When creating a new position, my management team spends a lot of time thinking about the position, the responsibilities and expectations. We turn these thoughts into a clear and detailed job description and then at the very end tag it with an appropriate title. I firmly believe, job titles should accurately reflect your position, role and responsibilities.
Titles have become important for most professionals as they convey your position during your career. Stay with the same title too long and people may think your career stalled. Jump titles too quickly and it may seem like you are missing some important foundational experiences.
I recently interacted with an organization that seemed to disregards common accepted standards for titles and gave everyone a title that seems more senior than they should be. In most organizations, the responsibility chain goes something like this: employee, team lead, manager, director, VP, SVP, EVP. Some organizations give out senior positional titles like VP (Vice President) for positions that would be considered manager level everywhere else.
Can this be real? Actually it is. During an internal disagreement with a Goldman Sachs employee that quit, Lloyd Blankfein (CEO) wrote an OpEd (link) where he referred to the 12,000 VPs at Goldman Sachs. Keep in mind they have a total of 34,000 employees. They also have 2,400 Managing Directors.
The company I met was in the banking and investment space. Goldman Sachs is in the banking and investment space. It seems this is common practice in that sphere of activity[ but it isn't limited to just this industry] I spoke to some trusted HR experts and learned that in many companies (particularly in banking), these titles are related to seniority and not the actual work an employee is performing. Think of it like a title you are allowed to use on business cards to look “more important” when dealing with external parties (customers, suppliers, regulators, etc.)
In some cases these titles are used to draw in difficult to find talent and in rare cases as a means to compensate a candidate when pay or benefits may not be enough.
The age of job title inflation
Economic inflation is typically defined as “a general increase in prices and fall in the purchasing value of money.” This happens when governments print money making it more easily accessible without relying on a strengthening economy. Basically you cut more pieces of the same pie.
We are living in the age of flattening org structures with the hope of making organizations more fair and efficient, yet employees still want to feel important (like they are progressing up the chain). This is the environment where title wackiness is allowed and encouraged to happen.
Tech is not immune to title inflation. Steve Jobs called himself “Chief know it all”. I meet people every week with titles like guru, evangelist, futurist and ninja. New top level domains have even been created to cater to peoples growing egos: .nina , .expert, .guru and many more.
This explosion of "useless" titles isn't limited to western companies and we see it in the developing world. Countries like India, where hierarchical standing carries a lot of weight, are also jumping on the bandwagon. With increasing demand and limited supply of qualified employees, companies are willing to “play ball” and give recruits that incredibly important sounding title that he/she can use to impress all of his friends and family.
Years ago, you had a president and a very limited number of Vice-Presidents. Today you can find companies where 40% of the employees are VPs. We see all kinds of strange new age titles. Without picking on anyone, here are a few examples of titles you wouldn't have seen 5 years ago.
You read right. Kodak had a Chief Listening Officer. We all know what happened to Kodak.
We are seeing Chief Twitter Officers, Chief customer advocate, Digital Overlord (website manager), chief chatter (call center manager), chief inspiration officer, etc.
Do these titles matter?
New technologies sometimes justify the creation of a new C-level executive (think Chief Digital officer) but companies have become too liberal with new titles.
With economic inflation, the effect is that the new "free" money has a very short positive effect, but soon everything costs more. This increase in prices hurts everyone medium to long term.
The same will happen with title inflation. At first you feel important. You are a VP in a prestigiously large and respected organization. You are better than your friends. Then everyone starts to get these kinds of wacky titles and the value drops to zero. The effect is even worse when the title was used to draw you into a position where the actual compensation may have been sub-par.
Inflation, in all its forms, devalues everything it touches.
What should we do?
On the hiring front, it is your job to perform a thorough due diligence on every candidate. Don't automatically favour a candidate with a senior sounding title and don't disqualify a candidate because the title sounds too junior. Remember that titles rarely represent the actual responsibilities, capabilities and level of many candidates.
When creating titles for your jobs, be honest and logical. Don't use the title as a mechanism for non monetary compensation. Make sure the titles (for the jobs you are hiring for) are clear, descriptive and adequate.