Copyright 1999 by Scott Hays
Magazine: Workforce
Topic: Generation X and the Art of Reward
Byline: Scott Hays

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For all the pop-psychology surrounding Gen Xers as "slackers," this particular group of mid-20 to mid-30 year-olds has finally come of age in the workplace. Yes, it’s true. Beavis and Butthead have gone corporate. And whether you care to admit it or not, members of Generation X with their "whatever" attitudes will doubtless continue to play a unique role in your company’s future.

That is, if you can manage to keep them motivated.

Their numbers alone (roughly 16 percent of the United States’ 270 million people) should warrant your careful attention to the pros and cons of employee-incentive programs. And while we all have similar needs and desires in the workplace, Gen Xers carry the added burden of growing up during rampant corporate downsizing, which turned the notion of job security into one BIG joke. "Gen Xers grew up in a different world," says Claire Raines, co-author of "Generations at Work" (Amacom, 1999). "They have different definitions for leadership and loyalty and incentive rewards. Work isn’t the No. 1 most important thing in their lives."

Instead, Gen Xers commit themselves to this whole notion of work/life balance. For example, while boomers (mid-40 to mid-50 year-olds) have gotten into the habit of working that extra hour at the end of an eight-hour shift, Gen Xers tend to have someplace else to go -- whether it’s to night classes or to Vail for extreme snowboarding. Unless, of course, you’re willing to pay them for the overtime. Otherwise, as long as they get the work done, what does it matter how and where it gets done? If they do it at home, in the car or on a cell phone while telecommuting, they think that’s their business, not their supervisor’s. At least, that’s their attitude, say some experts.

Not to stereotype an entire generation. But when it comes to rewarding and motivating Gen Xers for good behavior, even the experts suggest you consider this particular generation’s nontraditional attitudes about time and space, freedom and flexible work schedules. "Anything that makes work less corporate resonates well with a generation that feels betrayed by corporate interests," says Raines.

Read between the statistics
Generation X experts have noted all this already, and they’ve noted how -- despite the media dubbing them slackers (as if they were too busy to do anything more than play computer games and watch television) -- Gen Xers are typically self-reliant and entrepreneurial in spirit. And this puts human resources managers at a slight psychological disadvantage because motivating employees who would rather go into business for themselves than work for someone else can become a major challenge.

According to a cross-section study of generations at work by FORTUNE Personnel Consultants (FPC), a national franchise network of executive search firms headquartered in New York City, even though there are important similarities (work ethics, loyalty, work styles) among age groups that can reduce angst for HR managers, Gen Xers are much more likely than any other generation to leave for a more challenging job. They’re also the most likely group to leave a company for a higher salary and better "bennies," such as flexible work schedules.

It’s little wonder, then, that Gen Xers tend to be financially engaged and work-oriented, but they also want their flexibility and freedom, too. In fact, Gen Xers are gearing up for more heated professional lives. More than half say their jobs will be faster-paced in 10 years. A full quarter believe they’ll have their own businesses in 10 years, and another 16 percent say they’ll eventually be doing consulting and freelance work.

So, in sum, human resources managers who can identify the motivational factors that vary by generation will be better-equipped to recruit and retain the best candidates. "The workplace is accelerating. People are living turbo-charged lives. It’s crucial employers know what drives employees to stay or leave," says Ann Piacentini, director of market research strategy at Scudder Kemper Investments, a New York City-based global money management firm. "The future of Gen Xers is more freelance work and telecommuting. Employers need to accommodate the work and lifestyle changes of the younger generation in order to retain talent. If we don’t shift to accommodate these needs, we’re going to lose the talent we have."

This point is worth emphasizing. Gen Xers tend to describe themselves as techno savvy, aggressive, cynical and realistic, according to "Generations @ the Millennium," a survey conducted by Scudder Kemper Investments. In jobs, they embrace risk and prefer free agency over loyalty to a particular corporation. And they would rather volunteer than vote. This helps build the foundation from which HR managers can develop employee-incentive programs.

Who needs what, and why?
So the obvious "HR Insider"-type question is what do Gen Xers themselves want by way of an incentive program that motivates productivity and good behavior? This is a legitimately interesting question, although, given the extreme unpredictability of stereotyping a whole generation, it’s probably more realistic to ask someone who’s been there. A member of Generation X, if you will.

Heather Neely is a Palo Alto, California-based consultant who specializes in the working styles of Gen Xers, and is a member of Generation X. "Managers need to realize we’re the first generation of workers who’ve come in after years of corporate downsizing," she says. "We’re going to have different expectations in the workplace. We’re not expecting long-term employment anymore. Rather, we’re looking for daily proof that our work matters. It’s about creating a new type of security. Of course we want to make a good living. But if managers reward performance with only money, in many ways they’ve lost the war because we also want freedom and flexibility in the workplace."

John D. Willard is executive co-director of the Annapolis, Maryland-based Generation X Coalition Inc., and is a member of Generation X. He agrees that his generation tends to focus on long-term rewards like opportunities for ownership rather than on short-term rewards like cash bonuses. "I hear management consulting groups try to interpret us as greatly different from other generations, like we want nose rings and trips to Hawaii. But I don’t think we’re much different," he says. "Sure, we want good benefits. It’s just that the older generations were content with being part of the big company. We’ve had to deal with the ups and downs of getting hired and fired more rapidly than any other generation. If you want to motivate us, get us more involved in the decision-making process."

Then again, there are some needs and desires in the workplace that transcend generations. At the Dallas-based T.G.I. Friday’s, a chain of more than 500 restaurants, the company’s top workers (whether they’re servers, cooks or dishwashers) can choose to work at any Friday’s restaurant around the world. The program not only addresses a generation’s desire to play -- it also rewards work well done.

"Don’t get me wrong," says Willard. "Money works. Reassignment to a great location works. But these things aren’t unique to our generation. It’s only by getting the buy-in with a company where we have a meaningful part of the decision-making process that we end up with a greater sense of security."

Recognize Gen Xers
If you think about it, the so-called nontraditional attitudes that make work feel less corporate for Gen Xers -- ideas once considered arrogant or youthful or rebellious -- have become, well, mainstream. Like it or not, they’re here. Gen Xers. And they’re here to stay.

Deborah Masten is communications and human resources development director for Plano, Texas-based JCPenney. She says her company first identified the need to understand the differences between generations about four years ago, when store managers started complaining about Gen Xers who lacked a healthy work ethic.

"We couldn’t figure out how to keep them motivated," she says. "We quickly learned by working with a consultant that you don’t lead this generation by example, you lead by interaction. They want to know what’s expected of them, and they want accurate and timely feedback."

Gen Xers account for roughly 27 percent of the 200,000 JCPenney retail and catalog workforce, says Masten. As a result, the need for new ways to motivate this workforce became a priority. So the company set up a program where managers can click an icon on their PC screen, log on using their Social Security number and access the company’s knowledge-management system to learn more about how to motivate employees.

"For example, Gen Xers like to decide on their own how something should be done," says Masten. "So we teach managers how to allow them a little flexibility and creativity. You want to be a resource for them, but you don’t want to detail everything for them. We also found that by providing them with lifelong learning opportunities and after-hours education, they’re more likely to be engaged mentally, as well as physically. Gen Xers tend to be self-reliant. They realize the only person they can rely on is themselves, so we give them opportunities to develop their own skill-sets."

"Gen Xers have come of age during the most profound changes in the economy since the Industrial Revolution," says Bruce Tulgan, founder of New Haven, Connecticut-based consulting firm Rainmaker Thinking, and author of "The Manager’s Pocket Guide to Generation X" (HRD Press, 1997) and "Managing Generation X" (Capstone, 1996). "All of the forces shaping the economy and the workplace are the forces that have shaped Generation X. Instead of trying to get people to pay their dues and climb the corporate ladder, I urge companies to get creative at managing a fluid talent pool."

To that end, managers need to get over the misconception that Gen Xers are disloyal and not willing to pay their dues. Doesn’t every generation clash with the generation in power? Secondly, you have to realize that today’s workers, in general, have more negotiating power than in the past, and the most talented people are going to drive a harder bargain. "If you want to retain Gen Xers, you’d better be prepared to negotiate salaries and work assignments with them, and every day," says Tulgan. "The days of annual pay raises are over."

So what can you do to motivate and retain Gen Xers? Tie rewards directly to performance. Accelerate the timing of rewards -- immediate rewards are the most effective. Expand your repertoire of financial rewards, and consider things like short pay-increase cycles. Support work/life balance by increasing employees’ control over their creative space. Fill the workplace with training resources and give Gen Xers the remote control. And no matter what you do otherwise, the No. 1 factor for motivating your workforce is the relationship between manager and employee, says Tulgan. "Your day-to-day coaching style needs to be prompt and fast."

Tulgan has identified six non-financial rewards for Gen Xers and free agents of all ages:

• More control over their own schedules.
  
  
• Access to marketable skills.
  
  
• Exposure to decision makers.
  
  
• The chance to put their names on tangible results.
  
  
• Clear areas of responsibility.
  
  
• The chance for creative freedom.

"Generations at Work" author Raines suggests creating a culture that not only focuses on what needs to get done, but also accommodating the various ways in which people approach work. "The most important thing for human resources managers to remember is that if you’re a boomer, these younger folks are just like you when you were in your mid-20s to mid-30s," she says.

Sure, it’s different from generation to generation. Boomers, for example, may like the status symbol of promotions or first-class airfare. Gen Xers may prefer rewards less tangible but no less important to them, like free time and flexible scheduling. If one company says, "This is the schedule. Take it or leave it," Gen Xers may just leave it.

You could call this attitude arrogant. But members of Generation X -- the so-called disenchanted, disenfranchised generation -- finally grew up and sought "real" jobs. And even though they feel as if they can’t rely on institutions to be the foundation for their success and security anymore, they still want to hang on to something, anything. "You learn to feel like you have to fend for yourself, and this independence goes along with our willingness to walk away if we’re not happy in a situation," says Tulgan. "Managers can’t manage by fear, anymore. Long-term rewards, 12-month reviews and annual raises and bonuses are obsolete. So stop managing time and place, and start managing people and performance."