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Cracking the Promotion Equation

annual reviews giving a promotion human resources jobpromotion promotion equation Jan 02, 2024

 Mindy Honcoop, Founder - Agile in HR

In the complex world of small and medium business dynamics, the promotion conversation is no walk in the park for employees and managers—it's a delicate dance filled with uncertainties. As someone who's been in the trenches as an HR leader, I've closely witnessed the challenges that come with this journey. 

In my experience, companies with well-defined decision frameworks for this critical moment in the employee lifecycle not only increase trust but also boost retention. Unfortunately, it's a moment often overlooked, one that can swiftly break trust and sow toxicity. Enter the Promotion Equation—a clear framework that balances employee and business needs, serving as a guide for consistent and transparent conversations throughout the company. 

Why Transparency Matters

Imagine being the employee yearning for a promotion, left in the dark. Frustration brews, questions arise, and negativity creeps in. In this silence, employees craft narratives. Without communication, humans tend to fill the void with stories—sometimes not positive ones. Without a clear framework, a vacuum forms, ready for negative tales. Here, the promotion equation steps in, fostering understanding. It becomes an HR and manager tool for expectation setting.

The Skill Side: Employee Readiness

Skills matter—they're the building blocks of career progression. But acquiring them isn't a guaranteed promotion. It's the baseline, not the finish line. Employees must be ready with the necessary tools.

The Business Side: Company Need

The company must genuinely need the role. In SMBs, resources are precious. As an HR leader, I work with leaders to consider talent and roles needed. Do you need four engineers, and would five be too many? Use the equation to guide decision-making. Is there a business need? Who in our current company has the skills? If both are yes, promotion may be the route to take.

 The Equation Unveiled: Business Readiness + Business Need = Promotion

Magic happens when individual readiness aligns with genuine business needs. It's a two-way street. Keep honing employee skills—it's an investment. Small companies may not always have open positions, but provide opportunities for employees to prepare, and seize opportunities to build skills. Crack the promotion equation—assess and align skills, and stay proactive. Small businesses thrive on agility.

Managers and the Message: Consistency is Key

For the equation to work, the message must be consistent. Managers play a crucial role. They must understand and communicate effectively, ensuring company-wide consistency.

Navigating Promotions in Challenging Times

In this era of rising wages and slim profits, evaluating each potential promotion becomes imperative. The promotion equation guides this assessment for SMBs navigating growth.

Conclusion: Empowering the Journey

The Promotion Equation is more than a formula—it’s an empowerment tool. It enables transparent conversations, aligns aspirations with business needs, and guides the delicate dance of promotions in the challenging landscape of small and medium businesses.