The Value of Older Managers

Old leaders don't die, they just do things differently! Making a case for retaining our more mature managers.

Over the last 5 years or so, the media have infrequently highlighted the ageing workforce and its implications for future economic and social prosperity. Some commentators even acknowledge that scrapping workers aged 50 years or more is on a hiding to nowhere, and merely ignores the value of their years of work experience. Other commentators recognize that Australia needs to retain older workers in order to prevent a predicted shortage of skilled labor in the near future. What can't be denied is that older workers are important to ensuring that economic growth is sustained. This growth is often directly associated with innovative, dynamic, and creative qualities, which are more likely associated with younger and more energetic workers. Our premise is that older workers are just as valuable to economic and social growth, but that they bring different assets to the work place compared to their younger colleagues.

So we have two schools of thought here. One is to retain older workers in order to maintain some sense of economic growth, but we're not really sure of what these older workers contribute to the work place. The other school of thought is to replace older workers with younger, aspirational, and imaginative employees who should deliver long-term outcomes for organizations.

The research we have conducted in the Department of Management, Monash University, with the Australian Institute of Management - Qld & NT provides confirmation that older managers are just as vital to organizational outcomes. Indeed, our study (conducted with support from TestGrid Inc. and Genos) reveals that older workers have different skills to bring to the workplace. These skills may be just as important to organizational productivity, because they are based on years of experience that are just as powerful as are the creative and dynamic contributions of younger workers.

We surveyed both managers and their direct reports using a variety of on-line surveys and interactive intelligence tests which required completion in a set time frame. Managers completed a battery of surveys (two intelligence tests, and one on managerial effectiveness, including leadership style and emotional intelligence), and their direct reports completed one survey on manager leadership style and effectiveness. Managers and direct reports also completed a survey on psychological capital (which includes issues such as confidence, resilience and optimism), and direct reports also completed a measure of emotional well-being.

Although our sample was small (n=116 managers), we managed to obtain 45 matched sets of manager-and-subordinates data to help us verify the results. This sample was large enough for us to confidently detect differences between younger and older managers of around 9% or larger. Most of the older-younger manager comparisons were not statistically significant, indicating that either these two groups are not really different, despite common belief, or that any differences are relatively small (less than 9% magnitude).

When looking at the average scores, some showed modest differences between older and younger managers in the expected direction. So for a start, older more experienced managers recorded higher levels of crystalized intelligence – a type of intelligence that relates strongly to verbal reasoning, and is improved with education and practice. In contrast, fluid intelligence –the ability to solve novel problems using one's inherited basic reasoning ability – was lower among older managers, consistent with our expectations. In other words, if you want to get the best out of your organization's decision-making processes, younger workers may have a slight edge when it comes to developing new and innovative solutions, although the age-based differences were so small that a recruitment strategy based on managers' age isn't justified by this data. It is also important to note that a mixture of both problem-solving approaches often provides an optimum outcome.

In terms of leadership style, our study highlighted the importance of recruiting and developing effective leadership capabilities. Our data show significant correlations between leadership and of subordinates' psychological capital (akin to psychological "strength") and well-being. Specifically, transformational leadership (inspiring subordinates towards goals by helping them find meaning and significance in their work) and transactional leadership (use of appropriate performance-management strategies) were both important, but especially transformational leadership. Leaders with this style had subordinates with higher levels of hope, resilience, optimism and confidence. Their subordinates also reported higher levels of positive emotional experiences at work.

So having established the impact of effective leadership, we next tested whether older or younger managers have stronger leadership profiles. Surprisingly, we found no age-related differences in leadership style. This stands in contrast to other studies that have been conducted in the past, particularly in the US, where older managers tend to rate higher on these leadership styles. One explanation is that our study, being fairly recent, may reflect the impact of greater emphasis on leadership training at all levels and ages, throughout organisations, but also universities, schools. Even casual workers often benefit from a leadership component to their induction and training these days. So perhaps this has helped younger managers close the gap, and to adopt styles that are on average about as good as those of older managers. Conversely, it may be that our organisations have done a poor job at investing in the on-going leadership development of middle-age and older managers, leading to a stalling of leadership growth beyond middle management. Anecdotal evidence suggests that senior-level management development often focuses exclusively on strategy to the detriment of interpersonal leadership skills. This may have resulted in younger managers matching their older counterparts on transformational and transactional leadership styles.

So, the message from our study is that while there may be some slight differences, overall younger and older managers were surprisingly similar in their leadership and problem-solving profiles. Although there may be other reasons to target recruitment of certain age groups, there is not a strong justification on the basis of intelligence/problem solving or leadership capability. Further, this study highlights that effective leaders have significant impact on their subordinates, and so effective leadership should be developed and targeted in recruitment/selection, regardless of the age of that person. This adds to the enormous body of research here and globally that demonstrates the importance of good leadership on business outcomes. It is a reminder that we must take a serious look at the work our managers at all stages of their careers do in order to best position Australia to meet the global challenges of the next few years. The better prepared we are, the better we will cope with these challenges.

Professor James C. Sarros, Department of Management, Monash University,, (mob) 0439 343 825

Associate Professor Andrew Pirola-Merlo, Department of Management, Monash University (mob) 0425 853 490

Robin Baker, Research Assistant, Department of Management, Monash University (mob) 0435 073 247


Download and read the research paper here:

PDF The Impact of Age on Managerial Style [PDF; 834Kb]

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