the aging workforce challenge
Keith Michaelson and
Leslie Rittenhouse
H
ow do we prevent decades of
supervisory experience from
simply walking out the door?
How do we choose our next generation
of supervisors from within our work-
force? And how do we prepare people to
make a rapid and successful transition to
the supervisory role?
Like many electric utilities, American
Electric Power (AEP) is at risk of losing to
retirement many of its most experienced
supervisors. The median retirement age
at the company is 58.5, and with 10 years
of service, retirement is an option at age
55. In early 2005, the stark facts in one
of the company’s seven regional utility
units, AEP Ohio, reflected the situation
throughout the business: In Electric Dis-
tribution more than 50 percent of the ex-
empt supervisors of distribution systems
and 38 percent of the non-exempt line
crew supervisors were eligible to retire. In
the meter reading function, the number
stood at 37 percent.
Aging workforce issues are not new.
AEP’s human resource function has been
well aware of the numbers and the related
business risks. But progress on strategic
issues at the utility unit level requires a
planned and proactive approach, and in
a high-pressure, transactional environ-
ment, tackling the big issues has a cost.
The immediate job must be done—re-
sponding to personnel issues, imple-
menting affirmative action plans, track-
ing down the lost paycheck—or one can
quickly fall far behind. As a result, super-
visory development had continued along
in the traditional way. Exposure to lead-
ership training and experience was avail-
able only after promotion to the supervi-
sory ranks was offered and accepted. In
the best case, there was then a slow and
difficult training and ramp-up period; in
the worst case, the new supervisor was
not right for the job and the organization
lived with the mistake for years to come.
In October 2004, the AEP Ohio lead-
ership team identified the aging workforce
as one of its critical strategic priorities and
asked HR to bring together a team to
Reprinted with revisions to format, from the May/June 2006 edition of ELECTRIC LIGHT & POWER
Copyright 2006 by PennWell Corporation
tackle the issue. The team, which includ-
ed representatives from electric distribu-
tion, meter revenue, corporate commu-
nications and HR, was required to make
visible progress within 100 days.
the supervisory success plan
T
he team agreed that the central
issue came down to knowledge
management. The company had
no process for transferring decades of
experience to the next generation of
leaders. Leadership experience was
walking out the door, and people were
being promoted into supervisory jobs
before they were ready. But how could
the team make progress on this issue in
the next 100 days? As they struggled to
find a direction, the turning point came
with the concept of a “success plan.”
Rather than wait for positions to open up
at supervisory levels, they would give
people exposure to knowledge and ex-
perience by turning the supervisors eli-
gible for retirement into mentors.
Because this new concept would
be developed from the ground up, they
decided to put clear boundaries around
their work. They would start in two of the
company’s seven distribution districts
and focus on a few selected service cen-
ters. The specific goal was to have six line
mechanics in the Canton and Chillicothe
districts actively engaged in the new suc-
cess plan program within 100 days. This
goal implied a major undertaking for the
team that included defining the content
of the success plan, selecting the service
centers to work with, getting the buy-in
of mentors and participants, and get-
ting the development process under
way. Meanwhile, the daily work couldn’t
stop. The same group of mentors and
participants had to fit the success plan
into their already hectic daily schedules.
skeptics express doubts
E
arly discussions at various levels
of the organization provoked a
lively debate. Many people were
excited by the team’s ideas and goal;
others were skeptical.
According to the skeptics, there
were clear reasons the line mechanics
would never
agree to partici-
pate:
• Line mechanics
don’t want to face the peer
pressure around being promoted;
they’ll worry about being teased and
no longer being one of the guys.
• They worry that once they move up
to a supervisory position, they lose
the security of a union job; when lay-
offs come, they’ll be the first to go.
• The line mechanics assume that the
promotion belongs to the guy with
the most seniority and they won’t
want to buck the system.
• Taking the supervisory job means
losing overtime; no one will take the
pay cut.
As far as the primary reason super-
visors wouldn’t participate, skeptics said
the supervisors already were under pres-
sure to get the daily work done, that there
wasn’t time for an exercise that took time
away from completing the schedule. The
team listened to all the comments, but
made no judgments. They would have
to test these objections.
shaping the approach
T
he first step was to do a quick
survey. The team decided to
ask all supervisors, close to 75
in total, in their two pilot districts to
think back to what they went through
when they first took the job. What was
the transition like? What were the tough-
est challenges? What would they have
liked to have known before they took on
the new level of responsibility? To ev-
eryone’s surprise, the survey response
rate was huge: 89 percent of the super-
visors responded and many wrote de-
tailed descriptions of their early experi-
ences and how they felt the transition
process could be improved. The idea
around which there was the biggest
consensus was that each aspiring super-
visor had to have the help of a mentor.
Based on the survey results, the
team developed a first draft of the suc-
cess plan. This consisted of a list of
skills and experiences to be acquired,
the mode of delivery, and the group or
individual who would be responsible
for the delivery. Interviewing skills, for
example, would be taught during the
hiring process by the local HR repre-
sentative, and the grievance process
would be taught through a two-hour
discussion with the labor relations
manager. Some of the same supervi-
sors who were asked to complete the
initial survey were also asked for input
on the plan’s creation. A success plan
template would be used to track activ-
ity on the competencies, and a selected
mentor had overall responsibility to
ensure that progress was being made.
The Canton and Chillicothe dis-
tricts were chosen as start-up locations
because there was a significant aging
workforce issue to be addressed and a
supportive group of supervisors who
would buy into the program.
tapping an unexpected demand
T
o reach their goal of establish-
ing success plans for six line
mechanics, the initial idea was
to offer the program to senior line me-
chanic “A”s, who were viewed as hav-
ing supervisory potential. The team
wanted to test how much resistance
would really emerge to the idea of pre-
paring, in advance, for promotion.
When the team went to the local Can-
ton service garages to explain the pro-
gram, almost everyone, 27 out of the 30
line mechanics at all experience levels,
wanted to participate. In fact, it was a
few of the most senior mechanics who
opted out, paving the way for others to
take the initiative. Because they still
wanted the first phase to be a manage-
able pilot, and they were not clear on
how they would handle the unexpected
level of demand, the team committed
to enroll only one line mechanic in each
of the district’s five garages. The prom-
ise was made to enroll more people af-
ter the 100-day period was complete.
Similar commitments were made in
the Chillicothe district.
It was made clear to everyone that
signing up didn’t mean they were go-
ing to be promoted; it simply meant
they would be prepared when a posi-
tion became available. This would have
two important benefits for the business.
First, there would be much greater bench
strength as leadership and managerial
skills were shared with the workforce;
and second, there would be time to
evaluate an individual’s ability to absorb
the new experiences and thus improve
decision-making around promotions.
100-day implementation
D
uring the 100-day period, the
team coordinated the devel-
opment of the specific success
plans for the selected mechanics, iden-
tified mentors and helped ensure that
the participants were making tangible
progress. They also provided one-on-
one support to participants.
The success plan’s structure
and the deadlines for completion
meant that developmental opportu-
nities for the mechanics could not
be overlooked, as had often hap-
pened in the past. One mechanic sat
in on interviews of candidates and
then debriefed the experience with
the interviewing supervisor; another
had the opportunity to participate in
a pre-assessment event for potential
new hires. Other mechanics attend-
ed leadership classes previously at-
tended only by existing supervisors.
An important developmental experi-
ence that had often been overlooked
was the opportunity to be “stepped
up”—to take temporary leadership
of a crew when the supervisor was
not available. Using the success plan,
supervisors could provide the oppor-
tunity for a mechanic to complete a
developmental step while fulfilling an
immediate staffing need.
Enthusiasm for the process con-
tinued to grow as people saw that real
opportunities for growth were being
provided. Mechanics were asking for
more responsibility, and a number of
them started coming in early to check
what was going on during the day and
how they could move their success
plan ahead.
breaking the unwritten rules
O
ne of the project’s most impor-
tant results was that people
started questioning long-held,
limiting assumptions. Line mechanics
did want the opportunity for career
growth; long-time supervisors did want
to make sure their experience contribut-
ed to the business success and customer
satisfaction; and waiting until someone
was promoted into the supervisory ranks
to begin training wasn’t necessary.
The developmental experiences
helped the participants understand what
the supervisory role was all about. In some
cases they concluded that the role wasn’t
right for them, but this opting out was not
seen as a bad thing. Just the opposite: It
meant that the supervisory selection pro-
cess would have a better outcome.
expanding the impact of the program
W
hen the project’s results were
reported, all five of the re-
maining districts asked to be
involved. In the two pilot regions, the
commitment was made to add addi-
tional participants.
What had started as an effort direct-
ed at knowledge management and the
aging workforce had come to encompass
a number of other critical HR issues. Al-
though not the original intent, affirmative
action efforts, for instance, were enhanced
because a broader group of candidates
could be put in position for promotion.
The bottom line for AEP Ohio is
leadership bench strength. In the past,
training and development for mechan-
ics never extended beyond their techni-
cal skills. It is a fundamental mind-set
shift to say, “We don’t have to wait, we
can challenge our people to develop their
leadership skills as well. And we can use
an untapped developmental resource,
our most experienced supervisors.”
Keith Michaelson is with Robert H.
Schaffer & Associates. Contact Keith
at kem@rhsa.com. Leslie Rittenhouse
is a human resources manager at
AEP in Columbus, Ohio. She can be
reached at larittenhouse@aep.com.