Abhishek Rungta

In corporate world promotion = progress. Progress can happen with increase in responsibility, and growth in quality (skill)  or quantity (efficiency) of work.

Most promotions lead to improvement in responsibility and pay.

However, ​​blindly promoting team members without assessing their readiness or ability to contribute can lead to mid-long term consequences for the individual and the organization.

It sounds illogical, but it is extremely prevalent all over. At times it gets driven by competition for talent, market trends, short term fix; and at times it is followed like a ritual or right without giving much thought.

The unintended outcomes are:

1. Promotion without skill enhancement equals liability.

Elevating someone to a higher position without ensuring they possess the necessary skills, sets them up for potential failure, and also creates a liability for the company.​​ ​​An ill-prepared leader can hinder team performance and decision-making, ultimately affecting the organization’s bottom line.​​

Moving up requires ability to embrace discomfort, new challenges, and adaptability. It needs preparation and coaching.

2. The risk of a top-heavy organization

Even if someone is capable, you cannot promote everyone. Unless there are clear independent contributor role, which is directly linked to P&L; organizations run the risk of becoming top heavy, sluggish, bureaucratic, and less responsive to changes.

Company risks becoming “sick,” with many individuals operating at their level of incompetence.​​ ​​This misalignment can cause the organization to falter.​​

3. Higher pay for the same output: A costly mistake

At times an executive remains an independent contributor, and does not grow into higher value work, over time will incur losses for the company, and also breeds complacency. This can be managed if the client is ready to pay more basis inflation. However many-a-times pay growth is higher than the inflatation based price hike. Otherwise this erodes profit.

So, what can you do about it?

1) Make capabilities and responsibility expectation for each role clear. Provide equal opportunity in terms of training and growth to every person. The deserving ones will show up and grab.

2) Have open and transparent discussion about performance, position, pay, and gaps. Do not sugarcoat.

3) Let one perform the next-level role under mentorship of a proven leader, and improve key performance indicator to reduce chances of failure.

4) Do not let people stagnate in one single role for more than two-three years. If you don’t see growth for someone, tell them.

5) You cannot provide promotion in role to everyone. Some people will stagnate, and become negative, and bitter.

6) Good (as per your budget) pay hike when a person moves up and takes more responsibility, else inflation linked pay hikes.

Remember: Monetary growth follows capability growth.