Why Job Titles Don't Always Reflect the Value of Employees
Job titles don't always capture value creation in an organization. They do have their place in our professional lives. For example, they do a fine job aligning a company's org chart. However, they can do damage by creating entitlement in an organization, which can breed cultural viruses within the company. Position labels can also become an excuse to command superiority over another person, and confer a badge of honor that isn't always achieved in reality. What if our job titles moved in real-time, based on the value we are adding to the business instead?
Related: What's A Job Title Really Worth?
When I played in the NFL, our job titles changed continually. Sometimes daily, depending on performance, both on the practice field, or during the game itself. You could go from third string to first with a big game. Or, you could go the other way with a poor game. It was the performance that mattered -- not how long you had been with the team, or how much you were paid.
An article in The New Yorker looked at this issue, giving the example of the New York Jets quarterback, Mark Sanchez, in 2013. Although he was playing badly, the dilemma was, why would anyone pay $8.25 million to have the guy sit on the bench? We all know what happened next ...
By contrast, when Matt Flynn signed to the Seattle Seahawks for a small fortune, Head Coach Pete Carroll found his new star outshined by rookie Russell Wilson. His decision to bench Flynn and play Wilson was crucial to the team making the playoffs.
What made Carroll's decision remarkable was choosing to ignore convention -- he said he didn't want contracts, or salaries, or investments, to matter to him, "You want the best guy at that time to play."
It turns out this is not a new phenomenon. In 1995, the UK's IES Research Club made a study of eight companies that were delayering their management structures. The conclusion was that conversion to a flat organization did not work for all companies. Job titles can be looked at in many different ways, but the key to making it work is not to simply anoint leaders by their title. Peel back the onion and pay more attention to who is adding value and less attention to who has a VP title.
In my sports experience, across all disciplines, I have seen this, "sunken cost" notion played out more times than I care to remember. It is the coach's nightmare. The coach is under pressure from the owners and the fans to play someone he knows isn't cutting it.
There are obvious differences between building a Super Bowl caliber football team and building a world-class company. There are also a lot of similarities -- none bigger than the need to build a culture where high performance is the norm and not just aspirational.
Although we all carry job titles, my team hears me constantly say, "Your job title is not what carries weight inside our company. The amount of value and effort you are putting in defines your role here." Those who add the most value, and show the most effort, are the ones in line for raises and equity bumps at my company, Integrate.
When he's not running Integrate, Jeremy Bloom is a judge on CNBC's pitch competition show, Adventure Capitalists. Catch a new episode tonight at 10 p.m. ET/PT. Watch a sneak peek of what to expect below.