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Retaining skills and knowledge as older workers begin to retire

It is a well known fact that the average age of the workforce is steadily increasing. As the workforce continues to age, there will be significant economic and business-related ramifications for us and the companies we work for. Critical to the business will be the embedded knowledge that will be lost as older workers retire.

To help get a handle on the problem of an aging workforce, the first part of this article deals with how to identify the challenge ahead. The second section outlines possible strategies to tackle the problem. And, finally in the third section, we offer tactics for planning ahead and measuring success.

How To Identify Where Your Company Is Now

Step 1: Initiate a demographic analysis
The first step in harnessing the aging workforce problem is to define “retirement eligible” and conduct a demographic study to reveal what percentage of the employee population will be retirement eligible in the near future. A possible definition of a retirement-eligible employee could be those who are a minimum of 55 years old and qualify for full benefits or pension payments (typically after about 35 years of service). Other factors to look at: age, location, retirement savings information, age of dependents, position, tenure, and salary.

Step 2: Measure the problem
Study the age and tenure of the employee populations to gain an accurate estimate of how many workers are retirement-eligible. Also examine how many retirement-eligible employees actually retired in previous years to forecast how many workers will leave the organisation in the future. In making your projections consider things like:

  • The current economy
  • Changes in retirement policies, organisational structure, leadership, or demands of the current role.
  • Availability of affordable health care
  • Spouse’s retirement plan
  • The number and ages of school-age children

Step 3: Communicate demographic developments
Best practice suggests updating business managers on the demographic trends of their company’s employee population at least twice a year. Some very large companies communicate this information to its general management staff as often as once a quarter. Frequent updating keeps the aging workforce issue top of mind among decision makers.

Strategies for Retaining Organisational Knowledge & Skills As Older Workers Retire

Strategy 1: Transfer knowledge to the next generation
To retain critical knowledge, a best practice has the HR team working with external consultants to interview employees in key positions. The consultants then create a manual highlighting the fundamental aspects, tips, and resources that will facilitate the transfer of knowledge to other employees.

Strategy 2: Mentoring Future Leaders
In an effort to develop future leaders and retain organisational knowledge, the best practice is to pair older and younger workers together in a self-directed mentoring relationship guided by formal training. We explore this concept more fully in our Solutions column.

Strategy 3: Job Shadowing and Rotational Programs
Best-practice companies offer employees job shadowing opportunities and rotational programs to supplement their knowledge management initiatives using:

  • Job Shadowing: The company provides new hires the chance to accompany more tenured employees as they perform their day-to-day tasks. This provides the new hires a view into the resources, techniques, and short-cuts that make experienced employees more efficient.
  • Rotational Programs: The company provides management employees with the opportunity to rotate to another position either within or external to their home department. Rotation cycles typically last six months, and the majority of participants move into one new position full-time during that period.

Planning Ahead & Measuring The Success Of Aging Workforce Initiatives

Prepare the future leadership bench
Research suggests that many critical talent employees who are or will soon be retirement eligible are in high level management positions. To address this risk, best-practice companies created a 12 – 18 month development curriculum for high-potential employees that includes mentoring opportunities, interactive seminars, and other development activities.

Provide opportunity for employees to acquire specialised skills
Many of the employees nearing retirement eligibility possess specialised skills that may take years to develop. To address this challenge, one company dependent on highly specialised skills created a management-development program. Such a program places apprentices, who need four or more years of training, and a small number of other critical positions outside the authorised number of people the company allots to a particular division for running the business.

Promote success stories
Research indicates that you will need to demonstrate the success of your aging workforce programs in order to win advocates for the initiatives. Best-practice organisations shared with us that their companies analyse metrics such as feedback from the programs and the number of employees actively engaged in retaining critical knowledge or skills as an indication of success.


Adapted from GL Now

 

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