By: P. Lahiri
One of the most disconcerting decisions that human resource managers have been facing in deciding who to promote from within an organisation for bestowing higher responsibilities; whether they are serving senior and experienced employees of the organisation or those bright individuals who have proved their worth by their performance. Unarguably therefore, the most difficult part of the promotion policy that can be implemented by any organisation, is to select the criteria for conferring higher responsibilities to an existing employee, namely seniority or ability. There is no clear cut answer to this riddle as there are some seemingly strong arguments on both sides of this conundrum. Viewed simply, an effective promotion policy focuses on advancing employees based on their skills and performance, while shunning favouritism. It is important to determine the minimum criteria for advancement and make employees well aware of the standards they must meet to earn promotions. Skill and performance of employees can only be evaluated over a minimum time span which each employee is required to spend in the organisation. So the promotion policy should make it clear to employees about the definite time every employee need to spend in an organisation before he/ she can be considered for promotion. Having spoken about the importance of skill and performance of an employee and the minimum period over which these attributes are to be evaluated, the focus now shifts to another equally important benchmark for advancement which is on-the-job experience earned. More time spent within the organisation gives an insight to any employee about the nature of job and the best way to perform it. An experienced employee is an asset for any organisation, as much time and resources have already been invested in such individual. Many human resource professionals also believe, seniority adds value to an employee in terms of competence due to greater exposure. Accordingly, it adds relevance to provide the senior people in an organisation with opportunities for career advancement along with rewards or benefits that come with higher age.
Need for a clear promotion policy:
The need to lay down a clear and unambiguous promotion policy is of immense importance. An unclear promotion policy can lead to conflicts and high turnover rates among employees who do not understand why some co-workers received precedence in promotion over them. Additionally, vague promotion procedures may also appear discriminatory. To avoid these ambiguities, the need for employers to adopt a transparent promotion policy and to apply the policy’s standards to all the employees seeking advancement, cannot be overstated.
Seniority vs. Performance as criteria for promotion:
Before proceeding to decide on the desirability of adopting one criterion over the other it is vital to rightly interpret the terms, “Seniority” and “Performance.”
Seniority means the tenure of an employee in an organization. Seniority is something which comes with experience in some kind of work or in a particular position in the company. Such experience may also sometimes mean cumulative experience in various kinds/ levels of jobs in the company. It also signifies loyalty to the company and is measured by the seniority clock that runs from the moment the employee reports to work until the employee quits or is fired.
Performance is a distinction that is measurable. It reflects in the working behaviour of the employee. It is measured in terms of an employee’s involvement in the development of the company. It distinguishes hard work, quantum of work and also the quality of work delivered by an employee who contributes to the company’s growth in the best possible manner.
The proponents of seniority and those of performance as basis for advancement of employees, have very strong arguments in favour of their propositions. Objectively speaking, there are benefits/ advantages and detriments/ disadvantages in both the systems. Following lines enumerate advantages and disadvantages of both the systems:
Advantages of “Seniority” based promotions:
- Senior employees of an organization have better understanding of the organisational culture, vision and goals.
- Senior employees have on their side the advantage of more experience which is an invaluable asset for assuming higher responsibilities.
- Experienced employees make better team leaders for executing jobs where collective effort is needed.
- The measurement of seniority is simple, exact and also objective leaving no room for favouritism, nepotism, discrimination and retaliation.
- It protects and boosts an employee’s morale which in turn helps to increase productivity of the employee.
- It recognises and rewards loyalty to the organisation.
- It reduces labour turnover.
- It promotes industrial peace by making the workplace more harmonious especially in more unionised organisations.
- Seniority based promotions may help in attaining high levels of competence due to longer work exposure.
Disadvantages of “Seniority” based promotions:
- A more senior employee does not necessarily mean a more productive employee.
- Senior employees with long years at their back tend to be less enthusiastic and sometimes work listlessly which may prove detrimental to reaching goals of the company.
- Senior employees tend to display inertia to adapt to changes and prefer to stick to long-standing procedures.
- Promotion driven by seniority is a reward system that is based on entitlement rather than self improvement through acquisition of newer skills and training.
- Seniority based advancements are less likely to promote excellence within an organisation as employees may feel that promotions are guaranteed after completion of a certain period of time within the company. Such practice may promote a culture of mediocrity in the organisation.
- Holding onto senior employees rewarding them with higher positions with enhanced pay may prove costlier as talented younger employees can be obtained by offering a lesser compensation package.
- Seniority driven advancement may stifle motivation and fuel resentment among talented individuals with lesser experience.
Advantages of “Merit” based promotions:
- Merit based promotions by recognising high-performers nurtures a culture of healthy competition and productivity.
- Since actual performance, efficiency and talents are rewarded, this system of promotion encourages the employees to enhance their knowledge in maintaining a high level of productivity.
- It is very effective in putting the most productive, competent and talented person for specialised nature of jobs.
- Talent based promotion incentivises even new employees to improve their performance since promotion is made on the basis of competence, capability and efficiency.
- Performance driven promotion policy is effective in creating a sense of accountability among employees.
- It helps a HR manager to face the challenge of retention of talent, as high performers, driven by their urge to accelerate the professional goals, are always inclined to seek better opportunities elsewhere.
- It helps an employee to plan his own career trajectory within the organisation.
Disadvantages of “Merit” based promotions:
- The inevitable criticism of merit based promotions is that it may result in favouritism, nepotism, discrimination and victimisation by the management.
- The unsatisfied senior employees if superseded may resort to agitations and other activities emanating from resentments, impairing industrial peace and harmony.
- An essential pre-requisite of performance based promotions is a proper method of performance appraisal or merit rating which is not easy to make it foolproof.
- Lack of much experience may not make an employee effective when promoted into a position of leadership. Such shortcomings may affect performance of the group he/ she leads.
Neither seniority nor merit can be accepted as a sole basis for promotion. Based only on seniority, a promotion system will offer less incentive to learn and improve. The employees will only bide their time to wait for their turn to secure promotion. And summarily ignoring seniority in deciding on promotion will not recognise the inherent importance of experience of tenured employees. A well formulated promotion policy should be the one that can be executed properly whenever any vacancy arises. A promotion system based on merit needs to be fully structured to avoid the element of conjecture in it. Various jobs within the organisation should be well defined and rated and employees should be made aware of ratings. A sound promotion policy should be made on the combined basis of merit and seniority. Both seniority and merit should be given due weightage in a robust promotion policy. When ability is substantially equal, seniority should be taken into account. In specialised posts, talent, skill and ability should get precedence over seniority. For other posts a two track promotion system may be formulated whereby in the normal track, some posts may be filled on the basis of seniority only, provided the senior employee meets a minimum benchmark of performance set by the company. On the other hand, in the other track of elevation which can be named a fast track, an employee who has put in a minimum qualifying period of service can be evaluated with a slightly more demanding yardstick of performance to secure promotion. A promotion policy should not be static and needs to be reviewed at definite intervals so that it fulfils the growth of an organisation as well as offers its employees scope for their professional advancement.