Episode #8: Leading A Four Generation Work World

The projections are that the total number of the youth population in Japan of those aged up to 34 years of age, will halve by 2060. Put that in context. It has already halved in the last twenty year period, so the supply of young talent is only going to get worse. This means you will be in a rabid competition with every other employer, for a diminishing youth resource. This is going to be a nightmare, unless we start right now and introduce a powerful recruit and retain strategy.

Before we get into this week’s topic, here is what caught my attention lately.

Japan hasn’t yet been able to fully utilize its well educated female population. According to the World Economic Forum’s 2016 Global Gender Gap report Japan dropped 10 places to 111thout of 144 countries. The Abe Cabinet has a target of 30% on management positions being held by women by 2020. It was 6.6% in July 2016 according to a survey by the Teikoku databank. Snack manufacturer Calbee has 1300 employees and CEO Akira Matsumoto has taken the percentage of women managers from 5.9% when he became CEO to 24%. He said in Japan, “Men’s mindset won’t change…if you wait to see change, it will probably take another 300 years”. Hopefully others will copy Calbees lead. If it wants to avoid a slow economic decline, Japan needs to more fully involve its talented women.

Okay this is episode number 8 and we are talking about How To Work In Our 4 Generation Work World.


Soredewa ikimasho, so let's get going.

Abenomics and its successors will make sure we are all kept hard at it, beavering away well into our 70s. In fact, the over 65s already account for 12% of the working population in Japan. Lets look at the age categories of workers already in the workforce. The Veterans (born 1925-44) and Baby Boomers (born 1945-64) will be “Too old to rock and roll, but too young to die”. They will run out of money before they run out of life, so they have to keep working. That means they will be leading a scary workforce comprised of Gen Xers (born 1965-81) and Millennials (1982-2000). Scary, because, unlike their own youth where the leadership ethos of tough love and “you need us more than we need you” philosophy was all the rage, the young will definitely have the whip hand. Bosses in Japan are going to feel the lash, baby.

By the way, get ready – in the future the Universities will be doling out duds in large numbers. Nearly 80% of students go to private universities and currently 40% of these can’t fill their quotas for students – it will only get harder. They really, really need the money. They need warm bodies over there paying fees to keep the doors open. Guess what? Standards of entry and exit and the latter is already an in-joke amongst Japan hands, will be tweaked even further. It will have to be done to allow these bastions of academic mediocrity to stay in business.

You might say, well so what. Forget about universities, they are overrated, People can start businesses and make it without going to university. Well we are not about to see a gold rush here of entrepreneurial spirit any time soon. The young won’t be working for themselves much upon graduation, because they lack the ability to raise capital. Japan ranks 120th(the USA is 20 and South Korea 34) in terms of the ease of starting a business. The social stigma and shame of failing in Japan is a strong driver toward the relatively safer salaryman route. That means these young graduates from shonky University courses, with below average grades and basically an undereducated status will likely wind up working for us. We will be glad to get them because there are fewer and fewer of them coming into the job market, as their demographic continues to decline.

Interestingly, a recent Sanno Institute survey found 76% of new company entrants wanted to stay there until they retired. They will likely be a cosseted arrogant bunch of spoilt brats as well. Why? There will be fewer of them and they will be in demand. There are three factors impacting the decline in numbers of children. 1. We are seeing much smaller family sizes due to cost pressures. 2. Parents are marrying later so they are much older than previous generations. This effects fertility rates. Remember when unmarried girls at 25 were called Christmas Cake because they were too old to be single after that age? That idea has flown out the window. The average age for women to marry has moved up closer to 30. 3. With fewer grandchildren, doting grandparents will ensure they grow up super indulged. People in the West whine about Millennials having a sense of entitlement. Just wait until you see what we are going to be producing over here in Japan. If you don’t know the words mendokusai or troublesome or annoying, remember it. This is how the next generation of Japanese youth will be describing everything they don’t want to do. You are going to be hearing this word a lot from young people. This is how my 16 year old son and his mates describe everything they don’t want to do – it’s mendokusai.

We need a birthrate in Japan of 2.1 but are only achieving 1.43, so population decline is assured. Even if there is a major mental switch on the part of the populous and the government to entertain “foreigners” on mass in the workforce, the pure local bluebloods will be the “platinum” hires everyone will be favouring over any exotic alternatives.

What are the chances that Japan will entertain large scale immigration? Japan is looking very closely at what has been happening in Europe, as large numbers of people from Africa and the Middle East migrate into Europe. They take careful note of the racial and religious conflicts going on there. Japan loves calm and order. It does not like societal chaos. It promotes social stability. They do want to import future extreme terrorist incidents, perpetrated by second and third generation immigrants.

In these surveys referred to these grads may say they want to stay with their initial employer until they retire, but 32.4% in a 2014 Labor Ministry Survey said that they will happily switch companies for better working conditions. By the way, if you were wondering why I am quoting 2014 numbers, don’t shoot the messenger. Japanese Government statistics are always three years out of date. Anyway, this percentage will only grow, as the overall supply numbers for young people decline. Perplexingly, in a previous Sanno Institute survey, some 44% say they prefer to receive a steady salary, unrelated to measuring their achievement or competency – uh oh! That sounds bad to me.

It gets worse.

Here is some more bad news we need to be aware of. Between June 1997 and January 2014, the number of workers aged between 15-24 has almost halved from 8.9 million to 4.9 million and the total workforce has dropped from 69 million to 65 million. The projections are that the total number of the youth population of those aged up to 34 years of age, will halve by 2060. What dies this mean for leaders in companies? What does it mean for your company? It means you will be in a rabid competition with every other employer, for a diminishing resource. Basic economics says that their price must go up. People often lament the lack of worker mobility here, because of the prevalence of lifetime employment. That is going to change. We will finally have labor mobility, but it will be employee, not employer led.

So welcome to Leadership and Management in the new era! We will need to keep the old rockers rocking for longer, as they keep working into their seventies and eighties. We will have to accept that the “dud graduate quotient” will soar, as Universities scrap around for fees. Expect that energy and money will have to invested in vast quantities to seize scare human resources and then pray they don’t leave. Ask yourself - are your management team up to snuff for the task ahead?

Not sure? Well here is a quick reality check for you. Do they exhibit any or all of these 5 basic misperceptions about the troops they are leading now:

1. Everybody is the same
2. Everybody wants the same thing out of work
3. Everybody wants to be promoted
4. Everybody wants to be a manager
5. Everyone wants to live up to “your boss expectations”

By the way, if you personally already share these misperceptions about your own current team, brace yourself for the new younger crew’s arrival! Are you ready for that mendokusai future?

In our global survey of workplace engagement, validated in Japan, we found that there were three factors driving engagement amongst staff: 1. their relationship with their immediate supervisor. This is pretty obvious and shouldn’t surprise anyone. 2. Their belief in the direction senior leadership is taking the organization. Do the people at the bottom have full confidence those at the top know best? and 3. their level of pride in the organisation. Are bosses talking up the organization or are they dissing their rivals in other departments, as they scramble for higher leadership positions.

The key to keeping people and keeping them engaged will be your Middle Management. We talked about the importance of their role in episode 6, so if you missed that episode go back and watch it. Middle Managers can link the various generations together in the firm, they are your key messengers and they are responsible for almost all of the execution of the strategy piece for the organisation.

Trouble is brewing or has now become popular amongst Game of Thrones fans - “winter is coming”. Are you ready for it? Is your management team ready for it? You can be assured, whatever you have been doing to date, it won’t answer the new demands of leading a 4 Generation construct. Now is the time to get serious about soft skills development. Especially needed will be developing new leadership thinking, new and higher forms of people skills achievement and much better communication abilities. The latter ability in particular is going to be so important. If you are pleasantly concentrating on developing only hard skills or technical abilities in your team, good luck!

Don’t miss this. The rest of us will be plundering your shop for your youth talent and we will get them, after you have spent time and treasure training them. Why? Because your “technocrat” led team hard skills only leaders won’t know how to keep them happy, engaged and contributing. Cheers - thanks a million for sending us your young people, we really need them over here if we are going to expand!