AICPA Insurance Programs

They say 60 is the new 40.

No matter how you look at it, the fact is 92 million Millenials are entering the workforce, while 78 million Baby Boomers may or may not retire, depending on the state of their retirement savings. When you consider that never before have so many generations, with such varied life experiences, been in the workforce at the same time during an economic downturn - you realize you may have some communication challenges ahead.

The reality is, as the generational perspectives merge in a business, there are bound to be conflicts. So, how do you communicate successfully with these emerging cultural and generational differences? How do you build a positive culture and motivate and engage your employees when you can say something to four generations and it can be heard four different ways?

Especially in this uncertain economy, CPA firms must look inward to gain efficiencies and competitive advantage. To survive in this climate, you must empower, engage and retain your employees, focusing on their individual capabilities and results. To do this, you must first understand your workforce.

Studies say that the correlation between engagement and retention results in 85% of engaged employees planning to stay with their employer through year end. In fact, according to a 2004 Gallup study, highly engaged work groups:

• Have a 44% higher rate in retention
• Are 56% better in customer service performance
• Have a 50% higher record for safety
• Are 50% more productive
• Are 33% more profitable

In order to manage the shifting generations and your business more effectively in this economy, you as an employer need to take some time to define the generations and understand how you can make the most of their differences. You must also figure out how to appeal to their preferences in order to engage and retain a broad range of talent - and more importantly, help avoid a potential psychological battlefield.

Defining the Generations

According to a recent study by Aon Consulting, Baby Boomers, a generation of 78 million, make up 45% of the workforce and may be planning to retire. Millennials, born between 1980 and 2000, number 92 million and currently make up 10% of the workforce. In less than 10 years, more Millennials will be in the workforce than any other generation.

Consider the four generations accordingly as a frame of reference¹:

• Traditionalists - age 63 and older
• Boomers born between 1946 and 1964 - ages 44-62 78 million in size, 45% of workforce
• Gen-Xers born between 1965 and 1980 - ages 29-43 38.6 million in size, 40% of workforce
• Millennials (Generation Y) born after 1980 - age 28 and younger 92 million in size, currently 10% of the workforce; within 10 years may be as large as 50%²

The new challenge for CPA firms is going to be keeping the brain trust of the Baby Boomers and, at the same time, understanding and inspiring the Millennials. This is critical because, while you may expect large numbers of employees to be leaving the workforce as they reach retirement age, in an uncertain economy many Baby Boomers are planning to stick around - either remaining at their current job or in a second career - creating additional talent management challenges for your firm.

A recent study by the International Association of Business Communicators found that more than 75% of professionals surveyed felt that their current communication methods are "ineffective or only slightly effective in connecting with young professionals."

But the frustration or conflict between generations often stems from poor communication and a mutual feeling that one group doesn't respect the other. Managers need to learn how to communicate across generations, how to work with a diverse team, and how to adapt to technological advancements.

Looking through the Generational "Lens"

In a personal interview with Tammy Hughes, president of Claire Raines Associates, a consulting firm studying generational differences for nearly two decades, she explains that by looking at your firm through the "lens" of generational perspective and improving sensitivities to generational differences, you can create positive change. You can also find ways to leverage the best qualities of each generation, foster innovative flexible ways of working to better manage workload, client, and employee commitments - and ultimately be more effective.

"Employers can look through the generational diversity lens to evaluate their business and learn how to subtly sync one style of employee with another," says Hughes. "If you think about how the lenses were framed, you see some subtle places where we can start to use this knowledge to be more effective and gain competitive advantage," suggests Hughes.

According to Hughes, creating a climate of respect throughout your organization is a critical foundation for bringing out the best in employees from each generation. "Building upon shared values, attitudes, and behaviors while reaching out in ways that are appropriate to each group will be the key to a manager's success," Hughes said. "Think about how the lenses were framed. For example, young professionals can teach others how to use technology more effectively, while the mature generation can teach the young how to be professionals."

Hughes also says that generational differences are important to consider in dealing with clients as well. By having the capacity to reach out effectively to your client base, you can create positive change that benefits employees and improves results of your firm.

"Any time we can put the lenses on and find out how we can communicate in a way that works best and enables us to be heard best by that other person, we are going to be more effective," Hughes said.

Understanding Communication Preferences of the Generations

Learning how each generation defines respect and adjusting your communications accordingly can create a more effective workforce where each generation can reach its full potential.

For instance, the Traditionalists grew up in a strict environment with harsh discipline, whereas Baby Boomers grew up in times inspired by Dr. Spock's philosophy with not as many parameters (i.e. "love" your kids). Then, the entrance of Gen-Xers, the latch-key generation, who had to entertain themselves alone for hours after school while their parents were working. They were much less involved than prior generations. Lastly are the Millennials, products of "soccer moms" and "helicopter parents."

"Think in terms of how generations have been parented differently... think about how music has changed... think about how the media has changed," suggests Hughes.

As an employer, when you consider these differences in the make up of the generations, you begin to understand what drives their communication preferences. In order to attract and retain clients across the generational spectrum, employers must understand and cater to generational preferences. For example³:

Traditionalists' Strengths:

• Strong work ethic
• A wealth of experience
• Discipline
• Loyalty
• Emotional maturity
• Believe in the "greater good"
• Focus and perseverance
• Stability
• See work as a privilege

Challenges for employees and managers:

• Reluctant to buck the system and speak up when they disagree
• Uncomfortable with conflict

What motivates them?

• Seeing how their actions affect the overall good of the organization
• Respect for their knowledge, experience and insights
• Rewards for their perseverance and work ethic

Baby Boomers' Strengths:

• Committed to customer service
• Dedicated
• Good team members
• Optimistic
• Future-oriented
• A wealth of experience and knowledge

Challenges for employees and managers:

• Uncomfortable with conflict
• Sometimes put process ahead of results

What motivates them?

• Leaders who get them involved and show them how they can make a difference.
• Managers who value their opinion and recognize their contributions

Generation XERS' Strengths:

• Adaptable
• Technologically literate
• Independent
• Creative
• Expect to contribute
• Willing to buck the system

Challenges for employees and managers:

• Skeptical
• Distrust authority
• Less attracted to leadership positions

What motivates them?

• Giving them the freedom to get the job done on their own schedule
• Allowing them to do it their way
• Having very few rules
• Being more informal than "corporate"

Millennials' Strengths:

• Optimistic
• Ability to multi-task
• Technologically savvy
• A global world view
• Goal - and achievement-oriented
• Believe in volunteerism and serving their communities

Challenges for employees and managers:

• Need supervision and structure
• Inexperienced - particularly in handling challenging "people issues" in the workplace
• View changing jobs as a natural process and part of their daily schedules
• Instill a sense of play and fun in the work atmosphere.

What motivates them?

• Managers who connect their actions to their personal and career goals
• The promise of working with other bright, creative people
• Having adequate time and flexibility to live the life they want

According to Hughes, the generations may overlap by as much as seven or eight years. She explains that just as eras don't have start and end dates, a generation does not end one day and another begin the next. "Many people can identify with at least two generations," says Hughes. "When we talk about generational profiles, we are talking about people in the middle of the bell curve. There are many people who fall outside of the curve, so it's important that we understand people as individuals with a valuable contribution to make."

Hughes concludes by stating that the biggest resistance to working through generational differences is ethnocentric feelings, or a "my way is the best way, the right way, the only way" type of thinking. Her firm encourages people to take notice when these ethnocentric feelings begin to surface. "We can trace back over 1,300 years that every generation has thought the one behind it is useless ... We have to watch those feelings and realize that the generation that comes before us - or after us - is going to be shaped differently, simply because we are shaped by our times."

Moving Beyond Stereotypes and Seeking Common Ground

The take-away message here for CPA firms is that our discoveries across the generations can provide clues for you as an employer to begin building better bridges, making connections on common ground, and increasing effectiveness of engagements.

Whether you do this by creating opportunities for generations to interact over shared goals or by fostering formal up-and-down mentoring relationships, you will be more successful engaging and retaining talent if you begin from a perspective that celebrates generational differences.

By keeping an open mind you can leverage the best qualities of each generation to create a more productive and empowered workforce and better manage the goals of your firm in a challenging economy - creating a win/win outcome for all.

Generational Awareness: 10 Bright Ideas³

1. Have a Generational Awareness Week. Post icons and photos that represent the generations. Include slang and popular expressions. Play music that was popular in each generation's formative era.
2. Write four versions-one for each generation-of an Employee Value Proposition, a list of what is attractive about working for your organization.
3. Review your benefits package, asking yourself which generation would likely be most attracted to each... which perks are attractive to all generations.
4. Come up with three rewards specific to each generation.
5. Do a generational diversity audit for your organization. What percentage of your workforce is from each generation? Are all the generations represented at all levels?
6. Review the makeup of your Board of Directors. Are you getting the perspectives of all the generations?
7. Become an expert on a generation other than your own. Find someone twenty years older-or younger-to teach you about his or her generation: history, characteristics, language, work preferences.
8. Watch a movie that focuses on a generation other than your own (The Big Chill, Reality Bites, Office Space, Saving Private Ryan.) Step into the perspective of one of the characters. How might you see things differently if you were a member of the generation being featured?
9. Examine a "difference" from both sides. Begin by thinking of a conflict you are having/have had with someone with whom you have generational differences, and with whom you would genuinely like to have a better relationship. Write a brief paragraph about how you see the situation. Put it aside for a few minutes. Then reread what you wrote. Next, re-examine the situation and see if you can step into the other person's shoes. Finally, write a paragraph that might reveal his or her perspective.
10. In a management meeting, create profiles of four ideal managers-one for each generation. Then, ask participants to survey five employees each about the type of manager they prefer. In the meeting, discuss your findings and revise the profiles, if necessary. What do all the profiles have in common? Where do they differ? How can your managers apply what they've learned?

¹ "Social Media and Employee Communications" Aon Consulting Social Media and Employee Communications Summary of Survey Findings, February 2009
² The population figures represent US Census Bureau estimates of current US residents.
^3,4,5,6 *www.generationsatwork.com,http://www.generationsatwork.com/articles_succeeding.php

The information, examples and suggestions presented in this material have been developed from sources believed to be reliable, but they should not be construed as legal or other professional advice. CNA accepts no responsibility for the accuracy or completeness of this material and recommends the consultation with competent legal counsel and/or other professional advisors before applying this material in any particular factual situations. This material is for illustrative purposes and is not intended to constitute a contract. Please remember that only the relevant insurance policy can provide the actual terms, coverages, amounts, conditions and exclusions for an insured. All products and services may not be available in all states and may be subject to change without notice. CNA is a registered trade mark of CNA Financial Corporation. Copyright © 2009 CNA. All rights reserved.

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