How to Create an Organizational Culture for Successful Aging

Researchers and practitioners often focus on the influence of individual characteristics, such as cognitive and physical functioning, on employees’ successful aging at work, whereas organizational level factors have been largely neglected. However, recent research in organizational psychology demonstrates that companies’ cultures and climates for successful aging can be powerful predictors of older workers’ motivation, performance, and well-being.

What are organizational cultures and climates for successful aging?

The concept of organizational culture describes the shared values and beliefs of employees working for a company; it is influenced by factors such as the company’s history, line of industry, and leadership. Its sister concept, organizational climate, refers to employees’ shared perceptions of their company’s policies, procedures, and practices. An organization’s culture is thought to influence its climate which, in turn, impacts on employees’ motivation, performance, and well-being. By extension, organizational cultures and climates for successful aging entail how older employees and age management practices are collectively perceived by company members.

Are there differences between companies in their organizational cultures and climates for successful aging?

In a recent study, a colleague and I collected data from 274 employees working for 66 small and medium-sized businesses in Australia. We asked employees to rate how older workers were seen in their company with regard to characteristics such as “efficient,” “flexible,” “motivated,” and “reliable.” Results showed that employees within each company agreed on their assessments of organizational culture for successful aging, whereas there were substantial differences between companies as to how older workers were perceived. Thus, our findings provided empirical evidence that organizational cultures for successful aging exist.

How can companies create organizational cultures and climates for successful aging?

The research evidence to date suggests that companies’ leadership, human resource (HR) practices, and the composition of the workforce impact on the emergence of organizational cultures and climates for successful aging. In our Australian study, we found that organizational culture for successful aging was particularly positive in companies led by older CEOs with positive attitudes toward older workers. By contrast, culture ratings were lower in companies led by young CEOs and CEOs with negative attitudes about older workers. Another study with small and medium-sized companies in Germany showed that age-inclusive HR practices, such as age-neutral recruiting activities and equal opportunities for training and promotion, had a positive effect on age-diversity climate – that is, employees’ shared perceptions of how well age diversity was managed in their organization.

The composition of a company’s workforce also has been shown to influence organizational climate for successful aging. A study from 2011 showed that the more age diversity there was in a company, the higher the age discrimination climate, or employees’ shared perceptions of age discriminatory practices. A follow-up study from the same team of researchers showed that the negative effects of age diversity on age discrimination climate are attenuated when companies have diversity-friendly HR policies in place and when their top managers have low levels of negative age stereotypes.

What are the outcomes of organizational age cultures and climates?

At the individual level, recent findings from my lab suggests that an organizational culture for successful aging has positive effects on older workers’ job satisfaction, organizational commitment, and motivation to continue working after traditional retirement age. At the organizational level, research showed that age discrimination climate has negative effects on employees’ collective commitment and firm performance. Moreover, a positive age-diversity climate was linked to higher company performance and lower collective turnover intentions among employees.

What have we learned?

Organizational culture and climate can have important influences on the extent to which employees can age successfully at work. Positive cultures and climates impact on older employees’ attitudes and well-being, as well as company outcomes such as firm performance and turnover. Practitioners can create organizational cultures and climates for successful aging by training company leaders, implementing age-inclusive HR strategies, and actively managing their increasingly age-diverse workforces.