Welcome to the Island

Are the time tested methods of insolvency practice still relevant, or will the Digital Natives vote you off the island?  

The Millennial generation (born between 1982-2002) is the fastest growing segment of the workforce according to recent studies. Commonly characterised as “Digital Natives” Millennials are known to demonstrate comfort and facility with digital technology, with a digital presence so deeply entrenched with daily life, that 83% of the cohort admitted to sleeping with their smartphones in a recent study.[1]

The art of good insolvency practice is a matter of contention among scholars, and a mismatch between some theories and the current position of the law proves to be oppositional. However, there are core values that underpin good insolvency practice that are time-tested in their effectiveness, providing a common ground among opposing theories. Specifically, efficiency, expertise, accountability and fairness are all elements of good insolvency practice.

As the infiltration of the Digital Native population into the workforce is at its genesis, it is not yet known if the “Me” generation will carry on these values, or perhaps introduce values of their own. In short, the infiltration of Digital Natives into insolvency practice will likely change the face of practice management, however is this a welcomed change?

 

The Tribe has Spoken?

Generational diversity has become the norm in insolvency practice, with organisational behaviours changing to adapt to each generation. Managers are having to familiarise themselves with the work ethic of the emerging cohort, which is unique when compared to their generational predecessors. The Trophy Kids have grown up, armed with technological savviness unlike any cohort who have come before them. This aptitude for using technology as a tool and a platform has branded this group  as “Digital Natives”.

The Digital Native is distinguishable from the “Digital Immigrant”, which is a term coined by Mark Prensky in 2001 to describe anyone who grew up prior to the digital age.[2] In the Digital Native population, there is a  much celebrated sub-group comprising of those who witnessed the digital era develop, who didn’t grow up with the digital tools, but witnessed their invention and evolution.[3] As such, it is often thought that this sub-category of Millennials represents an idealistic class of “Digital Colonialists”.  Specifically, unlike the tech-dependant younger population of Millennials, Digital Colonists have learnt the adaptive skills of digital assimilation and are not wholly reliant on technology as a problem-solving mechanism.

The different characteristics of the various cohorts and sub-cohorts applies to insolvency practice, when considering the fact that many firms boast of being a “paperless” office space. The paperless office is an emerging trend, where the use of paper is completely eliminated or reduced by converting documents into a digital form, otherwise known as “Digitisation”. As such, the question of whether or not the tribe has spoken, and traditional insolvency practice has become irrelevant is no longer the issue. It is the island itself that is shifting, and the question now is whether or not its former inhabitants can survive?

There are numerous considerations at play when answering this question. Firstly, while Millennials are assumed to be tech-savvy, there are other skill sets required to meet a competent standard of digital file management, which are not universal among the cohort. It is the ability to comprehend and apply, which is a skill seen to be lacking in practical studies of Millennials, demonstrating “little understanding of what goes on behind their screens (and couldn’t care less)”.[4] It could even be argued, that the Digital Immigrant/Colonist population has the upper-hand when it comes to digitised file management, as they have learnt to adapt to revolutionising technologies, which at their genesis were not very user-friendly.

The use of internet search engines as a research method is a further consideration. Studies have indicated that Millennials lack resourcefulness and applied skills when it comes to database research.[5]  It is the quality of digital wisdom that lends to expedient and effective research, which is fostered from the constant exposure to technology. In short, pre-Millennials who lack tech-savviness will eventually be assimilated to tech-culture in varying degrees. The question that remains, is whether the Natives, Immigrants and Colonialists can co-exist harmoniously?

 

Mind the Gap

The Millennial population is different from other generational cohorts based upon opposing behavioural characteristics, value systems and preferences.

Period events and trends often leave a particularly deep impact on young adults because they are still developing their core values. It is not yet known which formative experiences Millennials will carry forward throughout their life-cycle. From a value-based perspective on workplace ideals, Millennials have exhibited preferences towards producing meaningful work, receiving immediate feedback, and achievement recognition.

Unlike their predecessors, Millennials are often characterized as narcissistic and impatient, which is evident in the use of social media as a platform for self-promotion and gratification gained from peer approval. However, it should be noted that on the flipside of these undesirable traits, Millennials display propensity towards tolerance and consideration to minorities. With respect to the workplace, the majority of research concludes that the Millennials are unique to their generational predecessors, adopting a preference towards the work-life balance trend and a focus on individual advancement.

As previously mentioned, Millennials have been maligned by the “Trophy Kids” title, used to describe the trend of mere participation in sporting  activities gaining an award. The general ideals associated with the stigma is demonstrated in the workplace ideals of Millennials. For instance, studies have indicated a tendency to switch jobs on a frequent basis, particularly if there is slow mobility towards career progression within a firm’s hierarchy. Some researchers even proclaim that the characteristics of Millennials may complicate and potentially disrupt workplace interactions with members of other generations, thus negatively affecting co-workers and organisational processes.

However, the vilification of Millennials should be avoided, as they also bring some positive influences to the workplace such as a tolerance of diversity and propensity towards teamwork. It is noted however, that the opposing  traits of Millennials can make their workplace capabilities difficult to predict. The socialisation of Millennials into the firm culture is highly dependent upon the tolerance and acceptance of their peers through ongoing interactional communication processes among members, otherwise known as “membership negotiation”.[6]

As such, insolvency “old-timers” should try to not be dissuaded by the overly confident and inappropriately demanding appearance of junior practitioners, rather than simply despairing, “Who do they think they are?”[7] Specifically, Millennials entering insolvency practice may bring a welcomed change to firm culture, such as an emphasis on a work-life balance and open communication. However, based on the conditioning of the Trophy Kid era, frequent praise has led Millennials to expect evaluation of their work to be based on the outcomes they produce, not based on the age, experience, or tenure of the person who produced it.[8] Ultimately, Millennials must heed the hierarchical nature of firm structure and demonstrate a willingness to listen and display respect to senior members of staff.

 

The Changing Face of Insolvency

From its genesis, insolvency practice hinges on an extensive diversity of interests, and is not merely confined to creditor wealth maximisation or a collectivized debt collection device. Namely, practitioners must consider the casualties of commercial dependants, diagnosing and treating imminent insolvency where possible, and commanding respect and observance to protocols, however also allowing for sufficient flexibility to cope with change. It remains, that there is no simple solution to balancing the multiple interests in insolvency practice.[9]

Can the emerging cohort of Digital Natives cope with such demanding, competing interests? This remains to be seen. The future of good insolvency practice hinges on the cohort’s  membership negotiation process when entering into practice,  which will hopefully lead to information sharing and mutually enhancing relationships with their predecessors.

On a multigenerational basis, practitioners are becoming more proficient with digitised file management and research methods through the constant exposure to technology. It follows, that the gap between the technological skills of a Digital Native and Digital Immigrant is slowly reducing through the digital assimilation process. In short, men resemble the time more than their fathers.

 

  • Clare Venema
  • File Accountant
  • Worrells Solvency and Forensic Accountants, Adelaide
  • E: Clare.venema@worrells.net.au
  • T: 08 8214 0513
  • M: 0435 636 969

 

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References:

George Lorenzo & Charles Dziuban, “Ensuring the Net Generation is Net Savvy”, (2006), 2, ELI White Paper Series, p.8.

 

Karen K. Myers, “Millennials in the Workplace: A Communication Perspective on Millennials’ Organisational Relationships and Performance”, (2010), 25, Journal of Business and Psychology, 2, pp 225-238.

 

Lauren Keating, Survey Finds Most People Check their Smartphones before Getting out of Bed in the Morning,  (2 March 2017), Tech Times, https://www.techtimes.com/articles/199967/20170302/survey-finds-people-check-smartphones-before-getting-out-bed.htm

 

Mark Prensky, “On the Horizon”, (2001), 9, MCB University Press, pp 1-6.

 

Sharon Stoerger, The Digital Melting Pot: Bridging the Digital Native-Immigrant Divide, (6 July 2009), First Mind, https://uncommonculture.org/ojs/index.php/fm/article/view/2474/2243#17a

 

Vanessa Finch & David Milman, Corporate Insolvency Law: Perspectives and Principles, (Cambridge University Press, 3rd Ed, 2017), pp 28-34.


[1] Lauren Keating, Survey Finds Most People Check their Smartphones before Getting out of Bed in the Morning,  (2 March 2017), Tech Times, https://www.techtimes.com/articles/199967/20170302/survey-finds-people-check-smartphones-before-getting-out-bed.htm

[2] Mark Prensky, “On the Horizon”, (2001), 9, MCB University Press, pp 1-6.

[3] Sharon Stoerger, The Digital Melting Pot: Bridging the Digital Native-Immigrant Divide, (6 July 2009), First Mind, https://uncommonculture.org/ojs/index.php/fm/article/view/2474/2243#17a

 

[4] George Lorenzo & Charles Dziuban, “Ensuring the Net Generation is Net Savvy”, (2006), 2, ELI White Paper Series, p.8.

[5] Sharon Stoerger, The Digital Melting Pot: Bridging the Digital Native-Immigrant Divide, (6 July 2009), First Mind, https://uncommonculture.org/ojs/index.php/fm/article/view/2474/2243#17a

[6] Karen K. Myers, “Millennials in the Workplace: A Communication Perspective on Millennials’ Organisational Relationships and Performance”, (2010), 25, Journal of Business and Psychology, 2, pp 225-238.

[7] Ibid.

[8] Ibid.

[9] Vanessa Finch & David Milman, Corporate Insolvency Law: Perspectives and Principles, (Cambridge University Press, 3rd Ed, 2017), pp 28-34.