One of the most disruptive changes seen in business over the last decade is the end of the traditional “career.”
People used to join companies for life
You look for a great company when got out of school, join the new-hire development program, pay your dues working up the ranks, and look forward to a nice retirement program 30-40 years later.
Well it’s different now, the average worker stays at their job for 4.4 years – Bureau of Labor Statistics.
The challenge is much more fundamental. Change the entire design of organizations.
Let us explore in a little more detail, how complex and important it is to rethink what a career means in your company.
The Traditional Model of a Career
Companies exist for crating economies of scale – by organizing the people in sepcialized roles. Create teams of functional specialists, driving down cost. These specialists can do more for less, enabling the business to grow at an ever increasing profit (supposedly).
IBM in the early 1980s, had a large and highly specialized sales force, one that had deep sales skills and relationships with businesses and IT departments around the world. This functional organization, which had a career model all its own, enabled IBM to aggressively sell hundreds of new IBM technologies around the world in a very short period of time.
These specialized functions (marketing, sales, engineering, manufacturing, logistics, distribution, finance, HR) grew into the careers we have today. Most of you spend decades in one functional area, moving up the path to become senior professionals or leaders in that function.
Managerial vs. Professional Careers
The traditional model of a career, driven by this functional specialization, consisted of two basic paths: managerial and professional.
Managerial careers involved leading people; professional careers involved deepening your functional expertise. Most companies “slot” you into one of these paths, based on your nature, skills, and interests.
The Leadership or Managerial Path
The managerial path takes you into the role of senior management. It typically pays more and people often feel pressured to go into management because it’s considered the more powerful or prestigious path.
In reality, of course, this is not always true. Many become leaders because of technical expertise and over time the role of “general managers” is becoming less and less important.
You create a steady supply of leaders from the dual path career model (Technical and Managerial), still dominant in most large companies. It builds on the concept of a “HIPO” (High Potential person), someone who is identified early in their career as someone “who could move up two levels in the organization.” You identify future leaders early.
However, HIPO programs are often over-emphasized. Typically HIPO pools become sacrosanct lists and people are secretly identified, put on special lists, and they get oversized opportunities for development and growth. In many companies they become the “new elite” or the “new leaders” of the company over time (even if their skills or abilities become out of date).
The concept of succession management is ‘’100 year’’ old concept. It rarely works, and fewer than 1/3 of executives have successors even identified. HR teams work hard to build senior succession programs, but as you move down the organization the practice tends to fall away.
Behind the concept of succession is the idea of “readiness.” Books like The Leadership Pipeline teach HR people how to prepare people for the next level of leadership, and most companies have multi-year programs to build ready leaders throughout the company. Such programs continue to exist throughout business, even though more than 88% of all senior leaders tell us that one of their top problems is “gaps in the leadership pipeline.” So while this process continues to be institutionalized within HR, I believe we have to reinvent it for the years ahead.
The Professional Career Path (The “HIPRO”)
On the professional side of the pyramid (left side of the picture), the architecture of a career is less clear. They are multi-faceted and far more difficult to understand.
Professional careers require two additional paths: technical expertise (and experience), and team or project management.
As an engineer, for example, you have to learn more and more about your engineering discipline, gain experience with larger and more complex projects, and expand your expertise in new technologies. You simultaneously learn “management” skills by learning how projects are managed, what makes a project succeed, and how to make a project successful. And in the case of engineering, this means understanding project management, agile methodologies, and other managerial skills which do not fall into the domain of “leadership development.”
Look at the competency framework – You have core values of the company, technical or functional competencies, “career path competencies” like project or program management, and then top leadership competencies above these.
“Leadership competencies” include things like running a P&L, mergers and acquisitions, and other business roles.
Career path competencies might include managing a major new engineering project or leading an IT transformation.
Suresh Shah, Pathfinders Enterprise