but what they have is the ability to be collaborative, to network and to be nimble: all those critical capabilities that will be even more critical as we move forward.
At the moment the phenomenon of ‘unpaid internship’ is exploding, as you may very well know. Do you think that this might in any way help them in terms of climbing up the corporate-ladder sooner rather than later?
Absolutely. I think an unpaid internship where you prove your worth either turns into a job offer for that particular organization or it just gives you the capabilities and experience to make you more successful and move forward. So the smart younger people in particular are thinking about what kinds of experiences do they need to have, and are finding different ways of getting them, even if it means an unpaid internship. It is about honing ‘you’ as a project, almost, that you are presenting to different organizations.
Regarding the mentorship programs, are they all being funded specifically from the business? Any government funding for these programs yet or in the near future?
I can’t really comment on government funding. I’m thinking more sort of ‘informal’ mentorships – but within a specific organization that may be formalized – where more “mature” employees in terms of seniority, and higher-performing employees, are mentoring newer entrants, teaching them skills, taking them under their wing, allowing them to job-shadow, being there to answer questions and bounce ideas off of. So I’m seeing mentorship taking root a couple of different ways: the more experienced to the less experienced, or more senior to less senior people; and I’m also seeing peer-mentoring happen in some organizations. For example, I do some work with the healthcare sector, where we’ve even looked at mentoring across different organizations – finding peers from different organizations in similar roles that you can start to do peer mentoring with. At the end of the day, with any role where you can develop a network and hone your expertise, whether from more senior employees or from your peers, you are simply becoming more marketable.
The people who would be mentoring, they are still with the company, not retirees already?
Well you raise a very good point. You could absolutely have mentors from outside the organization, or a coach – some people use ‘mentors’ and ‘coaches’ interchangeably; but you can absolutely have retirees. In fact, some people who are retiring want to keep within the business world so they have to do it on a voluntary basis, so yeah…
Have you found any opposition to any of these ideas, be it from the business-side or any other end?
Well, we typically approach it on a volunteer basis. So you really only have mentors who are passionate about it, who are engaged and who are going to invest energy in doing so.
One of the implications [of the flurry of retirees] that I read was that there will be “more non-western management practices as Asian and other emerging economies are dominating the global business environment…” How can this be interpreted: as something good, bad, irrelevant?
What we are getting at here is that the growth areas – the western areas, necessarily, and any organization and any employee in a leadership role – has to start adopting a global perspective; has to have more cultural sensitivity and be able to adopt more practices that may not traditionally have been associated with the westernized base. So it’s just staying attuned with what is coming out in emerging economies – particularly from the Asian region – so that you are more attentive to it. And this is certainly beneficial.
Is there something in the Asian business model, you think, that would be better not to adopt?
I’m not sure that I could speak to that directly. Certainly in the past, it has been about quality and efficiency, and those are the kinds of trends that we’ve been able to adopt here in the West. What we are looking at now is, if you think about some of the emerging economies (in technology, for example), they’ve been able to ignore all the years of development that we’ve gone through and kind of just jump-started and jumped a hurdle and came to an equal level playing field because they haven’t had to go through the same growth, they’ve been able to sort of adapt to what we have and run with it. So if you think about it from that perspective, we’re just being more tuned to the broader world and what is going on out there; it is not necessarily about ‘made-at-home’ but really a recognizing that it is a much more connected world than it used to be.
I don’t know if this may be off topic, because we’re talking about the business world itself; but can you maybe comment a little on what this flurry of retirees could possibly do to the economy?
Well, I’m not an expert in the economy, but let’s just say that from a higher level perspective, when there is more people retiring, there are less people able to support the labour force and economy, and more people drawing on pensions and CPPs. With demographics, from an economic perspective, you think about healthcare (an aging population) and the demands that that will be placing on Canada – those are the key areas that as a country and province we need to look at.
The reason I asked is this: do you see these mentorship business models that we’ve been discussing offsetting in any way these effects to the economy?
I’m thinking out-loud here a little bit…I guess if they are paid mentorships, and people want to stay in the workforce longer and not retire, that certainly helps. But we define mentorship usually on a volunteer basis so I’m not sure that that may have any impact. Other than allowing more senior people to pass on their expertise to more junior employees, there is no real other impact to the economy.
Do you think today is the best time to be an entrepreneur?
An entrepreneur really requires a sort of mind-set capability – a motive that will drive you to be successful. It isn’t something that will work for everybody. If you have the drive in terms of what energizes you, it certainly is a good time not to have to rely on others, given that in the past there have been a shortage of roles for younger generations to step into. So if you are energized and passionate by innovation and self-motivation, then it could be a good time…and there are people that do good in any point in time. But if you look at the demographic trend, there actually will be more opportunities for younger people to enter the workforce as more and more senior people retire. So this is kind of like a void in time, and over the next 20 or so years there will be more opportunities for people to enter the workforce, and in fact we need them: from an economical perspective, the more new jobs that are created, clearly the more people that are hired, and that works to everybody’s advantage! But you know, entrepreneurship is not for everybody, it takes a particular kind of make up to be successful and you have to really make sure that you have the capabilities that you need to be energized by that and to make it happen.
Our magazine focuses a lot on Finances and Politics, but we are aimed at young people and we talk a lot about entrepreneurship. And it’s become clear that over the last years – over the last decade but over the last five years, certainly – the whole notion about being an entrepreneur has exploded.
Absolutely, because people can’t find jobs! [Laughs]
Exactly! [laughs] I don’t know if this is so much a question or a comment, rather, but because there are so many more entrepreneurs coming into the workforce at the same time that so many people are leaving with, as you said, “mature competencies,” do you see this explosion of entrepreneurship as a way to replace that lost skill-set? In other words, do you agree that the spirit itself of leadership and what it means and takes to be one, is growing? Because what we’ve been seeing a lot is that these young entrepreneurs are not so much relying on the “mature competencies” that are leaving, but rather bringing in and creating their own.
Well the difference with somebody who is an entrepreneur is that they – people who are successfully entrepreneurial and who are naturally engaged by and passionate about it – are very strongly-focused people; they are energized by achievement. Typically the people that will make good leaders within a larger organization are people who are very energized by power or having influence or getting things done through other people. In a way they have different competencies – they are coming from different places – so it’s not like one would necessarily replace the other…. A does not necessarily translate to B. For instance, you’ll have lots of people who are successful in starting up a business, and it’s fantastic, but if you fast forward, you must look at the core of it: those really successful at it…are the ones who are more well suited, probably – and had a bit of good luck also – to run a business; while the others, who did it because there is nothing else for them to do right now, probably don’t have the same passion, energy and drive to be successful.
I know. Unfortunately it is like marriages. I’m not sure of the exact figure, but I know that more than half of marriages fail, and entrepreneurship is very similar: It looks good at the beginning but not everyone can stick-it-out till the end.
Exactly! And even if you look at successful entrepreneurs, many of them have a few ideas before they come up with the one that really takes them through to success. So there are so many factors that go into being successful, but what we do know from our research is that the profile of the successful entrepreneur tends to look different than the profile of a successful CEO from a larger organization in terms of what energizes them. We talk about it in terms of social motive – what deep down really energizes them. Successful entrepreneurs are really energized by achievements, as I said before; a little bit less so about being liked and needing to have harmony and those kinds of things, and a little bit more so around having impact – but the strongest of the three is the achievements, wanting to do something new and unique; the new and unique is critical. If you look at the successful CEO – at what energizes them – usually it’s less about personal results of the achievements, perhaps around the same for being liked, but what ranks highest for them is to have impact. They want to shape and influence people and have an impact over them. So what you very often see in start-up companies, is you have somebody new that is coming up with exciting and unique ideas, and then the organization grows and grows and by the time it becomes a mature organization the person whose idea it was is no longer the right person to be heading it anymore because they are still thinking of the organization as their baby and they cannot let go of their baby. And in order to be successful at that point you need to bring somebody in who is more energized about getting things done through other people, which is impact. So for example, I’m working with one organization right now – in the gas sector, a start-up company, hugely successful organization – but it went from one to 14 locations across the U.S. and the founder can’t let go of the organization and wants to have his fingers on every decision; but he can’t! It’s now grown to a size where he can no longer do it.
And that obviously hinders the growth of the organization, right?
Absolutely! It becomes a bottle-neck; it becomes confusing for everybody; nobody else is able to grow and develop the capabilities because he thinks he knows better – and he may know better, but that is not building a team.
Have you seen a lot of people going into retirement with retirement plans neatly made?
If you went back 10 years ago, people were probably looking forward to retirement. [Laughs] But as the economy took a turn for the worst, you actually see people working longer than they potentially wanted to. I’m kind of seeing two things: one is that people are hanging on a little bit longer than they had planned out of necessity; and the other thing is people hanging on longer than they had originally planned because, as you know, 65 today is not what 65 was in [my] parents’ generation; they are energized and able to go to work and have great ideas.
Definitely. I see 65 year olds with pierced ears and tattoos still!
Exactly! [Laughs] So people are probably not doing them as well as they should (retirement plans). Some are working longer. Some are retiring and starting a whole second career: many who, for example, have worked at their career for many years and all of a sudden at 65 are pursuing their passion.
Say what you want about them, but their work ethic – unbelievable!
Absolutely. Things are changing and this next generation is going to be even more different, leading, I think, a much more balanced life, which is going to become the norm: it’s not all about work anymore. There are also a lot more socially concerned and active youth, wanting more sabbaticals to do more community and social-work – many things which will have a very positive impact on society as a whole.
Apparently between 2006 and 2011, the number of children aged 4 and under jumped by 11%. Do you think this could be the beginning of a new boom?
I won’t comment on that. I’m no expert. [Laughs]. It could well be…
Do you think this could help future generations though?
Oh absolutely, down the road. But governments should be thinking and preparing in advance – knowing what the needs are in advance; smart organizations should be thinking about it; smart entrepreneurs should be thinking about it. What are the needs going to be down the road? We know there is a huge need for services around an aging population, so the smart money if you’re staring an organization now is to be focusing there.
What is your advice to young entrepreneurs, and also to recent graduates who are not looking to be their own boss but who want to enter the workforce?
Well we’ve touched on a few points. Networking, networking, and networking – it is critical! Keep a positive attitude and don’t be discouraged. The unpaid internships are absolutely not a bad idea. Follow your passion. And take a step backward and think if this is where I want to be, what the kinds of skills and capabilities are that I need to start to develop to make myself as marketable as possible? How do I make myself stand out from the rest? So, really think as early as possible about what are the experiences that I need to have in order to push me in the direction that I want to go? Look for mentors an coaches as much as possible; do your research around the organizations to really try to focus your searches as much as possible, because just sending blank-slate applications to every organization out there without really paying attention to what you want and what they want and what the needs are is not a good approach…You need to be strategic, to target, to plan! Planning volunteer work, charitable work, networking, making sure you are at the right conferences making the right connections. And on a different level, it is how you portray yourself in social media, which is playing a larger and larger role in the overall perceptions of the business world.
Oh most definitely, I’ve had to create a couple of different Facebook pages if I ever wanted to be considered for a job!
[Laughs] Exactly! Where you used to be able to keep two faces if you wanted to – your private and your professional – well everything is open to everyone now; you make one silly mistake and the entire world is witness to it on YouTube! [Laughs] So just being very careful about the image you portray online and where you go is very important. Thinking through more about what kind of impact you want to have and how you want to be perceived. But again, it is trying to remain optimistic. Yes, the numbers can seem a bit discouraging, but take a longer-term perspective and take steps that take you where you need to go. Sometimes it is a sideway step, but if you have that bigger picture of where you want to end up, it makes it a little bit easier to figure out what the intermediary steps are.
That is great advice, and on behalf of the ARB and of all our readers, I thank you very much for your time and great suggestions.
You are very welcome!
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