Are you a startup founder who has never had to think about career ladders? If you are growing and hiring more people, it's time to put career/job ladders in place. If you aren’t sure where to start, the Homebrew Guide to Career Ladders has arrived just in time. We will explore: what makes up a career ladder, when to implement a career ladder and how to use ladders both internally and for external recruiting purposes. As always, we welcome your feedback.
Let’s start with the basics.
What is a career ladder?
A career ladder (or often called a “job ladder”) defines different progression levels for each job function, explaining the differences between each level, and how an employee moves from one to the other. You should ideally have as many ladders as you do job functions. Product, Engineering, Management, Sales, Marketing, Finance, Ops, etc. A career ladder is a critical component of any formal process within a company that allows employees to advance their career to higher levels of salary, responsibility or authority. Once employees meet certain criteria, they are eligible to move into higher-level roles. This lays out some of the benefits of implementing career ladders. A career ladder is not a pay scale. Career ladders work in tandem with pay scales. When should we create a career ladder?
When you hit approx 30-40 people and the company is at least 18-24 months old you should implement career ladders for all functions. This is around the time when you hire an HR manager who may have some experience in this area. You will have employees who have been in their respective roles at least one year and may be ready for a role with greater scope (for example, a promotion) and there need to be clear guidelines about what the next level looks like and how employees will be evaluated to determine they’ve reached that level.
Management track vs. Individual Contributor (IC) track
Some companies have rewarding career tracks for people who want to move up and stay as ICs (individual contributors). Building an option for IC career ladders (rather than pushing high performers into management tracks) may be important to retain talent.
For example, some companies provide a career path for ICs such as in the engineering function where a very senior engineer becomes a “principal engineer” vs. director or vice president. It is becoming widely used in other functions such as recruiting, product management, and sales. One major advantage of having a two track (IC and Management) system is that the people who go into management actually want to manage. Otherwise, they’d pick the IC track.
How to create a career ladder...
Make sure every live job description has a clear set of responsibilities and requirements. Create the roadmap(s) or professional paths for each department, team, or business function. (Ex: how does an Associate Product Manager progress to a Product Manager or Sr. PM?). Are there lateral moves that should happen for some employees prior to moving up? Do you have the right training/support in place so that employees can move up the ladder? Where are the gaps? What coaching/training resources does the company need to invest in? Map every employee’s career path. Discuss during new hire onboarding. Career Roadmaps are highlighted during the interview process. Everyone involved in the interview process should be able to articulate the career path for each function. For example, when founders interview a junior engineering candidate, it is important to highlight the different paths this role can take. Some engineers move to product, data science, or technical writing roles. Not all career roadmaps are linear. Employees may make a lateral move prior to moving to a different level (depending on function). How many rungs in a career ladder?
It depends on the job function. The average career ladder for an IC role can be anywhere from 4-8 rungs. For management around 5-7 rungs. Engineering tends to have the most rungs at early stage companies.
How many rungs should I start with?
4 for IC roles and 5 for management roles should be safe. You can always revise as the business needs change.
Additional reading:
Example career ladders by function
Let’s explore different career tracks by function (Engineering, Design, Product, Marketing & Sales).
Note: We’ve included the necessary skills for each level of engineering. Other functions don’t include specific skills (product, marketing, design, sales)
Engineering
Individual Contributor (IC)
Here’s an example of Foursquare’s : Design
has created a detailed for product design roles. Product
You don’t see the Principal Product Manager as a popular title because the IC path for a PM tends to end at the Senior PM level at early stage companies. Some companies have a Group Product Manager (not shown in this chart) which is considered a balance of individual contribution and people management. Larger, later stage companies (MSFT, AMZ) tend to provide dual career tracks in product. These companies have a product area that is big enough in scope and complexity or that requires significant strategic planning.
Individual Contributor (IC)
Marketing
The IC career path is not typically recognized in marketing. Marketers tend to build their careers as ICs then manage others. Career growth for ICs can mean managing larger projects and managing cross functional teams vs. managing individual people. Some senior marketing folks who don’t want to lead big teams choose to work for themselves and run marketing consulting businesses. They take on different projects for companies where they are managing projects -- sometimes more than 1 at a time vs. managing people.
Individual Contributor (IC)
Sales
Sales is a function where an employee can stay an IC and successfully grow her career in most companies. Large companies tend to have more individual contributors with many years of experience who have chosen to “carry a bag” and sell themselves vs. manage a team. Sales IC’s carry a sales quota that they are experienced enough to meet or exceed regularly and that they can benefit from financially.
Individual Contributor (IC)
As your company grows in different functions, it is important to take time to build out career ladders for all functions where applicable. Employees need to understand their potential career choices in a company, whether they are moving towards management or individual contributor paths. It is the manager’s responsibility to discuss career development during and make sure that employees understand the different choices they have regarding future opportunities. A ladder is an essential tool in career development for both managers on the promotion side and employees working towards a larger scope of responsibilities. Additional Resources
Last updated: 11.1.24