Demographic shifts are important to understand. They impact buying behavior, social viewpoints and define market needs. The Baby Boom generation was huge in America – Nearly 72 million. That generation is now retiring and getting older. As they do, they are driving much of the debate around health care in the USA. The next generation, Generation X was one of the smallest in US History. They gave us grunge music and the early internet. The Millenials are currently the largest generation in American History; with approximately 78 million members. They’re in workforce now and will continue to do so for another 7-10 years.
But what comes next? And not just in America, but in the world?
I am a Gen Xer. I am sandwiched between the two biggest generations of American history. On the older side of Gen X you have the Boomers – 76 million or so people born between 1946 and 1964. On the newer side of Gen X you have the Millennials – 78 million people born between 1980 and 2000.
According to TimeWarner research in 2007, Boomers value function over form.
Similar research about Millennials 5 years ago found that they are aggressively connected socially through technology and that content takes center stage for them. 5 years ago they were advertising and content entrepreneurs that are moving into the mainstream. The study also stated that “Success with young people as customers flows from one’s success in attracting, retaining and engaging Millennials as employees.” (cites below)
Skip ahead to 2012. The characteristics of the generations identified 5 years ago are at the core of what we experience in business today. Enterprise software promoting function over form is prevalent in the back offices of major corporations. 5 years ago, 37Signals blogged that enterprise software sucks because the buyers aren’t the users. Less than one month ago the situation looked similar according to IT Mobility startup Moesion. Think about those enterprise software buyers. They were management leaders and CXOs empowered to spend 6, 7 or 8 figures on a single enterprise software platform – whether for CRM, HRMS, ERP or ECM. USA Today found their median age was 55. Forbes found the average age of CEOs across industries was 50 years old. They are Boomers. They are function over form folks. They find value in the feature list rather than the user experience. There are exceptions. But the exceptions prove the rule.
The market is changing as the Millennials – the largest generation in US History – take over purchasing power and become the leading influence on market expectations. The trends in social media started before the current trends in social business. Millennials were adopting social media technology as students, well before they started careers. But this too is changing now. If you have employees or peers 32 years old or younger, you have Millennials working for you. Millennials are in the workforce and have started to rise to positions where their expectations can exert force in the enterprise. Witness the rise of the flexible work week, bring your own device allowances and the explosion of B2B social business software. There would be no explosion of social business software if there was not a market to sell into.
The shift is happening now. If the adoption curve of the iPad and adoption rates of smart phones have taught us one thing, it is that form is gaining on function in the market. Feature bloat is not as important to the market as simplicity and the ability to do the one or two things I actually need. Agile development methods focusing on minimum viable products rather than soup-to-nuts feature lists bring more options to the market more quickly that happen to be substantially more affordable – even free in many cases.
Boomers are not giving up the purse strings any time soon. But expectations are driven by the market and the Millennials have more weight to throw around there. Belief – what we think – drives purpose – why we do what we do. How we do it is driven by our expectations which accelerate or thwart adoption of technology, business processes and tools.
Business has no choice but to go along with the changes in belief from the Boomers to the Millennials. The ground is moving whether big business wants it to or not. This is a tectonic shift in the market. It is underway right now.
All businesses are faced with a stark choice in dealing with this shift.
They can treat it as an earthquake and deal with their crumbling foundations.
Or they can make it a renaissance and participate in the blooming boom.
—————– Sources and Cites ————-
Generational stats taken from the book, “The Millenials” By Thom Rainer and Jess Rainer, 2011, B&H Publishing