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HR Architect: Saturday Shoutout!!! – Ageing Workforce (Part 2)

Saturday Shoutout!!! Ageing Workforce (Part 2) 

Issue 2 | Number 3 | 26 May 2012

Is the ageing workforce seen as an important issue?

A lot of articles come across my desk and the best of them tell you something new or breaks new ground on a particularly interesting approach in dealing with the ageing workforce.

In this second article I will examine what action two noteworthy Australian organisations – one public and one private – have taken with regards to the management of an ageing workforce.  Their stories start with a significant event within the organisation that prompts a critical analysis of the business and ultimately their biggest asset, the workforce. Amazingly, their stories are still relevant today….

New South Wales Transport, Roads and Maritime Services

This article dating back to 2009 from the Australian School of Business, University of New South Wales is still relevant to addressing the ageing workforce issues in 2012.  It examines a trailblazing approach to the ageing workforce challenge by the New South Wales Transport, Roads and Maritime Services (TRMS).  The TRMS implemented 3 key initiatives aimed at smoothing the transition to retirement for its workers and establishing succession planning so their wisdom and experience were not lost.

When a quarter of the workforce was heading for the door by 2014, it was time for some serious strategic thinking as it’s an outflow of people that could leave a gaping hole in the group’s knowledge and skills.  Like many organisations, the TRMS’ workforce was greying, with 29% of its 7000-plus staff older than 55 and 31% aged between 45 and 55 years.

As the HR function had been devolved to divisional areas and geographically dispersed locations, a centralised HR system was implemented and a HR analytics company was employed to interpret the data to understand the needs of mature age workers and TRMS.  This data-gathering exercise provided the evidence to implement 3 strategies which were supported by HR policies that were flexible and broad to encompass the various options to do business differently.

With employees older than 55, the authority runs regular focus groups to better understand what workers want or need in the lead-up to retirement; what type of information interests them.  Its HR department, in conjunction with external facilitators, then set up information sessions known as “My Journey“, which were offered bi-monthly to employees over 55.  Workshops were designed to engage members of the TRMS’ mature-age community and their spouses in conversation, covering key subjects such as knowledge and experience-sharing to help the TRMS transition critical knowledge and gain insights that may prompt innovation and change.  Future working intentions were discussed, including pre-and post-retirement flexible work options, to allow staff to map their own retirement pathways, and to establish how the TRMS alumni can support them.

Succession planning was crucial to the strategy as the knowledge and expertise of the TRMS’ mature employees are recognised as valuable.  The “Knowledge Continuity” project was designed to embed knowledge transition practices and create cultural change.  Each prospective retiree was assigned an individual from his or her department and from human resources to identify the critical knowledge of the mature employee through a series of regular meetings. These sessions asked questions, collected and recorded the mature employees’ knowledge, and then transition it to the wider TRMS workforce.

Double Benefit Mentoring Programs were useful both for mature age workers and their employers, believes Anne Junor at the University of New South Wales.  “If people who have either left or are in the process of leaving their employment are given meaningful roles, it may aid their retention,” she says.  Also, one-to-one partnering with new employees prevented early wastage for younger staff as well, because there is nearly always a spike in turnover after people have gone through an induction period.

Sunstate Cement Queensland

In 2006, Sunstate Cement was recognised for its integrated and responsive strategy to business risk and objectives in winning The SageCo Award for Best Mature Age Workforce Implementation for their innovative and award winning approach to an ageing workforce.

Since 1985, Sunstate Cement Ltd has maintained its operations as a supplier of over one million tonnes of cement products in support of the building and construction industry.  Accompanying the organisation’s success, they had experienced high employee morale and a stable workforce, along with low turnover of production, maintenance and administration staff.  In an effort to maintain such standards, any potential risks to the successful operation of the organisation had to be identified and assessed.  A HR audit was conducted in 2005 which led to the organisation’s need to address the requirements of their rapidly ageing workforce.

Recognising the problem

The majority of Sunstate employees, as wage employees, were required to provide only one week’s notice of their intentions to leave, and salaried employees were required to give only one month’s notice in order to end their employment with the company.  As a consequence, Sunstate was exposed to an increased risk of losing intellectual property, including marketing, technical and operating knowledge.  In 2006, Sunstate decided to seize the initiative by taking an innovative approach to preparing the company for the ageing of their workforce.

A program of attack

Initiatives were designed to align the mature age workforce with business objectives, and enhance the organisation’s culture.  The initiativse were to address issues such as retention of accumulated knowledge (intellectual property, technical, operational and historical information of long-serving employees); transfer of such knowledge from long-serving, departing employees to existing and new employees; and transitioning of mature age, long-serving employees from full-time employment to either retirement or alternate career choices.

“What we came up with was our employee transition management system (ETMS),” says Errol Peters, financial controller and company secretary at Sunstate Cement. Peters.  “It encouraged employees to signal well ahead of their leaving date their intention to retire.  With that early warning gives us time to find good replacements and have them well-trained and wanted.  This way, accumulated expertise doesn’t leave the business when they retire.”

It became apparent to the team that the issue of employee transition was relevant to all ages of the workforce and HR provided two different packages.

  • Transition arrangements provide employees with the opportunity to transition from full-time to part-time work, flexible hours or teleworking. This was made available to those employees who have provided at least five years’ full-time service and given six months’ notice of their termination date.
  • A retirement package, open to anybody who has had 12 months’ full-time service and, again, required six months’ notice.  Employees were also required to be around their superannuation preservation age for this.  “This included all the mature employees and the benefits they receive include financial planning and retirement coaching from a third party as well as the payment of any professional fees involved in the process. We also provide reasonable paid time off work to attend the coaching.”

Maintaining success

In looking to the future, success was a matter of continuing to communicate the benefits of the ETMS system to Sunstate employees, and involving their spouses where necessary. “From here on just to continue to have employees focus on what’s available and ensuring that they have given it serious consideration,” says Peters.  “The success of the program has derived from the necessity to be in a proactive position while ensuring that the program was specific to the particular requirements of the workforce. “  “All organisations should do a ‘needs analysis’ in this area and then develop an initiative that will handle their particular needs in their organisation.”

Lessons in Moving Forward

These two case studies suggest that no single strategy works.  Everyone’s circumstances are unique.  In an ideal world, a case-by-case approach may be more beneficial, suggests Loretta O’Donnell from the Australian Graduate School of Management, UNSW.  Given the changing composition of the workforce in the next 5 to 10 years, the following questions can help to identify key HR requirements to avoid potential pitfalls and proactively address ageing workforce related issues according to Eric Lesser, IBM Institute for Business.  Here they are:

  • Does your organisation have a detailed understanding of its employee demographics, and of what key positions or job categories may be at risk in the near future?
  • Has your organisation identified potential opportunities for attracting and retaining mature workers using part-time or alternative work arrangements?
  • To what extent is retraining mature workers part of your company’s overall learning and development strategy?
  • Does your organisation have a strategy in place to preserve critical knowledge before it walks out the door?
  • How effectively are age-related issues addressed within your company’s overall diversity strategy?
  • To what extent does your organisation address the accessibility needs of employees when designing or implementing new software?

In the third article on the Ageing Workforce, we will look at how current Australian workplace surveys reports are reporting on the current context of the ageing workforce within Australian organisations.

Graphics: Australian Chamber of Commerce and Industry

Next week’s blog – Ageing Workforce (Part 3)

If you find these updates useful, feel free to forward on to a work colleague or friend.

About the Author

To fulfil his professional and personal career aspirations, Tony Wiggins created ‘The HR Architect’ brand in 2009.  With a well-grounded focus and passion for HR, he thrives on working across his networks as a thought leader in ‘making a difference’ in the HR arena.

Tony Wiggins is the Founder and UX Editor of Saturday Shoutout!!! and The HR Architect Spends 5 Minutes with …. Tony utilises the blog ‘The HR Architect’ as a social media network and platform that empowers HR professionals to network, assist and support one another, spanning different countries, subcultures and niches.  Contact Tony at basketa@optusnet.com.au or on Twitter @tonywiggin.

One Response

  1. […] grabbed me about these surveys is that they reinforced the argument in the two case studies in the Ageing Workforce (Part 2) article that no single strategy works.  Everyone’s circumstances are unique.  A […]

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