Workforce Transformation: - Hitachi Consulting

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Workforce Transformation: - Hitachi Consulting

A Knowledge-Driven Consulting ® White Paper

© 2007 Hitachi Consulting Corporation

Workforce Transformation:

New Leadership for the

Multi-Generational Workforce

1


Contents

Does Leadership Need to Change? ............................................................. 3

The Coming Leadership Crisis ..................................................................... 3

A Theory of Generations ............................................................................... 4

Defining the Generations .............................................................................. 5

The Generations at Work .............................................................................. 6

The Solution to Leading the Multi-Generational Workforce:

Knowledge Capital Management .................................................................. 10

Conclusion ..................................................................................................... 12

About the Author ........................................................................................... 12

About Hitachi Consulting .............................................................................. 13

References ..................................................................................................... 15

2


―Within a decade, the massive

boomer generation will begin to

retire. At the same time,

declining birth rates will mean

fewer younger workers. Through

savvy use of flexible work

arrangements, innovative

learning opportunities, and

creative compensation and

benefits programs, companies

have the opportunity to retain

valuable employees and prevent

a "brain drain."

— Ken Dychtwald

President of Age Wave

“Almost 8,000 Boomers turn 60

every day.‖

— U. S. Census Bureau

Does Leadership Need to Change?

Roger was a management consultant. For 20-plus years he helping clients build

better relationships with their customers. Roger found that while segmenting

customers, age was almost always a primary or secondary predictor of customer

preferences and behavior. No surprise that data clearly indicated age matters,

but why did it matter, he wondered? Were people changing their likes and

dislikes as they became older? Were they adopting new behaviors as they

passed through different life stages such as school, marriage, parenthood, or

retirement? Roger sensed this was only part of the story. There were also

differences that formed in certain age groups and persisted as that group grew

older. He would find to his suprise this was also true of his workforce.

Roger often interviewed bright, motivated, young people coming out of

school and seeking a career in consulting. One particular interview,

however, started a bit differently. When he went into the lobby to greet a

candidate, she was sitting with another woman, having a conversation. As

he walked back to his office with the candidate, he asked how she knew

the other woman.

"Oh, she's my mother,” she said. “She just wanted to check out what kind

of place I might be working for.”

This left Roger scratching his head. He couldn’t understand why a young

person would bring a parent to a job interview or why a parent would

agree to go. He also wasn’t sure why it bothered him so much.

Had he known then what he knows now about the unique perspective of

each of the three generations involved that day (Millennial job candidate,

Gen-X manager, and Boomer parent), it would have been crystal clear.

Roger vowed to learn more about what this new generation of workers

valued and how to get the best performance from them. He found a

delightful divergence of generations and an alarming convergence of

trends pointing to a coming crisis in leadership.

The Coming Leadership Crisis

A historic generational shift that will lead to a crisis in American business

leadership is underway. Companies that understand this shift and take action will

retain their senior leaders, attract the next level of top talent, and cultivate a new

generation of leaders. Those that don’t will find it increasingly difficult to compete

in a complex, rapidly changing, global marketplace.

The American workforce is changing in ways that are certain to create a

shortage of experienced leaders at the precise time that large enterprises are

becoming increasingly difficult to manage. These changes are due to basic

demographics, structural changes in organizations, and generational attitudes

and behaviors. The same demographics that warn of a future fiscal crisis in

Social Security and Medicare will first fuel a leadership crisis in American

business. Simply put, demographic trends have predestined that large numbers

of workers are now reaching retirement age with fewer workers to replace them.

3


―10 million positions will go

unfilled in the U.S. by 2012.‖

— Bureau of Labor Statistics

―The United States is on the

brink of a generational

transition the likes of which

has not been seen before. The

largest generation in history to

retire—some 77.5 million

people, according to the

AARP—will begin vacating the

workplace in the next five

years. And over the next 15

years, our workplaces will

continue to shift to a new

generation of leaders.‖

—Deborah Gilburg

CIO Magazine

It is estimated that almost 8,000 Boomers turn 60 every day. The peak year of

the Boomer generation was 1957 with 4.33 million births, compared to a Gen-X

generation low of 3.14 million in 1975. Those aged 45-55 (born 1952-1962) are a

healthy 46 million, but that number drops to 37 million aged 30-40 (born 1967-

1977). Immigration has filled part of this gap. In fact, Gen-X immigrants number

over 17 million, according to the U.S. Census, but immigration will not avert the

leadership crisis where as many as 10 million positions will go unfilled in the U.S.

by 2012, according to the Bureau of Labor Statistics.

Failing to understand the impact of these demographic forces, companies have

followed short-sighted, cost-cutting strategies that have downsized, outsourced,

or made contingent millions of skilled and capable employees. Some of these

strategies were aimed directly at senior and mid-level management through buyouts

and early retirement programs contributing to the thinning ranks of

experienced leadership. There is a contradiction here. On the one hand,

companies are waging a “War for Talent,” while on the other hand, experienced

managers in their 50s and 60s remain unemployed and underemployed. Age

discrimination and outdated recruiting and hiring practices have certainly

contributed to this situation.

Specific characteristics of each generation are contributing to the crisis as well.

Many Boomers in their 50s and 60s are leaving the corporate world in search of

more meaningful, spiritually fulfilling work. Others are hoping to downshift into a

more flexible work arrangement. Gen-Xers in their 30s and 40s practically

invented the job-hopping, free-agent career path that came to dominate the

1980s and 1990s. In addition, Gen-Xers’ strong risk-taking, entrepreneurial bent

makes them a challenging cohort to lock into long-term employment. This means

that in many companies there are few mid-level leaders who possess the

sustained institutional knowledge of a company’s products, customers,

and operations.

Now in their teens and 20s, many Millennials are most comfortable in a

structured environment that provides supportive coaching and mentoring. This

implies that in the future, companies may require more—not less—mid-level and

senior management. In many ways, the old command and control leadership that

worked well for the G.I. Generation, those born between 1901 and 1924, is well

suited to the needs of the next “Greatest Generation,” the Millennials.

The impact of this leadership crisis will leave many companies without the

senior, mid-level, and emergent management talent required to effectively

compete. Companies that take steps now to address the crisis will be positioned

to thrive. In this whitepaper, we’ll delve into those steps, but before we get to that

it is important to understand the basic mechanisms of generational theory and

learn a bit about who the generations are.

A Theory of Generations

Everyone is familiar with the idea of generations. Popular media labels such as

the “Me Generation” or the “generation gap” have been with us for decades.

Politicians attack budget deficits based on the impact on “future generations” or

support entitlement programs that benefit the “older generation.” But, as we will

see, there is a great deal of confusion about who the generations are, how they

are differentiated, and why they are important.

A modern theory of generations is typically credited as originating with German

sociologist Karl Mannheim (1893-1947) and his essay, “The Problem of

Generations.” Dr. Mannheim described how a cohort’s “fresh contact” with the

prevailing culture led to differentiation between generations. A rising generation

with different formative experiences stands in opposition to the prevailing culture,

the proverbial “generation gap.” He also explained that youth are primary

participants in war, revolution, immigration, urbanization, technology, and other

social upheavals. Uncommitted to a career, family, or way of life, and impacted

by these transformational events, each particular generational cohort is a

powerful force for pressing alternatives to the status quo.

4


Defining the Generations

Generation Birth Years Notable Members

There is often confusion in the definition and use of the term “generation.” The

origin of the word generation is from the Greek word genesis, and traditionally

stood for a parent-child relationship. A second definition of generation is an agerelated

group or cohort with a collective identity. The first definition implies the

transmission of stable cultural norms and values from one generation to the next;

while the second definition emphasizes the profound differences between

generations caused by a rapidly changing modern society. It is this second

definition that we are interested in here.

There is also a great deal of confusion about which and how many years define

a generation. Marketers and researchers have employed a wide range—from

seven years to 30 years—as delineating a generation. For example, the Boomer

Generation is popularly defined by 19 years (1946-1964), whereas Generation X

is sometimes defined by a much shorter 13-year period (1965-1977). Defining

the year a generation starts is also problematic. For example, in some definitions

the Boomer Generation begins as early as 1940 and in other definitions, as late

as 1947. This is important because the length and start date of a generation can

have a dramatic effect on the size and composition of that generation.

The most useful standard is the one proposed by William Strauss and Neil Howe

in their 1991 book, Generations, which is based on the historical analysis of the

common characteristics of each generation. Some of the notable members of the

various generations and their birth years, using the Strauss and Howe standard,

are included in Table 1.

G.I. 1901-1924 John Kennedy, Glenn Miller, Ernest Hemingway, Joe Louis

Silent 1925-1942 Dr. Martin Luther King, Colin Powell, Jack Kerouac, Gloria Steinem

Boomer 1943-1960 Bill Clinton, Elvis Presley, Steven Spielberg, Oprah Winfrey, Bill Gates

Gen-X 1961-1981 Michael Dell, Barack Obama, Jodie Foster, Kurt Cobain, Tiger Woods

Millennial 1982-2003 Sasha Cohen, Scarlett Johanssen, Frankie Muniz, Shawn White, Lebron James

Table 1. Strauss and Howe’s Generational Labels and Intervals: United States 1901-2006

Generations are becoming an increasingly important social concept. One

important factor is the decline of race, gender, and class as cultural battle lines.

Progress on creating a multi-cultural society has reduced racial differences, and

women’s economic empowerment has placed them on a more equal footing with

men. Additionally, the triumph of capitalism over communism on the world stage

has reduced the emphasis on class divisions.

Another factor is that the pace of change in our society has quickened,

enhancing and emphasizing the differences between age groups. Consumer

culture, with its rapidly changing styles and trends, gives each generation the

clothes, music, books, and heroes to express their values and way of life. In

addition, as advances in health and medicine make it possible for the majority of

Americans to live longer and remain vital into their 70s and 80s, more

generations are active at any one time. This also engenders the potential for

intergenerational conflict, particularly in the area of government entitlement

programs. Finally, the impact of the large activist, post-war Boomer cohort in

raising the consciousness of generational issues cannot be understated.

5


―For Generations X and Y, the

old command and control

leadership is passé. The top

down leadership style that

grew from a military model is

not effective in today’s world

of rapid change. Today’s

young leaders act first and

evaluate later, because a

leader cannot afford to

carefully evaluate first in the

high-speed environment of

today."

— W. Bennis & R. Thomas

Geeks & Geezers:

How Era, Values and

Defining Moments

Shape Leaders

The Generations at Work

There are currently four active generations in the workforce: Silent, Boomer,

Gen-X, and Millennial. In order to counter the coming crisis, company leaders

must understand the formative influences on each generation, what they value at

work, and how to get the best performance from them. By maximizing the

leadership potential in each of these active generations, companies will provide

a leadership advantage over their competitors. In the final section of this

whitepaper, we address three disciplines that will enable companies to make this

advantage a sustainable one. But first, let’s meet the generations at work.

The Silent Generation

The Silent Generation is made up of those people born between 1925 and 1942.

This cohort was mostly too young to fight in WWII and came of age in the late

1940s and 1950s. Many married early and worked for large corporations under

the command and control of their G.I. Generation elders. This generation is often

associated with its many introspective intellectuals and thoughtful social activists,

such as Sandra Day O’Connor, Dr. Martin Luther King, Jr., and Gloria Steinem.

Later in life the Silent Generation broke away from conformity in a “mid-life

crisis,” resulting in soaring divorce rates and other social ills.

Primarily in their 60s and 70s, this generation is the smallest generational group

in the workforce and is leaving the workforce at a rapid rate. They are the

technicians and engineers of atomic energy, jet aircraft, and moon rockets. Silent

Generation workers swear by standard operating procedures and loyalty to one

company. They are motivated by the satisfaction of a job well done. Their

communication style is more formal with face-to-face and phone communication

instead of e-mail or voice mail. They are motivated by recognition such as

awards and plaques. Silent Generation workers are now the primary

beneficiaries of social entitlement programs such as Social Security and

Medicare. In retirement, Silent Generation workers are also collecting significant

pensions and health benefits. However these types of programs have been put

at risk because Silent Generation-era industries, such as automotive, chemicals,

materials, and manufacturing have undergone a profound realignment.

The strategic imperative is for companies to preserve the experience,

knowledge, and wisdom of the Silent Generation. In industries such as

aerospace and defense, Silent Generation managers hold much of the tacit

knowledge associated with company products that have long service lives. By

focusing on knowledge management and transfer, a topic discussed in the final

section of this whitepaper, leaders can mitigate the loss of this knowledge.

Additionally, by developing an active alumni network, companies can tap into this

knowledge even after Silent Generation workers have retired.

The Boomer Generation

The much analyzed Boomer Generation represents those people born between

1943 and 1960. This cohort began life in an idyllic Father Knows Best conformity

in the 1950s and came of age in the 1960s rebelling against the world that their

G.I. and early Silent Generation parents had built for them. The Vietnam War

and campus protests against it galvanized the collective identity of this cohort.

This generation is often associated with an outspoken idealism and a somewhat

self-absorbed “Me Generation” attitude. After disillusionment set in during the

1970s, this generation became Yuppies, New Agers, Evangelicals, and Cultural

Warriors. In presidential politics, the baton was passed directly from George

Bush, Sr. (G.I.) to William Jefferson Clinton (Boomer), thus bypassing a whole

generation of accomplished Silent Generation politicians.

6


―Between 1993 and 2003, a

profound revolution has taken

place in the values and norms

of the American workplace.

In this change – called the

Generational Shift – the

prime-age workforce will be

made up increasingly of

Generation X and Generation

Y (born 1978-1986). As

Generation X and Generation

Y come to dominate the

prime-age workforce, they will

usher out the last vestiges of

the old-fashioned workplace

values and norms and finish

the workplace revolution.‖

— Bruce Tulgan

Key Findings of A Ten Year

Workplace Study

RainmakerThinking, Inc.

Primarily in their late 40s through early 60s, this generation is the largest

generational group in the workforce. Boomers are competitive, value expertise,

and believe in paying their dues. However, Boomers also retain a 1960s-era

idealism and daydream about leaving the corporate world in search of more

meaningful, spiritually fulfilling work, as mentioned above.

Corporate America’s strategic imperative is to retain senior leaders from this

generation. The good news is that many Boomers want to continue to work and

contribute. Some studies have shown they will need to work due to scant

retirement savings. Boomers love pep talks and appreciate public recognition of

their good work. The keys to retaining the best of these senior leaders are to

provide flexible job arrangements, promote individual goals/rewards, and

develop a meaningful company vision and mission. As we discuss in the final

section, companies that embrace corporate Human Capital Management may be

best positioned to retain Boomers.

Generation X

In the shadow of the Boomers, Generation X is made up of those individuals

born between 1961 and 1981. They had the unfortunate luck of being born into

the least child-centered era in the 20 th century. The proliferation of widely

available and accepted birth control and abortions dramatically reduced the

number of live births in the 1960s and 1970s. These independent, “latch-key”

kids grew up in front of the TV as parents of both sexes focused on careers,

relationships, and lifestyles. Reacting to the background of defeat in Vietnam, oil

embargos, economic insecurity, Watergate, and AIDS, this cohort grew up with a

distrust of institutions and a deeply internalized self-reliance. As young adults,

they expressed themselves on the cultural edge with punk, grunge, and hip-hop

music and fashion.

Gen-Xers’ first contact with the workplace was during an era of downsizing and

restructuring. This led them to adopt an entrepreneurial, free-agent approach to

employment which focused on building marketable skills to take with them to the

next job. They believe actions speak louder than words and are often skeptical of

the idealism of their Boomer co-workers. Their job-hopping means many have

followed alternative career paths and they may lack the institutional knowledge

that was typical of middle managers in an earlier era of near-lifetime

employment. They make up for this with a savvy ability to make correct decisions

quickly with incomplete information, often to the bewilderment of their Boomer

bosses. Many Gen-Xers appreciate extra time off and hope to retire in their 50s.

The strategic imperative here is for companies to attract the top talent in this

generation. The good news is that Gen-Xers are very likely to make mid-career

lateral moves if given the opportunity to build new skills in an environment that

values their innovation and risk-taking. And don’t give up on those employees

who have left: many companies are experiencing a “boomerang” effect where

former Gen-Xer workers return with new skills and experience.

In order to attract the best of this generation, companies must invest in

developing their human capital, as discussed in the final section of this

whitepaper. Leaders should note that Gen-Xers want success on their own

terms, and by supporting their success they can become a magnet for what will

soon be the most important leadership group in American business.

7


The Millennial Generation

The heralded Millennial Generation includes members born between 1982 and

2003. Perhaps the most protected generation in history, Millennials have been

raised with bike helmets, Drug-Free Zones, Nannycams, Baby on Board signs

and No Child Left Behind standards. Concerned about their child’s self-esteem,

Boomers and early Gen-Xer parents have made sure that these children feel

special and wanted. Millennials have grown up during the economic prosperity of

the 1990s and early 2000s. Their technology and media savvy orientation makes

even Gen-Xers feel less than cutting edge. In opinion polls, Millennials expect to

become rich and famous, and the sooner the better. The result is that this

generation is the most optimistic and civic-minded since the G.I. generation, and

some have gone so far as to predict that this will be the new “Greatest

Generation.”

Now in their teens and 20s, many Millennials are entering the adult workforce for

the first time. Many of them are predictably most comfortable in a secure,

structured organization with clear goals and expectations. They like to know how

they fit into the “big picture.” They prefer informal communication such as e-mail

and hallway conversations, and are adept at new forms of communication such

as blogs, wikis, and text-messaging. They are motivated by state-of-the-art

technology and training in the workplace. Unlike their Boomer parents, they see

little reason to pay their dues; and, unlike their Gen-Xer older siblings, they trust

the organization to quickly move them up a defined career track. If they don’t find

this at your company, they will move on or even move back home, since many

parents provide their Millennial children an economic safety net. Most Millennials

are comfortable working in a culturally diverse workplace and are adept at

building a strong social network. Boomers are proud of the fact that Millennials

want to change the world for the better, while Gen-Xers are disappointed in the

Millennials’ lack of independence and constant need for reinforcement.

The strategic imperative here is for companies to grow the next generation of

leaders. Millennials need to see a defined career path that moves them quickly

into meaningful positions which implies more management levels and a less flat

organization. In the G.I. generation, promising managers were routinely rotated

through the various corporate divisions as a way to groom them for senior

leadership positions. This is a practice that the Wall Street Journal says

companies are finding valuable in developing new leaders. In many ways, the

old command and control leadership style that worked well for the G.I.

Generation is well suited to the needs of this next “Greatest Generation.” The

philosophy of Human Capital Management, discussed in the final section,

provides the type of structured goals, career paths, mentoring, and feedback

mechanisms that will feel intuitively right to Millennials.

8


Generation What They Value Getting Their Best

Silent

―Preserve

Institutional

Knowledge‖

Boomer

―Retain Senior

Leaders‖

Gen-X

―Attract Top

Talent‖

Millennial

―Grow the Next

Generation‖

Loyalty to the company

Standard operating procedures

Satisfaction of a job well done

Winning against the competition

Commitment to the company’s mission

Paying your dues; gaining knowledge and experience

Freedom to innovate and take calculated risks

Relying on your own intellect and instincts to quickly

size up a situation

Success on their own terms

Having goals and a plan to reach them

Balancing work/life while finding a way to benefit society

Working in diverse teams and maintaining a strong

social network

Table 2. Generational Work Values and Leadership Best Practices.

Preserve their experience,

knowledge, and wisdom

Develop an active alumni

network

Make retention a priority

Feed their idealistic, spiritual side

Provide flexible work

arrangements

Provide training and learning

opportunities

Recruit outside for lateral

career movers

Provide for non-traditional

career paths

Provide structured career

paths with clear goals and

feedback

Develop mentoring,

coaching, and leadership

programs

Create a volunteer

community involvement

program

9


―It is not necessary to change.

Survival is not mandatory.‖

— W. Edwards Deming

The Solution to Leading the Multi-Generational

Workforce: Knowledge Capital Management

In the previous section we discussed a number of tactical initiatives for managing

the multi-generational workforce. In this last section, we briefly describe the key

strategic imperative we refer to as Knowledge Capital Management. Companies

have three classes of capital assets:

� Financial Assets—cash, stocks, and bonds

� Physical Assets—plants, equipment and materials

� Knowledge Capital

Knowledge Capital is comprised of three areas:

� Human Capital: The skills and knowledge of people

� Structural Capital: The capabilities of the organization to meet

market demands

� Customer Capital: The customer and partner relationships and solutions

Accountants often think of Knowledge Capital as “intangibles” or “goodwill,” but

research shows it often makes up one-half to two-thirds of a company’s stock

value. To better address this bottom-line asset, Knowledge Capital Management

would incorporate the disciplines of:

� Knowledge Management

� Human Capital Management

� Corporate Social Responsibility

� Organizational Change Management

The integration of these disciplines into corporate culture would enable

companies to achieve a sustainable, competitive advantage. These disciplines

would need to become critical components of the effective leadership in a multigenerational

workplace.

Knowledge Management

Knowledge Management (KM) involves systematically managing the tacit and

explicit knowledge in an organization. Knowledge Management includes taking

tacit knowledge—information in people’s brains—and making it explicit, as well

as connecting individuals to share tacit and explicit knowledge. KM is a strategy

and process that is enabled by technology, but is not just a technology solution.

Making knowledge explicit prevents the company’s knowledge capital from

walking out the door with retiring Silent and Boomer Generation retirees. By

developing communities of practice and linking experts to Gen-X and Millennial

newcomers, it accelerates learning and knowledge transfer in an organization.

Millennials have the ability to build social networks and will naturally create and

participate in communities. Ultimately, this makes the organization more

effective, productive, and profitable.

Human Capital Management

Human Capital Management (HCM) is a transformation of the human resources

function that treats employees as assets, with quantitative links to individual

performance that align and integrate to the company’s strategic goals. The

critical success factors to strategically lead HCM must be data-oriented, factbased,

and have a long-term commitment to valuing human capital as a strategic

asset. People must be seen as valued assets who can only be enhanced

through investment.

Effective Human Capital Management provides the framework for clear goals

linked to performance and commensurate rewards. That type of transparency in

10


―Organizational Change

Management provides a

methodology and the tools so

companies can obtain greater

economic value faster by

effectively developing,

deploying, and aligning a

company’s assets to the

initiative.‖

— Beth Montag-Schmaltz

Hitachi Consulting

an organization appeals to all employees, but is absolutely necessary when

working with the Millennial Generation. To establish a goal-performance-reward

culture that would effectively meet the needs of a multi-generational population,

would require taking into consideration the diverse needs and expectations of

each of the generational cohorts. This would mean, for instance, the values of

each of the generational cohorts would need to be considered when designing

effective benefits, promotion paths, evaluations, succession planning,

compensation, workplace diversity, or equal employment programs. Thus,

leaders will need to define how the business acquires, develops, deploys,

motivates, and retains employees in each generational cohort.

Corporate Social Responsibility

Corporate Social Responsibility (CSR) is not charity; it is the recognition that

companies must take into account the impact on all stakeholders, including

employees, shareholders, customers, suppliers, and the communities in which

they operate. CSR is also good business as consumers recognize the value of a

socially responsible brand and are often willing to pay a premium for those

products. Products as diverse as Newman’s Own Salad Dressing and the Toyota

Prius Hybrid have shown companies the logic of “doing well by doing good.”

Dozens of studies have found that well-run, profitable businesses also have

strong social and environmental records, and vice versa. Companies that

embrace this discipline will be most successful in retaining the idealistic

Boomers, as well as attracting socially conscious Gen-Xers and Millennials.

Some critics deride CSR as naïve, but they often use as evidence the faulty

accounting assumptions that fail to place any value on Knowledge Capital.

Organizational Change Management

Organizational Change Management (OCM) comprises the organizational

design, communication, learning, and governance related to any organizational

change. Change may come as the result of shifts in business priorities, new

product introductions, technology implementation, or any of a myriad of

other causes. The one constant in business today is that the pace of change

is accelerating.

In order to communicate effectively to the diverse set of generational cohorts and

have the changes to your organization have a positive impact, an effective

Organizational Change Management program is required. Imagine a

communication about a change to the company’s benefit programs. It may be

viewed by Millennials with indifference, by Gen-Xers with skepticism, and by

Boomers with moral outrage. Without effective change management, even a

positive communication about new benefits can have unintended consequences.

Table 3 summarizes the disciplines and components of the Knowledge Capital

Management strategy with links to the three areas of focus.

The final hurdle is changing accounting standards to recognize and include the

value of the human, social, and organizational “intangibles,” and to correctly

include knowledge capital assets. The recent trend for U.S. companies to

outsource their customer service function is an example of undervaluing

knowledge capital assets. The decision to reduce the cost of headcount by

outsourcing seemed like a smart financial move—until customers started leaving

as a result. Traditional accounting did not consider the actual knowledge

capital those employees had provided the company or the potential cost of

lost customers.

11


Discipline Focus Components

Strategy All

Organization OCM

People HCM

Process All

Technology KM

Management understanding & committing

Aligning the approach with the business strategy

Roadmap for transforming into a High Performance Organization

Defining the roles and functional responsibilities within the

organization

Developing and tailoring approach to meet specific business needs

Evaluating impact on all stakeholders

Evolving the principle of employees as key resources to optimize

enterprise performance

Promoting the company brand and company culture to enhance

performance and develop loyalty

Integration and alignment of key business processes

Targeted investments in people (e.g., total comp., talent mgt.,

succession mgt.)

Unit and individual performance linked to organizational goals

Integrated systems supporting data-driven decisions

Enabling process automation

Enabling key metrics

Table 3. Knowledge Capital Management Disciplines and Components

―The five basic differences

between generations can be

categorized into values around

career, speed, loyalty, balance,

and heroes. And each of these

differences leads to the need

for different styles

of leadership.‖

— W. Bennis & R. Thomas

Geeks & Geezers: How Era,

Values and Defining Moments

Shape Leaders

Conclusion

This whitepaper describes a historic generational shift that is underway and will

lead to a crisis in American business leadership. Understanding this shift and

recommending specific actions is the primary focus of this material. Companies

that heed the call will retain their senior leaders, attract the next level of top

talent, and grow a new generation of leaders. Those that don’t will find it

increasingly difficult to compete in a complex, rapidly changing,

global marketplace.

For more information about what is possible from a Knowledge Capital

Management perspective please email Brian Johnson at

BRJohnson@hitachiconsulting.

About the Author

Brian R. Johnson is a managing vice-president for Hitachi

Consulting. He is responsible for profitable growth and

intellectual property development in the areas of sales,

marketing, and customer service optimization and automation.

Johnson has spent his entire 21-year professional career

assisting companies with improving and automating their

customer-facing functions.

Johnson has extensive experience helping clients develop

strategies, design technology solutions, plan for complex

12


global implementations and manage the process and organizational change

required to successfully transform themselves into customer-centric

organizations. Prior to joining Hitachi Consulting, he spent ten years leading

commercial software development teams in the creation of software for sales,

customer service, direct marketing, field service, human resources, and financial

applications.

Johnson holds a Bachelor degree in Computer Science and Economics as well

as an MBA in Information Systems from the University of Colorado. Johnson is a

Ph.D. Candidate in Applied Management and Decision Sciences at Walden

University.

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� Customer Advocacy Part I: Creating the Business Case for Customer-Centric

Companies with Fanatical Customer Advocates

� Creating the Single View of the Customer: The Value of Accurate, Reliable,

Consistent Customer Data to the Bottom Line

� Protecting Customer Data: How Much is Your Customer’s Trust Worth? Part 1:

The Business Case for Privacy

Workforce Transformation: New Leadership for the Multi-Generational

Workforce

� Changing Leadership to Lead Change and Enhance Executive

Accountability: An Organizational Change Management Series

� Knowledge Management: The ROI of Employee Braintrust: Strategies for

Reserving the Organizational Knowledge Drain

� Service Oriented Architecture (SOA) Goverance: Revolutionizing Business to

Meet Customer Demands

� Fact-Based Business Decisions: Business Performance Management and

Business Intelligence in Today’s Enterprise

� Calculating Your Brand Ambassador’s Bottom-line Value: The ROI of The

Contact Center and Contact Center Agents

� Return on Advertising Dollars (ROAD): How to Make the Most of Your Budge

and Incorporate New Media

� Marketing Optimization: The CMO and Strategic Leadership In The

New World of Marketing

Books:

� The Leadership Advantage, AMG Press, 2007

� Reinventing Your Contact Center: Managers Guide To Managing

Multi-Channel Contact Centers, Prentice Hall, 2006

� Integrating Your People with Process and CRM Technology:

Change Management That Provides An ROI, Anton Press, 2005.

� CRM: The Bottom Line to Optimizing Your ROI, Prentice Hall, 2001

� Recruiting and Retaining Call Center Employees, ASTD, 2001.

13


Customer and Channel Solution Case Studies:

• Case Study: Aviall - CRM and Supply Chain Optimization

• Case Study: Avocent Sales

• Case Study: Avocent - Worldwide Business Processes

• Case Study: Birkenstock

• Case Study: Cable Operator

• Case Study: Charitable Organization

• Case Study: Customer Care for Coffee Retailer

• Case Study: F5 Networks

• Case Study: Leading Food Products Company

• Case Study: IHOP

• Case Study: Indoff

• Case Study - International Relief Organization – CRM

• Case Study: Large Software Customer Contact Strategy

• Case Study: Large Financial Institution

• Case Study: Customer Intelligence for Global Software Company

• Case Study: Large Software - Global Marketing Standards

• Case Study: Marketing Campaign Reporting for Global Software Company

• Case Study: Sales Force Transformation for Global Software Company

• Case Study: Macromedia

• Case Study: Network Computing Company

• Case Study: National Oilwell

• Case Study: Oil Field Services

• Case Study: Raytheon

• Case Study: Semiconductor Manufacturer

• Case Study: Third Party Logistics Provider

• Case Study: Toyota Motor Sales

• Case Study: Wireless Telecommunications Company

• Case Study: Wireless Telecommunications Segmentation

About Hitachi Consulting

As Hitachi, Ltd.'s (NYSE: HIT) global consulting company, with operations in the

U.S., Europe and Asia, Hitachi Consulting is a recognized leader in delivering

proven business and IT solutions to Global 2000 companies across many

industries. We leverage decades of business process, vertical industry, and

leading-edge technology experience to understand each company's unique

needs. From business strategy development through application deployment,

our consultants are committed to helping clients quickly realize measurable

business value and achieve sustainable ROI.

Hitachi Consulting's client base includes nearly 35 percent of the Fortune 100,

25 percent of the Global 100, as well as many leading mid-market companies.

We offer a client-focused, collaborative approach, and knowledge throughout

each engagement. For more information, call 1.877.664.0010 or visit

www.hitachiconsulting.com.

Hitachi Consulting -- Inspiring your next success! ®

© 2007 Hitachi Consulting Corporation

14


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Moments Shape Leaders. Massachusetts: Harvard Business School Press.

Bagby, M. Rational Exuberance: The Influence of Generation X on the New American

Economy. New York: Penguin Group, 1998. ISBN 0-525-94408-7

Coupland, D. Generation X: Tales for an Accelerated Future. New York: St. Martin’s Press,

1990. ISBN 0-312-05436-X

Dychtwald, K. & Flower, J. Age Wave: How the Most Important Trend of Our Time will

Change Your Future. New York: Bantam Doubleday Dell, 1990. ISBN 0-553-34806-X

Edmunds, J., & Turner, B. S., (2002). Generational Consciousness, Narrative, and Politics.

Oxford: Rowman & Littlefield Publishers.

Goldberg, Beverly. Age Works: What Corporate America Must do to Survive the Graying of

the Workforce. New York: Simon & Schuster, 2000. ISBN 0-684-85759

Hankin, H. The New WorkForce: Five Sweeping Trends That Will Shape Your Company's

Future. New York: AMACOM. 2005. ISBN 0-8144-0829-X

Hicks, R. & Hicks, K. Boomers, Xers and Other Strangers: Understanding the Generational

Differences that Divide Us. Wheaton: Tyndale House Publishers, 1999. ISBN 1-56179-677-8

Howe, Neil, and William Strauss. Millennials Rising: The Next Great Generation. New York:

Random House, 2000. ISBN 0-375-70719-0

Mannheim, K., (1997). The Problem of Generations. In Essays on the Sociology of

Knowledge. London: Routledge.

Markert, J., (2004). Demographics of Age: Generational and Cohort Confusion. Journal of

Current Issues and Research in Advertising. 26(2), 11-25.

McCarthy, Sheryl. Too Young to Retire, Too Old to be Hired. USA Today, January 31,

2007.

Pilcher, J., (1994). Mannheim’s Sociology of Generations: an Undervalued Legacy. British

Journal of Sociology, 45(3), 481-495.

Richard, Judy W., and Carol D’Amico. Workforce 2020: Work and Workers in the 21st

Century. 5th printing. Indianapolis: Hudson Institute, Inc., 1999. ISBN 1-55813-061-6

Strauss, W. & Howe, N. Generations: The History of America’s Future, 1584 to 2069. New

York: William Morrow, 1991. ISBN 0-688-11912-3

Tulgan, B. Winning the Talent Wars: How to Manage And Compete In The High-Tech,

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Company, Inc. 2001. ISBN 0-393-01958-6

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