My boss was recently forced to retire. I have taken their position. Now they are coming back part-time with me as their boss. I have made some changes in how they did things before but I know this person is probably not going to like them. Also, I need this person to perform duties that they haven't done in years. How should I go about getting this person to understand that they are not as "powerful" as they were months ago. I respect this person but I do not think they will respect me as their boss. How can I start off on the right foot given the reversal of roles?
Have a private conversation as soon as they arrive. Say essentially,
"I appreciate having your expertise to bounce ideas off of you. As you can see, I'm doing things a little differently. If you see something going wrong, I'd really appreciate it if you would talk to me privately and let me know. I may not always agree, but I will always listen to you and consider what you're saying."
Let him know his knowledge, experience, and opinion are valued, and I doubt he'll be upset if it isn't always done the way he would prefer.
Well, it COULD go well, but...
This was a terrible decision on the part of your company - my condolences! It is really difficult to establish oneself as the leader when the old leader is still there. This should be a period of establishing your own vision, which takes time, and that process may be unduly influenced by this person's presence.
You will likely need to establish firm boundaries and reinforce them over and over. Start with an initial conversation about what role you expect this person to take. Go over the job description, and let the person know that, though they may have suggestions for helping you do your job, you prefer to learn the job on your own and to find your own way. Then defend this boundary you have created. Expect some hurt feelings at the beginning.
Boundary enforcement is often successfully achieved with a broken record technique. For example, every time the former boss offers a suggestion that is contrary to the way you would like things done, be prepared with your response: "I appreciate the thought, but I prefer to do it a different way." You may have to say it over and over and over. Don't get drawn in to defending your way of doing things.
I have been in a similar situation, and I found that opening myself up to the other person's help just one time meant I had to spend months trying to re-establish the boundary I had created initially.
You may also find you have difficulties with this person influencing your staff, in which case, you have a disciplinary issue on your hands.
Good luck! Maybe it will go well...
Your old boss now having to work under you may find it difficult to adjust to seeing see you as anything more than a subordinate. They will forget that they don't call the shots anymore and presume to give you orders from time to time.
Treat them with the dignity they deserve and defer to them for their experience but don't let them encroach on your authority because they won't ever respect you if you capitulate under their bossy wiles like the minion you once were under them.