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The potential role of coaching for executives dealing with the impact of a retirement transition

The potential role of coaching for executives dealing with the impact of a retirement transition

By Tessa Deighton

  • DEC 2019
17 minutes to read

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Retirement: a welcome relief or a shock to the system?

For many people, work is an intrinsic part of life. Besides being a source of livelihood, work can afford people a daily routine, an opportunity to interact with other professionals, an environment that encourages learning, personal satisfaction for a job well done, and prestige. When people stop working as a result of retirement, their lives often change dramatically.

For some, retirement represents a welcome next phase in their personal journey as they are free to spend more time with their families or engage in long-neglected leisure activities. They may even move into a new occupation that involves fewer or more flexible working hours. For others, however, retirement induces uncertainty and fear. Not only does it herald the loss of a regular income, but it can also rob people of their social status and sense of self-worth. When people’s personal identities have become intertwined with their professional pursuits and achievements, retirement can be a rude awakening.

Retiring at the age of 60 or 65 is no longer a foregone conclusion. Many people, either willingly or otherwise, take early retirement which might see them exit their companies in their 50s. With many companies under pressure to make way for new generations of employees, the early retirement provision is gaining ground. In contrast, some people who reach their companies’ official retirement age are asked to stay on, possibly under a contractual arrangement. While no two people’s reactions to retirement are the same, studies have shown that corporate executives – given their level of responsibility, visibility, earning power and social status – often find the transition to retirement particularly challenging. Having given so much of their time and energy to their corporate duties, they are often left wondering who they are when their high-profile professional life comes to an end.

When people’s personal identities have become intertwined with their professional pursuits and achievements, retirement can be a rude awakening.

It is becoming increasingly evident that coaching has an important role to play in preparing corporate executives for retirement. Coaching helps executives to view retirement as a natural phase in their lives, which is full of promise and not simply the sad conclusion to the illustrious career that once defined them. It shows them how to reflect on their attributes and aspirations and to repurpose their lives so as to find new forms of enjoyment and fulfilment. Little research, however, has been conducted on the transition into retirement from an executive coaching perspective.

The main purpose of this study (which formed part of the researcher’s Master of Philosophy degree in Management Consulting) was to address this knowledge gap by exploring the benefits of coaching to corporate executives who are making the transition to retirement. The study, which was qualitative in nature, comprised an extensive literature review and personal consultations (using semi-structured interviews) with six retiring corporate executives and five coaches with experience in working with retirees from the corporate world.

The transition to retirement: a three-phase process

Retirement is neither quick nor simple. It is a transition, which can be emotionally, psychologically and financially challenging and can even affect people’s physical health. Involuntary retirement (in the face of retrenchment, an early retirement policy or ill-health) can be more difficult for an individual than voluntary retirement because an unwelcome early departure can trigger emotional and financial distress.

The transition to retirement can be seen to have three main phases: pre-retirement, retirement and post-retirement. The pre-retirement phase relates to the period in which individuals are still working but considering or facing the prospect of retirement. This is when they should start thinking about what life will or should be like once they leave formal employment. Of particular importance are the financial resources they will need and how they will spend their time. In the retirement phase, individuals face the end of formal employment head-on and may even take on some sort of bridge or volunteer employment to extend their working life, albeit in a less intense form. The post-retirement phase sees individuals putting financial and other plans into effect, thereby cementing their transition to a different type of lifestyle.

It is during the post-retirement phase that the appropriateness and thoroughness of earlier plans are put to the test. Factors such as financial and physical health, personality, gender, age, education, leisure pursuits, status and family support structures all need to be considered when charting the way forward. In this regard, pre-retirement support can go a long way towards ensuring optimal results.

Do men and women react differently to retirement?

There is no hard-and-fast rule in this regard. Men often have higher earning power than women and are more likely to carve out a personal identity from their status at work and their professional achievements. Thus, the prospect or reality of retirement could be more stressful for men, particularly if they occupy or once held a high-level executive position.

Owing to their varied responsibilities (work, child-rearing, caring), many women do not experience the same level of anxiety as men when retirement approaches. Anxiety aside, women who have not progressed to the upper echelons of management because they have had to balance their responsibilities at work and home (which can be career-limiting) may find that their pensions are not big enough to sustain an adequate lifestyle after retirement. Where women have had unbroken corporate careers, though, retirement generally induces as much emotional upheaval as it does for their male counterparts in the corporate world.

A good education generally has a positive effect on how men and women adjust to retirement and encourages them to engage in other profitable or cognitive pursuits after they retire, which can contribute to their general well-being and longevity.

Coaching for a smoother transition to retirement

Planning for retirement should ideally start early on in people’s careers. Financial planners have long advocated this practice, although the psychological impact of retirement is frequently overlooked. All too often, the opportunities associated with retirement are obscured by a heavy veil of fear and uncertainty.

Those who are preparing for retirement need to banish from their minds the idea that their knowledge, experience and advice will be enthusiastically sought once they have left formal employment – otherwise their ego is likely to be seriously bruised.

Coaching can help corporate executives, who have become accustomed to driving productivity and shareholder value, to embrace a different and potentially more powerful purpose in life. Through coaching, they learn to confront their fears, consider various lifestyle choices and implement realistic plans that will make retirement a reality they can actually look forward to. Coaching helps people to look at their lives holistically, define their short- and long-term needs and aspirations, and decide how they would like their pathway into the future to be paved. ‘Owning’ the process will allow them to make necessary adjustments along the way, which will minimise the risk of difficulties and disappointments later.

In a nutshell, the act of coaching promotes self-awareness through a collaborative, outcomes-driven approach. Self-awareness is a key ingredient in building mastery, which gives retirees a sense of being in control and facilitates a smoother transition from retirement planning to actualisation. While goal-setting is advisable, squeezing too many goals into a concentrated period is counter-productive as there is a strong risk that they will not be achieved. This could trigger disillusionment. Moreover, goals need not be staid. They could, for example, be the result of creative visualisation of coveted ‘bucket list’ items. Retirement coaching could straddle one, two or more years and span multiple sessions, although there is no prescribed time frame or format. Circumstances will dictate what interventions are desirable.

One participant spoke poignantly of his descent from “hero to zero”. He used his authority and influence in his corporate role to make things happen, but upon retirement he became nobody and had to sort out his own problems.

Various models have been developed to support transition or retirement coaching, but all – to a greater or lesser extent – focus on building individuals’ self-awareness and self-confidence so that they are better equipped to embrace change. For example, Bridges’ Transition Model recognises three distinct stages relating to retirement: (1) letting go of current circumstances; (2) coping with the ‘neutral’ zone when confusion or uncertainty often peaks; and (3) embracing new beginnings. These broadly mirror the pre-retirement, retirement and post-retirement phases discussed earlier. Often it is beneficial to combine retirement coaching with financial coaching because there tends to be a strong link between financial know-how and security and emotional well-being.

What the interviews revealed

The corporate executives who were interviewed for the study were retiring for different reasons: one was leaving at the normal retirement age stipulated by the company; three were facing involuntary, early retirement; one was opting for voluntary early retirement; and one was pursuing a voluntary extended retirement option. All had had some retirement coaching. The coaches who were interviewed had all once been corporate executives or directors and had strong coaching credentials. The most common issues raised during the interviews were the following:

  • Control over the exit conditions

The circumstances giving rise to the executives’ retirement prompted different reactions. Those executives whose impending retirement was involuntary showed signs of being in denial and were very uneasy about the prospect. Those facing more favourable exit conditions (where retirement was voluntary) had a much more positive attitude. Although participants were in favour of receiving ‘step-down’ or contract work from their companies, they acknowledged that in most cases BEE policies were an impediment.

  • Control over resources

It was evident that the level of comfort or anxiety that the executives experienced was directly linked to how much control they had over resources like finances and time. For example, the thought of having more time on their hands but less money raised their anxiety levels. Anxiety went hand in hand with feelings of insecurity about the unknown.

Coaching helps executives to view retirement as a natural phase in their lives, which is full of promise and not simply the sad conclusion to the illustrious career that once defined them.

Some participants admitted to being in denial – not wanting to accept the inevitability of losing their corporate responsibilities and status. They also feared that after operating in a high-pressure environment, their days would feel empty. While travel and hobbies could consume retirees’ time, more often than not they were looking to devote time to ‘meaningful’ pursuits.

Money was a major concern. Although one might expect retiring corporate executives to be well provided for financially, extraordinary expenses (such as second marriages and additional children later in life) could erode their capital base and leave them with insufficient resources for a comfortable retirement. Health was identified as a factor that inevitably becomes more important with the passing of years and can be a stress trigger if not properly managed.

  • Identity, status and ego

Some participants spoke of the challenge of having to accept that, after a long and distinguished career, they were seen to the door with a small box of possessions – as if their contribution to the company over the years had been of little consequence. It is common for retirees – particularly those who have lived energetic lives in the corporate fast lane – to think that they have become indispensable to their companies. But this is rarely the case. Even the most revered senior figure tends to be forgotten within a relatively short space of time and the company moves on.

Those who are preparing for retirement need to banish from their minds the idea that their knowledge, experience and advice will be enthusiastically sought once they have left formal employment – otherwise their ego is likely to be seriously bruised. Another important finding was that retirement is generally associated with old age and a reduced capacity to work. Such a perception can damage people’s sense of self-worth.

  • Inter-relational considerations

The loss of work-related networks and friendships was another area of great concern, as was the loss of corporate support services such as software technicians, accounting officers, financial advisors, and so on. One participant spoke poignantly of his descent from “hero to zero”. He used his authority and influence in his corporate role to make things happen, but upon his retirement he became nobody and had to sort out his own problems. Retirement also impacts family relationships, particularly the spousal relationship. Newly retired corporate executives and their spouses could find themselves having to renegotiate their roles at home to ensure a smooth transition, particularly if retirees have more free time but finances are stretched. Couple coaching might be beneficial in such a case.

Final thoughts

Providing retirement coaching to executives is not something that any person can do. It calls for a professional who is mature in age (and has experienced life’s knocks), well educated, experienced in retirement dynamics, skilled in coaching techniques, and a good and empathetic listener. In addition, for coaching to be effective, there must be buy-in from the retirees themselves. Even if they are harbouring feelings of insecurity or resentment about having to withdraw from corporate life, they should be open to the possibility of their post-retirement life being enjoyable and even empowering. Corporate entities in turn can play an important role by introducing a retirement coaching programme as a standard offering. People should ideally join the programme about five years before their anticipated retirement date to allow sufficient time for personal reflection, scenario planning and the crafting of a well-considered retirement strategy.

Coaching can help people to look at their lives holistically, define their short- and long-term needs and aspirations, and decide how they would like their pathway into the future to be paved.

Engaging the services of newly retired executives to mentor younger staff members on their developmental journey would provide added benefits to the company and would also help the retirees in question to make a more confident and comfortable transition.

  • This article is based on the research assignment of Tessa Deighton – an MPhil in Management Coaching alumnus of USB. The title of her research assignment is: The potential role of coaching for corporate executives dealing with the impact of a retirement transition.
  • Her study leader was Dr John Morrison, a Senior Research Consultant at USB, who specialises in project management, research methodology and research coaching.

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