Big firms are trashing their own people assets

Age and experience exposes the naivete of youth Clip courtesy BBC's The Apprentice

By Neil Patrick

Recently I had some bad news from a friend. His wife had been laid off in a corporate restructuring.

This lady had spent over ten years with a global blue chip employer and through professionalism and hard work had risen to the position of Global Marketing Director.

She’d done absolutely nothing to deserve her ejection. On the contrary, she had been diligent and committed. Her results and appraisals had been excellent. Her colleagues thought highly of her.

Yet in an HR spreadsheet exercise, she and several hundred other senior colleagues were terminated. No ifs, buts, or options. Just out.

Age is always side slipped in diversity programmes

The firm’s plan was to cull the most senior and expensive people and hire younger – and of course cheaper people. Doubtless, someone had bandied around the term ‘Digital natives’ in the discussions about this decision.

Perversely, their website talks a lot about creating a more diverse workforce – yet this diversity appears to mean just gender and ethnic diversity. They seem to have forgotten that age is also a diversity issue and a protected characteristic in law (in the UK, under the Equality Act, 2010).

Money talks and…you know the rest

I understand a severance package (doubtless constructed with bullet proof legal advice) is in place. But this is not the point.

The point is that this is no doubt thought of as cutting out the dead wood and saving money in the process.

We need to look at people as part of the balance sheet more than the P&L

The second irony is that her employer is one of the biggest and most prestigious advisory and consulting firms in the world. i.e people you’d expect to understand that assets like people are part of the balance sheet (at least conceptually), not just a cost on the Profit and Loss account.

Older and more expensive people are more valuable than younger and cheaper people. We need them both and we need them to work together respecting and harnessing each other’s unique skills and aptitudes.

After so many years, my friend’s wife is older. She’s more experienced. She’s more valuable than however many cheaper young people they could hire instead. Perhaps not if this was a potato farm. But this is a global leader in knowledge-based advice and solutions for large corporations and organisations. They trade in intellectual capital. And intellectual capital isn't bought, it is grown and nurtured over years.

How many times do we hear CEOs spouting the mantra that ’Our people are our most valuable asset’?

That’s right. They are. And when you have invested a decade in nurturing an asset, surely it’s idiotic to just throw it away for a cheaper and less effective one?

But she’s in marketing; like its cousins, sales and advertising, marketing jobs are notorious for over-valuing one personal characteristic; youth.

Ageism is illegal in the UK. But it is also the last of the ‘isms’ to remain socially acceptable. And since it is so easy to fudge, many employers breach this law routinely.

So her chances of a rapid and smooth transition to a comparable role elsewhere are slim and will become slimmer with each month which passes.

There’s no such thing as a specialism where youth trumps everything else

Most people believe that marketing demands high creativity, high energy, media know-how. Exuberance and slick presentation skills don’t hurt either. These are characteristics which are incorrectly (see my post about this here), believed to be more prevalent amongst the young. The reality is something else. Effective marketing teams are experts at revenue generation; nurturing client relationships; data gathering and interpretation; brand building; managing specialist suppliers.

I work all the time with smart, enthusiastic young people who have marketing roles. They are wonderful. But they are also inexperienced and limited in their understanding of how to build successful businesses. They simply have not had the depth of experience to obtain the perspectives which I learned often painfully through 30 years of hard won experience.

Sure our world is transforming faster than ever before, but this doesn’t mean it is entirely different. The digital revolution doesn’t change the fundamental workings of economics and business, it just changes the ways in which these goals are attained. The Zuckerberg mythology is just that. Facebook is a success not because of Zuckerberg’s youth. It’s a success because he did better than his Silicon Valley peers…who guess what, were also young and inexperienced.

Youth alone is not a panacea for the digital age. The future belongs to those organisations who can figure out how to satisfy the aspirations and nurture the talents of young and old alike. It’s called ‘inclusivity’ guys…

Digital business is not at all beyond the comprehension of older employees. In fact I’d wager they could bring a good deal of common sense to some of the short sighted nonsense I see written about SEO, social media and other preserves of the tyros.

Please, please please, let’s stop believing that somehow culling the most experienced people is a recipe for progress.

It’s not. It’s like setting fire to your best work and flushing the ashes down the toilet…