What Are the Benefits of Career Ladders?
Professional progression is an aspiration for most people. Essentially, what this entails is climbing the steps of the corporate or career ladder.
This article looks at what a career ladder is, the types of organizations that may implement a career ladder program, and some key tips for making your way to the top.
What Is a Career Ladder?
A career ladder is a metaphor for an organization’s internal structure. Each rung on the ladder represents a position within the company, with entry-level roles at the bottom and levels of seniority at the top.
As an employee climbs the career ladder, they achieve what is referred to as career growth.
With each step (or more accurately, each promotion) they acquire more responsibility and authority, and usually, a higher-level salary.
In many cases, a career ladder is a formal structure – a clear path that employees will follow throughout their professional lives.
Where this is the case, it usually involves continuous training and employees may even be required to sit and pass accredited examinations to further continue on their journey.
This is a basic career ladder definition. In reality, working your way to the top of your career ladder takes more than a few simple steps. It requires ongoing development, hard work and commitment.
What Types of Job Might Have a Career Ladder?
Whilst progression and career growth are available in almost every industry, some have clearly defined career ladders.
These are typically industries in which on the job training is the norm or industries that operate under employment bands.
Some examples include:
- Finance and accounting
- Law enforcement
- Teaching and education
- Public sector roles
In other sectors, progression is not so finely tuned. For example, the creative industries often operate a more flexible approach to career growth and, whilst they exist as a metaphor, career ladders here a less formally structured.
What Are the Benefits of Career Ladder Programs?
Where a company operates a structured model of professional advancement, it is known as a career ladder program. These are beneficial from both an employer and an employee perspective.
For the employer, they:
Help with staff retention – Companies that invest in staff with career ladder programs hold on to their best employees for longer, as they are less tempted to look elsewhere for further progression.
Keep employees motivated – The potential of promotion acts as an incentive for employees to work hard, develop and commit to their responsibilities.
Improve standards – Because most career ladder programs involve continual training and education, they ensure employees are working to current and expected standards, thus creating a highly effective workforce.
Draw in the right people – Attracting top talent can be a struggle for many employers, but those who operate a career ladder program tend to get the attention of candidates with ambition since they see the potential for growth within the company.
Help with work distribution – When roles are clearly defined, as they are with a structured career ladder, employers can distribute work with great efficiency, knowing exactly who is capable of what.
For employees, the benefits of a career ladder program include:
Greater satisfaction – A career ladder program shows employees that they are valued and if they work hard, their efforts will be rewarded. This leads to increased job satisfaction.
Less stress – Internal promotion removes the need to look for a new job and the stresses that come with switching employer; like meeting new people, learning new ways of working and, potentially, even relocating.
Less competition – As a career ladder program focuses on internal promotion, employees know that when a job opening arises, they will not face external competition, but will only go up against their co-workers.
A level of security – Because there is a structured path for career growth, employees feel more comfortable. Their role is unlikely to suddenly become redundant because, without it, those above would cease to function.
Career Ladder Example
As a career ladder example, take the world of investment banking.
Typically, a graduate fresh out of college will start as an analyst.
After three years in this role (as an average) and with further on the job training, they would progress to the level of associate.
They will carry out most of the same responsibilities as they did as an associate but will have a small team working below them, and a higher salary to match their increased authority.
Associate roles often last between three and four years, and if the individual shows commitment and promise, they may then advance to a director position, or vice president overseeing the work of several associates and analysts.
From here, they may move up to an executive director, and after several years in the job, might even reach the position of managing director with a salary to match.
Of course, it’s not as easy as it sounds. Investment banking is a competitive sector that comes with a lot of pressure, but it’s a good example of how a career ladder program works in practice.