Financial Institutions: Look into the Future, Listen to the Young

Every generation feels that they are unique in some aspect from their parent’s generation. The phrase; “In our day we did things differently,” has been repeated throughout history. In the work place, the challenge is to understand generational differences so that they do not become a breeding ground for confusion, resentment, anger or turnover.

Generational divides are nothing new. Scholars have traced the phenomena back to Socrates in 400 B.C.: Our youth have contempt for authority; they show disrespect for their elders, he once said. 

Stakeholders of financial institutions in Ethiopia are increasingly wrestling with generational disparity in their work force. The differences primarily arise from conflicting mind-set, misperceptions, miscalculations, and misunderstandings of workers born during different decades. Here one can sense that organizations have two “campsites” looking at each other across a great divide with suspicion and frustration. The friction may be aggravated by new technology, access to education, availability of information and work patterns that mix workers of different ages in a “team”. This has lead to conflicts between the “young” and “old” generation that hamper organizational development in the financial sector.

To bear this, though one hardly finds comprehensive studies conducted targeting the financial industry, sectoral information is useful in identifying broad stages of development. According to CIA World Fact book, the compositions of Ethiopian Demographics Profile 2013, the age category below 25 years comprises over 65Pct of the total population. Likewise, the employment rate in the service sector that includes, financing and insurance according to ILO, Key Indicators of Labour Market, are less in Ethiopia as compared with estimates of the rest of Africa.

As per the data collected, in a time not more than a decade most of the financial institutions will witness the exit of much of the workforce, mostly from the retiring “old generation”. Here, with so many stereotyped views about the “young” generation’s capacity to succeed in leadership and overall lack of readiness, forward looking stakeholders should be concerned enough to do something about “Developing future leaders” in the financial service industry.

To visualize the matter, scholars suggest considerations on some of the possible generational differences in the work place. There exists a generational difference in light of a perceived decline in work ethic. Indeed, the prevailing stereotype is that younger workers do not work as hard as older workers do. Whether the younger generations do not work as hard as previous ones is debatable. Here, the story might be different if the “younger generation” gets access to air its views.

Another point of contention among generations is loyalty towards employers. Again the extent to which employees feel loyal towards their organizations differs. Some of the institutions have conducted reform programs and the way change is handled has also fuelled the generational war. Although it is open to debate, some say that they are more likely to remain with an organization if the organization respects older people with experience more younger counterparts. However, the stereotyping is that youngsters are money hunters, although it is difficult to differentiate which group has less interest for such factors.

There is also a generational tug of war regarding respect. Many youngsters complain about managers who ignore ideas and have a ‘do-it because I said so’ management style while “older workers” complain that there is a lack of respect from “new faces”. Here, although respecting others is a top tradition of Ethiopians it is undoubtedly becoming a challenge in the workplace.

Moreover, as manifestations of the war, there exists a difference in giving and receiving feedback. This also lends some credence to the stereotype that the older generation is sensitive to feedback, especially when it comes from younger counterparts. The “older generation” assumes that youngsters necessitate regular feedback while those before worked hard for everything they currently have. The “younger generation” is considered as a “certificate holder”, devoid of the necessary practical skills. The question is who is responsible for developing the young generation?

Another area of difference resides on work-life balance and who should lead. Here, the “Old generation” predominantly regards the “young” as less committal to work although most old workers to a varying extent aspire to the same thing. Equally, the issue of who should be at the top requires a wise answer. The stereotype is that “old is better”, although most organizations are suffering from “strategic myopia”, absence of innovation and practical forward looking vision. Those who fight only to maintain the status quo are considered wise. Any “youngster” with better and innovative ideas is considered a “noise maker” and every organization works with the notion of “yesterday and today is more important than tomorrow”. There is a wrong tendency to relate capacity with age. The point here is in the industry which suffers from absence of role models and professionals, who supervises who.

Although the issue is strategic, most organizations do not have a clear direction towards, talent and knowledge management, succession planning, and any one proposing such issues is considered to be a “bookworm”. The “old generation” should abandon such stereotypes to block “youngsters” from taking the driver’s seat. Proportional sharing of positions brings healthy knowledge transfer. Ironically, although some managers do not boldly argue against succession planning, the hidden notion seems that developing a successor is like digging your own grave. It fosters easy replacement. 

Similarly, stakeholders need to figure out why “youngsters” are asking questions, instead of assuming that those asking questions are causing trouble or making the person in authority look awful. Instead, developing instruments whereby interest of both age brackets can be geared towards accomplishment of national and organizational visions.

Finally, unless organizations come up with a sound strategy to narrow the generational gaps, sustainable growth of the firms can be endangered. A road map should be sketched to weed out the best from the rest and the seed from the chaff. A successful manager will be the person who can bring these generations, with their differences and attributes, together to success. As Winston Churchill once said, the farther back you can look, the farther forward you are likely to see.

Fikru Tsegaye

Fikru Tsegaye holds MBA in Marketing and MA in Human Resource and Organizational Dev’t. He is currently working at Ethiopian Insurance Corporation as Marketing and Strategic Management Team Leader. He can be reached at fikru.tsegaye@yahoo.com

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