Millennials can get a bad press as employees, being called lazy, fickle and narcissistic. But could adapting to become the type of company which Millennials are queuing up to work for give a business a competitive edge?
Despite their detractors, the Millennial Generation, generally defined as people born between 1980 and 1999, are making up an increasingly large proportion of the workforce. By 2025, they're expected to comprise 75% of all British employees but Generation X and Baby Boomer managers and directors aren't necessarily adapting workplace practices to reflect this.
What Millennials want out of their jobs underpins their status as optimistic idealists, even if many have had to compromise to get on the career ladder. The most important factors which attract them to jobs are innovation, flexibility, opportunity to progress, training, development and ethical practices. Innovation, CSR and career progression are rated as being more important than remuneration, meaning that the days of expecting a healthy pay cheque to motivate employees even when their other needs are not being met are over.
But how can they create more competitive businesses?
Innovation can easily become a meaningless buzzword, but it's the driver behind countless corporate success stories, from world leaders like Google to ambitious start-ups. Innovative companies nurture an intrapreneurial mindset, where employees of all levels are encouraged to contribute ideas for new projects, services and approaches to work.
When Microsoft recognises that it needs to harness the power of its employees to collaborate and create new products in order to survive, it's time for all businesses to consider whether they're overly focused on delivery as opposed to discovery. Companies might be able to get away with this when they're running on a growth streak but in the long-term a failure to be responsive to market and social changes can be disastrous - just look at Kodak or Blockbusters.
For more hierarchal companies allowing junior employees a bigger voice might seem alarming, particularly as innovation brings the risk of failure along with a willingness to disrupt established systems. The success of Amazon, SalesForce, Netflix and Hermès, currently rated by Forbes as some of the world's most innovative companies, are a strong motivator.
As a side note, this type of culture taps into Millennial's attraction to entrepreneurship too.
Robust corporate social responsibility schemes that focus on sustainability and ethical practices make sense from a business perspective too. In the UK consumer demand is the main force behind adopting CSR programmes, followed by employee retention or recruitment and cost management.
As Millennials' economic power grows both business-to-business and consumer brands need to be aware that ethical policies will be expected as standard. This doesn't have to be a cost - energy saving and environmental schemes can deliver vital economic efficiencies.
Millennials want frequent feedback and expect opportunities based on merit, not length of tenure. Although this can seem needy, even entitled, to some older workers, there's growing evidence that the traditional review system is broken. Only 8% of companies feel that their review system adds value and a third of workers say that it's unfair.
Some companies like Microsoft and Kelly Services are moving towards more flexible, employee-driven systems which get rid of ratings and include regular dialogue throughout the year. They report that this is stimulating innovation and collaboration and decreasing unhealthy internal competitiveness.
If employees have to wait for an anxiety-inducing annual interview to discuss their career ambitions with anyone in the company, the chances are that they will simply have the conversation with a recruiter instead.
It's not just Generation Y who want flexible working - more than half of Baby Boomers and Generation X do too. In fact Generation X, born from 1965 to 1979, are actually keener than Millennials, which perhaps isn't surprising given that many in this age group are raising young families. As more Millennials become parents themselves it's reasonable to assume that this will become even more important.
From job-sharing to working from home and flexible working hours, adaptable working practices could enable companies to keep top talent and act as a desirable employee incentive. As a 2012 McKinsey study showed that companies with diverse boards perform better, it's sound strategic sense to introduce policies that make it easier for mothers to stay in their jobs.
Companies that adopt these policies are more likely beat the odds that say over half of Generation Y employees are expecting to change employers in the next two years. More importantly though, what Millennials want out of a workplace aligns with some of the leading strategies for creating successful business models.