Assigment For Researcher_D
Managing Careers
Questions This Chapter Will Help Managers Answer
1. What strategies might be used to help employees “self-manage” their careers?
2. What can supervisors do to improve their management of dual-career couples?
3. Why are the characteristics and environment of an employee's first job so important?
4. What strategies are available for dealing with “plateaued” workers?
5. What steps can managers take to do a better job of responding to the special needs of workers in their early, middle, and late career stages?
SELF-RELIANCE: KEY TO CAREER MANAGEMENT
Source: For more information on the new approach to career self-management, see Hube, K. (2004, Mar. 29). Thanks, but no thanks. The Wall Street Journal, pp. R4, R7; Thurm, S. (2003, Mar. 23). Crashed program: In Silicon Valley a techie-for-hire struggles to get by. The Wall Street Journal, pp. A1, A8; Cascio, W. F. (2000). The changing world of work: Preparing yourself for the road ahead. In J. M. Kummerow (ed.), New directions in career planning and the workplace, Palo Alto, CA: Davies-Black, pp. 3-31. See also Waterman, J. A. (2000). Informed opportunism: Career and life planning for the new millennium. In J. M. Kummerow (ed.), New directions in career planning and the workplace, Palo Alto, CA: Davies-Black, pp. 163-196; Hall, D. T. (1996). Protean careers of the 21st century. Academy of Management Executive, 10 (4), 8-16.
Human Resource Management in Action
Consider this stark fact: In today's corporate environment, you are ever more likely to crash into the ranks of the unemployed with no safety net, and it could happen over and over again. Moreover, candor about career issues is in short supply at many companies these days. Bottom line: Career survival is up to you—not the company. Consider yourself to be self-employed, responsible for your own career development, CEO of You Inc. This new approach is based on an underlying assumption that would have been considered heresy 10 or 20 years ago in the paternalistic “We'll take care of you” environments of many companies—that self-reliance is the key to career management.
This does not mean that everyone will be working as self-employed contractors, enhancing their marketability by changing jobs frequently, learning cutting-edge skills, and working as a roving gun-for-hire. According to recruiters, such a pattern of employment over a long time can actually be a detriment because it does not show any pattern of loyalty or any kind of stability—precisely the characteristics employers are looking for in today's workers.
In the past, many companies assumed responsibility for the career paths and growth of their employees. The company determined to what position, and at what speed, people would advance. That approach worked reasonably well in the corporate climate of the latter 20th century. However, the corporate disruptions of the last decade have rendered this approach to employee career development largely unworkable.
Acquisitions, divestitures, rapid growth, and downsizing have left many companies unable to deliver on the implicit career promises made to their employees. Organizations find themselves in the painful position of having to renege on career mobility opportunities their employees had come to expect. In extreme cases, employees who expected career growth no longer even have jobs! At the same time, there has been a massive realization brought on by the tragic events of September 11, 2001, that work isn't everything. As a result, people in every industry are passing up opportunities for promotions so that they can have a life.
Increasingly, corporations have come to realize that they cannot win if they take total responsibility for the career development of their employees. No matter what happens, employees often blame top management or “the company” for their lack of career growth, and those who want to be top contributors at their current level often feel pressured to move up. That's a potentially lose—lose proposition for organizations and their employees.
Characteristics of the New Approach
Although the primary and final responsibility for career development rests with each employee, the company has complementary responsibilities. The company is responsible for communicating to employees where it wants to go and how it plans to get there (the corporate strategy), providing employees with as much information about the business as possible, and responding to the career initiatives of employees with candid, complete information. One of the most important contributions a company can make to each employee's development is to provide him or her with honest performance feedback about current job performance. Employees, in turn, are responsible for knowing what their skills and capabilities are and what assistance they need from their employers, asking for that assistance, and preparing themselves to assume new responsibilities—if that is what they want. If not, then employees are responsible for communicating their intentions to their bosses. Career self-reliance, or career resilience, as we noted earlier, does not mean free agency. Rather, each individual needs to become an “informed opportunist,” combining accurate information with a flexible, opportunistic approach to his or her career.
This approach to career management can be summed up as follows: assign employees the responsibility for managing their own careers, then provide the support they need to do it. This support takes different forms in different companies but usually contains several core components—as we will see in the conclusion to this vignette.
Challenges
1. Should employees be responsible for their own career development?
2. Is the new approach to corporate career management likely to be a passing fad, or is it here to stay?
3. What kinds of support mechanisms are necessary to make career self-management work?
As the chapter-opening vignette demonstrates, corporate career management has come a long way in the last several decades. This chapter presents a number of topics that have sparked this reevaluation. We will consider the impact of mergers, acquisitions, and downsizing on corporate loyalty; the impact of dual-career couples on the career-management process; and the major issues that workers and managers must deal with during the early, middle, and late career stages of the adult life cycle. Finally we will examine alternative patterns of career change: promotions, demotions, lateral transfers, relocations, layoffs, and retirements. Career management has many facets, both for the individual and for the organization. The chapter-opening vignette emphasized that in the new concept of career management the company and the employee are partners in career development. This chapter emphasizes that theme. Let's begin by attempting to define the word “career.”
TOWARD A DEFINITION OF “CAREER”
In everyday parlance, the word career is used in a number of different ways. People speak of “pursuing a career”; “career planning” workshops are common; colleges and universities hold “career days” during which they publicize jobs in different fields and assist individuals through “career counseling.” A person may be characterized as a “career” woman or man who shops in a store that specializes in “career clothing.” Likewise, a person may be characterized as a “career military officer.” We may overhear a person say, “That movie ‘made’ his career” (i.e., it enhanced his reputation) or in a derogatory tone, after a subordinate has insulted the CEO, “She can kiss her career good-bye” (i.e., she has tarnished her reputation). Finally, an angry supervisor may remark to her dawdling subordinate, “Watney, are you going to make a career out of changing that light bulb?”
As these examples illustrate, the word career can be viewed from a number of different perspectives. From one perspective a career is a sequence of positions occupied by a person during the course of a lifetime. This is the objective career. From another perspective, though, a career consists of a sense of where a person is going in his or her work life. This is the subjective career, and it is held together by a self concept that consists of (1) perceived talents and abilities, (2) basic values, and (3) career motives and needs.1 Both of these perspectives, objective and subjective, focus on the individual. Both assume that people have some degree of control over their destinies and that they can manipulate opportunities in order to maximize the success and satisfaction derived from their careers.2 They assume further that HR activities should recognize career stages and assist employees with the development tasks they face at each stage. Career planning is important because the consequences of career success or failure are linked closely to each individual's self-concept, identity, and satisfaction with career and life.
Given the downsizing mentality that has characterized most large organizations over the past decade, career development and planning have been deemphasized in some firms as employees wondered if they would even have jobs, much less careers. Companies that ignore career issues are mistaken if they think those issues will somehow go away. They won't. Here are some reasons why:3
1. Rising concerns for quality of work life and for personal life planning.
2. Pressures to expand workforce diversity throughout all levels of an organization.
3. Rising educational levels and occupational aspirations.
4. Slow economic growth and reduced opportunities for advancement.
A career is not something that should be left to chance; instead, in the evolving world of work it should be shaped and managed more by the individual than by the organization.4 Traditionally, careers tended to evolve in the context of one or two firms and to progress in linear stages, as workers moved upward through the hierarchy of positions in an organization. Today, given the disruptions caused by downsizing, restructuring, technological advancements, and global competition, careers span multiple organizations and they are distinctly nonlinear. They are boundaryless and tend to be characterized by features such as the following:5
· Portable knowledge, skills, and abilities across multiple firms.
· Personal identification with meaningful work.
· On-the-job action learning.
· Development of multiple networks of associates and peer-learning relationships.
· Responsibility for managing your own career.
The concept of a boundaryless career raises an interesting question, namely, what is the meaning of “career success”?
Toward a Definition of “Career Success”
The tradition-oriented “organization man” of the 1950s had a clear definition of success and a stable model for achieving it. However, massive changes in the business environment have forced employees at all levels to explore alternative models ofcareer success, and they are confronted with a variety of possibilities.6 Is it occupational success? Job satisfaction? Growth and development of skills? Successful movement through various life stages? Traditionally, career development and success have been defined in terms of occupational advancement, which is clear and easy to measure. Today, however, it seems appropriate to consider a new model as more careers tend to be cyclical in nature. That is, they involve periodic cycles of skill apprenticeship, mastery, and reskilling. Lateral, rather than upward, movement often constitutes career development, and cross-functional experience is essential to multiskilling and continued employability. Late careers increasingly are defined in terms of phased retirement.7 In this new world, the ultimate goal is psychological success, the feeling of pride and personal accomplishment that comes from achieving your most important goals in life, be they achievement, family happiness, inner peace, or something else.8The following section examines career management in more detail; by way of background to this, let's consider the adult life-cycle stages.
For years, researchers have attempted to identify the major developmental tasks that employees face during their working lives and to organize these tasks into broader career stages (such as early, middle, and late career).9 Although a number of models have been proposed, very little research has tested their accuracy. Moreover, there is little, if any, agreement about whether career stages are linked to age or not. Most theorists give age ranges for each stage, but these vary widely. Consequently, it may make more sense to think in terms of career stages linked to time. This would allow a “career clock” to begin at different points for different individuals, based on their backgrounds and experiences.10
Such an approach allows for differences in the number of distinct stages through which individuals may pass, the overlapping tasks and issues they may face at each stage, and the role of transition periods between stages. The lesson for managers is that all models of adult life-cycle stages should be viewed as broad guidelines rather than as exact representations of reality.
MERGERS, ACQUISITIONS, RESTRUCTURINGS, AND THE DEMISE OF CORPORATE LOYALTY
Worldwide, more than 33,000 mergers and acquisitions took place between 2000 and 2003 among both large and small companies.11 In general, after a buyout, the merged company eliminates staff duplications and unprofitable divisions. Restructuring, including downsizing, often leads to similar effects—diminished loyalty from employees. In the wave of takeovers, mergers, downsizings, and layoffs, thousands of workers have discovered that years of service mean little to a struggling management or a new corporate parent. This leads to a rise in stress and a decrease in satisfaction, commitment, intentions to stay, and perceptions of an organization's trustworthiness, honesty, and caring about its employees.12
Companies counter that today's competitive business environment makes it difficult to protect workers. Understandably, organizations are streamlining in order to become more competitive by cutting labor costs and to become more flexible in their response to the demands of the marketplace. But the rising disaffection of workers at all levels has profound implications for employers.
U.S. companies now lose half their employees every four years, half their customers in five years, and half their investors in fewer than 12 months.13 Median years of tenure on the job is only 2.7 for workers ages 25 to 34, but 9.9 for those ages 55 to 64.14 Furthermore, employee turnover is expensive. Merck found that it costs as much as 1.5 to 2.5 times a worker's annual salary, when separation, replacement, and training costs are considered.15 The average worker goes through about nine jobs by age 32, and 10 percent of the American workforce actually switches occupations every year!16 Yet there is hope, as companies such as Monsanto, United Technologies, and Xerox recognize an opportunity to create value in the midst of such turmoil. How? By understanding that they can only retain loyal customers with a base of loyal employees.17 Decreasing defection rates of customers, employees, and investors can lead to substantial growth, profits, and lasting value. That's a win—win for all concerned.
CAREER MANAGEMENT: INDIVIDUALS FOCUSING ON THEMSELVES
In thinking about career management, it is important to emphasize the increasingly temporary relationships between individuals and organizations. Said a victim of three corporate downsizings in four years: “A job is just an opportunity to learn new skills that you can then peddle elsewhere in the marketplace.”18 While such a view might appear cynical to some, the fact is that responsibility for career development ultimately belongs to each individual. Unfortunately, few individuals are technically prepared (and willing) to handle this assignment. This is not surprising, for very few college programs specifically address the problems of managing one's own career. However, as long as it remains difficult for organizations to match the career expectations of their employees (a following section shows actual corporate examples of this), one option for employees will be to switch organizations. Guidelines for doing this fall into the following three major categories.19
Selecting a Field of Employment and an Employer
1. You cannot manage your career unless you have a macro, long-range objective. The first step, therefore, is to think in terms of where you ultimately want to be, recognizing, of course, that your career goals will change over time.
2. View every potential employer and position in terms of your long-range career goal. That is, how well does this job serve to position me in terms of my ultimate objective? For example, if you aspire to reach senior management by the year 2010, consider the extent to which your current job helps you develop a global orientation, develop public speaking skills, practice the “bring out the best in people” leadership style, and learn to manage cultural diversity. These are now, and will continue to be, key requirements for such senior positions.20
3. Accept short-term trade-offs for long-term benefits. Certain lateral moves or low-paying jobs can provide extremely valuable training opportunities or career contacts.
4. Consider carefully whether to accept highly specialized jobs or isolated job assignments that might restrict or impede your visibility and career development.
1. Always be aware of opportunities available to you in your current position—for example, training programs that might further your career development.
2. Carefully and honestly assess your current performance. How do you see yourself, and how do you think higher management sees your performance? Ask yourself, “Am I in the right job? Are my skills of real value to my organization? What other positions might fit my needs and skills well?”21
3. Try to recognize when you and your organization have outlived your utility for each other. This is not an admission of failure but rather an honest reflection of the fact that there is little more the organization can do for you and, in turn, that your contribution to the organization has reached a point of diminishing returns.
Here are five important symptoms: Your job ranks low on a “joy and meaning” scale; requests for advancement or new opportunities are ignored consistently or only half met; the job doesn't adequately meet your needs in areas you care about, such as work-family balance, work location, and compensation; your standing in the office has been diminished—for example, key clients or vendors no longer deal with you; or you are not fulfilling your dreams.22
1. Try to leave at your convenience, not the organization's. To do this, you must do two things well: (a) know when it is time to leave (as before), and (b) since downsizing can come at any time, establish networking relationships while you still have a job.23
2. Leave your current organization on good terms and not under questionable circumstances.
3. Don't leave your current job until you've landed another one; it's easier to find a new job when you're currently employed. Like bank loans, jobs often go to people who don't seem to need them.
Up to this point it may sound as though managing your career is all one-sided. This is not true; the organization should be a proactive force in this process. To do so, organizations must think and plan in terms of shorter employment relationships. This can be done, as it often is in professional sports, through fixed-term employment contracts with options for renegotiation and extension.
A second strategy for organizations is to invest adequate time and energy in job design and equipment. Given that mobility among workers is expected to increase, careful attention to these elements will make it easier to make replacements fully productive as soon as possible. Perhaps the most persuasive reason for helping employees manage their own careers is the need to remain competitive. Although it might seem like a contradiction, such efforts can enhance a company's stability by developing more purposeful, self-assured employees. As noted earlier, today's employees are more difficult to manage. Companies that recognize the need to provide employees with satisfying opportunities will have the decided advantage of a loyal and industrious workforce.
One of the most challenging career management problems organizations face today is that of the dual-career couple. Let's examine this issue in detail.
Dual-Career Couples: Problems and Opportunities
Today, families in which both parents are working have become the majority among married couples with children.24 In fact, dual-career couples now comprise 45 percent of the workforce.25 Dual-career couples face the problems of managing work and family responsibilities. Furthermore, it appears that there may be an interaction effect that compounds the problems and stresses of each separate career.26 This implies that, by itself, career planning and development may be meaningless unless an employee's role as a family member also is considered, particularly when this role conflicts with work activities.27 What can be done?
Research indicates that if dual-career couples are to manage their family responsibilities successfully, they (and their managers) must be flexible; they must be mutually committed to both careers; and they must develop the competencies to manage their careers through planning, goal setting, and problem solving.28
From an organizational perspective, successful management of the dual-career couple includes flexible work schedules and company-supported child care. It also includes customized career paths that include elements such as the ability to turn down advancement and be offered it again in the future, the ability to move laterally for development, the ability to turn down relocation and be asked again in the future, and the ability to specialize in one area of the organization.29 Evidence across a wide array of industries indicates that some firms are more responsive to work—family issues than others. Firms are more likely to offer such benefits when work and family issues are prominent and important to senior HR executives and the executives believe that failure to offer the benefits will detract from the ability of the organization to perform well in the marketplace.30
COMPANY EXAMPLE: BOTTOM-LINE BENEFITS FOR FAMILY-FRIENDLY COMPANIES31
Companies that truly “get it” actually go farther and integrate family-support mechanisms into the business itself. Thus, Hewlett-Packard requires that every business unit identify work—family issues and propose an action plan as part of its annual business review. Lost Arrow Corporation, the Ventura, California, maker of Patagonia apparel and sporting goods, opened its onsite facility for employees' children in 1984. Today it spends about $530,000 a year on family-friendly benefits. In return, it captures more than $190,000 in federal and state tax breaks, and it saves an estimated $350,000 in costs associated with recruiting, training, and productivity because its family-friendly approach helps hold turnover below the average for apparel manufacturers. First Tennessee National Corporation found that supervisors rated by their subordinates as supportive of work—family balance retained employees twice as long as the bank average, and kept 7 percent more retail customers. Higher retention rates, according to the company, contributed to a 55 percent profit gain over two years, to $106 million. At a broader level, results from a national sample of 527 U.S. firms revealed that organizations with more extensive work—family practices have higher levels of organizational performance (relative to other firms doing the same kind of work), market performance, and profit-sales growth. Bottom line: Work—family strategies haven't just hit the corporate mainstream—they've become a competitive advantage.
For all the talk about family-friendly policies, however, only 11 percent of companies that operate during daytime hours provide child care, while another 20 percent offer resources and referrals. However, less than 1 percent of companies offer child care for parents working outside regular hours.32 Yet demand for the service has never been greater. Families nationwide pay an average of about 7.5 percent of their annual pretax income for child care.33 Here are some reasons employer-supported child care will continue to grow:
· Dual-career couples now comprise a preponderance of the workforce.
· There has been a significant rise in the number of single parents, more than half of whom use child care facilities.34
· More and more, career-oriented women are arranging their lives to include motherhood and professional goals.
Employer-sponsored dependent care is no longer limited just to onsite or near-site child care centers, however. The concept has expanded to include elder care, intergenerational care, sick-child care, and programs for school-age children (before and after school, as well as holiday programs). Other variations include centers located in office and industrial parks for use by all tenants and centers sponsored by networks of businesses.35
Data from a national random sample indicate that providing family benefits promotes a dedicated, loyal workforce among people who benefit directly from the policies, as well as from those who do not.36 However, the lesson from two other studies is clear: Don't expect that a day care center or a flexible schedule will keep women managers from leaving corporations. They may be quite willing to throw corporate loyalty to the wind if they aren't getting adequate opportunities for career growth and job satisfaction.37
Managing dual-career couples, from an individual as well as from an organizational perspective, is difficult. But if current conditions are any indication of long-term trends, we can be quite sure of one thing: This “problem” is not going to go away.
CAREER MANAGEMENT: ORGANIZATIONS FOCUSING ON INDIVIDUALS
In this section we examine current organizational practices used to manage workers at various stages of their careers. Let's begin by considering organizational entry.
Once a person has entered the workforce, the next stage is to enter a specific organization, to settle down, and to begin establishing a career there. Organizational entry refers to the process of “moving inside,” or becoming more involved in a particular organization.38 To do this well, a process known as socialization is essential. Socialization refers to the mutual adaptation of the new employee and the new employer to one another. Learning organizational policies, norms, traditions, and values is an important part of the process. Getting to know your peers, supervisor, and subordinates is, also. All of this enhances the newcomer's commitment, job satisfaction, job performance, and desire for personal control.39 Because most turnover occurs early in a person's tenure with an organization, programs that accelerate socialization will tend also to reduce early turnover (i.e., at entry) and therefore reduce a company's overall turnover rate. Two of the most effective methods for doing this are realistic job previews (see Chapter 6) and new-employee orientation (see Chapter 8). A third is “mentoring.”
A mentor is a teacher, an advisor, a sponsor, and a confidant.40 He or she should be bright and well seasoned enough to understand the dynamics of power and politics in the organization and also be willing to share this knowledge with one or more new hires. Indeed, to overcome the potential problems associated with one-on-one, male—female mentoring relationships, some firms have established “quad squads” that consist of a mentor plus three new hires: a male, a female, and one other member of a protected group. Bank of America is typical. It assigns mentors to three or four promising young executives for a year at a time. There are also benefits for the mentor. For example, just being chosen as a mentor, according to one 35-year-old female branch bank manager, boosted her self-esteem. This is a central goal of any mentoring effort.
Organizations should actively promote such relationships, either formally or informally, and provide sufficient time for mentors and new hires (or promising young executives) to meet on a regularly scheduled basis, at least initially. Vinson & Elkins LLP, the big Houston law firm, developed a handbook that lists guidelines for the program and responsibilities for both mentors and protégés. The handbook is a tangible effort to avoid the problem of mismatched expectations that can arise when responsibilities aren't spelled out.
Mentors matter. Evidence indicates that a new employee's satisfaction with the mentoring relationship has a greater impact on job and career attitudes than whether the mentoring was formal or informal.41 Conversely, bad mentoring may be destructive and worse than no mentoring at all.42
The mentor's role is to be a “culture carrier,” to teach new hires “the ropes,” to provide candid feedback on how they are being perceived by others, and to serve as a confidential “sounding board” for dealing with work-related problems. If successful, mentor relationships can help reduce the inflated expectations that newcomers often have about organizations, can relieve the stress experienced by all new hires, and, best of all, can improve the newcomer's chances for survival and growth in the organization.43
General Electric uses reverse mentoring, in which older managers meet with younger subordinates to learn about the Internet and electronic commerce. They learn to navigate the Internet, to critique their own Web sites as well as those of competitors, discuss the articles and books they've been given for homework, and barrage their subordinates with questions. It's a win—win for both parties. One 27-year-old mentor said the sessions made her more comfortable in dealing with her 54-year-old boss. “I can teach him things … I know things he doesn't know.” At the same time, she gets to observe first-hand the skills a manager needs to run a big operation, such as the ability to communicate with lots of different people.44
Thus far we have assumed that a mentor is a single individual. Yet forces such as rapidly changing technology, shifting organizational structures, and global marketplace dynamics have transformed mentoring into a process that often extends beyond the services of a single mentor. Don't be afraid to seek out different mentors at different career stages and levels in an effort to build a diverse portfolio of mentors.45
Early Career: The Impact of the First Job
Many studies of early careers focus on the first jobs to which new employees are assigned. The positive impact of initial job challenge upon later career success and retention has been found many times in a wide variety of settings. Among engineers, challenging early work assignments were related to strong initial performance as well as to the maintenance of competence and performance throughout the engineer's career.47 In other words, challenging initial job assignments are an antidote to career obsolescence.
ETHICAL DILEMMA Bringing Mentors and Protégés Together
Research has revealed that informal mentor-ships (spontaneous relationships that occur without involvement from the organization) lead to more positive career outcomes than do formal mentorships (programs that are managed and sanctioned by the organization).46 Random assignment of protégés to mentors is like a blind date—there is only a small chance that the match will be successful. On the other hand, not all new hires are willing or able actively to seek out opportunities to work with a mentor. For those that do not, is it ethically acceptable to assign them randomly to mentors, or to let them “sink or swim”? How would you advise an organization faced with this dilemma to proceed?
The characteristics of the first supervisor are also critical. He or she must be personally secure; unthreatened by the new subordinate's training, ambition, and energy; and able to communicate company norms and values.48 Beyond that, the supervisor ideally should be able to play the roles of coach, feedback provider, trainer, role model, and protector in an accepting, esteem-building manner.
One other variable affects the likelihood of obtaining a high-level job later in one's career: initial aspirations.49 Employees should be encouraged to “aim high” because, in general, higher aspirations lead to higher performance.50 Parents, teachers, employers, and friends should therefore avoid discouraging so-called impractical aspirations.
Many 20- and 30-somethings, who cut their professional teeth at a time when the possibilities seemed endless and the Internet the path to instant riches, have had to reassess their priorities as dot-coms turned into dot-bombs. Dreams of stock options at 27 and retirement at 32, if only you worked hard enough and sacrificed all things personal, led to big disappointments in the ensuing shakeout. According to a psychologist who specializes in work/life issues, it's as if a segment of today's young adults came of age too fast and lost something en route. The pattern for human development usually includes acquiring skills related to personal intimacy, time management, and exploration of culture alongside professional growth. But because many Internet entrepreneurs averaged 70- to 80-hour weeks, everything but work got put on hold. Said one such entrepreneur, “The peer pressure in Silicon Valley is to have no life. It was almost as if you were purely in execution mode, with no time to reflect or think if this was the right trajectory for me.”
The silver lining to such angst is that by reassessing their priorities so early in life, this generation could ultimately lead far more balanced lives than their parents did. Not only do many boast extraordinary work experience, but they are developing a maturity far beyond their years.51
COMPANY EXAMPLE: IMPACT OF THE FIRST JOB ON LATER CAREER SUCCESS
For more than 20 years researchers generally accepted the view that unless an individual has a challenging first job and receives quick, early promotions, the entire career will suffer. This is a “tournament” model of upward mobility. It assumes that everyone has an equal chance in the early contests but that the losers are not eligible for later contests, at least not those of the major tournament. An alternative model is called “signaling” theory. It suggests three cues (“signals”) that those responsible for promotion may use: (1) prior history of promotions (a signal of ability), (2) functional-area background, and (3) number of different jobs held.
A study of the patterns of early upward mobility for 180 employees of an oil company over an 11-year period are enlightening.52 The company's very detailed job classification systems and actual salary grades served as measures of career attainment. The results generally did not support the tournament model of career mobility, because the losers—those passed over in the early periods—were later able to move up quickly. Rather, the results were more analogous to a horse race: Position out of the gate had relatively little effect in comparison to position entering the home stretch.
Different mobility patterns for administration and technical personnel helped to explain why the pattern of the early years did not always persist. Those who started early in administrative positions began to move up early but also plateaued early. A technical background meant a longer wait before upward movement, followed by relatively rapid promotion. The number of different positions held also predicted higher attainment.
In summary, past position, functional background, and number of different jobs all seem to act as signals to those making decisions about promotions. All were related strongly to career attainment. Together they accounted for more than 60 percent of the variability in promotions.
Managing Men and Women in Midcareer
To a large extent, middle age is still a mystery. Myths about psychological landmarks of midlife, such as the “empty-nest syndrome,” the “midlife crisis,” and the menopausal “change of life” have little scientific basis.53 Nevertheless, the following issues may arise for women as well as for men at some point during the ages of 35 to 55:54
· An awareness of advancing age and an awareness of death.
· An awareness of bodily changes related to aging.
· Knowing how many career goals have been or will be attained.
· A search for new life goals.
· A marked change in family relationships.
· A change in work relationships (now more of a “coach” than a novice or “rookie”).
· A growing sense of obsolescence at work (as the saying goes, “Never look back; someone may be gaining on you”).
· A feeling of decreased job mobility and increased concern for job security.55
Everyone experiences career transitions, but such transitions need not morph into full blown crises. The key is to recognize the warning signs, such as depression, a stagnant marriage, an unsatisfying career, or heavy emotional baggage from years past. Curbing impulsive behavior is crucial to limiting the human damage a midlife crisis can do. From a career perspective, the fact is that over the next decade promotions will slow down markedly as middle-level managers are put into “holding patterns.”
While career success traditionally has been defined in terms of upward mobility, more and more leading corporations are encouraging employees to step off the fast track and convincing them that they can find rewards and happiness in lateral mobility. In lectures and newsletters, the companies are trying to convince employees that “plateauing” is a fact of life, not a measure of personal failure, and that success depends on lateral integration of the business. Does such a move make sense? Yes, if it puts aplateaued worker into a core business, gives that person closer contact with customers, or teaches new skills that will increase marketability (both inside and outside one's present company) in case the person is fired.56 Companies that are moving this way are still a minority, but they include such giants as Monsanto, Motorola, BellSouth, General Electric (GE), and RJR Nabisco.
Others note that while there are fewer middle managers at medium and large companies as a result of the reductions in layers of managers during the corporate restructurings of the last decade, their jobs are more important. Middle managers now focus less on supervision and more on decision making.57 However, for those who simply cannot accept lateral mobility, there is still hope. From 2002 to 2012, according to the Bureau of Labor Statistics, many firms will face shortages of managers with leadership and technical knowledge (such as engineers with MBA degrees) and those with expertise in management and computer matters.58
What can a middle-aged man or woman do? The rapid growth of technology and the accelerating development of new knowledge require that a person in midlife make some sort of change for her or his own survival. A 30-year-old might make the statement “I can afford to change jobs or careers a couple of more times before I have to settle down.” But a 50-year-old faces the possibility that there is only one chance left for change, and now may be the time to take it.59
Not everyone who goes through this period in life is destined to experience problems, but everyone does go through the transition, and some are better equipped to cope than are others. Evidence now indicates that the older people are, the more control they feel in their work, finances, and marriages, but the less control they feel over health, children, and sex.60 Life planning and career planning exercises are available that encourage employees to face up to feelings of restlessness and insecurity, to reexamine their values and life goals, and to set new ones or to recommit themselves to old ones.
One strategy is to train midcareer employees to develop younger employees (i.e., to serve as coaches or mentors). Both parties can win under such an arrangement. The midcareer employee keeps himself or herself fresh, energetic, and up to date, while the younger employee learns to see the “big picture” and to profit from the experience of the older employee. An important psychological need at midcareer is to build something lasting, something that will be a permanent contribution to the organization or profession. The development of a future generation of leaders could be a significant, lasting, and highly satisfying contribution.
Another strategy for coping with midcareer problems is to deal with or prevent obsolescence. To deal with the problem, some firms send their employees to seminars, workshops, university courses, and other forms of “retooling.” But a better solution is to prevent obsolescence from occurring in the first place. Research with engineers indicated that this can be done through challenging initial jobs; periodic changes in assignments, projects, or jobs; work climates that contain frequent, relevant communications; rewards that are closely tied to performance; and participative styles of leadership.61 Furthermore, three personal characteristics tend to be associated with low obsolescence: high intellectual ability, high self-motivation, and personal flexibility (lack of rigidity).
COMPANY EXAMPLE: STRATEGIES FOR COPING WITH “PLATEAUED” WORKERS62
ChevronTexaco, General Motors, and First Banks Inc. are encouraging employees to move across departmental lines on a horizontal basis since restructuring has made vertical promotions less frequent. In banking, for example, someone from auditing might switch to commercial training; someone from systems research and development might move into international development. The inflexible HRM policies of the past are rapidly fading to accommodate present and future problems. Another strategy is to create dual technical/management ladders. New “technical executive” positions are equal to management jobs in title and dollars. For example, First Banks has created senior lending positions and positions for accounting and systems specialists that are equivalent to senior managerial posts in those departments.
An alternative way to placate people who do not move up is to pay them more for jobs well done. For years, companies that rely heavily for growth on creative people—scientists, engineers, writers, artists—have provided incentives for them to stay on. Companies are now offering such incentives to a broader spectrum. For example, at Monsanto, favored scientists can now climb a universitylike track of associate fellow, fellow, senior fellow, distinguished fellow. The company has 130 fellows, and they earn from about $100,000 a year to more than $165,000 (in 2004 dollars).
Prudential Life Insurance Company rotates managers to improve their performance. At General Electric, employees who are “plateaued” (either organizationally, through a lack of available promotions, or personally, through lack of ability or desire) are sometimes assigned to task forces or study teams. These employees have not been promoted in a technical sense, but at least they have gotten a new assignment, a fresh perspective, and a change in their daily work.
Actually, there may be a bright side to all of this. Because of increased competition for fewer jobs, the quality of middle managers should increase. Those unwilling to wait for promotions in large corporations may become entrepreneurs and start their own businesses. Others may simply accept the status quo; readjust their life and career goals; and attempt to satisfy their needs for achievement, recognition, and personal growth off the job. Research at AT&T supports this proposition. By the time managers were interviewed after 20 years on the job, most had long ago given up their early dreams, and many could not even remember how high they had aspired in the first place. At least on the surface, most had accepted their career plateaus and adjusted to them. Midlife was indeed a crisis to some of the managers, but not to the majority.63
It is possible to move through the middle years of life without reevaluation of one's goals and life. But it is probably healthier to develop a new or revised “game plan” during this period.
Many older workers have valuable skills that contribute significantly to organizations and society.
“Work is life” is a phrase philosophers throughout the ages have emphasized. Today, advances in health and medicine make it possible for the average male to live for more than 74 years and for the average female to live for more than 79 years.64 Longevity increased by 30 years in the 20th century! The result: an army of healthy, over-65, unemployed adults. Legally, the elimination of mandatory retirement at any age has made this issue even more significant. As managers, what can we expect in terms of demographic trends?
In a nutshell, we can expect fewer younger workers and more older workers. The Census Bureau predicts that the number of workers ages 20 to 44 will increase by 0.4 percent between 2000 and 2010 and by 4 percent between 2010 and 2020. Meanwhile, the number of workers ages 45 to 64 will increase 29.7 percent and 3.3 percent over the same time periods.65Figure 10-1illustrates this trend graphically. In short, the baby boom of the postwar period will become the “rocking-chair boom” of the early 21st century.
Figure 10-1 Projected population change in the United States among persons ages 20 to 44 and 45 to 64, from 2000 to 2010 and 2010 to 2020.
(Source: U.S. Census Bureau. (2004). U.S. interim projections by age, sex, race, and Hispanic origin.)
Myths versus Facts about Older Workers
Age stereotypes are an unfortunate impediment to the continued growth and development of workers over the age of 50. A 2004 survey by ExecuNet ( http://www.ExecuNet.com ) found that 82 percent of senior executives consider age bias a serious problem in today's workplace, up from 78 percent in 2001.66 Here are some common myths about age, along with the facts:
Myth.
Older workers are less productive than younger workers.
Fact.
Cumulative research evidence on almost 39,000 individuals indicates that in both professional and nonprofessional jobs, age and job performance are generally unrelated.67 The relationship of aging to the ability to function, and the implication of aging for job performance, is complex. Overwhelming evidence contradicts simple notions that rate of decline is tied in some linear or direct fashion to chronological age. Rather, the effects of aging on performance can be characterized by stability and growth, as well as decline, with large individual differences in the timing and amount of change in the ability to function.68
Myth.
It costs more to prepare older workers for a job.
Fact.
Studies show that mental abilities, such as verbal, numerical, and reasoning skills, remain stable into a person's seventies.69
Myth.
Older workers are absent more often because of age-related infirmities and above-average rates of illness.
Fact.
Cumulative research has found that older workers tend to be absent less frequently, at least in nonillness situations, but the duration of the absences that do take place tends to be longer.70
Myth.
Older workers have an unacceptably high rate of accidents on the job.
Fact.
According to a study by the Department of Health and Human Services, persons ages 55 and over had only 9.7 percent of all workplace injuries, even though they made up 13.6 percent of the workforce at the time of the study.71 The data are even more compelling when only healthy workers are considered (i.e., as a result of a thorough medical screening). Among healthy workers ages 23 to 75, age was not associated with increased accidents and illnesses at work.72 It could be argued that this is because older workers have more experience on a job. But regardless of length of experience, the younger the employee, the higher the accident rate (see Chapter 15).
Myth.
Older workers do not get along well with other employees.
Fact.
Owners of small and large businesses alike agree that older employees bring stability and relate well. Indeed, the over-50 worker's sense of responsibility and consistent job performance provide a positive role model for younger workers.73
Myth.
The cost of health care benefits outweighs any other possible benefits from hiring older workers.
Fact.
True, when older people get sick, the illness is often chronic and requires repeated doctor's visits and hospitalization. However, the costs of health care for an older worker are lower than those for a younger, married worker with several children.74 To trim these costs further, some older workers have agreed voluntarily to be paid 60 percent of their salaries for 80 percent of their time, using the difference to pay for health insurance.75
Myth.
Older people are inflexible about the type of work they will perform.
Fact.
A study of job candidates by Right Associates, placement counselors, found that 55 percent of those under age 50, but 63 percent of those ages 50 to 59 and 78 percent of those over age 60, changed industries. Many older workers saw difficulties in being rehired by their old industries.
Myth.
You can't train older workers.
Fact.
Age itself will increasingly become an important diversity training issue. Gerontologists emphasize that people learn differently as they age.76 Particularly with older workers, it is important to provide a nonthreatening training environment that does not emphasize speed and does not expose the older learner to unfavorable comparisons with younger learners. Encourage self-confidence by allowing the older worker to master a skill-development task, by observing similarly aged models who are performing well, and by offering verbal assurances, ample time, and privacy.77
Myth.
Older people do not function well if constantly interrupted.
Fact.
Neither do younger people.
Implications of the Aging Workforce for HRM
Certainly not all older workers are model employees, just as not all older workers fit traditional stereotypes. What are the implications of this growing group of able-bodied individuals for human resource management?
We know what the future labor market will look like in general terms: Both the demand for and the supply of older workers will continue to expand. To capitalize on these trends, one approach is to recruit workers from those individuals who would otherwise retire. Make the job more attractive than retirement, and keep the employee who would otherwise need replacing.78 As the following example illustrates, some companies are doing exactly this.
COMPANY EXAMPLE: UNRETIREES
Baptist Health South Florida is one of a growing number of organizations that are finding their own retirees to be a valuable source of experienced, dependable, and motivated help. In fact, workers who leave and return within five years are “bridged,” retaining seniority and salary level.79 At Travelers Corporation, retirees meet seasonal or sporadic employment needs for the company, and the company gets a tax break. The retirees fill a variety of jobs, including typists, data-entry operators, systems analysts, underwriters, and accountants. Working a maximum of 40 hours per month, retirees are paid at the midpoint of the salary range for their job classifications. If they work more than half a standard workweek, they risk losing their pension benefits. Nevertheless, retirees generally like the program because it keeps them in better physical, mental, and financial shape than full-time retirement does.80
With a smaller cohort of young workers entering the workforce, other companies are also seeking workers who once would have been considered “over the hill.” Deloitte Consulting launched a Senior Leaders Program to allow high-talent executives to redesign their jobs rather than lose them to early retirement. Both Monsanto and Prudential use retirees as temporary workers to do everything from sophisticated technical jobs to answering phones. GE Information Services hires retired engineers to service older systems that are still in use.81
A second approach is to survey the needs of older workers and, where feasible, adjust HRM practices and policies to accommodate these needs:
1. Keep records on why employees retire and on why they continue to work.
2. Implement flexible work patterns and options. For example, older workers might work on Mondays and Fridays and on days before and after holidays, when so many other employees fail to show up.
3. Where possible, redesign jobs to match the physical capabilities of the aging worker.
4. At a broader level, develop career paths that consider the physical capabilities of workers at various stages of their careers.82
5. Provide opportunities for retraining in technical and managerial skills. Fully two-thirds of older workers want more training and leadership development opportunities. Unfortunately, two-thirds of HR executives say their firms don't offer such training for older workers as an incentive to upgrade their skills.83
6. Examine the suitability of performance management systems as bases for employment decisions affecting older workers. To avoid age discrimination suits, be able to provide documented evidence of ineffective job performance.
7. Despite the encouraging findings presented earlier, in the section “Myths versus Facts about Older Workers,” research has indicated no overall improvement in attitudes toward older workers.84 Characteristics employers consider most desirable in employees—flexibility, adaptability to change, capacity and willingness to exercise independent judgment—are not commonly associated with older workers.85
For their part, older workers say their biggest problem is discrimination by would-be employers who underestimate their skills. They say they must convince supervisors and coworkers, not to mention some customers, that they're not stubborn, persnickety, or feeble.86 To change this trend, workers and managers alike need to know the facts about older workers, so that they do not continue to espouse myths.
CAREER MANAGEMENT: ORGANIZATIONS FOCUSING ON THEIR OWN MAINTENANCE AND GROWTH
Ultimately, it is top management's responsibility to develop and implement a cost-effective career planning program. The program must fit the nature of the business, its competitive employment practices, and the current (or desired) organizational structure. This process is complex because organizational career management combines areas that previously have been regarded as individual issues: performance management, development, transfer, and promotion. Before coaching and counseling take place, however, it is important to identify characteristic career paths that employees tend to follow.
Career paths represent logical and possible sequences of positions that could be held, based on an analysis of what people actually do in an organization.87 Career paths should
· Represent real progression possibilities, whether lateral or upward, without implied “normal” rates of progress or forced specialization in a technical area.
· Be tentative and responsive to changes in job content, work priorities, organizational patterns, and management needs.
· Be flexible, taking into consideration the compensating qualities of a particular employee, managers, subordinates, or others who influence the way that work is performed.
· Specify the skills, knowledge, and other attributes required to perform effectively at each position along the paths and specify how they can be acquired. (If specifications are limited to educational credentials, age, and experience, some capable performers may be excluded from career opportunities.)
Data derived from HR research are needed to define career paths in this manner. Behaviorally based job analyses (see Chapter 5) that can be expressed in quantitative terms are well suited to this task because they focus directly on what people must do effectively in each job. Clusters or families of jobs requiring similar patterns of behavior can then be identified.
Once this is done, the next task is to identify career paths within and among the job families and to integrate the overall network of these paths into a single career system. The process is shown graphically in Figure 10-2.
Figure 10-2 Development of a career system composed of individual career paths.
Federal guidelines on employee selection require a job-related basis for all employment decisions. Career paths based on job analyses of employee behaviors provide a documented, defensible basis for organizational career management and a strong reference point for individual career planning and development activities.
In practice, organizational career management systems sometimes fail for the following reasons: (1) Employees believe that supervisors do not care about their career development, (2) neither the employee nor the organization is fully aware of the employee's needs and organizational constraints, and (3) career plans are developed without regard for the support systems necessary to fulfill the plans.88 The following section gives examples of several companies that avoided these pitfalls.
Internal Staffing Decisions: Patterns of Career Change
From the organization's point of view, there are four broad types of internal moves: up, down, over, and out (Figure 10-3). These moves correspond to promotions (up); demotions (down); transfers and relocations (over); and layoffs, retirements, and resignations (out). Technically, dismissals also fall into the last category, but we will consider them in the context of disciplinary actions and procedural justice. Briefly, let's consider each of these patterns of movement.
Figure 10-3 As in chess, people can make a variety of internal moves in an organization.
Promoted employees usually assume greater responsibility and authority in return for higher pay, benefits, and privileges. Psychologically, promotions help satisfy employees' needs for security, belonging, and personal growth. Promotions are important organizational decisions that should receive the same careful attention as any other employment decision. They are more likely to be successful to the extent that firms
1. Conduct an extensive search for candidates.
2. Make standardized, clearly understandable information available on all candidates.89
Organizations must continue to live with those who are bypassed for promotion. Research indicates that these individuals often feel they have not been treated fairly, their commitment decreases, and their absenteeism increases. Conversely, promoted individuals tend to increase their commitment.90 To minimize defensive behavior, it is critical that the procedures used for promotion decisions (e.g., assessment centers plus performance appraisals) be acceptable, valid, and fair to the unsuccessful candidates. Further, emphasize the greater merits of the promoted candidates, relative to those who were not promoted.
In unionized situations, the collective bargaining contract will determine the relative importance given to seniority and ability in promotion decisions. Management tends to emphasize ability, while unions favor seniority. Although practices vary considerably from firm to firm, a compromise is usually reached through which promotions are determined by a formula, such as promoting the employee with the greatest seniority if ability and experience are equal. However, if one candidate is clearly a superior performer relative to others, many contracts will permit promotion on this basis regardless of seniority.
A further issue concerns promotion from within versus outside the organization. Many firms, such as Delta Airlines, have strict promotion-from-within policies. However, there are situations in which high-level jobs or newly-created jobs require talents that are just not available in-house. Under these circumstances, even the most rigid promotion-from-within policy must yield to a search for outside candidates.
COMPANY EXAMPLE: PROFESSIONAL SERVICE FIRMS
Professional service firms (PSFs) are involved in a variety of activities, from consulting, law, civil engineering and architecture to software production. They trade mainly on the knowledge of their human capital—employees and producer-owners—to develop and deliver solutions to client problems. The usual ownership form of the PSF is the partnership, and a key decision for the existing owners is promotion to partner. This has implications for the reputation of the firm, as well as its future direction.
Conventionally, PSFs use up-or-out promotion policies, excluding from permanent tenure all except those offered partnership. If employees fail to obtain promotion within a certain time period, they are expected to quit or are dismissed. The attraction of up-or-out for the owners of the firm is that it creates a strong incentive for aspiring juniors to perform, reducing supervision or monitoring costs. It also leaves career paths inside the firm relatively clear by exiting those not elected to the top jobs, thereby helping to attract ambitious entrants who do not want to be stuck in a promotion logjam. However, up-or-out also involves losing talented and knowledgeable staff in whom the firm will have invested not only formal training (and possibly signing bonuses) but also the time and effort associated with mentoring and developing them.
Up-or-Out Promotions91
In general, the more that firms value their knowledge base and see it as a source of competitive advantage, or where the knowledge loss represents a competitive threat, the greater the costs of losing the knowledge that exiting unsuccessful candidates take with them through up-or-out. In such cases, firms may adapt by creating permanent career positions. There are costs to this strategy as well, in the form of the need for higher-powered incentives linked to the performance of the firm for those in permanent career positions below the level of partner (to reduce the risk of shirking or loafing) and higher compensation to attract and retain good-quality staff. What's the bottom line in all of this? Where firms perceive their knowledge base as distinctive and a source of competitive advantage, a promotion system like up-or-out may be less appropriate. Where the knowledge is codified and publicly available (as in public accounting firms), firms are more likely to retain up-or-out.
Employee demotions within a firm usually involve a cut in pay, status, privilege, or opportunity. They occur infrequently because they tend to be accompanied by problems of employee apathy, depression, and inefficiency that can undermine the morale of a work group. For these reasons, many managers prefer to discharge or to move employees laterally rather than demote them. In either case, careful planning, documentation, and concern for the employee should precede such moves.
What causes demotion? It could be a disciplinary action, inability of an employee to handle the requirements of a higher-level job, health problems, or changing interests (e.g., a desire to move from production to sales). Demotions also may result from structural changes, as one-time managers are recast into project leaders, technical specialists, or internal consultants by companies in the throes of reorganization. In many cases, demotion is mutually satisfactory to the organization and to the affected employee.92
What about so-called career downshifters, white-collar managers caught in a difficult job market who decide that a lesser job is better than no job at all? A http://www.Vault.com study of 400 former senior-level managers who were out of work found that 60 percent were willing to take some sort of pay cut to land their next job. Yet this presents a difficult dilemma for companies looking to hire at the executive level: They are wary of hiring career downshifters, fearing they will bolt as soon as conditions improve.93
Who is most likely to be transferred? A survey by the Employee Relocation Council found that the prototypical transferee is a married 37-year-old male with children. Female workers are less likely to be transferred, although this situation is changing.94Reduced mobility, like leaves of absence, tends to retard women's salary progression relative to that of similarly situated men.95
With respect to relocations, senior management sometimes faces resistance from employees for family reasons. Fully 81 percent of all relocation refusals are due to family and spousal issues.96 The effect of a move on a family can be profound.97 For the employee, relocation often means increased prestige and income. However, the costs of moving and the complications resulting from upsetting routines, loss of friends, and changing schools and jobs are borne by the family. Uprooted families often suffer from loss of credentials as well. They do not enjoy the built-in status that awaits the employee at the new job; they must start from scratch. Wives may become more dependent on their husbands for social contacts (or vice versa, depending on who is transferred). Women now account for about 25 percent of corporate moves, up from 5 percent 20 years ago. Currently, about a third of transferees are female, and one in four trailing spouses is male. Do such moves work out? Mobil Corporation finds that a man generally will follow his wife only if she earns at least 25 percent to 40 percent a year more than he does.98
There is one bright side to all of this, however. Research has shown that transfers produce little short-term impact on the mental or physical health of children.99
Transferred employees who are promoted estimate that it will take them a full nine months to get up to speed in their new posts. Lateral transfers take an average of 7.8 months. However, the actual time taken to reach competency varies with (1) the degree of similarity between the old and new jobs and (2) the amount of support from peers and superiors at the new job.100
To reduce this “downtime,” companies are taking some unusual steps. Thus Sprint Corp. spends up to $4,000 to replace a relocated spouse's income for 60 days. That has helped transferees to return to full productivity in about three months; it had taken six. Marriott International Inc. installed a computerized job-posting system that tracks its managerial vacancies nationwide. Both employees and their trailing spouses can apply for the openings.101 As an overall strategy on relocation, some companies have developed frequency standards whereby no manager can be relocated more than once in 2 years or three times in 10 years. Another firm has set up one-stop rotational programs at its larger facilities to replace what used to be four stints of six months each at different plants over a two-year training period.
The financial implications of relocation are another major consideration. As we noted in Chapter 6, a tier 1, complete relocation package for executives includes ongoing cost-of-living differentials; mortgage interest differentials; home disposal and home-finding expenses; expenses to help defray losses on home sales; real estate commissions; home purchase expenses; home maintenance, repair, and refurbishing costs; equity loans; and, for renters, lease-breaking expenses. Employees on temporary assignments often receive home property management expenses. All of this adds up. The average cost of relocating a home-owning current employee now exceeds $60,000, but the costs for renters and home-owning new hires were much lower.102
Organizations are well aware of these social and financial problems, and, in many cases, they are responding by providing improved support systems to make the process easier. These include special online relocation programs, intranets, “house-hunting” on the Internet, and electronic data interchange (EDI) that lets relocation professionals keep track of every detail of every move.103 MasterCard International is typical. It provides a lump-sum payment for home-finding and temporary housing. Transferees appreciate having immediate access to funds, which eases cash-flow concerns, eliminates the need to do expense reports, and gives the transferee discretion in allocating funds.104
Layoffs, Retirements, and Resignations
These all involve employees moving out of the organization.
Layoffs.
How safe is my job? For many people, that is the issue of the early 21st century. It's becoming clear that corporate cutbacks were not an oddity of the 1990s but rather are likely to persist through this decade as well.105
Involuntary layoffs are never pleasant, and management policies must consider the impacts on those who leave, on those who stay, on the local community, and on the company. For laid-off workers, efforts should be directed toward a rapid, successful, and orderly career transition.106 Emphasize outplacement programs that help laid-off employees deal with the psychological stages of career transition (anger, grief, depression, family stress), assess individual strengths and weaknesses, and develop support networks.107
How long does it take on average to find a new job? While it depends a great deal on the state of the economy and on the amount of effort put into the job search, a recent survey of 35- to 60-year-old job seekers showed that the older they were, the fewer interviews they got, and the longer it took them to find a job. How much longer? Compared to a 35- to 40-year-old job seeker, it took almost 25 percent longer for a 46- to 50-year-old, and 65 percent longer for a 50- to 60-year-old.108
Termination is a traumatic experience. Egos are shattered, and employees may become bitter and angry. Family problems may also occur because of the added emotional and financial strain.109 For those who remain, it is important that they retain the highest level of loyalty, trust, teamwork, motivation, and productivity possible. This doesn't just happen—and unless there is a good deal of face-to-face, candid, open communication between senior management and “survivors,” it probably won't.110 Within the community, layoff policies should consider the company's reputation and image in addition to the impact of the layoff on the local economy and social services agencies. Although layoffs are intended to reduce costs, some costs may in fact increase, including the following:
|
Direct costs |
Indirect costs |
|
Severance pay, pay in lieu of notice |
Recruiting and employment cost of new hires |
|
Accrued vacation and sick pay |
Training and retraining |
|
Supplemental unemployment benefits |
Increase in unemployment tax rate |
|
Outplacement |
Potential charges of unfair discrimination |
|
Pension and benefit payoffs |
Low morale among remaining employees |
|
Administrative processing costs |
Heightened insecurity and reduced productivity |
What are the options? One approach is to initiate a program of job sharing to perform the reduced workload. While no one is laid off, everyone's work-week and pay are reduced. This helps the company to reduce labor costs. In an area experiencing high unemployment, it may be better to have all employees share the “misery” rather than to lay off selected ones. Some of the benefits of job sharing are111
· Retention of experienced workers who would otherwise leave their jobs.
· Benefits continue.
· Overtime is reduced.
· Workers retain a career orientation and the potential for upward mobility.
· It eliminates the need for training a temporary employee, for example, when one employee is sick or is on vacation, because the other can take over.
However, job sharing is not without its drawbacks:112
· There is a lack of job continuity.
· Supervision is inconsistent.
· Accountability is not centered in one person.
· Nonsalary expenses do not decrease, because many benefits are a function of the employee, not the amount of pay.
· When workers are represented by a union, seniority is bypassed, and senior workers may resist sharing jobs.113
Job sharing appears to be more common among small employers. Of companies with 100 or more employees, 37.5 percent allowed job sharing, compared with 28 percent of larger employers surveyed by Hewitt Associates.114
Retirements.
For some employees, early retirement is a possible alternative to being laid off. Early retirement programs take many forms, but typically they involve partial pay stretched over several years along with extended benefits. Early retirement programs are intended to provide incentives to terminate; they are not intended to replace regular retirement benefits. Any losses in pension resulting from early retirement are usually offset by attractive incentive payments.117 At Procter & Gamble, for example, 18,400 workers left the company with voluntary buyout packages between 2002 and 2003.118
IMPACT OF CAREER MANAGEMENT ON PRODUCTIVITY, QUALITY OF WORK LIFE, AND THE BOTTOM LINE
From first-job effects through midcareer transition to preretirement counseling, career management has a direct bearing on productivity, quality of work life, and the bottom line. It is precisely because organizations are sensitive to these concerns that career management activities have become as popular as they are. The saying “Organizations have many jobs, but individuals have only one career” is as true today as it ever was. While organizations find themselves in worldwide competition, most individuals are striving for achievement, recognition, personal growth, variety, and inspiring colleagues.115 In a world that is becoming more open, more interconnected, and boundaryless, attempting to seek balance, equilibrium, and stability may be counterproductive. Leave behind the notion that the amount of time and energy devoted to “work” needs to balance the time and energy devoted to “life.” Instead, focus on enriching your overall quality of life. Reframing the issues in this way changes the focus from work to life and from balance to quality.116 The payoff is obvious for individuals and their organizations.
What about the effects on those who remain? With respect to layoffs, generous benefits provided to victims tends to be associated with lower intentions to quit on the part of survivors. With an early retirement program, however, perceptions of overly generous benefits to early retirees tends to be associated with higher intentions to quit on the part of ineligible employees who remain.119 That is not the only downside risk associated with voluntary severance and early retirement programs. Both Kodak and IBM lost skilled, senior-level employees in past cutbacks. To overcome that problem, the firms targeted subsequent programs to specific groups of employees, such as those in manufacturing and in some administrative jobs.120 The keys to success are toidentify, before the incentives are offered, exactly which jobs are targeted for attrition and to understand the needs of the employees targeted to leave.121
Because mandatory retirement at a specified age can no longer be required legally, most employees will choose their own times to retire. While many younger employees are leaving the workforce (nearly 2 million ages 25 to 54 from 2001 to 2004), older workers are streaming back in, with labor force participation among workers 55 and older rising to 36 percent in 2004.122
Research indicates that both personal and situational factors affect retirement decisions. Personally, individuals with Type A behavior patterns (hard-driving, aggressive, impatient) are less likely to prefer to retire, while those with obsolete job skills, chronic health problems, and sufficient financial resources are more likely to retire. Situationally, employees are more likely to retire to the extent that they have reached their occupational goals, that their jobs have undesirable characteristics, that home life is seen as preferable to work life, and that there are attractive alternative (leisure) activities.123
While retirement is certainly attractive to some, many retirees are returning to the workforce. In fact, retirees are the fastest growing part of the temporary workforce. Among baby boomers, 80 percent say they plan to do at least some work after they “retire”; specifically, they plan to work part-time for interest or enjoyment (30 percent), work part-time for income (25 percent), start their own business (15 percent), work full-time in a new job or career (7 percent), and other (3 percent).124 Others need the money, and they need health benefits to compensate for those they have lost. Many want in retirement what they don't currently have: balance. They want what aging experts now call a blended life course—an ongoing mix of work, leisure, and education.125
IMPLICATIONS FOR MANAGEMENT PRACTICE
To profit from current workforce trends, consider taking the following steps:
· Develop explicit policies to attract and retain dual-career couples.
· Plan for more effective use of “plateaued” workers as well as those who are in midcareer transitions.
· Educate other managers and workers in the facts about older workers; where possible, hire older workers, including retirees, for full-time or part-time work.
· Commit to broadening career opportunities for women and members of protected groups.
Resignations.
The National Quit Rate—the percentage of people who left their jobs voluntarily—averaged 1.7 percent (about 2,200 people) per month, in 2004.126 Different motives underlie voluntary resignation.127Impulsive quitters resign “on the spot” (as a result of sharp negative emotions) without any advance planning. Comparison quitters, in contrast, rationally evaluate alternative jobs and are relatively free of strong negative emotions toward their former employers. Preplanned quitters plan in advance to quit at a specific time in the future (e.g., upon reaching age 60). This type is least avoidable and therefore least preventable by management. Finally, conditional quitters hold the view “I will quit as soon as I get another job offer that meets certain conditions.”
While the motives for voluntary resignation may vary, the rules for how to do it have not. Experts generally agree that the fastest way to derail a promising career is to tell your boss “to take this job and shove it.” Instead, leave gracefully and responsibly, stressing the value of your experience in the company. In addition, give plenty of notice (at least two weeks), work hard to complete all of your outstanding obligations, and even consider sending your former boss a thank-you note, focusing on the positive aspects of your work there. After all, the working world is smaller than you think.128
SELF-RELIANCE: KEY TO CAREER MANAGEMENT
Human Resource Management in Action: Conclusion
Corporate career management programs often include one or more of the following support mechanisms:
1. Self-assessment. The goal of self-assessment is to help employees focus on appropriate career goals. For example, Career Architect is a deck of 67 skills cards that each employee sorts into three piles: greatest strengths, strengths, and weaknesses. The system, also available in software form, helps employees walk themselves through the difficult and sometimes emotional process of assessing their own skills—for example, dealing with new technology or working in teams. It is a process of identifying and calibrating your professional aptitudes and capabilities and of identifying improvements that will enhance your career growth. Alternatively, employees may complete an interest inventory, such as the Strong Interest Inventory®, to help identify the kinds of activities that they are most interested in. As a rule, people are happiest doing things that fit their interests and skills, and they tend to avoid jobs or activities in which they are uninterested or for which they lack necessary skills.129
2. Career planning. Verizon uses the results of Career Architect to chart the skills the company most needs for future business and to forge career development plans for its high-potential managers. Royal Insurance created a series of success profiles for important jobs using the cards.130 The companies then teach employees how to plan their career growth once they have determined where they want to go. Employees learn what they need as well as how to “read” the corporate environment and to become “savvy” about how to get ahead in their own companies.
3. Supervisory training. Employees frequently turn first to their immediate supervisors for help with career management. At Sikorsky Aircraft, for example, supervisors are taught how to provide relevant information and to question the logic of each employee's career plans, but not to give specific career advice. Giving advice relieves the employee of responsibility for managing his or her own career.
4. Succession planning. Simply designating replacements for key managers and executives is no guarantee that those replacements will be ready when needed. Enlightened companies such as K. Hovnanian Enterprises, a $2.6 billion homebuilder in Red Bank, New Jersey, are adopting an approach to succession planning that is consistent with the concept of career self-management. They develop their employees broadly to prepare them for any of several positions that may become available. As business needs change, broadly developed people can be moved into positions that are critical to the success of the business.131
While the concept of career self-management is appealing, research has revealed some significant cautions. First, don't make the programs mandatory. Second, don't offer the programs as a one-time opportunity that will not be repeated in the future. Integrate it into the performance management process. And finally, provide opportunities for employees to practice their career self-management behaviors in the workplace. This may require new HR policies and new roles for supervisors.132
The practice of making career self-management part of the corporate culture has spread rapidly over the past several years. Companies are using this approach to build a significant competitive advantage. Given today's turbulent, sometimes convulsive corporate environments, plus workers who seek greater control over their own destinies, it may be the only approach that can succeed over the long term.
A career is a sequence of positions occupied by a person during the course of a lifetime. Career planning is important because the consequences of career success or failure are closely linked to an individual's self-concept and identity, as well as with career and life satisfaction. This chapter has addressed career management from three perspectives. The first was that of individuals focusing on themselves: self-management of a person's own career, establishment of career objectives, and dual-career couples. The second perspective was that of organizations focusing on individuals: that is, managing individuals during early career (organizational entry, impact of the first job); midcareer, including strategies for coping with midlife transitions and “plateaued” workers; and late career (age 50 and over) stages. We considered the implications of each of these stages for human resource management in both large- and small-business settings. Finally, a third perspective was that of organizations focusing on their own maintenance and growth. This requires the development of career management systems based on career paths defined in terms of employee behaviors. It involves the management of patterns of career movement up, down, over, and out.
· career
· career success
· organizational entry
· socialization
· mentor
· reverse mentoring
· plateaued worker
· career paths
· promotions
· demotions
· blended life course
· impulsive quitters
· comparison quitters
· preplanned quitters
· conditional quitters
· self-assessment
|
10-1 |
Why is the design of one's first permanent job so important? |
|
10-2 |
What practical steps can you suggest to minimize midcareer crises? |
|
10-3 |
How can an organization make the best possible use of older workers? |
|
10-4 |
Discuss the special problems faced by dual-career couples. |
|
10-5 |
A friend of yours is considering accepting a new job offer but can't figure out how to tell his current boss he's leaving, or what steps to take. What advice would you give him? |
|
10-6 |
What does the concept of loyalty mean in today's world of work? |
|
10-7 |
Identify some telltale signs that it's time to quit your current job. |
|
10-8 |
Working in small groups, develop a corporate policy that specifies how training, performance management, and reward systems might integrate career planning considerations. |
Exercise 10-1: Self-Assessment and Career Planning
Awareness of both the job market and your own strengths, weaknesses, needs, and desires is required to make an effective career choice. This exercise focuses on the second part of the equation: personal traits, interests, needs, and aspirations as they relate to the choice of a career. Professionally developed interest inventories and personality tests can help in this diagnosis. They are usually available through college placement offices.
Following are three exercises designed to help you discover how your personal characteristics relate to your career choices. A sample self-assessment exercise is followed by an exercise providing guidelines for discussing and evaluating answers to the self-assessment questions. The final exercise provides additional ways to examine self-perceptions and interests.
An approach that has proved useful is that of answering a series of probing questions. A list of typical questions is provided below. Answer them as honestly as you can.
1. List five words that describe my personality best (not roles such as student, husband, daughter).
a.
a.
a.
a.
a.
1. Who am I? List five statements that answer this question.
b.
b.
b.
b.
b.
1. My best childhood memory is:
1. The single achievement in my life of which I am most proud is:
1. The type of people I like best are:
1. When I have 15 minutes to do anything I want, I most enjoy:
1. When I think about making changes, I feel:
1. My overriding goal in life is to:
1. My greatest strengths in the following work-related areas are (list specific strengths):
i. Intellectual abilities
i. Social skills
i. Leadership skills
1. My greatest weaknesses in the following work-related areas are (list specific weaknesses):
j. Intellectual abilities
j. Social skills
j. Leadership skills
j. Communication skills
1. Ranking values. Rank the following 16 values in terms of their importance to you (1 is most important, 2 is second most important, etc.).
k. Family security
k. Social recognition
k. Salvation
k. An exciting life
k. A world of beauty
k. Inner harmony
k. Mature love
k. Accomplishment
k. A world at peace
k. Self-respect
k. True friendship
k. Happiness
k. Equality
k. Wisdom
k. Freedom
k. Pleasure
1. Ranking job outcomes. Rank the following 14 job outcomes in terms of their importance to you (1 is most important, 2 is second most important, etc.).
l. Status
l. Money
l. Security
l. Variety
l. Independence
l. Power
l. Challenge
l. Travel
l. Respect
l. Flexible hours
l. Working conditions
l. Socially important work
l. Self-actualization
l. Achievement
1. Life line. Draw a line representing your life. Use peaks and valleys to represent positive and negative periods or events in your life. Mark an “X” where you are now; then project your life line out to the end. At the end of your life line, write the epitaph that you think will best summarize your life's work.
B. Discussion and Career Planning
The class should now divide into groups of two (dyads). Each individual in turn should explain to the other what insights were gained about himself or herself from answering the questions in part A. Then the dyads should discuss appropriate career options based on the answers. Finally, using the insights and information gained from the responses to the questions and from the discussions, each student should answer the following questions individually.
1. What are my three major career strengths?
2. What characteristics of jobs are most important to me?
3. What occupations, jobs, and types of organizations seem most suitable for me?
4. What career goals should I set for myself, both long term and short term?
5. What steps should I take, and by when should I take them, to accomplish these goals?
C. Further Exploration of Self-Perceptions and Interests
1. It is frequently helpful in career planning to get others' perspectives on you to compare with your self-perceptions. One way to do this involves interviewing one or two people who know you very well, such as a parent, spouse, or best friend. Ask them the same questions you asked yourself in part A of this exercise. Then compare their responses with your own. What are the similarities and differences? What explains the differences?
2. Another way to get a different perspective beyond your own is to take an interest inventory. Such questionnaires typically assess your career interests according to some underlying model of careers and compare your responses with those of individuals in a variety of career fields. Your career development office on campus should be able to administer an instrument such as the Strong Interest Inventory or the Kuder Preference Scale.
3. It is also sometimes useful to keep a 24-hour diary. For one full school day, keep track of how you spend your time. Then repeat the process for a weekend day or some other day when you do no schoolwork. What did you learn about how you like to spend your time? What does this indicate about your interests?
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4Andy Grove on navigating your career. (1999, Mar. 29). Fortune, pp. 187-192. See also Hall, D. T., & Mirvis, P. H. (1995). Careers as lifelong learning. In A. Howard (ed.), The changing nature of work. San Francisco: Jossey-Bass, pp. 323-361.
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8Hall, D. T. (1996). Protean careers of the 21st century. Academy of Management Executive, 10 (4), 8-16.
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13Reichheld, F. F. (1996). The loyalty effect. Boston: Harvard Business School Press.
14Employee tenure in 2002. Accessed from http://www.ftp://ftp.bls.gov/pub/news.release/tenure.txt on Aug. 12, 2004.
15For more on this, see Cascio, W. F. (2000). Costing human resources: The financial impact of behavior in organizations (4th ed.). Cincinnati, OH: South-Western.
16Daniels, C., & Vinzant, C. (2000, Feb. 7). The joy of quitting. Fortune, pp. 199-202. See also Henkoff, R. (1996, Jan. 15). So, you want to change your job. Fortune, pp. 52-56.
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18Working scared (1993, Apr. 17). NBC News.
19Bolles, R. N. (2004). What color is your parachute? 2004: A practical manual for job hunters and career changers. Berkeley, CA: Ten-Speed Press; Ceron, G. F. (2004, Mar. 29). When leaving is the best move. The Wall Street Journal, p. R4. See also Andy Grove on navigating your career, op. cit.
20Barrett, A., & Beeson, J. (2004). Developing business leaders for 2010. NY: The Conference Board.
21Waterman, J. A. (2000). Informed opportunism: Career and life planning for the new millennium. In J. M. Kummerow (ed.), New directions in career planning and the workplace. Palo Alto, CA: Davies-Black, pp. 163-196.
22Ceron, op. cit. See also Fisher, A. (2001, Apr. 2). Surviving the downturn. Fortune, pp. 98-106.
23Borzo, J. (2004, Sept. 13). The job connection: Using online networking, job seekers turn friendship into employment. The Wall Street Journal, p. R14.
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25The impact of demographics. (2002, Dec. 1). Workplace Visions, p. 1.
26Greenhaus, op. cit.
27Brady, D. (2002, Aug. 26). Rethinking the rat race. BusinessWeek, pp. 142, 143.
28Mellor, S., Mathieu, J. E., Barnes-Farrell, J. L., & Rogelberg, S. G. (2001). Employees' non-work obligations and organizational commitments: A new way to look at the relationships. Human Resource Management, 40, 171-184.
29Hube, K. (2004, March 29). Thanks, but no thanks. The Wall Street Journal, pp. R4, R7. See also Lublin, J. S. (2000, May 30). Working dads find family involvements can help out careers. The Wall Street Journal, p. B1.
30Milliken, F. J., Martins, L. L., & Morgan, H. (1998). Explaining organizational responsiveness to work-family issues: The role of human resource executives as issue interpreters. Academy of Management Journal, 41, 580-592. See also Rubin, B. M. (2002). Think outside the (cereal) box. http://www.workingwoman.com/thinkoutside.shtml . Accessed Sept. 20, 2004.
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34The impact of demographics, op. cit.
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36Grover, S. L., & Crooker, K. J. (1995). Who appreciates family-responsive human resource policies: The impact of family friendly policies on the organizational attachments of parents and non-parents. Personnel Psychology, 48, 271-288. See also Demby, op. cit.
37Lublin, J. S. (2004, June 23). Women aspire to be chief as much as men do. The Wall Street Journal, p. D2. See also Trost, C. (1990, May 2). Women managers quit not for family but to advance their corporate climb. The Wall Street Journal, pp. B1, B8.
38Breaugh, J. A. (1992). Recruitment: Science and practice. Boston: PWS-Kent.
39Wannberg, C. R., & Kammeyer-Mueller, J. D. (2000). Predictors and outcomes of proactivity in the socialization process. Journal of Applied Psychology, 85, 373-385. See also Ashford, S. J., & Black, J. S. (1996). Proactivity during organizational entry: The role of desire for control. Journal of Applied Psychology, 81, 199-214.
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41Ragins, B. R., Cotton, J. L., & Miller, J. S. (2000). Marginal mentoring: The effects of type of mentor, quality of relationship, and program design on work and career attitudes. Academy of Management Journal, 43, 1177-1194. See also Young, A. M., & Perrewe, P. L. (2000). What did you expect? An examination of career-related support and social support among mentors and proteges. Journal of Management, 26, 611-632.
42Dunham, K. J. (2003, Sept. 23). Mentors may not help. The Wall Street Journal, p. B8. See also Scandura, T. A. (1998). Dysfunctional mentoring relationships and outcomes. Journal of Management, 24, 449-467.
43Dreher, G. F., & Cox, T. H., Jr. (1996). Race, gender, and opportunity: A study of compensation attainment and the establishment of mentoring relationships. Journal of Applied Psychology, 81, 297-308. See also Whitely et al., op. cit.
44Murray, M. (2000, Feb. 15). GE mentoring program turns underlings into teachers of the web. The Wall Street Journal, pp. B1, B18.
45Janasz et al., op. cit.
47Northrup, H. R., & Malin, M. E. (1986). Personnel policies for engineers and scientists. Philadelphia: Industrial Research Unit, The Wharton School, University of Pennsylvania.
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48Schein, E. H. (1978). Career dynamics: Matching individual and organizational needs. Reading, MA: Addison-Wesley.
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79Grossman, op. cit.
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83Grossman, op. cit.
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100Pinder, C. C., & Schroeder, K. G. (1987). Time to proficiency following job transfers. Academy of Management Journal, 30, 336-353.
101Lublin, (1993, Apr. 13). op. cit.
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106Grant, M., & Kraft, J. D. (1998). Results-based career transition and revitalization at the U.S. Office of Personnel Management. In M. K. Gowing, J. D. Kraft, & J. C. Quick (eds.), The new organizational reality: Downsizing, restructuring, and revitalization. Washington, DC: American Psychological Association, pp. 143-163. See also Bragg, R. (1996, Mar. 5). Big holes where the dignity used to be. The New York Times, pp. 1, 8-10.
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114Hirschman, op. cit.
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128MacDonald, J. Going out on the right note. Accessed from http://www.bankrate.com on Sept. 22, 2004.
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130Lancaster, H. (1995, Aug. 29). Professionals try new way to assess and develop skills. The Wall Street Journal, p. B1.
131Wells, S. (2003, Nov.). Who's next? HRMagazine, pp. 44-50.
132Ibid. See also Kossek, E. E., Roberts, K., Fisher, S., & Demarr, B. (1998). Career self-management: A quasi-experimental assessment of the effects of a training intervention. Personnel Psychology, 51, 935-962.
Managing Human Resources
Managing Careers
ISBN: 9780072987324 Author: Wayne F. Cascio
Copyright © The McGraw-Hill Companies (2005)