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  • Ezra Weeks

Six Reasons Why Your Company May be Failing at Employee Advancement

When it comes to worker advancement, it is essential for companies to deliver opportunities for their employees consistently. Not only is this beneficial for the individual workers, but it can also lead to overall benefits for the company. A well-developed workforce is more productive and able to adapt to new challenges, leading to a stronger and more sustainable business. This is the key finding that emerges from the American Opportunity Index, a first-of-its-kind ranking of Fortune 250 companies based on the experiences of three million of their US workers.

The study, sponsored jointly by the Burning Glass Institute and the Harvard Business School's Managing the Future of Work project, found that two-thirds of the companies evaluated landed in the top quintile on at least one of the six measures used to describe worker advancement. However, the study also found that even the top-ranked firms often fail to deliver consistently on worker advancement. To understand why this is the case, the researchers grouped underperforming companies based on measures of opportunity creation, including the speed of promotion and the success employees achieve at other firms after leaving.

By categorizing firms according to commonalities in worker experiences, the researchers identified six archetypes of underperformance, each representing a unique combination of characteristics. The six archetypes are Fast & Flimsy, Low Value-Add, Churn & Burn, Glass Ceiling, Slow & Steady, and Elite & Excluded. Fast & Flimsy companies create lots of opportunities for employees without prior experience and have a high velocity of initial promotion, but they don't consistently invest in training, leading to career stagnation. Low Value-Add companies provide lots of entry-level opportunities, but employees do not advance internally or after they leave. Churn & Burn companies have high turnover and fail to provide employees with experience and learning that would help them qualify for better opportunities after they leave. Glass Ceiling companies have low levels of representation for certain groups, such as women and people of color, at higher levels of the organization. Slow & Steady companies have low promotion rates and employee mobility levels but also relatively low turnover. Elite & Excluded companies have high levels of representation for certain groups at higher levels of the organization but also have low levels of representation for other groups.

The reasons for underperformance generally fell into one of three categories: a lack of consistent measurement of outcomes, insufficient investment in training, or adherence to outdated business models. These factors can lead to a lack of opportunities for employee advancement and career progression, which can negatively affect the individual workers and the company. Without a clear understanding of how well their efforts are paying off, companies may be unable to identify and address any issues holding their employees back. Similarly, a lack of investment in training can prevent employees from gaining the skills and knowledge they need to advance in their careers. Adhering to outdated business models can also limit opportunities for advancement, as it may prevent the company from adapting to changing market conditions and industry trends.

To improve employee advancement and overall success, companies must strive for consistently high performance in worker advancement. This includes consistently measuring outcomes, investing in training, and avoiding outdated business models. By addressing these issues and creating a culture of opportunity for all employees, companies can create an upwardly mobile workforce that benefits everyone. This is particularly important in today's rapidly changing business environment, where the ability to adapt and learn new skills is more critical than ever. By supporting the advancement of their employees, companies can ensure that they have the skills and knowledge they need to meet the challenges of the future.

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