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The new work order

The new work order

Amid a tight jobs market and damaging skills shoratage, employers are out to reinvent the workplace to attract and retain the best talent.

Martin Whittaker has a credo: The secret to business success is to "attract, retain and develop" good people. Whittaker is not a human resources wonk. He is chief executive of listed industrial services company Thomas & Coffey, which employs 1000 people, mostly in trades. Amid record low unemployment and a near crippling skills shortage, Whittaker wants his managers to "think ARD" and is prepared to tear up his company's employment manuals and start again if that's what it takes to attract and retain scarce talent.

That commitment includes offering older employees with an eye on retirement or a lifestyle change the option to shorten their working weeks to make staying on more attractive.

"It's much better to keep somebody with a lifetime's experience for three days a week than lose them altogether," he says. "In this environment, you have to have that flexibility."

With 42 per cent of Whittaker's workforce aged 40 and older, flexible programs targeting older workers are a critical strategy for retaining talent. At Thomas & Coffey, this includes variable starting and finishing times, working from home and sacrificing salary for shorter work hours and/or extra leave.

The company also encourages phase-out arrangements for employees of retirement age. For example, one of its electricians works a four-day week and will work progressively fewer days as he gets closer to retirement.

More apprentices is another strategy. Thomas & Coffey is growing, and its core markets of resources, energy and infrastructure in New South Wales and Queensland promise further growth. For that, it needs a stable, skilled workforce.

The company has increased its intake of apprentices from 75 in 2005 to 120. Of these, 30 are over the age of 25 and the oldest is 40. (Whittaker is embarrassed that only two of the 120 are female.)

To make apprenticeships more attractive to young and older candidates alike, the prospects for advancement to supervisory and management roles are emphasised.

"There's a whole range of positions they can aspire to," he says. "We don't want them to think that their apprenticeship is the end of it. We'll provide them with a career path and we'll arm them with the skills to go further." Thomas & Coffey has run a series of frontline management courses which 65 employees have completed.

Whittaker says attraction and retention strategies are essential because "everyone's vying for the same people".

In a tight labour market - unemployment is at a generational low of 4.2 per cent - and an unprecedented skills shortage, attraction and retention are equally weighted priorities.

According to a survey by recruitment group Vedior Asia Pacific, 25.8 per cent of Australian organisations believe that attracting the right talent is their biggest human capital challenge in the next 18 months; 24.4 per cent nominate retention. So widespread is the skills shortage that 20 per cent of companies are using search services to recruit junior and entry-level candidates.

The chief executive officer of Vedior Asia Pacific, Debbie Loveridge, says companies are responding with a range of strategies - including performance reviews, training and development, internal career opportunities, flexible work options, and health and wellbeing programs - to retain employees.

Even when companies can enhance their "employer branding" and attract candidates, retaining them remains a struggle - particularly for flighty members of generation Y who are likely get itchy feet within 12 to 24 months.

"It's the big conflict for employers: gen Ys are telling employers they want to be developed, mentored and provided with leadership opportunities, but they're not going to stick around anyway," Loveridge says. "But to not offer that is to risk missing out on the person even for two years."

Gen Ys are one of the biggest discussion points in Australian business today: how to handle these brash, super-confident, ambitious, technology-savvy, impatient for promotion 20-somethings?

Loveridge suspects there is "some rhetoric" associated with the phenomenon. But there's also some substance to it. A gen Y, she says, will think nothing of asking to sit in on a board meeting just for the experience.

"They're not a disrespectful generation - they just want things quicker, faster. They want more. I've been in the business 20 years and I still get blown away by the gen Ys."

There are four generational cohorts in Australian workplaces: The so-called silent generation (also known as the builders or the matures), born between 1920 and 1944; the baby boomers (or sometimes just boomers), born 1945 to 1963; generation X, 1964 to 1977; and generation Y, 1978 to 1994. (Like the labels, the age boundaries vary.)

Gen Ys have a way of rubbing people up the wrong way. Tim Roche, a regional practice leader with talent management consultant Right Management, is ambivalent about the group.

"One half of me says, yes, we have gone overboard with gen Y, but it's also true that gen Ys are a lot more conscious about managing their own careers and at the moment they have the choice [of jobs]."

Roche will watch with interest over the next two to three years as the Australian economy most likely slows. "They haven't been through an economic downturn before; that might change their thinking," he says. "They won't be able to throw their weight around any more.

"Basically, I think gen Y will have to grow up and they'll have a hard time - they'll move out of home, they'll get a mortgage, and they won't be so bolshie any more."

In the meantime, gen Ys are making their presence felt in workplaces and so are older workers as both groups search for greater work-life balance and workplace flexibility.

Roche believes that in the event of an economic downturn, employers might claw back some control over the gen Y candidate pool, but there will be no turning back on workplace changes already under way.

At a time when the job candidate is king, and with employees increasingly asserting their influence on work practices and structures, Roche says fundamental shifts in Australian workplaces are here to stay.

He urges employers to seize the initiative and reinvent the workplace for the 21st century.

"Employers will need to take a much more liberal view towards flexibility in the workplace, reinventing what it means to work," he says. "There will be no going back, and the real time bomb is not Gen Y but the ageing workforce."

Research by human resources group ¿Mercer notes that the number of workers aged 55-plus in the Australian labour force will increase by 14 per cent between 2007-08 and 2012-13.

There are now 1.7 million people aged older than 55 in the labour force (15 per cent). By 2012-13, this is expected to grow to nearly 2 million (17 per cent). This is a huge chunk of the labour market - and its most experienced - on the cusp of exiting, and the lure will not be a competitor or even retirement.

The Mercer report, Workplace 2012, tells employers: "Your greatest competition to retain 55-plus employees [is] the promise of a new lifestyle."

As employers seek to make themselves more attractive to fussy gen Ys spoilt for job choice, and ageing baby boomers with other plans, talent management is the most pressing business issue.

Organisations are responding by injecting greater flexibility into their workplaces and creativity into their human resources policies.

In the past four years, law firm Mallesons Stephen Jaques has introduced programs for attracting, retaining and "engaging" employees - a variation on Whittaker's theme.

With 2000 partners and staff in Australia, Asia and London - 90 per cent of them in Australia - Mallesons has every demographic covered.

The chief executive partner, Robert Milliner, says the firm's employee survey, introduced in 2004, shows common themes across all groups covering 1200 lawyers (including 200 partners), support staff and corporate services staff.

The surveys, which had an 89 per cent completion rate last year, emphasise expectations that are being repeated in workplaces across Australia.

These include professional and career development; coaching and mentoring; feedback and recognition for individual effort; and a desire to understand where the firm is going and their part in it.

Programs introduced by Mallesons include mentoring (with 600 participants), long-term leave of absence, and online career management and learning programs.

Health and wellbeing programs, a peer-based staff recognition scheme, twice-yearly performance and development reviews and flexible working arrangements have also been introduced.

Nearly 300 Mallesons employees are on flexible work arrangements, and 70 per cent of these are lawyers.

Mallesons has also responded to the call for more information about the firm's performance by introducing an annual roadshow by Milliner and his leadership team, during which they report on the business, including market strategy, opportunities and regional and global outlooks.

Employees also receive an internal annual report. Previously, only partners received the report.

"If we wanted to move the firm forward, we knew this was the kind of effort we had to make to inform and engage staff," Milliner says.

Over the past four years, Mallesons has reduced staff turnover from 23.5 per cent to 17.5 per cent.

A talent management specialist with management consultant Hay Group, Andrew Beveridge, says that most employers recognise the growing demand from employees for greater flexibility and work-life balance. The response of business to these demands has been uneven, but this will change.

"Some organisations have made that radical shift and others are on the path to it," he says. "The bulk of organisations are just getting into this and experimenting with different policies and practices.

"There is a recognition that they need to be doing things differently, and that a lot of people are going to leave if they don't make those changes.

"What we'll see in the next five years is that the experimentation will start to drop off and we'll see more science around this."

THROUGH THE AGES

Baby Boomers

(Born 1945-63)

Post-World War II baby boomers grew up in the 1950s and 1960s and entered the workforce from the late 1960s to the early 1980s during periods of high unemployment. Comfortable with authority and hierarchy. They recall the mail room is where you started and worked your way up; they remember the tea lady, the typing pool and the telex. Once referred to as the materialistic generation, but usually loyal to the organisation. This loyalty was tested during the downsizing of the 1990s. Boomers hold the majority of decision-making power in organisations. They are today's "ageing workforce".

Generation X

(Born 1964-77)

Xers came of age in the late 1980s and early 1990s. They grew up during a time of escalating divorce and an increase in single-parent and dual-income households. Most likely to hold tertiary qualifications, they entered the workforce with the introduction of the fax machine and personal computers. They were in the thick of the technology boom of the 1990s. Once derided by baby boomers as "job hoppers", they have often had multiple jobs and careers. Tend to be loyal to themselves over the organisation. Highly entrepreneurial, with many starting their own businesses. They are currently trying to balance work and family.

Generation Y

(Born 1978-94)

Gen Ys came of age in the 1990s and the "naughties". Those not in the workforce are at school or attending university. Use multi-modes of communication; thanks to continuing leaps in technology, everything is instantaneous for gen Ys. The information age is shaping their working styles. An increased awareness of the environment, drought, climate change, sustainability and globalisation is shaping their world views. A global perspective is also the norm for gen Y. They are likely to have multiple careers and believe two years is a long-term commitment to a job.

Source: Dr Roslyn Sayers

CAUGHT IN TRANSITION

The chief executive of Melbourne work-life balance consultant Converge International, Dr Lindsay McMillan, says baby boomer executives are not the retiring type. The idea of taking up golf is an anachronism, he says.

"We have an emerging baby-boomer generation who don't want to move [straight] into retirement.

"Retirement is almost an abhorrent expression for them. They want to continue their interests and be stimulated."

Typical transition strategies include part-time, consulting and project work. Increasingly, many are looking to the not-for-profit sector, lending their expertise to a good cause. Whatever they do, "it has to fit around their lifestyle".

Organisations suffering because of the talent shortage should tap into the "forgotten demographic" of executives and professionals in transition from full-time work, McMillan says.

"There's a huge emerging workforce that still wants to be around and wants to make a contribution.

"This group is essentially Australia's business leadership; they don't want to go from running companies, building businesses and driving performance to simply playing golf every day.

"This is a major planning issue for the next two decades: how do we benefit from this workforce which is moving out but still has a contribution to make?"

WORK-LIFE BALANCING ACT

Peter Odgers, chief financial officer of ¿Queensland Alumina, thought he knew what the response would be when engineering tradesmen at the company's refinery at Gladstone, on Queensland's central coast, were surveyed on their working conditions "I was expecting the usual motivations, such as more money," he laughs.

Queensland Alumina wanted to learn how it could better engage and retain its tradesmen in the face of the skills shortage. But the response showed a desire for more time to go fishing.

As a result, tradesmen on the day shift were put on a nine-day fortnight. (Night-shift workers were already on four days on, four days off.) "The overwhelming message that came out of that survey was that lifestyle and work-life balance were important to them," Odgers says.

The company created a lifestyle and wellbeing program that included free gym membership, cinema admission and golf club membership for employees and their families. Staff turnover has since fallen from 11 per cent in 2003 to 8 per cent in 2007.

Odgers still reflects on the work-life priorities of the tradesmen. "The things that gen Y wants are the same things that older workers want. What we've heard for so many years about gen Y and lifestyle issues is not so different for the older segment."

TOWARDS 2020: THE AGEING WORKFORCE

In 2020

Australia's median age will be almost 40. Today it is 37 and in 1980 it was 29. There will be more 65 year olds than one year olds. There will be as many people aged 60 to 70 as there will be aged 10 to 20. There will be more people aged 50 (338,081) than any other age. Life expectancy at birth will exceed 81 for a male and 86 for a female; more than one in five people will be aged over 60.

Generation Z

The generation of 2020 is part of generation Z, the so-called digital natives, the dotcom kids - the most technologically literate generation of children. Generation Z are the children of generation X (and Y). They are expected to live and work longer than previous generations and will have at least five careers and 20 employers in their lifetime.

Workforce

More people will be exiting full-time roles than entering it. Baby boomers will be in their 60s and 70s; generation Xers will be in their 40s and 50s. Most baby boomers will have retired while generation Y will dominate employment, comprising 42 per cent of the workforce. The average job tenure will be about three years (four years today) with voluntary annual turnover approaching 20 per cent. More than one in three workers will be casually employed.

Career and work

The multi-tasking, multi-channelling gen Ys comprise just 14 per cent of the Australian workforce. By 2020, they will be the largest generation in the workforce, comprising 42 per cent. By 2020, 40 per cent of today's managers in family and small business will reach retirement age. Australia is headed towards the biggest leadership succession ever, and the next generation of leaders will redefine work life and the workplace.

Fairfax Business Media

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