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Generation Y – those born between 1983 and 1995 – is on a mission; a mission to shake up the status quo.

Many of today’s younger workers are tech-savvy, highly educated professionals who want meaningful and challenging jobs that allow them to grow. They want more of a ‘business mentor’ than a boss as well as a better working culture. They know they will spend a huge amount of their time at work and they want to enjoy it. To them, work is not something to be endured for the sake of a pay packet at the end of the month. Instead, it needs to inspire, excite and fulfil, and offer a strong work-life balance that reflects the value they place on family, friends and leisure.

The old style of business leadership – the carrot and stick approach of rewards for motivation and inducing behaviour – has little traction with Gen Y. For them, this is an approach that is at best defunct, and at worst divisive, with annual performance appraisals, strict working boundaries and cumbersome, often unnecessary, rules – all coming from the management manual, which should be marked ‘obsolete’.

Today’s managers need to recognise that people are more productive when they work without fear, the threat of punishment or even the promise of reward. This is why in today’s business world the best managers adopt a humanistic approach to leadership.

The humanistic leader places people first and sees employees as partners rather than just workers, nurturing a style that creates strong internal cultures and collaborative environments. They make work enjoyable because they understand that when people look forward to work they are loyal, committed, happy and energised. People grow, relationships deepen, productivity soars and people find new meaning and significance in their roles.

A key attribute of a humanistic leader is understanding one’s own values, beliefs and behaviours. A self-awareness that results in an authentic and natural leadership style.

The best humanistic managers communicate with their team, sharing their vision but at the same time encouraging feedback. This eliminates internal competition, allowing for professional development without pressure and ultimately leading to a heightened sense of job satisfaction.

Coaching is another crucial part of this approach. It allows managers to position themselves as role models, stepping away from process-led management and taking responsibility for staff development and team success. By demonstrating the very skills employees need to progress, they gain respect, meaning their team is more likely to discuss issues before they become problems, creating a happier, more motivated workforce.

The humanistic approach is crucial for the success of a business as well as the management of Gen Y – which, PwC predicts, will make up 50 per cent of the global workforce by 2020. All leaders can benefit from modelling a humanistic behaviour, but, as the younger generations seek more meaningful development in work, this will become even more significant.

Dr Craig Nathanson is a leadership expert and a faculty member for the University of Roehampton, London Online management programmes

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Article published in CIPD