It comes as no surprise to anyone that different generations think differently; they demonstrate completely distinctive decision-making mechanisms in the same situations. Because of this, increasing numbers of companies are researching this topic. The traditional and very general X/Y/Z approach is no longer an answer for weighty strategic issues; top decision-makers operate with short-term solutions based on in-depth analysis.
One system with a deep background divides generations into 12-year periods and 4-year sub-terms. They collect exceptional socially and sociologically events in a database to analyse how those events impact the personality and behaviour of populations. Thanks to this methodology, we can analyse an individual’s decision-making factors, including the additional effects thrust upon them based on the 4-year sub-term to which they belong. Obviously, generational influences do not completely override the decisions motivated by our own personalities. Still, they can be pivotal factors in everyday business decisions and can also have a severe impact on behaviour during a crisis.
The system includes the generations that are most active in business today: The Authoritarians, born between 1949 and 1960, The Precisionists, born between 1961 and 1972, The Diplomats, born between 1973 and 1984, The Ambitionists, born between 1985 and 1996, and the Followers, born between 1997 and 2008. It then subdivides the 12-year periods into three 4-year sub-terms for more precise zoning. For each person, the social, sociological, and historical influences that impact their 12-year generation or 4-year sub-term have a consistent effect on decision-making mechanisms. The first four-year sub-term of a given 12-year generation always has some commonalities with the previous generation, but they already show the markings of their own generation. Those belonging to the second four-year period exemplify the personality traits of their generation, which is readily apparent in their decisions. The third four-year period, in addition to the features of their own generation, are already starting to display features of the upcoming generation. Thus, those born in the first four-year sub-term can relate more easily to those born in the generation before them. Likewise, representatives of the third four-year sub-term better understand the generation after them. The middle four-year sub-term, which has “pure” generational effects, is usually the least understood part of a given generation, yet they typically control their generation. There are more aspects to the theory than this basic introduction, but it is clear that when planning business strategy, this in-depth knowledge provides fundamental support for decision-makers.
The History of Generations and The Authoritarians (1949-1960)
Understanding the intergenerational mindset is a critical point for those in decision-making positions, as, on the one hand, the manager sees their own decision-making mechanisms more clearly. On the other hand, they can take into account how and why they think differently when evaluating other generations. Thus, it is understandable why this research has become a defining element of modern business strategy-making. Whether it’s B2B or B2C, defining decision-making of consumers, finding their points of influence, and making a tangible impact on them are the real challenges. And an integral part of this method is the generational knowledge base. Whether one is defining a target group, developing a product, building a brand, drafting communications, or planning a sales strategy, each business module must take into account the different mindsets of those born during different periods.
Then we have the HR field, where generational differences have significant impacts in various areas of organisational development, such as teambuilding, leadership selection, and conflict management. If we want to present the background of the generations briefly, we can say that the Authoritarians believe in hard work, plain and simple. Even when we talk about leaders, a heavy time investment is what is expected for success. For them, physically tangible things take precedence, and there is a strong emphasis on human relationships. They can develop and keep their organisation together with empathy and the creation of a stable background. While they are not traditionally proactive decision-makers when it comes to business matters, they do build with the long run in mind, and have been successful at building large companies. Change is not their forte; they like to move within known environments, to apply already proven methods and systems. However, they are powerful characters. Perhaps their greatest weakness is that they expect respect from everyone because of their age. Thus, generations who prefer results, knowledge, and the ability to constantly change can have serious conflicts with Authoritarians, as these young people do not respect age alone. They focus on current performance. They don’t care who achieved what decades ago; they care much more about the present and future. And because the Authoritarians have, in many cases, built their careers in a self-taught way, they never acquired real management knowledge, making strategic change increasingly difficult for them. Their organisations fail in most cases where standard solutions are not enough.
The Precisionists (1961-1972)
Learning from the example of The Authoritarians in front of them, this Generation put serious energy into education. They wanted to become real managers, and because of that, they had easy access to the most prominent companies. In addition to their own personality traits, they always have an extra maximalist expectation of others. They built their careers on the traditional path, often starting from the bottom and climbing straight up the proper career ladder. Their way of thinking is professional, and their decisions strongly reflect their analysis and evaluation of details. This is often their biggest problem: they can’t see the forest for the trees. They were perhaps the biggest losers of the 2008 Great Recession on an international level, as their previously well-functioning, perfectly constructed worlds were not prepared for dire events. Moreover, technology and business sciences have evolved a great deal in recent decades, so their once-impressive education quickly lost its relevance. Change is not their strength, just like the previous generation, and they are on the more inactive side of the psychological circle.
The Diplomats (1973-1984)
This generation has made an outsized difference in the business world. Due to the social effects, their thinking shows disparities compared to that of the two generations that preceded them. Most of all, they believe that everything can be faster and more global. They also profess the need to get out of the cage of precision, to eschew physical limitations, so they can think more freely and dream bigger. They feel right at home when networking, and their often-superficial relationships work very well for business purposes. Their technological knowledge, global awareness, or even their language skills in non-English-speaking countries have brought them significant advantages in corporate cultures. They are characterised by rapid career-building. Many times, they leapt up two or three rungs of the career ladder at a time, skipping the generations that preceded them. This generation has produced many great, young, top leaders. This is due to their strong communication, influence, and manipulation abilities. Early in their careers, they adapted well to the older generations, and as soon as they saw an opening, they immediately jumped in to replace the older generations. We can’t talk about the Diplomats without mentioning the startup world. After all, it was almost entirely shaped by them. After all, this generation is very creative; they love change and dynamism. Of course, they are often quite superficial, thanks in part to the fact that investors ate up a lot of startup ideas with a big spoon, even though they had neither a market nor a customer base. However, they also launched the startups that had the greatest impact on later generations, such as Facebook or Spotify.
The Ambitionists (1985-1996)
The incomprehensible generation. Many call them that. Traditional generation theories fail them the most, as they cannot explain the severe differences found in this generation when compared to representatives of any other generation. They have a high level of dominance and autocratic features. They grew up on social media, seen all of its drama, and while they can perfectly apply these tricks, their need for raw honesty is exceptional. They have considerable strengths, but in most cases, they cannot take advantage of them, often because of their intolerable behaviour. They are headstrong and demanding. This generation is heavily influenced by the world of talent shows, as it has burned a distorted image in their heads that encourages them to stand on the stage, even as a “nobody”, in hopes of becoming “somebody” within weeks. They want to accumulate a lot of money, make a ton of interviews, and immediately build up a secure background. And let’s face it, many have succeeded. But what about the 90% who never, in fact, had a chance? They are angry, often envious. And rightly so, in many cases, because in their workplaces they see underqualified Diplomats in management positions with high salaries, even though that generation is less skilled. Moreover, there is a prejudice against them as business owners.
They think in black and white terms. When they arrived in the job market, other generations immediately labelled them as caring about one thing: money! Of course, this was already debated by serious experts, because the statement is not correct in this form. For the Ambitionists, idols are paramount. They want to move quickly; they are impatient, which is why they want to learn from the best. By the way, their idols are usually Diplomats, since the two older generations are not at all attractive to Ambitionists. Those generations achieved their goals slowly, they had to build towards them for a long time, persistently, and there is no time to do so in the present world. They have huge egos, and this is often their downfall. They had to start their careers during the Great Recession, which, frankly, is by no means lucky. Their loyalty is lower than that of previous generations, so by 2020, many companies have had enough of their perpetually dissatisfied attitudes. Generational analysts consider the Ambitionists to be the biggest losers of 2020. The advantages they had — technology, social media, etc. — are already bigger advantages for the Followers (1997-2008), also known as “The Social Generation”, who are much more likeable. For these reasons, companies are beginning to cast Ambitionists out of the workplace in large numbers.
Intergenerational tensions are higher than ever because of the COVID crisis. The Authoritarians and the Precisionists, two relatively passive generations, are facing the greatest challenges because changes are needed that have never been seen before by a living person. The Diplomats were the biggest winners of the Great Recession, and experts predict that it will be no different now, only the victory will be even more spectacular. The generation in greatest danger, however, is the generation that was once thought to have the greatest potential, the Ambitionists. As I mentioned in the introduction, generational effects add an extra layer of influence on our inherent, personality-based decision-making mechanisms. We see that the most successful members of any generation are those who are perfectly aware of their generation’s weaknesses, so they pay very close attention to avoiding their generation’s pitfalls. So, if someone is born in a particular generation, it does not dictate their success as a manager. It just means that they have different types and degrees of challenges, but this is where intelligence and will intervene, which is always defined at the individual level.