Whether in gender, race, or age, diversity can allow companies to tap into a variety of perspectives, experiences, and expertise to solve problems and generate new ideas.
Whether in gender, race, or age, diversity can allow companies to tap into a variety of perspectives, experiences, and expertise to solve problems and generate new ideas. But for the first time, we have workplaces today where four, even five generations work side by side. Conflict and unconscious bias can arise from generational differences in values and working styles. Unfortunately, research shows that those in senior positions (and often more senior in age) are the most biased.
Left unchecked, inter-generational conflict could lead to resentment, low morale, less engagement, and as a result lower productivity. Therefore, boards must understand the management challenges of a multi-generational workforce. They also need to examine their level of understanding of the youngest under 24 – Generation Z.
In this podcast, Dr Sabine Dembkowski, Founder and Managing Partner of Better Boards, discusses Generation Z with Hana Ben-Shabat, Founder of research and advisory firm Gen Z Planet, and previously an elected partner and board member of the global management consulting firm Kearney.
Some of the key takeaways of the conversation include:
Hana helps business leaders prepare for the next generation of employees and consumers, combining her passion with commitment to support the integration of the next generation into business and society in general. She is the author of Gen Z 360: Preparing for the Inevitable Change in Culture, Work, and Commerce.
“Gen Z-ers are important because they are going to be the future talent of every organisation”
Hana explains that Generation Z is defined as anyone who was born from 1998 to 2016, so aged 6 to 24. Many of them are still children, but we are already starting to see this generation’s effect on culture, the workplace and consumer markets. She believes that boards should be informed about anything that will affect a company’s performance and demographic shift, including generational shift. Generation Z is important because these individuals will be the future talent of every company and will form one of the largest consumer segments ever seen.
“Diversity is not only a demographic statistic, but it is also a cultural lens through which they view the world”
Hana relates that Generation Z is unique in many ways, and she believes that this will affect company performance, either from a talent management perspective or from a customer perspective. This is the most diverse generation ever, and she is conscious that diversity is not only a demographic statistic to them. It is also a cultural lens through which they view the world and bring that need for diversity and inclusion to the workplace.
She also notes that this is the most digitally connected generation, born into a world of search engines, mobile phones, and social media applications. This has influenced the way they learn, think, communicate, interact, and the way they want to work. It is also the most educated generation, and 50% of Generation Z globally are predicted to be university educated. Hana cites the US, where Generation Z has the lowest high school dropout and highest college enrollment ever seen. These digital skills and formal education will enter the workplace and be very important in the future.
Hana also notes that this generation is challenged by mental health issues on a global scale, with 45% reporting being stressed most/all of the time. The CDC has recently published a study suggesting that 4 in 10 teenagers are suffering from a persistent feeling of sadness and hopelessness, 1 in 5 have contemplated suicide, and one-third of college students suffer from anxiety and depression – and companies will need to address these issues. From a board perspective, she believes the big questions that need to be asked are how companies hire and retain this new generation of workers and how companies are changing or adjusting their strategies to appeal to this new generation of consumers.
“The Z brands are demonstrating excellent understanding of who this consumer is and what is important to them”
Hana believes organisations need to focus on how successful they are in hiring and retaining Generation Z talent, especially in industries where the turnover of employees is very high. She notes that especially in the consumer market, where she does much of her work, a new wave of direct-to-consumer brands arises that she refers to as the ‘Z brands’. These Z brands are demonstrating excellent understanding of who their customers are, what is important to them and the values they hold. Then they build their brands and brand messaging around this. She believes markets will see a major disruption coming from these brands, who will start taking shares from bigger brands and companies. These companies will not just attract Generation Z, but they will also act as a major wake-up call for other companies to follow suit. In particular, many Generation Z-ers at a local and community level make big efforts around sustainability, which is very important to them.
“Directors should concentrate on exploring possibilities to diversify their supplier base and also digitalize their supply chain”
Anahita believes that, at the moment, most companies will be concerned with making their supply chains more resilient to future prices. She recommends that to increase supply chain resilience, focus should be on exploring possibilities to diversify the supplier base and digitalize the supply chain. She recommends that smart, capable and business-oriented Chief Sustainability Officers be enabled to set the tone from the top, so the organisation can anticipate and not just react.
“I think it’s very enlightening to listen to the younger generations”
Hana explains the concept of a shadow board. This is not necessarily a board that works with the board of directors. It is a group of non-executive employees that works with senior executives on strategic initiatives. She believes this has a lot of value, and an opportunity for a board of directors to engage with a shadow board can only be a good thing. The purpose of a shadow board is really to benefit from the younger group’s insight into what is happening either inside the company or in the market. Some companies, such as Gucci or Accord, have done this very successfully because younger generations bring outside knowledge that may be invaluable.
The age of boards is increasing further, and with the average age of 58 amongst board members in the UK FTSE organisations, boards could do well to consider the younger generations to come.
The three top takeaways from our conversation are:
- Check your biases; how often have you dismissed someone just because they are younger or didn’t have the same experience as yours?
- This generation is the most educated, and they are the digital natives. They have a lot to bring to the table and want to contribute, so listening to them and embracing what they have to say will be beneficial for everyone.
- Hiring Generation Z and giving them both roles in which they can shine and opportunities to contribute will be critical in retaining them.
To find out how you can participate in the Better Boards Podcast Series or more information on Better Boards’ solutions, please email us at firstname.lastname@example.org.