Do job titles matter?
And if so, what should you do to make sure you get the one that’s right for the role you’re seeking?
In an ideal world, a job title or “role” – words that are sometimes but not always synonymous – would connote scope of the person’s job and level of responsibility. Externally it give you a sense of who you’re dealing/working with, and internally signals relative position and responsibility in an organizational hierarchy for those who put importance on those sorts of things things.
Ten years ago I wrote “Job titles are like mini-billboards: they suggest what you do, and as such are a part your job description and walking personal advertisement. ”
As background though, job title inflation is rampant and in some cases titles now are near meaningless. The CEO title for example, used to signal the one most senior person in an organization, usually someone, if the company was publicly traded, who reported to the board of directors. Today we have CEO’s who report to CEOs who report to CEOs all within the same organization.
While titles formerly were a proxy for experience and impact, that criteria has been chipped and steadily washed away. Amplified titles are used to attract candidates that organizations want, or retain employees that organizations are keen to keep. Why? The direct cost is negligible.
For companies that use job grades and job levels – a legacy system that hails from the 1960’s – job titles and roles drive salaries, and where applicable, bonuses, stock and in some cases, perquisites. Here’s a sample from the Society of Human Resources Management. A roster of different compensation consulting companies and methodology from Wikipedia is instructive as well.
So how does the title game rules work? It depends, and you’ll see that having the right job title becomes important if what you get paid, or how you signal career progression to the outside world, is important.
A job hierarchy for even a 300 person company might look like the levels below. If it seems crazy to have this many levels today – each with a potential impact on compensation, each with rules for who can occupy what role, and each with HR staff to administer and regulate them – join me in line. Research, especially in the world of Silicon Valley where I live, shows that speed, simplicity and flatter organizations are what’s most important for success today,
- Associate
- Senior Associate
- Analyst
- Senior Analyst
- Specialist
- Senior Specialist
- Manager
- Senior Manager
- Associate Director
- Director
- Senior Director
- Associate Vice President
- Vice President
- Senior Vice President
- Executive Vice President
- CEO
My experience has been that organizations may set hiring and job titling “rules.” One that comes to mind is a (silly) guideline that you can’t hire someone into a job more than two roles levels above where they are (e.g. Analyst to Senior Specialist in this example) or that promotions are once a year and people can’t receive an off-cycle promotion. My experience is that most HR people bend their own rules; they just don’t admit it. Guidelines get “modified” all the time; there may be rules and there are likely exceptions when convenient.
Some places – Apple and Google come to mind – have mostly avoided title inflation and have kept real titles in check. At both places a Director or VP title is a big job, with years of successful experience under the person’s belt and a significant scope of role.
At many companies today those titles may not mean much. When BlackRock acquired the former Barclays Global Investors, a three level organizational hierarchy of Managing Director, Principals, and Associates became Senior Managing Directors, Managing Directors, Directors, and Vice Presidents. While folks may or may not have been happy with the acquisition, the pumped-up titles likely made many people happier.
So how do you play the game?
1 – Research (LinkedIn is a terrific tool) what titles look like at the company you’re considering. What’s the level of experience people have for the title different people carry?
2 – Research (LinkedIn again) what people who have similar roles outside of the target company carry. What’s their level of experience. Look at professional association rosters, trade association, etc. to see what titles can be found and the experience behind them.
3 – How badly does the firm want to hire or retain you, and how much flexibility can you discover around titles? Is their “precedent” – a word that strikes terror into the minds of some risk avoidant HR people.
4 – How much pull does the hiring manager have, and are they keen to use it when it comes to title? How badly do you want the role and will you negotiate a bigger title if it risks cratering your candidacy. Will you trade title for pay?
5 – Ask what the potential title means in terms of compensation, any internal guidelines around longer term promotion, and what job titles above the suggested title do in terms of pay. In some states (California and Massachusetts come to mind) it’s illegal to ask a candidate what they currently make as a way to determine your pay offer. In California employers are now required when asked to tell a candidate what a job pays.
When I served as an SVP of HR with McKesson Corporation I changed titles of our Regional Vice Presidents to Executive Vice Presidents overnight because the external customer market merited it. We were under clubbing titles, and needed to signal that the roles were substantial when dealing with large health organizations like Kasier and supermarket chains such as WalMart and CostCo.
Not that people who became EVPs overnight didn’t ask about a compensation bump upward; they did. But there was no pay change with the move.
Hunch is that that lack of compensation pop wouldn’t happen again today. It’s a changed world, and title inflation is a part of doing business.
So the gist of all of this is that generally roles have a target title and there may be fudge room up or down a level, maybe two. It depends on the power of the hiring manager, the HR controls put in place, and how badly the organization wants to hire or retain you.
So do job titles matter? Yes; sometimes.
Life Back West is an occasional set of writings focused on ways people, teams and organizations can be both more effective (doing the right thing) and more efficient (doing the right thing well). More about my 30+ years of work coaching execs, startup and leadership teams can be found at the “About J. Mike Smith and Back West, Inc.” sidebar at the Back West blog. Now welcoming new and known clients.