Transforming Job Architecture: A Path to Business Resilience

It’s nearly four years since the COVID-19 pandemic upended global labor markets and left organizations scrambling to retain their people. Rather than seeing the Great Resignation as a call to action for reassessing conventional talent management approaches, most companies relied on short-term tactics to attract and keep their people.

Many of these tactics focused on pay, with companies doling out unprecedented retention and signing bonuses. These approaches have left businesses with internal pay equity issues that will take years to address. While money is a vital component of the employee value proposition, focusing on money alone does not fully address what employees want from their jobs — and what they are willing to give up to find it.

According to November LinkedIn research, “While employees leave organizations for reasons that include salary, benefits and working conditions, many move on because they feel their career has stalled with no opportunities for growth or advancement.”

Approaching career advancement through the lens of a traditional, static hierarchy is no longer serving employees or organizations. As Deloitte posits in their 2023 Global Human Capital Trends Report,

“Perceptions that economic growth is slowing, fears of an impending recession, and rising costs of living are putting increased pressure on organizations and business leaders to do more with less. At the same time, global talent trends—including a hot labor market, a rise in stakeholder capitalism, and shifts in the composition of the workforce—call into question the very foundation of how, where, and why we work… Organizations and workers should challenge prior assumptions and adopt a new set of fundamentals built for a dynamic, boundaryless world rather than the stable, compartmentalized one we are leaving behind.”

In today’s labor landscape, identifying and marrying employee purpose and career growth to pay growth is essential for keeping employees challenged and fulfilled. Rather than being tied to rigid organizational structures and role definitions that provide limited opportunities for growth and advancement, employees are looking for opportunities that better align with their strengths and passions.

As companies retool how they do business, they need to build new skill and career development pathways. The first step in this process is to upend traditional job architecture, which presents a rigid career ladder with one path for advancement: management. In its place, organizations need to create job architecture that rewards and encourages cross-functional and lateral moves.

Giving employees more options to chart internal career paths rather than forcing them to look for external growth, the number one reason from Gallup’s research that people left their jobs during the Great Resignation, enhances the employee experience and creates organizational “stickiness.”

In this third installment of our talent retention blog series, we explore the organizational cost of hierarchical job architecture — or, even worse — its complete absence. By definition, job architecture is a framework that organizes positions into clear organizational levels and career paths. When done well, we will establish that job architecture drives the business strategy, increases talent agility, and inspires employee growth.

The Role of Job Architecture in the New World of Work

In the new world of work, poor or nonexistent job architecture resembles a trip without GPS. Lacking a clear view of career growth possibilities or a sense of how to advance, employees can feel trapped in their jobs, believing the only way to progress in their careers is with another organization.

Facing more productivity disruptions than ever before, organizations must create more workforce agility and flexibility to remain competitive. Yet many companies still rely on inflexible employment frameworks, locking people into stagnant roles and limiting the ability to deploy talent quickly against emerging trends and business needs. Since the first Industrial Revolution over 250 years ago, career paths have generally moved in one direction: up. This staid structure largely remains in place today.

Rather than a hierarchical career ladder with narrowly defined job roles that keep people in functional boxes, job architecture should include interconnected paths that enable employees to move across and around the organization. According to Harvard Business Review, “Rather than climbing a ladder, the career of the future is a portfolio to curate.  For individuals, career portfolios are designed to adapt, evolve, and uniquely represent you. For organizations, career portfolios represent the future of HR.”

Like a Japanese garden that is intentionally and thoughtfully designed, with stones and pathways purposefully placed, an organization can create multiple career paths based on business needs. Using a Japanese garden as a metaphor for creating greater career agility and employee agency inspired our company name, Acera, meaning “pathways” or “sidewalks” in Spanish.

Without linear-defined paths, employees can move in different directions, to different business areas, around work that inspires and challenges them.  In this way, organizations invite employees to co-create career paths curated for them.

How Does Job Architecture Drive Retention and Growth?

An agile, future-focused job architecture provides more than multiple career paths. It plays a crucial role in integrating talent decisions with organizational strategies. When thoughtfully designed and woven into the organization, job architecture fosters resilience and adaptability in an unpredictable labor landscape by:

• ‍Fueling talent mobility.

When employees move between functions and disciplines, they help break down silos for increased collaboration and innovation. With experience and insights into the organization’s broader work, they also bring ideas for greater process efficiency and scalability.

As evidenced in many Fortune 500 rotation programs, where small groups of “high-potential” entry-level employees rotate through different areas of the organization and fast-cycle into leadership roles, organizations know the value of exposing employees to diverse experiences. These expensive, exclusive rotation programs are a testament to that. Yet these same companies keep less privileged employees locked in their functions.

For the few employees making lateral moves into different business areas, often through their own iron will, compensation is not provided for the increased value they bring to the organization. They are paid the same, based on restrictive pay grades defined for that level. Organizations may even threaten employees with earning less when moving into different business areas, especially if it requires them to jump down a rung or two.

Many businesses use pay equity to rationalize pay restrictions. But when an organization clearly rewards mobility, a pay differential between mobile and stagnant employees is easily defensible. Instead of tying compensation to inflexible job ranges and hierarchy (as most of today’s compensation plans do), job architecture should track and reward employee movement across and around the organization. This encourages cross-pollination and lateral moves while recognizing the increased value these employees bring to the table.

• Driving a skills-focused business.

According to the World Economic Forum, half of all employees will need reskilling by 2025 to offset the adoption of industry-wide automation and technological advancements. To weather the mounting global skills crisis, companies can deploy job architecture to define current skills needs and project future requirements within job roles and levels. Organizations like Unilever and IBM lead the way in this work by helping employees move between assignments based on their skills, not just their titles. In addition to creating more employee mobility, this approach enables organizations to stay competitive through critical reskilling.

By capturing future skill requirements, thoughtful job architecture also helps organizations tie employee skill development to the organization’s strategic direction — something that few organizations do today. According to Boston Consulting Group, only 24% of companies are making a connection between corporate strategy and reskilling efforts.

• Enhancing retention & role clarity.

According to Gallup's Annual Employee Engagement Survey, “A lack of role clarity makes all other engagement elements less impactful . . .[employees] cannot perform at a high level when they are confused as to what they are supposed to do. Confused employees are more likely to look for other work and eventually leave the organization.” By clearly delineating roles and expectations, job architecture heightens employee engagement and loyalty.

Some organizations invite even more employee agency in role definition, which can translate into job architecture. Harvard Business Review reports that the tomato processing company Morning Star “enables employees to reshape their job descriptions to be more in line with the core parts of themselves.” Through alignment with the organization’s needs, employees craft their jobs in line with their strengths and interests, creating a more appealing and engaging way to spend their days.

In Summary

In a labor market where “78% of employees are frustrated because they’re experiencing challenges trying to advance their careers,” according to Guild Education’s American Worker Survey, it’s not surprising that 61% of workers are ready to leave their jobs for new opportunities. To weather a competitive talent landscape, businesses need job architecture that offers a visual roadmap for career growth — increasing employee retention and employee engagement.

Besides offering multiple career paths navigable by employee interests and strengths, job architecture tied to skill development and pay progression can incentivize workers to upskill and reskill. While advancing personal growth goals, this helps employers realize business objectives and meet modern work demands.

A flexibly designed job architecture plan allows for multiple, interconnected paths, optimizes talent potential, and drives organizational momentum by:

• Recognizing and incenting the value of internal mobility.
• Embracing the labor market’s emerging skills focus.
• Tying career paths and skills to the business strategy.
• Clarifying employee purpose and driving engagement.
• Increasing a company’s external competitiveness.

Is Your Job Architecture Ready for the Future of Work?

As work boundaries continue to dissolve, Deloitte’s Global Human Capital Trends Report finds that organizations and workers “need to chart a different path, co-creating their relationship in pursuit of new and evolving purpose, innovation, and reimagination.” When carefully designed to align individual paths and possibilities with the organization’s strategic direction, job architecture marries employee and organizational purposes to catalyze growth, agility, and sustainability for both workers and businesses.

Integrating talent and compensation into one cohesive strategy, Acera Partners helps clients drive business outcomes and prepare for the future of work. Discover more insights in the second installment of our series on Job Architecture featuring Zayo Group's story here - Job Architecture: A Gateway to the Skills Economy - or please get in touch with us to connect.