MANAGING GEN Y
1.0 Introduction
Managing today workforce is never something easy. One of the hot topics in the recent years is that the art of managing younger people is different from the conventional wisdom of managing workforce. As discussed by Carlson (2010), today, the younger workforce is often called the Generation-Y, or equally frequent as the Internet Generation. The art of management of Generation-Y is essential skills of managers in the workplace today. This is because more and more young workforces are joining the employment today. Often, they are energetic, ambitious and dare to change. However, there are arguments that Generation-Y is hard to be managed. As discussed by Cunningham (2007), Generation-Y can be hard to be managed because the traditional management techniques may no longer relevant in dealing with the younger workforce. Specifically, it is commented that the traditional motivational techniques used are less effective against Generation-Y, as they seemingly response or react to different sets of motivational factors. Besides, managing Generation-Y is also often perceived as daunting due to the high turnover rate of the younger workforce. As argued by Myers (2007), the high turnover rate of Generation-Y often lead the managers to feel that the young workforce are not patient, short term oriented, not loyal, and hard to be managed. Thus, in this report, proper ways to deal with the Generation-Y will be discussed. The relevant reward system suitable to manage the younger workforce effectively will be discussed. Then, a discussion on how these rewards system can be applied to current workplace will be presented.
2.0 Unique Characteristics of Generation-Y
It is not hard to observe that Generation-Y tend to exhibit different behaviors than the elder employees. Such a phenomenon is also widely discussed in the human resource literature (Downs, 2009). There are several reasons contribute to such phenomenon. Firstly, Generation-Y tend to have different expectations, due to different upbringing environment and experiences. Apart from that, Generation-Y also tend to perceive things differently (Binsacca, 2008). Thus, it is important for human resources manager to attend to the different expectations and perceptions of the younger workforce. As they have different mindset and hence different behaviors, a different set of best practices may be necessary to manage Generation-Y effectively.
3.0 Literature Review: Different Reward System for Generation-Y
3.1 Transactional Approach in Managing Generation-Y
As discovered by Tulgan (2009), Generation-Y tend to think frequently from a consumer perspective, even when they are studying in the school or university. Generation-Y tend to think themselves as the consumers, and thus have develop a transactional mindset in dealing with other people. In the context of workplace, Generation-Y view that the employment contract is indeed some form of transaction between them and the employers. Thus, effective managers should not structure the pay system in the traditional manner. The Generation-Y is not interested in being paid because they are the workforce in a corporation. Instead, they may be more easily managed through the new mindset whereby the manager is essentially purchasing results from the workforce. Thus, to effectively manage the workforce, managers should have a result oriented reward system, and to purchase the results generated from those Generation-Y workforces in the company. Such a reward system makes real sense to the Generation-Y.
3.2 Short-Term Reward System
As the economy and the business environment has been changing fast in the recent decades, Generation-Y intuitively understand that long term secure and permanent employment is not to be expected in the future. Thus, it is found by researchers that Generation-Y tend not to trust the corporations’ promises to provide them with long term, lifelong, reliable and secure employment benefits. For them, such promises essentially worth nothing much, as the changes of the business environment may cause any corporations to go bust in just a few years. As such, Generation-Y value more on remuneration or compensation packages that is obvious and given to them in the shortest possible time (Eisner, 2005). They are less likely to value those promises that will benefit them in the long run, often, many years down the road. As such, it is essential for the management to structure the reward system to reward the younger workforce under a short term time frame. As argued by Tulgan (2009), such short term reward system is powerful in motivating Generation-Y because the short term structure of these reward system deliver a greater sense of control and certainty on the potential rewards to be achieved by Generation-Y. Thus, they are more likely to work harder in the short term towards the completion of a project. As such, it is possible then to manage them to get real results under competitive business environment everyone is experiencing today.
3.3 Establishing Point-based Reward System
According to researchers, Generation-Y is the generation growing up with video games, and many of them have been repeatedly programmed subconsciously to keep scores and beat their previous high scores in a game. Such a phenomenon is affecting Generation-Y in the behaviors in workplace (Caverhill et. al., 2010). Due to the video game effects, they love to collect points, compete in a safe environment, and continuously improve their performance and scores. Thus, researchers suggested that a point system is necessary way to effectively manage Generation-Y workforce. Under the point system, everything in the organization should be assigned points. The successful completion of projects or behave in a certain way will assist the workforce to be fine-tune their behaviors to score better in the future (Caverhill et. al., 2010). For example, points shall be rewarded when they arrive early in a meeting or workplace, points should be rewarded when they able to complete a project successfully, while points shall be deducted when they did something wrong. On such a system, management can slowly let the point system does the management job. Once the younger workforce able to achieve certain level of points; they shall be given certain form of formal recognition and rewards. Only in such a manner they can be motivated to work harder to beat their own scores and to concentrate on doing the right things, at the fastest possible time.
3.4 Financial Rewards
There are also certain findings discover that money has been becoming more important motivators in moving the younger workforce today. This is not something so obvious in workplace in the past, whereby the elder generations are motivated by job securities, passions on the job, recognition, workplace condition, and employment benefits. However, these factors are less likely to be considered by Generation-Y as important factors. In a survey, a total of more than 80% of the Generation-Y workforce look forward to the salary packages, bonuses, stock options, and other sorts of financial benefits in their decision making process for an ideal job (Binsacca, 2008). Besides, it is also discovered that many of them will leave the current employment, if they are offered significantly high salary in other places (Downs, 2009). Thus, in order to prevent high turnover among Generation-Y employees in workplace today, it is crucial for management to offer equally competitive salary packages to them.
4.0 Discussions
As discussed above, it is discussed that younger workforce, namely, the Generation-Y is reported repeatedly to have higher turnover ratio, perceived as less loyal, not patient, and have more short term oriented behaviors. Thus, managing such group of workforce can be hard, and a great burden will be placed on the human resources management department (Cunningham, 2007). After reviewing the many literature related to managing Generation-Y in workplace, several findings can be concluded. These findings will be discussed in this section.
To begin, it can be seen that it is widely recorded under the literature that younger workforce has different expectations. As they have different expectation, they needs and wants from working in a company differ from the elder generations. From the different expectation; they tend to react differently to different stimulus. Apart from that, they tend to have different mindset or perceptions also. Some of the different perceptions discussed in literature review above include: seeing employment contracts as transactional agreement or deal; place more importance on monetary and short term solid rewards; prefer to be rewarded on results or performance; does not view positively on the corporations promises for lifelong employment security, and more motivated by financial related rewards. From these observations, it is obvious that a different set of guidelines or best management practices and policies should be implemented to effectively manage the younger workforce.
Consistent with such findings, sensible and logical management system designed to manage Generation-Y have been proposed. Among the promising management techniques that can be applied to manage corporations with many young workforces include establishing a point system. Under the point system, every attitudes, results, successes, or bad outcomes will be assigned relevant points. When the Generation-Y perform in a way consistent with company values and contributing to company performance, they should be rewarded points; and points shall be deducted when they did something wrong. This is a sensible management tool. Besides, in managing the younger workforce, it is also make sense to have different compensation packages for them. As it is discovered that they no longer react to the traditional motivation factors, such as job security, employment benefits, and so on; a different set of promises should be provided to them.
However, there are certain points worth mentioning. The discussions provided above can best be perceived as generalization of the behaviors or perceptions of Generation-Y. It is crucial to understand that not all young workforce to behave in the similar manner. Thus, management should not over generalize in managing Generation-Y. On case by case basis, they should have different techniques to deal with different people, whenever possible or feasible to do so. Apart from that, people can change really fast, and it is also reasonable to expect that the different cultural setting in different region may affect the behaviors, attitudes, expectations and tendency of Generation-Y. As most of the researches conducted above is focusing on the western countries, particularly in the United States, it is reasonable to expect that Generation-Y in other nation, for example, in the East region, such as China, Japan or India may have different set of behaviors or expectation; and hence require different best practices to be managed effectively.
5.0 Conclusion
Overall, the report has highlighted several interesting points of findings about Generation-Y. Generally speaking, a lot of the Generation-Y is found to have different behaviors, perceptions and expectations. Under such a situation, it is reasonable to expect that the many traditional human resources best practices may no longer be effective (Espinoza et. al., 2010). It is then argued that particularly the reward system in managing younger workforce, should be altered or changed accordingly. Such an assertion is definitely important to be noticed and aware by managers in workplace today.
6.0 References
Anonymous. (2008). Benefits Are Key in Managing Gen Y. (2008, September). IOMA’s Report on Managing Benefits Plans, 08(9), 1,11-12.
Binsacca, R. (2008, November). Managing Gen Y. Builder, 31(13), 59-60.
Carlson, S. (2010, February). managing gen-y: supervising the person not the generation. SuperVision, 71(2), 9-11.
Caverhill, S., & Brooks, M. (2010, October). Understanding and Managing Your Gen-Y Lawyers. Law Office Management & Administration Report, 10(10), 1,13-15.
Cunningham, S. (2007, March). Managing The Millennials. Best’s Review, 107(11), 67.
Downs, K. (2009, April). Managing Gen Y in Recessionary Times. Business Credit, 111(4), 28-29.
Eisner, S. P. (2005). Managing Generation Y. S.A.M. Advanced Management Journal, 70(4), 4-15.
Espinoza, C., Ukleja, M., & Rusch, C. (2011). CORE COMPETENCIES FOR LEADING TODAY’S WORKFORCE. Leader to Leader, 2011(59), 18.
How to Get Buy-In From Generation Y. (2005, March). Accounting Office Management & Administration Report, 05(3), 4-5.
Jacobus, J. (2008, January). Managing the generation gap. The Kansas Banker, 98(1), 14.
Messmer, M. (2008, June). Managing the Millennial Generation. NPA Magazine, 7(3), 27.
Myers, J. (2007, October). The How and the Y. Profit, 26(4), 43-44.
Tulgan, B. (2009, December). MANAGING in the ‘NEW’ Workplace. Financial Executive, 25(10), 50,52-53.
Wubbe, E. (2009, September). Striving for a Balance Between Work & Life. The Secured Lender, 65(6), 26-30.
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