The whole Gen Y thing really intrigues me.
On one hand I think the concept behind Gen Y is a complete myth, and on the other I think there is something compelling we can learn from.
In this post I cover the following:
- why Gen Y is a useless categorisation
- the coming IT crash
- why Gen Y will be especially disadvantaged, and
- some suggestions for how we can all best survive.
What the hell is Gen Y?
First some clarifications.
What is Gen Y? Ask this question and you'll get a variety of answers. Many will stick to definitions (eg they are born after 1980), most will point to (or at least mention) 'kids' who have grown up with a sense of 'entitlement', some will talk of young adults still living with their parents, a few will mention highly educated, and others will simply describe them as incredibly hardworking employees, determined to climb the corporate ladder. In technology circles you'll inevitably hear the equating of Gen Y with social networking, use of IM, etc and on it goes.
One article I read stated it like this: ...'we are talking about a generation of kids who grew up not being told what to do, but instead being asked what they wanted to do...'
In any case there seems to be no real consensus as to what Gen Y really is. Even Wikipedia is confused.
Gen Y is a crock
My opinion: Gen Y is a crock.
Instead of being representative of a certain demographic, if anything the Gen Y moniker is little more than an indicator of economic conditions.
But before elaborating, lets first talk about categorising people.
Ever noticed that we use all kinds of tests and criteria to analyse people, but invariably end up defining the sum of the person in little more than a few broad categories? There's usually 3 or 4 labels attached, all of which help us instantly pigeon-hole friends, family and colleagues (eg "...I'm INTJ, but he seems ISFP, I wonder how he'll deal with conflict...")
If you're especially lucky, your categorisation method can be neatly visualised with a circle cut in quarters... :-)
It's all good on paper, but in real life, categorising people is a waste of time.
There's benefit of course in being able to visualise a concept, but these days we take the visual-bites too seriously and start making all kinds of HR related policy decisions based on them.
The Gen Y concept is another of these useless categorisations, where we attempt to reduce a large and important section of society into an easily manageable idea. It's never that simple.
Some recruiters* have much to answer for, having propagated the Gen Y notion to silly extremes. Witness the rash of 'Investigative reports' into the mind of Gen Y and the special advice forums on how to recruit and retain the talent. Business magazines are no better, with in-depth articles on how to best accommodate the 'needs' of Gen Y in your organisation.
However, it's time we started challenging some of these 'findings'. For example, let's pick on this 'entitlement' notion we hear so often.
The truth is, economic conditions had much more to do with the trend than any Millenial mindset. Only a handful of 'kids' started demanding entitlements, and in a skills-shortage (eg the IT market, Financial services market, etc over the last few years) they easily got their way. Recruiters started noticing the trend and soon had a winning pitch on their hands.
But here's the thing: Tell a group of 20-somethings enough times they are special, entitled to promotions, deserve flexible working conditions, etc, and after a while they start to believe it. Start telling companies that are hiring that they should expect this, and incredibly... it happens. Now get those same companies to participate in surveys about the working conditions this new Gen Y group are 'demanding' and the myth propagates.
And the winner is...
Who wins from all this I wonder?
- Recruiters? Perhaps. If it results in a bigger package for their candidate (since recruiters are usually commission % based).
- Gen Y? Yeah, I guess, but there's a downside which we'll discuss in a moment.
- The employers? Not really.
Who wins? Well, nobody really. Nobody wins.
Which is why we need to kill off this silly Gen Y notion. And perhaps the coming crash will be the catalyst...
The IT crash is coming
Back in January we chatted briefly about the impending crash. Three months on and it seems a little more certain, especially when we start absorbing the scale of economic slowdown and the decline in venture capital. As economies in the United States and Australia slow, there will be significant impact in many sectors, but particularly affected will be the IT sector (we'll discuss why in a minute).
So, the discussion is no longer if, but when. Most people know that economic cycles happen in.. well cycles. So there is always going to be an end to the good times (and likewise the downturns will always pick up again). It so happens we've come to the end of a good time. Better start preparing for the bad times, because they are almost upon us.
Taking stock of the situation
Now's a good time to summarise some news themes of late (I'll simply mention what's happening - there's not enough space to discuss why it's happening):
Exhibit A: Venture Capital and Angel investing downturn
VC and angel investors ploughed $26B into 57,000 startups last year. But already the trend has turned. The latest reports show VC and angel investing down by 8.5%.
Exhibit B: Australian state economies slowing
This has been noted in business news sections a fair bit lately. NSW and Victoria economies for example are slowing, and already some of the larger accounting firms are looking to relocate staff to other states. But even though QLD and WA economies are growing they are much smaller than NSW and VIC and thus only able to absorb a subset.
Exhibit C: US economy
Open any business magazine or news section and you'll read how the US economy is stalling. Whilst initially reluctant to use the R word*** many economics commentators are now pointing to 4 quarters of negative growth...
Exhibit D: Silly money flowing
The TechCrunch lists and corresponding Deadpool should be red flags to anyone watching the industry. Every day a new company with very little to contribute starts up.
When you realise that the only reason for a company being in existence is because they are hoping to be bought out by Google, Microsoft or other large corporate, then you know there is a problem**. Those companies are never going to be sustainable in their own right.
Summary: In a down economy, with large corporates redeploying staff, venture capital drying up, but still IT startups surfacing (most on the back of misguided acquisition strategies), it doesn't take long to realise that IT is going to be hit hard. The fallout is unlikely to be the size of the dot com crash at the start of this decade, but it will be significant. The hot IT market of the last few years will quickly turn into a buyers market where employers have their pick of the best candidates.
Timing
It's anyone's guess as to when the real effects will hit. And I'd be foolish to make specific predictions... but I'm going to anyway :-)
For large Australian companies, my opinion is that we'll see rapid spending of remaining budgets from now until the end of June (when our financial year in Australia ends). After that there'll be plenty of 'revised' budgets hitting department heads. Look for layoffs to start appearing shortly thereafter.
For startups it's simply a matter of when the money starts running out. Most venture capital backed startups won't be renewed, and the Dead pool will grow rapidly. We're already seeing hints of this activity happening now.
For small to medium businesses, it will depend on who your customers are, and whether you sell features or benefits (more on this later).
The curse of Gen Y
OK, so let's assume by this point that we agree bad things are coming to IT. Cut backs need to be made, projects cancelled, and staff numbers cut. Who do you think is first in the firing line?
How about those new, entitlement seeking up and comers we keep having to satisfy...? Yes, even though Gen Y is a myth, the notion has been so well swallowed that it will come back to bite. When a sector like IT moves from a sellers market to a buyers market, discussions about entitlements don't get much air time.
The sad thing about this of course is that just being labelled Gen Y will be a disadvantage. An otherwise hard working professional will be tarred with the same brush as those IM using, web surfing, Facebook browsing, entitlement seeking, corporate climbers we've heard so much about.
What to expect
Dinner party conversations are already discussing how for the first time in a 'generation' we are going to see highly employable people out of work.
Sure, we've got some general unemployment, but for those in skilled professions it is reasonably easy to get a job. Perhaps that's part of the reason we think there's a whole generation of young adults who think they are 'entitled' to a job - it has never really been that difficult to get one.
This year however we are going to experience, for the first time in a decade, a time when young adults won't be able to get a job. This is going to be a huge shock for a certain segment of society.
The rest of us of course, used to working hard, and being paid for a fair days work will continue on unaffected right? Not so fast...
Is it just Gen Y?
No it's not just Gen Y of course. It will be a time when companies undertake necessary cleanups, and people are trimmed at all levels. The usual chops of middle-management will feature prominently, and under-performing CEOs will be unceremoniously shown the door. But there will also be a large swathe of junior staffers that are all cut back.
And here's my point. Once this cycle has been completed, and the transition has been made, there will no longer be any notion of Gen Y. All those ideas of entitlement will be long gone.
It will be the death of Gen Y.
Moving on...
Surviving the crash
Keeping your job during a downturn is a combination of having the right attitude and working for the right company.
The following points are specific to IT but could be applied in general with a few tweaks.
Remember though, good people will be lost. Like all things in life, there are no guarantees, which is why sadly, even great companies have to trim back great workers in tough times (see Sun's recent announcement along these lines for example).
The following is merely a few thoughts to consider, all other things being equal:
Make sure you are working for the right company
1. Work for a company that focuses on benefits instead of features
Here's how to distinguish between the two:
- Features are things a vendor thinks are cool.
- Benefits are things a customer thinks are cool.
- Benefits fix pain points.
- Benefits are easy to express in dollar terms (we'll save this much...)
So, if you find a vendor doing all the talking about how cool their product is, then they are probably fixated on features. But if you hear their customers talking about how cool their product is, take a closer look. They may be the type of company you want to work for...
Ideally what a vendor thinks is cool and what the customer thinks is cool will overlap, but in practice many vendor features are of no real business use.
Example 1: Most social networking sites are little more than features, they provide no real benefit. In 12 months time many of them will be gone.
Example 2: As much as I hate to say it (here's why), targeted internet advertising is a benefit - it solves a real pain point that advertisers have (ie not being able to reach the right audience)
Example 3: Being built on a particular technology (eg .NET, Java, Silverlight, AIR, etc) is a tricky one. It can be a benefit depending on existing infrastructure and other customer requirements, but is often only a feature.
Features are nice when times are good, but in economic downturns and IT spending cuts, companies only spend on benefits. So make sure your company, or the department you work for, is actively providing benefit to it's customer base, whether that be internal or external.
Summary: Find a company that focuses on providing a service or product(s) that benefits its customers/users.
2. Work for a company that invests in R+D during a downturn
If your company makes it clear that it will continue to invest in R+D during the tough times ahead, this tells you two things. Firstly, they have the financial strength to continue, but secondly and more importantly, they have the leadership 'balls' to take the long term view and be confident in their business. This is a company you want to work for. (Example)
Make sure you are working right
3. Work hard AND work smart
I know this sounds like common sense, but it needs to be said: Be passionate
I'm amazed, and perhaps a little disappointed, at how many developers I know who treat their livelihood as a 9-to-5 job. They rarely invest in: self-learning outside of work hours, attending user groups, trying new stuff or even thinking in new areas. They seem content to simply coast along. And these are smart (sometimes very smart) individuals. Yet, without passion, they will never make it too far in a downturn.
Also, be wary of misunderstanding books like The 4 Hour Work Week. People can be tempted to think the book is promoting a way to escape doing work (ie how to get paid to be lazy). This is a mistake. The value of the book is best summarised as Effectiveness trumps Efficiency. That is, often we get really good at doing things well, they just happen to be the wrong things. We need to focus on doing the right things. That's the 'work smart' part.
4. Be a solution provider
Telling your boss or customer about all the problems with an idea will not get you far. Instead they will be relying on you to find answers. Don't be the 'ideas man' - instead make sure you are the 'solutions person'. Anyone can come up with great ideas - but few can execute them well.
You want to be the person, that no matter how hard the problem, your boss knows she can hand it to you and be confident you'll take responsibility for the task, investigate it and provide a real solution.
Closing
Gen Y is a myth. It's an inconsistent bunch of ideas about how a certain demographic behave. But it's coming to an end. The coming IT crash will dissolve any notions of entitlement we may have thought existed and instead bring us back to reality. It's going to be a tough time for many, including the so-called Gen Y. Companies and staff need to work hard and act wisely.
No matter what demographic you fall into, now's the time to make sure you are working for the right company. And if you are, make sure you are working hard on the right things.
Notes:
* Not all recruiters are bad in my books, just most of them :-) I admit that I give recruiters a hard time, and it of course doesn't apply to all, but I think it applies in general.
** Every company should have an exit strategy. But to survive companies must also provide value and contribute something meaningful.
*** R word = Recession
