Some estimates show that close to 10,000 employees retire each day — an astounding figure. However, given that 76 million people were born between 1946 and 1964, it’s clear the number of older adults in today’s workplace will continue to decrease. This trend is shifting business ownership and leadership to younger employees.
Succession planning opens the door for tomorrow’s leaders
A study by the Center on Aging and Work showed that 77% of employers had not examined the retirement rates of current employees. And the number of employers who have strategies in place to capture business-critical expertise and knowledge of processes from long-term employees fluctuates between 19% and 37%.
Yours may be one of the many businesses that’s concerned about losing institutional expertise through employee retirement. If so, consider several effective succession options that can nurture the talent of all employees across your business.
Expand relationships through mentorship
Knowledge transfer is key. But what does this mean to your business? It means finding ways for your older workforce to actively transfer their business acumen before they retire.
Some businesses use their seasoned employees as ambassadors for:
- Onboarding programs
- Mentorship development programs
- Intergenerational communication programs
The purpose of a mentorship program is to create a business culture that incentivizes knowledge-sharing among all employees, not just those nearing retirement.
Transition gradually and consider full retirement alternatives
Successful retirement transitions involve identifying a potential successor and including that person in meetings long before retirement. Sudden transitions to a new team member can be difficult for both the team and the client. When you introduce a new employee over time, it helps acclimate the new leader to processes and to the client. It can also build a foundation for a successful new business relationship.
Many employers create programs and incentives that allow retirement-age employees to create flexible schedules that ensure a smooth, gradual transition. Flexible schedules allow more opportunities to share knowledge. These may include:
- Per-project schedules
- Short-term projects
- Consulting
- Part-time schedules
Many employees aren’t ready for full retirement and want to ease into it. Allowing this flexibility can open the door to transferring skills to more junior team members who want to enhance their skills.
A phased retirement option for seasoned employees gives you an ongoing opportunity to tap into those employees’ institutional knowledge.
Assess retirement potential annually
Don’t wait until it’s too late. Each year, it’s a good idea to review the possibility that certain employees will retire. This helps prevent any surprises. Assess whether an employee in a critical job may be planning to retire soon. If so, don’t wait until the last moment to start the conversation about knowledge sharing.
Start talking about the big picture and the small details. Learn what they do on a day-to-day basis, why they approach work the way they do and how they ensure success. Ask questions such as:
- What do you do that’s not in your job description?
- What are the three most important components of your job?
- How do you nurture and maintain customer relationships?
- What do you envision for marketplace growth?
- What knowledge do you think is essential to share with others?
- What are the critical skills you feel are important for a team?
- What information do you think is important to transfer to another employee?
As you have these conversations, be careful not to come across as trying to rush them out the door! You don’t want anyone to feel they are being pushed out of the workplace because of their age. This could lead to hurt feelings and, even worse, a potential age-bias lawsuit.
Reduce any silos and cement cohesive teams
Sharing ideas among team members and departments creates a culture that supports business and professional growth. Create an environment that supports commonality, so employees feel and recognize they are part of the greater good. It also boosts enthusiasm and empowers each team member to collaborate by exchanging knowledge.
Create a sense of purpose
Your seasoned employees have played a vital role in your business for years. Their purpose was clear. Now, as they approach retirement, you can continue to allow their expertise to shine. Communicate to your soon-to-be-retired employees that their knowledge makes a difference to the future success of the business.
By sharing their long-honed skills and strategies, they can support the growth and development of newer employees. This also allows for creative brainstorming between recent and retiring employees, so they can generate fresh ideas and develop new solutions together.
Your employee talent requires a plan for succession
Do you have a significant number of employees nearing retirement? If you don’t know the answer, the first step is to evaluate whether your workforce is multigenerational and what numbers are associated with employee retirement. Then, work to capture the expertise and knowledge of the seasoned employees by developing programs and opportunities for knowledge sharing — whether through a mentoring program, a video series, or lunch and learns, to name a few.
Being proactive and prepared for your employees’ retirement will reduce any adverse effects on the department and the business as a whole. Take steps now to ensure knowledge and insights are transferred to future leaders, so your business stays on track no matter what changes occur.
