Demographic change, a slo-mo disruption?

Paul Hancock — Tue, 08 May 2018 15:03:18 +0000

If it’s not one thing it’s the next.

It’s 5pm and the coffee shop at the corner of my street has just shut. There’s still plenty of customers in the neighbourhood with tourists, commuters and locals, but the owner has been struggling to get staff, and the only sensible solution is to close early. Staff are the core of any business, without them we all might as well shut up shop and go home. However across many economies, organisations are struggling to recruit and retain staff against multiple headwinds of demographic change which are global in nature but local in impact.

Ageing populations and generational change.

Is this a real problem for the resilience of organisations? Forty countries now have shrinking working populations according to a recent Economist article so the traditional labour pool for hospitality businesses of younger people is shrinking. And it’s not just Europe but it’s world-wide. While the population is aging the proportions of each generation in the workforce is changing. As baby boomers retire, millennials and centennials will become larger proportions of the workforce with their different skill sets and aspirations shaped by their experiences in their formative years. Depending on where you are this could mean 1 in 3 staff will fall into these groups by 2020 and 75% by 2025 according to Forbes. So less younger workers and their changed outlooks mean this is a slow motion and continuing disruption to every organisation now and in the future.

It’s all in the mind.

All disruptions are an opportunity for an organisation which is resilient, and preparing for them is key. 50% of children born today will live to over 100. Lynda Gratton and Andrew Scott’s book about living and working in an age of longevity ‘The 100 year Life ‘ is one possible approach for us all. Serial careers, lifelong learning, family, health and wealth are all impacted by increase lifespans. Organisations need to adapt as well, older workers may not be as physically fit but bring reliability and experience while younger staff bring vitality and tech savvy working. A family friend went to work 2 days a week for B&Q, the national DIY retail chain after retiring as company director. Who wouldn’t trust him to offer advice on the right tool or fitting for a home improvement project? On the other hand younger workers increasingly find difficulty affording housing so one hospitality business in Palo Alto attracted staff with discounted accommodation. Another business had reverse mentoring with younger workers mentoring the more senior executives, especially around new technology and social trends.

So how to prepare for demographic change?

Accepting these changes are happening already mean that baby boomers like myself need to view things in the workplace differently. There are a whole raft of possible and practical ways to address this and build resilience depending on your circumstances, but for me these come down to three key things;

Creating a workplace culture which is deliberately diverse in age, gender and ability, not only reduces the risk to the organisation but taps into the widest possible workforce and range of talents.
Making positive changes to workplace practices and facilities to support the culture means that each individual is valued, retained for longer and is more effective day to day.
Removing barriers to enable each generation to play its part according to individual ability and need whether they are practical or less tangible such as housing, re-training or flexible working.

Resilience of organisations means that all aspects must work together effectively, in a changing world creating advantage from disruption will ensure the organisation is sustained, and can thrive and grow. I believe building resilience into your organisation’s workplace will prepare it for demographic change so you don’t have to close early!.

Disruptions usually start small and look insignificant.

Paul Hancock — Mon, 09 Apr 2018 15:36:31 +0000

A Road Trip

A long road trip often provides the opportunity for me to reflect, my recent Easter visits to family and friends gave me the luxury of a chance to think. Disruptions to business by their very nature have some element of the unknown, whether timing, location, what they might be or their eventual impact. Every sector and organisation is subject to them and preparing and benefiting from them is what resilience is all about, but they often start small and appear insignificant.

20-20 Rear View

Hindsight is a marvellous thing and usually we can convince ourselves after the event that we spotted something coming long before the experts, I am no exception in this regard!
At the end of March Jaguar Land Rover announced a £1.2million deal with Waymo to sell their new electric vehicle the I-Pace. Not massive compared to many in the automotive sector which is why it probably slipped under most radars. Stopping at the somewhat dated service station I noticed a new group of electric vehicle chargers, which during our meal had just the one user.What struck me apart from the obvious lack of users were;

A typical charge for a Tesla is 40 minutes. A captive premium client base and yet there was no pedestrian crossing to the services nor a coffee place adjacent.
The chargers were restricted to motorway users, the access to the local community was just for staff, valuable customers were therefore excluded.
Disruptions often feel a little ridiculous and these 14 charging stations certainly felt a bit lonely but the JLR/Waymo deal suggests that electric vehicles are about to be more common and may have reached a tipping point.

A Different Perspective of Disruptions.

Disruptions are often seen as bad, to be avoided and minimised, resilience is about more than just weathering disruption but seeing it as an opportunity. Clayton Christensen has written about why innovation often appears no threat to incumbents, and my Easter trip underlines the lessons.

Always keep one eye on emerging trends before they become overwhelming. Your new competition will take only a small un-attractive piece of the market at the beginning.
The shape of new markets is unlikely to be the same, so be prepared to adapt your business model.
The focus on business as usual is no longer good enough to be successful, existing managements often struggle to deal with both loss making disruption and current profit centres.

Resilience is all about preparing for unknown disruptions and creating advantage from them. I certainly expect to see more change as this trend unfolds, some businesses ignore it and others adapt and thrive.

4 min read | 360 Resilience