As Silicon Valley's human resource vice presidents and directors sit around the table over breakfast at the High Tech HR Forums, our conversation these days frequently turns to the challenges that older managers are facing in recruiting, retaining and managing younger workers.

Picture this scene: the seasoned manager calls a meeting of his elite product development team to introduce them to their next project. He makes his presentation with an impressive array of facts marshaled to hammer home the point: The future of the company is staked on the success of this new product.

After the meeting he complains to one of his colleagues about his young employees. "Where's their work ethic?" he asks her. "While I'm giving them the assignment, they're yawning, whispering to each other and staring out the window!" Down the hall a couple of the team members are griping about the boss. "Does he think we're dumb?" says a newly hired software engineer to her colleague. "I got his point in the first two minutes. Why did he have to torture us and waste our valuable time by making us sit through another 45 minutes of boring PowerPoint slides?"

What's going on here? Welcome to today's workplace. A recent informal survey of members of the High Tech HR Forums gives a rough idea of what this workplace looks like:

TOTAL WORKFORCE Pre-Boomers & Boomers: 61% Gen X & Gen Y: 39% NEW HIRES Pre-Boomers & Boomers: 30% Gen X & Gen Y: 70%

MANAGERS Pre-Boomers & Boomers: 74% Gen X & Gen Y: 26% EXECUTIVES Pre-Boomers & Boomers: 99% Gen X & Gen Y: 1%

The composition of the workforce in the valley is changing at a rapid clip. In most high-tech companies, particularly those in the Internet economy, the creative and engineering talent of younger workers is increasingly critical to success. But it is still mostly the Boomers who are responsible for finding them, recruiting them, motivating them and managing them. As the younger generation is becoming the mainstream of the workforce, the older generation is still mostly in charge of managing the transition.

Judy Heyboer, HR vice president at Genentech, comments on the challenge that both generations face in working together. "It's a diversity issue," she says, "and on this score the Boomers are behind. Gen Xers realize that Boomers see life differently, and while they disagree, they tolerate. Boomers are still trying to figure out why the non-Boomers aren't doing it 'right.' "

Younger workers — Generation X and now Generation Y — are facing the challenge of building lives in a world where job stability, career paths, safety nets and pensions are history, where everyone is on their own, where the only constant is that change keeps getting faster, where everyone around you is looking prosperous and the only security is what you can produce that has market value today.

On one hand, they are starting their careers in the best of times, during the longest economic expansion ever, where they have never yet experienced the impact of a down market. The demand for their skills has risen to unprecedented levels, and employers in the valley are going to extraordinary lengths to compete for their services. Their confidence as they name their demands about compensation and working conditions — and employers scramble to meet them — is the envy of past generations.

On the other hand, younger workers are competing in a world where the gap between the "haves" and the "have nots" in the American economy is wider than at any time since the Great Depression. In Santa Clara County today there are 65,000 households with a net worth (not counting home value) of over $1 million. At the same time, 40% of all households cannot comfortably afford the rent on a two-bedroom apartment. At a time where there is prosperity for many and not much of a safety net for the rest, the pressure to succeed is intense. We tend to judge our own success in comparison to those we see around us. As Gen Xers look around at their peers and see a burgeoning class of dot-com millionaires, the bar for that success looks high. And the reality is that owning a home — and the lifestyle that goes with it — is a goal that many will not attain.

The Boomers who run the companies that employ the Gen Xers are facing a different kind of challenge. As they began entering college in the '60s, they took on "the establishment" with a sense of adventure and idealism, a sense that it was their mission to change the world they had inherited and make it a better place. They took this sense of mission and adventure with them as they entered the workforce, began their careers, and created new kinds of companies. Their energetic commitment to their careers and their companies produced great successes, including the economic dream machine of Silicon Valley. But there was also a shadow side — lives that were often stressful and out of balance, not enough time for children and family, high divorce rates.

Now they are the establishment. What ever happened to their dreams of a better world? Some things are better: racial discrimination and gender discrimination have been outlawed, Medicare protects the health of older Americans, environmental regulation has improved air and water quality and saved species, and the Cold War has ended. But in many ways the world is as messed up as ever. And in the high-tech economy where Boomers operate — the one they built — the economic value of their own experience is rapidly declining compared to the economic value of new skills of younger workers. This is causing growing numbers of older workers in the valley to feel increasingly insecure about their own place in the economy.

Against this backdrop, Boomers have to master the ability to integrate younger workers into the workforce — the kids from the stressed-out Boomer families, the kids whose outlook seems so different from theirs, the kids who are demanding, and getting, new kinds of working conditions and such extraordinary salaries. June Haselton, a senior HR director at Nortel Networks, observes that in the valley today, "Some companies are getting it, and others are still struggling."

In the opening years of the new century, the most successful companies will be the ones that can field the best teams of Gen X workers, and do the best job of preparing them to take over the reins of management. Like it or not, generational values transforming the workplace will effect everyone in high technology in the years ahead and will be a primary influence on the future of work.

Ken Durbin, senior training specialist with Aspect Communications, is 34. Demographically he is on the cusp of the generations, but considers himself solidly Generation X. He speaks of a childhood typical of his generation and formative of its values:

``I was a latchkey kid. My typical late afternoon and early evening was spent home alone, with my homework spread out in front of me, with the TV on and the remote in my hand, while I talked to my friends on the phone. I got used to being responsible for myself. I got used to continually shifting my attention to monitor the flood of information coming at me from different sources. I got used to technology woven into everything I do.''

Durbin quotes from an anonymously posted Internet article entitled ``Managing Generation X'' to expand on his point.

``We are latchkey kids who are used to solving problems on our own. We grew up immersed in the information era. We are America's first computer generation. These two influences, our independence and technological literacy, are the distinguishing characteristics of my generation. We are individualists, and we place a premium on enjoying our lives away from our jobs, while always keeping our options open. We thrive on new information and stay informed about new technology.''

If you are a manager in a high tech company and you are seeking to establish a strong culture for attracting, retaining and developing younger workers, you'd better pay attention. You need to understand the formative experiences of Generation X, how they are different from those of your generation, and how they shaped the values of these young adults. Meredith Bagby, an economist, news commentator and author in her 20s, elaborates on the effects of divorce on her generation in her book ``Rational Exuberance'' (1998. New York: Penguin): ``Half of this generation comes from divorced families. Since 1970, when Xers were growing up, the divorce rate has tripled.''

``Wary of family breakup,'' Bagby continues, ``our generation is marrying later, putting more time into family, and sacrificing less for the job. ... The biggest challenge is providing our own children with what we didn't have — fathers, time, attention, security. ... According to the Families and Work Institute, 60 percent of men and women under age 25 with children would make `a lot' of sacrifices in money and career advancement in order to spend more time with their families, versus 34 percent of workers overall.''

As Gen X kids were growing up, they not only saw instability in their parents' marriages, they also saw instability in their parents' careers. This was the era of downsizing and layoffs, where the basic contract between the U.S. employer and the U.S. worker was changing radically. A memorable milestone came in 1984 when John Sculley, then CEO of Apple, announced that the traditional corporate commitment to provide workers with long-term employment would be replaced by a new one: help them have more valuable skills when they left than when they arrived. The Xer kids,who saw their parents weather waves of layoffs and downsizing, felt the impact when those waves washed through their families.

June Hazelton, human resources director for Equinix, comments on this link between experience and values among younger workers at her company:

``They grew up with divorce. They grew up seeing their parents getting laid off. In my opinion this is causing them to not want to be `attached' to any one thing. They really want to rely on themselves and not on others. This creates a culture of independent people, not a group of `follow the group anywhere' types. The `I've been moved (IBM)' mentality is dead.''

When young workers struggle to create balanced lives in a world where stability, loyalty and safety nets are gone, they are acutely aware that whatever happens, it is up to them. The result is not always family. Eva Condron, training specialist at Altera Corp., is 28. She says, ``I don't have children yet. Up to this point, I've made work a high priority in my life, because I believe I need to be independent and know how to take care of myself before I can take care of others.''

So how does the broad range of experiences of Generation X translate to the attributes they bring to the workplace?

When asked how the habit of ``taking care of yourself'' affects the way she and her friends approach their work, Condron says,

``We believe in ourselves and our abilities. In turn, we like others to believe in us. We like to receive assignments and be given the freedom to run with anassignment pretty independently. Non-micromanagement conveys to us confidence in our abilities and potential, and I think we thrive off of others believing in us.''

Taking a step back to look at the whole picture, that anonymous Internet posting provided by Ken Durbin, ``Managing Generation X,'' provides one of the best summaries I've seen:

Ten Top Attributes of Generation X Employees

1. We are good at change. A higher divorce rate with many Xer parents often led to new schools and surroundings, which forced adaptation to multiple circumstances.
2. We are comfortable with technology. We grew up at the start of the information era, and we have been immersed in it ever since.
3. We are independent. Many of us took on adult responsibilities and learned to take care of ourselves at an early age.
4. We are financially savvy. We understand the idea of money and how it can be used to improve our economic situation.
5. We are not intimidated by authority. We do not seek approval from those in charge.
6. We are creative. We add a fresh perspective to problem-solving and strategy sessions.
7. We are street-savvy survivors. Above all, my generation has survived psychedelic parents, divorces, one-parent families, stepfamilies, both parents working, razor blades in their Halloween candy, latchkey lives, violence on TV, violence on the streets, and violence in the schools.
8. We are group-oriented. Friends have taken the place of absentee aunts, uncles, cousins, parents, and even the presence of enough warm adult bodies in school. Going in groups to the mall, group dating, etc., all are very natural to Gen X, and Xers are very protective of their groups. The rise of gangs among the most neglected groups of children could be the extreme version of this.
9. Xers are diverse. We're talking male and female, heterosexual and gay, European-, African-, Hispanic, Asian-, and Native-Americans. Xers have grown up with the reality-oriented version of how it is for diverse groups to live together.
10. Balance. Our jobs are not often our No. 1 priority. We want time for a life away from work.

For the foreseeable future, a key differentiator among high-tech companies will continue to be who is best at deploying the best talent. In the years ahead the best and brightest of Generation X will be the most critical piece of that talent. Companies in the valley that can master this ``Top Ten Attributes` list and translate it into company culture will have an enormous competitive advantage.

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It's time to get to the bottom line in this discussion of generational values. And the bottom line of values is value. A small percentage of the younger workers in high-tech companies, maybe 10% when the economy is good, will get enough value from their stock options to provide them with lifetime financial security. That means that 90% will not. The question I want to ask here: For the majority of Gen X workers, and for their high-tech employers, today and tomorrow — what has the greatest value?

My newest guests at the breakfast table of the High Tech HR Forums are the people in charge of HR (human resources) at new Internet companies. Most of them are in their 40s. At a recent breakfast we talked about the challenges they are facing, and how they will measure their own success.

The typical company in this group was founded in 1996, has a CEO who is 45, has about 300 employees today, and expects to add 200 to 300 more in the next year. Not surprisingly the top two challenges on everyone's list today — the human resource bottom line — are recruiting the highly skilled workers they need and keeping them. Next on the list are training, motivating and developing them, and forging them into a cohesive company culture. Most of these workers will be under 30.

New Internet companies and more established companies in the valley have been a laboratory for developing new approaches in attracting, managing, developing and retaining Generation X workers. As in most things regarding the future of work, it is happening here first. Business Week's December 6, 1999, cover story was ``The Wild New Workforce: What it takes to hire and keep the modern worker.'' When you open the story, the first thing that pops out is, ``It first emerged in Silicon Valley. Now it's forcing companies to play by new rules.''

Let's be honest. These ``new rules'' in the valley have resulted in corporate behaviors that, by any previous standard, range from excessive to bizarre. Signing bonuses in the tens of thousands and options worth millions. Boisterous games at the office. Dentists who roll up in vans when you need them and concierges who do your shopping and laundry. Autonomy and choice — even on your very first job — that were previously undreamed of.

To state the obvious, it's the market, not the generation, that is making the rules — and determining value. Rebecca Baybrook-Heckenbach, HR director at 3Com, former assistant HR vice president for Knight Ridder, told me how this was driven home to her.

``We did a panel with five Gen Xers this last summer at an internal conference on recruiting. One of the most interesting comments was from a late 40s executive who said that she and many of her cohorts wanted the same things when they were in their 20s that Xers want today. The difference: companies didn't need their talent the way companies need Gen Xers today. For her, this phenomenon is about supply and demand. Companies need talented people, so they are willing to take risks and respond to demands that were unheard of a generation ago.''

So here's a bottom-line question: If you're a manager with the task of attracting, keeping and developing younger workers, how do you find your way through this circus of ``new rules'' to develop a strategy you and your company can live with — one that works?

Ken Durbin, training manager at Aspect Telecommunications, has researched the literature on his generation and studied its values. He identifies a fundamental difference in the way his generation and the Boomers perceive value: It is in the way they look at their careers. According to Durbin, Boomers tend to see career development as doing what is necessary to progress to positions of greater influence, power and prestige. Xers see it as increasing the value of their skill portfolio, so they have the clout that allows them to keep moving to better projects, while maintaining fun and balance in their lives.

Durbin's list of ``Tips and Strategies for Managing Generation X'' should be posted on the cubicle of every manager in Silicon Valley. Here it is:

1. Concentrate on Results — Xers consider that the ends of a project are more important than the means used to obtain them. They value the ownership of the work they produce. Stick to the principle that all work should be divided into clearly delineated tangible results that are smaller in scope. Assign 100% ownership. Let them use these smaller results as proving ground to earn ownership of larger results.
2. Set Reasonable Expectations — Provide deadlines to achieve desired results; it is important to set time limits.
3. Develop Clearly Defined Goals and Lines of Communication — Provide Xers with clearly defined goals and lines of communication because it enables them to get on with the task put before them to complete, rather than getting bogged down in the minutiae of office politics.
4. Offer Freedom — Allow Xers the freedom to develop their skills in tandem with organizational needs. Expect self-starters among Gen X workers and provide them with the freedom to juggle their own time and work schedules.
5. Use a Team Approach — Generation Xers are adept at interaction with others and they are very productive in a team environment.
6. Identify Workplace Desires and Try to Meet Them - Use the open lines of communication to develop a sense of what type of work environment they would be best suited for, and work to develop it. Listen without prejudice to their perspective, and let them know that you understand their values. Incorporating their ideas may be useful in developing a fresh perspective to problem solving.
7. Mentorship — Be a mentor to Generation X employees. Provide individual attention, including both quality and quantity time. Improving this orientation process is an effective strategy to retain the services of Generation X employees.
8. Employee Recognition — Celebrate Xers' success; they enjoy nothing more than a good party for a job well done.
9. Provide Feedback — There is a need among Gen X for constant reaffirmation. It is a positive step for managers to give frequent and specific feedback to Generation X employees. Also provide skills assessment and specific training. ``HR News'' reported that 49% of businesses are increasing training opportunities as a strategy to retain Generation X employees.
10. Integrate Xers into the Development of Organizational Success -- Generation X employees like to feel that they are contributors and that they understand the organizational mission and vision.
11. Provide Time Off and Flexible Hours — Generation X employees seek to strike a balance between work and home priorities. Allow Xers the flexibility to do so.
12. Earn Respect Over Time — Respect is not something that is immediately given from Generation X because you are the boss. It can be earned over time by incorporating the strategies above and addressing their needs in a timely manner.
13. Add Job Variety — Generation Xers' development in the Information Age led to the ability to complete numerous tasks simultaneously. Adding job variety and multiple tasks keeps their minds interested and focused on the completion of numerous projects that stimulate their intellects.
14. Earn Job Loyalty — Don't pressure Xers into the belief that job loyalty is a must. Earn loyalty by developing strategies that develop short-term benefits and gains for both parties.

I had lunch a few weeks ago with Larry Butler of PeopleSoft. He has served as PeopleSoft's HR vice president for the past six years, a period when the company grew approximately tenfold. As his 60th birthday approaches, he is moving into a corporate advisory role. He also sits on the advisory boards of a half-dozen dot-com start-ups, and intends to add to that portfolio.

As we discussed Durbin's list, Butler reflected on his own experience with younger workers over the past few years. ``You and I and our peers had the security of stable jobs with stable companies, predictable career ladders, pension benefits, and if all else failed — Social Security,'' he said. ``For Gen Xers their skills are the only visible safety net they have. If we keep investing in those skills while they're with us, we're giving them something that matters — both to them and to us. We're giving them a compelling reason to stay, and the company a compelling reason to keep them. That's the most valuable benefit we can offer.''

In my opinion Butler nails it on value: High-tech companies systematically investing in increasing the value of their workers' skill portfolios, year after year, and holding managers accountable; Gen Xers who work there investing their skills back into increasing the value of their companies and reaping the rewards, both financial and personal. These will be the real winners in the future of work.

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Aryae Coopersmith is founder and organizer of the High Tech HR Forums, whose members are the human resources executives and directors in most of Silicon Valley's leading corporations, and a growing number of the Bay Area's new Internet companies. Through his firm, Learning Synergies, he provides HR consulting services to high tech companies. For information on the High Tech HR Forums, Aryae can be reached at aryae@hrforums.com