Entrepreneurs have the propensity to give employees big, lofty titles.
That new kid handling the social media is given the title “Chief Marketing Officer.” The technician who is an old-timer because she has been around since the inception of the company four years ago, gets the title “Chief Technology Officer.” Entrepreneurs love to throw around lofty titles lie Vice Presidents, Directors, and Alpha Dogs (seriously, I have seen that one used more than once).
As an entrepreneur it feels like it is a nice way to empower your team. It feels like a nice way to recognize your small elite team. It feels nice, until it backfires.
Employees with lofty titles will inevitability believe that their role is equivalent to their title. They will learn about big business CMO’s, CTO’s, VPs and directors. They will compare responsibilities. They will compare compensation.
They will wonder how they can be a Chief Marketing Officer at your business and only make $30,000 a year, when the Chief Marketing Officer at the Fortune 500 down the street makes a base of $450,000 a year. Your CMO will wonder why he is posting tweets, when the CMO down the street doesn’t even know how Twitter works, but has a team of five Twitter-er’s.
Then the moment will come when your employee feels that they got the short end of the stick. That they can and should be doing so much more than what you have them doing. That you are paying them so much less than they should be making. That they are a lofty Chief Marketing Officer and you treat them like a lowly social media grunt. And that’s the moment you lose.
Don’t give lofty titles. In the short term it feels nice. In the long term it tears apart companies.
Do you agree or disagree?
If your employees are determining their value based on titles perhaps you hired the wrong people! If you hire “great talent” you won’t have to worry about what you label them because they will have the proper perspective.
Great point!!!!!
In my first job out of college I was named “Engineering Manager” for a small engineering company when I actually knew **nothing**. Company closed 2 years later!
Later I was named VP for another small engineering company (seeing a trend here?) where I oversaw a staff of 2 people. Didn’t stop me from getting fired even they had cutbacks.
LOL. Such a similar experience to mine. Now, honestly, did you feel that because of the title you deserved more compensation or appreciation or anything?
Not in the first instance because I was too naive.
But sure, by the time I was 36/37 and the boss had given me the title of VP I really thought I was “on the fast track” to superstardom.