Age diversity: the future of competitive  advantage

Every business wants to unlock the secret to competitive advantage — but all too often leaders look for niche solutions or costly initiatives in an attempt to get a competitive edge. Instead, the secret could be right under your nose. Simply cultivating inclusive and healthy multigenerational teams with age diversity taps into a hidden pool of talent that, when embraced, can offer unique benefits to organisations.

In this blog, we’ll explore why an inclusive multigenerational workforce is even more essential now than ever before, and what this actually looks like.

Age diversity: a success story

Picture this: you are in the race to develop the first low-cost open source printer at the Open Sustainability Tech Lab in Michigan. You are moments off the finished product, and disaster strikes when you realise you are missing a much-needed mechanical component. Your team member turns to Amazon to order the part, before an older employee steps in and builds the component from spare pieces quicker than any Amazon delivery could match. Meaning the product could be built in record time.

This was just one of the success stories from Joshua Pearce’s multigenerational team. He credits the success of the product development to each colleague’s willingness to learn from other generations, meaning the team could expertly blend the technical skills of Gen X employees with the software wizardry of their millennial cohort and the experienced resourcefulness of their boomers.

The result? A groundbreaking product launch from the team.

And while this is just one example of the competitive advantage that age diversity within teams can offer an organisation — the results shouldn’t surprise you. After all, we’ve known for a while that diverse teams tend to produce better results for businesses.  It is an unquestionable fact that they are more creative, productive, engaged, happier and healthier: organisations in the top quartile for ethnic and racial diversity in management were 35% more likely to have financial returns above their industry mean, and those in the top quartile for gender diversity were 15% more likely to have returns above the industry mean.

But here’s the crux. Unlike their less-inclusive counterparts, age diverse workplaces offer a unique blend of skills, offering a huge competitive advantage for organisations who choose to embrace them.

In fact, a workplace that embraces age diversity can address and offer solutions for many of the key challenges facing businesses globally.

The case for age diversity within teams

Productivity, engagement, agility, and talent — these are some of the megatrends affecting businesses around the globe. We’ll take a look at the current situation for businesses, and then investigate how an age-diverse workforce can give teams a competitive edge in tackling each.

Productivity

The current situation: 48% of employees self-report being productive less than 75% of the time.

The multigenerational workplace: Contrast this with the fact that, in firms with intergenerational inclusive work practices, 87% of employees report high productivity, compared with 58% of those without these practices. 

A large driver of this productivity increase is skills sharing. In fragmented work environment individual talents often remain isolated and are not given the chance to cross-pollinate. Yet multigenerational teams often have complementary skills that span the various generations. In an age-inclusive workplace, these competencies are allowed to intermingle and combine. This offers the opportunity to plug blind spots and develop existing skillsets. Not only does this result in a more well-rounded and productive organisation, but it offers valuable opportunities for organisations to nurture and develop unique skillsets, that their competitors lack access to.

The stats that show this truly works: Analysis by the German Economic Institute found that each increase in the variance of workforce age increases the likelihood of achieving a product or process innovation by 1.5%. 

Engagement

The current situation: Two-thirds of employees are disengaged at work.

The multigenerational workplace: According to a study by AARP and AON Hewitt, the 50+ age group are the most engaged age cohort across all generations. And research from Pew Research Center finds that over 65s are most likely to find their job enjoyable and fulfilling.

By creating age diversity within their organisation, this can disseminate across workers of all ages, spreading good practice throughout. According to HBR, older workers can serve as mentors and role models of resilience and emotional maturity to younger colleagues struggling with the increasing demands of their jobs and lives.  

Not only this, reverse mentoring and skill sharing offers a unique opportunity for engagement — combining fresh ideas, new concepts and learning for both parties. This offers a great sense of personal and professional development for many employees, and research shows that they support employees development, and increase involvement and motivation.

Agility

The current situation:  79.7% of business leaders need to adapt their business every two to five years.

The multigenerational workplace: Multigenerational workforces may be more stable and resilient to shocks. Age diversity reduces the risk for the employer that a large part of the workforce stops working at the same time due to common life events for certain age groups — like the birth of a child. Additionally, it brings together a wealth of experiences from multiple age groups, providing organisations with critical insights to navigate workplace challenges.

Imagine you were going on a camping trip. If you were heading up the trail to the campsite and there were people coming back from where you were heading, it would make sense to take time to ask them ‘Where are the best water spots?’, ‘Are there any dangers?’. By tapping in to other’s experience, I am giving myself the best advantage to prepare myself and succeed.

In a similar way, the multigenerational workforce allows employees to learn from one another’s mixed experiences, providing valuable insights and foresight that allows organisations to prepare and adapt to future challenges.

We’ve seen the value of agile and adaptable workforces in recent times, yet, with an age-diverse workforce, the variety of skills and experience naturally makes the workplace more adaptable to global trends that might unsettle less diverse organisations.

Skills gap

The current situation: A recent ManpowerGroup survey of 39,000 employers worldwide found that the share of companies reporting talent shortages rose from 35% in 2013 to an all-time high of 77% in 2023.

It’s clear that employers are grappling with a skills gap. In a crippling war for talent, companies that don’t utilise their existing talent will be left at a dangerous competitive disadvantage.  

The multigenerational workplace: Increasingly leaders are realising the value of internal mobility. However, many often fall into the dangerous stereotype of believing that only their younger workers will be receptive to new training. They unfairly associate stagnancy with their older workers. This misconception can lead to losing out on valuable talent. In fact the opposite is true:  the AARP International found that the opportunity to learn something new is an essential element of the ideal job for most workers aged 45 to 65. Instead of investing millions in efforts to fill talent gaps, leaders should recognise that their multigenerational teams hold the answers.

 Ken Dychtwald, CEO of Age Wave, says ‘On the one hand, we’ve got gaps and challenges around finding people who can do these jobs. On the other hand, we’re pushing people out the door because of an old notion that they were no longer worthwhile.’

In contrast, a multigenerational organisation has the ability to put aside their ageist stereotypes, allowing them to tap in to a large and under-utilised labour pool, and accessing a valuable talent source that offers competitive skills and insights.

Inclusive teams

Here are the five characteristics of an inclusive team:

1. Embracing differences

I remember undergoing my teacher training, where I was working in a culturally diverse class. I was careful to ensure I treated everybody the same, aiming for fairness across the board.

Yet when it came to feedback, my mentor pulled me up on this. At first, I was confused — I’d been careful to make my classroom a level playing field. Yet this was the exact problem — instead of embracing differences, I’d willingly chosen to paper over them.

Often, leaders often stick to the same strategy and miss opportunities. However, an inclusive workplace recognises the value of generational differences, embraces them, and uses this variety to gain a competitive advantage.

2. Creating a team that is willing to share and learn from their differences

Curiosity is a key feature of an inclusive multigenerational team. Curiosity doesn’t just mean a willingness to learn, it involves approaching a new situation with an open mind. In an inclusive workplace, team members recognise that differences are not obstacles but valuable perspectives to be embraced.

Gina Pell likened these individuals to perennials — like evergreen plants, they don’t simply bloom in certain conditions. In a similar way, perennial employees transcend age-stereotypes, thriving regardless of the challenges or the generation they work with.

3. Compromise

In Lindsay Pollack’s book, she describes ‘The Remix’. If the manager is a DJ, and each of the generations is a music track, he/or she has the unique ability to mix all of these together into a wonderful soundtrack that includes multiple elements. Maybe you have that great bridge from soundtrack 1, or that catchy riff from soundtrack 2. Remixing is all about finding how you, the composer, can integrate your generations so that they truly work together to make something better than their individual parts.

4. Culture and design

A team that truly embraces age diversity should have inclusive practices implemented into their very core. This involves considering the way your office is designed (are your employees seated in age-collated groups?) Do your culture events cater to every generation? Do your wellbeing initiatives suit every age?

5. Equity, not equality

A truly inclusive leader recognises that the workforce has natural differences and variations. Each individual has talents and areas of expertise, while they may lack in other areas. An age-inclusive team ensures that no-one has less opportunities because of their age. This may involve recognising the need for personalised training to ensure everyone has the skillsets to allow them to perform their best in the office environment. A good leader will understand that everyone will need different accommodations to ensure allow them to have equal opportunities. It also involves scrapping exclusivity — only offering opportunities and training to specific cohorts.

Top three practices of inclusive teams

1. Mutual learning

Reverse mentoring programmes provide valuable opportunities for employees to tap in to the valuable experience of other generations. These initiatives are so successful they have been implemented at top companies such as Deloitte, PwC and Cisco.

2. Holding a space for unique viewpoints

A shadow board, or a generational roundtable; whatever the initiative, providing a space for diverse viewpoints to be shared, and unique perspective listened to is an invaluable practice of great age-diverse teams. Truly inclusivity doesn’t happen by implementing isolated initiatives, it must have the space to begin to grow and take root.

3. Checking assumptions

Identifying age-related assumptions, and having whole teams start to become aware of them, is the foundation of an inclusive team. It can abolish harmful stereotypes, which cause miscommunication or tensions, and encourage members to challenge their existing opinions by looking to better understand their team members.

Final thoughts

Embracing the multigenerational workforce means more than fostering diversity. It is a necessary undertaking for organisations who wish to remain competitive in a dynamic and challenging economic climate.