Why is there an age, 60-65, when people are required to retire?
There are as many answers to this question as there are people, since each retirement case has to do with the person, job, company, country, and so on. But for the sake of discussion, we’ll assume your question pertains to retirement within the S&P 500 world of big corporations.
In which case there are two answers, because corporations generally have two categories of employees. First there are the specialists—individuals with unique, accumulated knowledge. Given the long and productive lives people enjoy today, it hardly makes business sense to bid farewell to these valuable employees at some arbitrary age. We say let them decide to work or not, as long as they keep contributing!
But we’d make the opposite case for the second category: leaders. Why? Because companies need vitality and change. Stay static, and they petrify. Often that’s what happens when people in the top layers hang around for too long. Great people in their 30s and 40s don’t want to wait 10 years for their shot. They want to invigorate companies with new ideas and shake things up now, and organizations should let them. With a change of leadership, fresh air pours in the windows, and new energy puts extra spark in the place.
That’s why, generally speaking, managers in their 60s should take their good economics, well earned over decades, and move on to exciting, and different, new futures. They’ll be giving their companies the same in return.
This question and answer originally appeared in Business Week magazine on October 30, 2006.
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