Wednesday, 17 February 2010

Managing an older workforce

An excellent article in the Economist gives many examples of companies that are leading the way in maximising the potential of older workers.
A forthcoming article in the Harvard Business Review by Christoph Loch of INSEAD and two colleagues looks at what happened when BMW decided to staff one of its production lines with workers of an age likely to be typical at the firm in 2017. At first “the pensioners’ line” was less productive. But the firm brought it up to the level of the rest of the factory by introducing 70 relatively small changes, such as new chairs, comfier shoes, magnifying lenses and adjustable tables.A much fuller description of this is the article in the Sunday Times by Christoph Loch.
Some companies, particularly in energy and engineering, are also realising that they could face a debilitating loss of skills when the baby-boomers retire en masse. Bosch asks all retirees to sit down for a formal interview in an attempt to “capture” their wisdom for younger workers. Construction companies such as Sweden’s Elmhults Konstruktions and the Netherlands’ Hazenberg Bouw have introduced mentoring systems that encourage prospective retirees to train their replacements.
Companies will have to do more than this if they are to survive the silver tsunami. They will have to rethink the traditional model of the career. This will mean breaking the time-honoured link between age and pay—a link which ensures that workers get ever more expensive even as their faculties decline. It will also mean treating retirement as a phased process rather than a sudden event marked by a sentimental speech and a carriage clock.

There are signs that this is beginning to happen. A few firms have introduced formal programmes of “phased retirement”, though they usually single out white-collar workers for the privilege. Some, notably consultancies and energy companies, have developed pools of retired or semi-retired workers who can be called upon to work on individual projects. Asda allows employees to work only during busy periods or take several months off in winter (a perk dubbed “Benidorm leave”). Abbott Laboratories, a large American health-care company, allows veteran staff to work for four days a week or take up to 25 extra days of holiday a year.
But there is one big problem with such seemingly neat arrangements: the plethora of age-discrimination laws that have been passed over the past few years make it harder for companies to experiment and easier for a handful of malcontents to sue.

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