saba wp gen y talent

white paper

Gen Y Talent: How to Attract and Retain the Young and the Restless

Co-Sponsored by

Written by Janet Shaffer of Aardvark Writing

white paper | Gen Y Talent: How to Attract and Retain the Young and the Restless

Contents

Introduction 1

Gen Y Is Here 1

How Gen Y Is Wired 2

Gen Y In The Workplace 3

HR (R)Evolution 5

Holistic HR 6

Staying Competitive 7

Changing the Rules 8

Conclusion 9

1

Introduction“Ready or not, Gen Y is here.” Gen Y will change the rules of talent

management, states David Weisman, Director of the Fidelity Center for Applied

Technology. It is essential that companies evolve their HR programs and

services to deliver to Gen Y and that they focus on recruiting and retaining this

next generation of workers.

Weisman, and Meredith Paxton, VP and Offering Leader for Talent Management

of Fidelity HR Services discuss the issues surrounding Gen Y in the workforce,

covering:

• TheimpactandinfluenceofGenY

• WhyGenYbehavesdifferentlythanGenXandtheBabyBoomers

• NewinsightsonattractingandretainingGenYtalent

• HowHRischangingthewayitoperates

• HowHRisadaptingservicedeliverytomeettheneedsofGenY

“AsHRprofessionals,wespendalotoftimediscussingthewarfortalent.Now

we can focus a little more on the next generation that we are fighting for.” HR

needs to think and talk differently to recruit and retain Gen Y; there are subtle

and not-so-subtle nuances companies need to take in serving them. “The rules

of the game are clearly changing in all aspects of talent,” says Weisman.

Gen Y Is HereThere is a dramatic demographic shift occurring in the workforce; maximizing

Gen Y talent is essential for future organizational success. Yet, there are

companies that ask why they should adapt their current talent management

strategy to meet Gen Y expectations. Eighty percent of respondents in a Fidelity

study said that Gen Y talent is extremely important or very important to business

success over the next 5-10 years; however, 7 percent of those polled felt Gen Y

talent was either somewhat important or not important at all.

Untilrecently,theworldhasbeendominatedbytheBabyBoomgeneration—

workers currently in their early 40s to early 60s who compose a majority of

companymanagement.GenXworkers—thoseintheir30s—areovershadowed

bythesizeandthepoweroftheBabyBoomers.NowthechildrenoftheBaby

Boomersarebeginningtheirmigrationintotheworkplace(Figure1).

Generation Y, also known as the Millennials, is already laying its claim to the

future of business. “The ‘digital natives’ of Generation Y do not know life

without technology and the Internet,” states Weisman. “The rest of us are

‘digital immigrants’ in the world that that Gen Y has grown up in, and we talk a

different language.”


2

AccordingtoForrester’sNorthAmericanConsumerTechnologyAdoption

BenchmarkStudy2007,GenYusessocialnetworkingsitesalmost3times

more than the rest of the population, reads blogs 2 times more, and utilizes

instant messaging 1.8 times more. The only technological advancement that

Gen Y has not embraced as its own is email. Email is not the primary way the

younger generation communicates with its peers.

How Gen Y Is WiredGen Y has grown up in a very different world from that of previous generations.

“Research shows that by the time most Gen Y kids get to college, they have

spent 10,000 hours playing video games (compared with 5,000 hours reading a

book). Engaging in the repetitive tasks of such activities is rewiring Gen Y brains.”

TheolderGenXgoesonlinetoaccomplishataskandthenwalksawayfrom

thecomputer.GenYgoesonlineandofflineseamlesslyanddoesnotmake

a distinction between one and the other. Younger people expect to be able to

communicate with others anytime and anywhere.

Figure 1

3

As a group, Gen Yers are multitaskers, often with short attention spans. They

are used to being engaged, communicated with, and trained in ways that are

verydifferentfromthatwhichworkedfortheBabyBoomers.GenYersdonot

want to sit through long lectures or read a lot of text; they expect things to

be entertaining and fast-paced. “Customization is very important to Gen Y,”

declares Weisman. “These people expect things to be tailored to them in their

workschedule,recreation,andlifestyle.Nothingistakenstandard.”

Gen Y In The WorkplaceIn1980,theworkforcewasdominatedbytheBabyBoomers;threedecades

later, they are still in the majority. However, if change is not already here, it is

comingsoon.Bytheyear2010,GenYwillmakeupthelargestsegmentofthe

working population (Figure 2).

Gen Y traits such as technology savvy and the ability to multitask add value to

boththeworkforceandtheorganization.Butsomeorganizationsbelievethat

other skills such as personal communications skills, collaboration skills, and

the ability to build informal networks are not as highly valued. These things are

essential when competing in a rapidly changing global market. “Collaboration

leads to innovation,” declares Paxton, “and innovation is extremely important

Figure 2


4

to business today.” Companies cannot underestimate the value that the Gen Y

population brings to the workplace.

Gen Y has the talent and the ability to succeed in the workplace. Weisman

states, “These are very driven kids. They are not slackers looking for a way to

cutcorners.Theyarelookingformoreflexibilityandforpeopletomeasurethem

on their work done, not on their attendance.” Companies that can do this will

attract and retain a larger portion of Gen Y talent.

Gen Y workers often exhibit the following workforce and work style

characteristics:

• Theyexpectflexibleworkhours

• Theyneedpraiseandcontinuousfeedback

• Theyliketoworkinteams/collaboratively

• Theyaretask-oriented

• Theyexpectemployerstobegoodcorporatecitizens

• Theywouldlikethecompanytoprovidetimeforvolunteer/communitywork

• Theirrelationshipwiththeirdirectsupervisoristherelationshiptheyvaluemost

Gen Y does seek mentoring opportunities, even though the percentage of

companies that agree the relationship with direct supervisors is the most

important falls lower on the list than the other items (only 59 percent of

respondents to a Fidelity study agreed or strongly agreed). This younger

generation needs someone to mentor them and to be open and supportive of it.

“Companies need to think about the right mentor,” cautions Weisman. “Often

itisaBoomer,notaGenXer.”GenXersareoftentheworstmentorsforthe

younger generation because they may not understand why Gen Y workers are

coddled;BabyBoomerswhohaveGenYkidsaremuchmorewillingtomentor.

Besidesvaluingmentoringrelationships,GenYworkersseekchallenging

projects with significant business impact and expect to be promoted quickly,

butthisgroupvaluesitswork/lifebalancemorethanfinancialrewardsorcareer

advancement. Tailoring workplace needs to Gen Y workers is important to

attractingandretainingtalent—GenYworkersareoftenmorefocusedoncareer

advancement than loyalty to the company.

5

HR (R)Evolution“Retaining talent has never been an easy task, states Weisman, “and now

Gen Y is going to make the job even tougher,” Paxton adds, “Organizations

need to evolve their HR programs and services to adjust to the needs of the

Gen Y workforce. Weisman says, “HR service delivery is critically important

in achieving a successful approach with Gen Y and positively impacting their

employment with an organization.” Research shows that over half of Gen Y

workers plan to leave their current employer within five years (Figure 3).

Businessesaredividedintheirleveloforganizationalreadiness.AnHCI

webcast poll found that 21 percent of respondents have already implemented

strategies and plans to attract and retain the emerging Gen Y workforce, 25

percent are considering it in future planning, and 36 percent say their companies

are currently researching options. Only 15 percent of survey takers had no

immediate plans.

Figure 3


6

“Organizations need to understand what works and what does not work to form

the deployment of new strategies,” cautions Paxton. Of the same HCI audience,

37 percent say their company has been successful and 45 percent have been

somewhat successful with previously implemented plans to attract and retain

Gen Y. The Gen Y workforce will affect recruiting, learning and development,

compensation and benefits, performance management, succession planning,

and workplace tools over the next two to three years.

The rules have changed. Recruiting will see the biggest change; there are new

sources on which to focus and new ways in which companies can look for

talent. Effective workplace tools need to be made available to the Millennium

generation to fully harness their power. Younger workers expect things like blogs

and instant messaging. Organizations need to keep this in mind as they move

forward with talent retention strategies.

Holistic HRMany opportunities exist to engage Gen Y, but Paxton says, “It is really about

the individual. There are hundreds of touch points where HR can engage on a

personal and professional level.” HR should look at what is going to motivate

this audience and take an end-to-end view for each individual. “See how HR

caninfluencethetouchpointsthroughtheservicedeliverymodel—thehow,

when, and where the programs are delivered, and the tools that offer assistance

along the way.”

A traditional approach to talent management may suffer from a lack of

coordination and continuity; adapting to Gen Y may involve creating an

integrated talent management program. Gen Y workers want better retirement,

health and welfare, and total compensation plans with more options, more

flexibility,andbetterdecisionsupport.

Key additions to existing benefits lineups will be driven by Gen Y workforce

demands (Figure 4). HR must link all of the individual elements together and not

take a silo approach, helping Gen Y understand how all of the components of

their career fit together. Paxton explains, “Companies need to offer the kinds of

services that help an employee manage their health and their wealth.”

7

Companiesthatwininthewarfortalentmayincorporateaninterestinflexibility

andplacemoreofafocusonwork/lifebalanceandpersonalinterests.To

successfully recruit Gen Y, HR must understand the needs of the talent. Gen Y

expects honesty and transparency, states Weisman; “It is a deadly mistake to

promise something and not deliver.”

Staying Competitive “NotallcompaniesrecognizethechanginglandscapewithrespecttoGenY

and recruiting,” says Paxton. Recruitment mediums have changed, and it is

worth looking at how new channels will affect recruiting. In the next few years,

company career sites, online job sites, and employee referrals will still be

effective methods of mining new candidates, but social networking sites and

blogs will also play a huge role in attracting the next generation. Virtual worlds

such as Second Life are still in their infancy, but promise to offer another option

for finding Gen Y talent.

“Employees are asking for different things, and companies need to brand

themselves to adapt to this.” Companies need to pull together the interests of

each population to make a win-win situation for all.

Figure 4


8

Many organizations feel unprepared for Gen Y when it comes to particular

aspects of HR program management. They need to adapt HR programs

and offerings for this younger generation. They need to improve training and

educational resources for both Gen Y employees and managers supervising

Gen Yers. They need to update technology and communications delivery

vehicles to take advantage of Gen Y expertise. Finally, the families of Gen

Yers are more involved in their children’s lives than in previous generations, so

companies need to communicate with the family as well as with the individual.

Changing the RulesIn tailoring HR to Gen Y needs, it is all about the individual. Companies can

prepare for this generational shift with a service delivery model that relies on

three elements: simplicity, integration, and decision support.

Gen Y does not have a lot of time to waste and wants to get to the point.

HR needs to think about how to enable Gen Y to take action quickly. It

also needs to consider how the business process fits within the context of

traditional HR delivery

Talent management can no longer exist in a silo; holistic HR is essential with

Gen Y employees (Figure 5). This generation wants to know their next steps and

would like readily available information to help them make career decisions. HR

Figure 5

9

must support Gen Y as well as managing the capabilities of the organization.

Decision support is no longer just about reporting. It is about predictive

analytics, clear reporting, and making sure that the company has the tools and

assessments to enable each Gen Year to make the best choices.

ConclusionTo get Gen Y involved in talent strategies, Paxton says, “There is no better input

than Gen Y themselves.” Active involvement from Gen Y will achieve better

resultsthan“listeningtoaBoomerinasuit,”addsWeisman.Enlistingtheaidof

Gen Y in recruiting their peers will enable the organization to “be where the puck

is going, not where it already is.”

“Clearly with Gen Y,” says Paxton, “the rules of talent management have

changed.” To be an employer of choice, companies have to develop and deliver

programs and services that attract employees and retain them for the long term.

GenYemployeeswantmoreflexibleworkoptions,chancestogivebacktotheir

community, more learning opportunities, recognition for contributions, and tools

that enable them to make the best decisions quickly and easily.

Gen Yers are more demanding about advancement and about asking for what

they want. HR needs to address Gen Y concerns and effectively provide this

group with what they need. “The investment we make from a talent perspective

needs to pay off by keeping the attention of the Gen Y team,” declares Paxton.

It is up to HR to link how Gen Y learns and grows over the course of their career.

© 2008 Saba. All rights reserved. Saba, the Saba logo, Centra, and the marks relating to Saba products and services referenced herein are either trademarks or registered trademarks of Saba or its affiliates. All other trademarks are the property of their respective owners.

Saba2400BridgeParkwayRedwoodShoresCA94065-1166USA(+1)877.SABA.101or(+1)650.779.2791www.saba.com Rev.06/08

BasedontheHCIWebcastGen Y Talent: How to Attract and Retain the Young and the

Restless, presented March 25, 2008. This paper is in the Talent Strategy Community,

E-Learning Track. The sponsor is Saba.

Moderator

Joy Kosta

Directory HCI Communities, Human Capital Institute

Presented by

Meredith Paxton

VP, Offering Leader For Talent Management

Fidelity HR Services

As Vice President and Offering Leader for Talent Management at Fidelity HR Services, Meredith

is responsible for the overall design and development of the talent management offering.

Meredith has worked with dozens of clients across a range of industries including financial

services, consumer and retail products, manufacturing, and architecting and designing

comprehensive HR outsourcing services.

David Weisman

Director

Fidelity Center for Applied Technology

David Weisman is a director on the Competitive Technology Assessment team within the

Fidelity Center for Applied Technology. He brings to Fidelity over 20 years of experience in

technology analysis and research as well as financial services. Prior to joining Fidelity, David

was vice president of Industry Strategies Research at AMR Research, Inc. and served as vice

president of Global Research at Forrester Research, Inc.

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