Companies across the country from defense contractors to General Motors and General Electric are scrambling to ensure that millions of younger managers are ready to step into leadership roles as baby boomers retire.
About 10,000 boomers reach retirement age every day, according to Bloomberg Businessweek. Companies large and small are often unaware of how much company knowledge the retirees will take with them.
Dorothy Leonard, Professor Emeritus at Harvard Business School, and her firm Leonard-Barton Group, have developed knowledge-transfer programs at several GM divisions.
Until last year, boomers made up the largest portion of the U.S. population, and Generation X represented the biggest share of the workforce. Now millennials lead in both categories. They hold 20 percent of all management jobs, up from 3 percent in 2005, according to U.S. Bureau of Labor Statistics.
“In the next 10 to 15 years, we’re going to have the greatest transfer of knowledge that’s ever taken place,” says Chip Espinoza, Director of Organization Psychology at Concordia University Irvine. He says to handle the shift, companies need to create relationships between the generations.
Multinational defense and aerospace company BAE has been preparing for the retirement cliff for several years. They adopted a NASA program developed when the space agency started to lose expertise from lunar landings as individuals retired.
When BAE learns that an employee with deep institutional knowledge plans to retire, even in a couple of years, a knowledge transfer group of about a half-dozen people working in the same area is formed. The teams meet regularly to talk and exchange advice.
Younger workers get tips and older workers learn how to gradually hand off duties to junior employees.
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