With up to 4 to 5 generations making up our workforce today, differing attitudes toward risk can often create conflict, without even realizing the source of this tension. These perspectives are shaped by the economic and historical experiences each generation and their families had to navigate in their formative years.. Understanding these perspectives is key to turning potential conflicts into opportunities for innovation and growth. Here is a broad stroke overview of the factors that shaped each generation. This is a generalization, but offers insight and context. It will be important to use this information to nurture understanding rather than strengthen bias or stereo-typing.
Baby Boomers: This generation is shaped by post-World War II economic growth and stability and hearing the stories of the poverty and suffering brought on by the great depression from their parents and grandparents. This generation will often favor risk-averse strategies. Having witnessed significant corporate and financial success through consistent, incremental efforts, and fearing to repeat what their predecessors experienced, Boomers may lean toward tried-and-true methods in favour of maintaining stability.
Generation X, growing up during periods of economic uncertainty like the 1970s energy crisis and early 1990s recession, developed a pragmatic approach to risk. They are skeptical of pipedreams and good intentions and prefer to do the hard work of creating a plan B. They may tolerate moderate risks but prefer thorough evaluation and clear contingency plans before proceeding.
Millennials entered the workforce during the recession of 2007-2009, experienced the fragility of traditional stability firsthand. This has driven their preference for calculated risks, particularly when pursuing innovation or aligning with values such as sustainability and equity. The Millennial approach to risk is more open hearted and innovative resulting in a less linear approach to solving problems. They value the real-time approach of evaluating and iterating as they go.
Generation Z, raised in a rapidly changing digital world and amid global crises like climate change and the COVID-19 pandemic, are often the most comfortable with risk. They are bold advocates for disruptive change and quick to adopt innovative solutions. In fact, older generations' seeming tolerant approach to toxic environments and ineffective strategies for the reason that they are stable seems baffling to this younger generation. Gen Z is willing to do the work of breaking something down and rebuilding something new. This generation is often judged for this approach as lacking wisdom, however their understanding of current trends, new technologies, and passion for wellbeing means dismissing their input, also means dismissing significant opportunities.
“Our culture is developed by default or design. If we are not intentional about the culture we create in our workplace, our culture will evolve and potentially sabotage the very thing we are trying to build.”
Let’s take a look at 3 areas where we see this tension show up and strategies we can use to design the workplace environment where every generation can bring their best to the table.
Workplace Impacts of Differing Risk Tolerance
Decision-Making Conflicts: Disagreements may arise between those advocating for rapid innovation (Gen Z, Millennials) and those preferring steady, cautious progress (Boomers, Gen X). This can become combative, tempting some of the older generations to resort to command and control or hierarchical/authoritative tactics to bring resolution. This approach only increases the tension and generational gap.
Resistance to Change: Generations favoring stability may perceive risk-taking as reckless, creating friction in teams. While younger generations convinced their new perspective is the right one may struggle to listen to the wisdom of older generations and find compromise in solutions. Resistance to change affects all generations equally and must be navigated.
Innovation Challenges: Hesitation to embrace risks can stifle creativity, while unchecked risk-taking can lead to poorly executed initiatives. Innovation often drowns in the tension of these conflicts. This is where the opportunity to leverage the brilliance of each generation becomes critical.
Strategies to Leverage Differences
Create Balanced Teams: Pair risk-takers with stability-focused colleagues to combine bold ideas with careful planning, fostering innovation without unnecessary exposure. Encourage a mutual mentoring model that strengthens collaboration and improves understanding and communication.
Nurture Psychological Safety & Emotional intelligence: Investing intentionally in training that nurtures healthy relationships and communication becomes critical to leveraging the valuable perspectives each generation brings to the table around the topic of risk. Concerns around risk cannot be addressed through edicts and demands as this simply nurtures division. Meaningful and healthy engagement practices become critical in harnessing generational wisdom.
Implement Pilot Programs: Create opportunities for your balanced teams to use or create small-scale tests for new ideas to satisfy risk-averse individuals while allowing risk-takers to experiment and innovate. This provides immense experiential learning which is vital for all ages, and supports trust building and communication. Follow each test with a robust debrief, affirming and recognizing the contributions of all team members and iterating on the best parts of this learning.
“Culture shifts like this one take time and effort, but the payoff and ROI has been proven to be worth it! Organizations such as Canada Life, Dupont, Prudential Insurance and Citibank report positive ROI in the range of $2 to $6.85 savings for each $1 invested in employee wellness (Makrides, 2013).”
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