This comprehensive view of organizational career management systems discusses the portfolio of career planning and management practices available to organizations and explores ways by which organizations can use career systems to meet their needs. It focuses on organizational career management: what it is, why it is needed, and what it does. Special attention is given to career management practices and how they form an integrative system for people development within organizations.
What is a career? A career can be seen as the pattern of work-related experience that spans the course of a person’s life, an evolving sequence of a person’s work experience over time, the sequence of employment-related positions, roles, activities, and experiences encountered by a person, or as a process of development along a path of experience and roles in one or more organizations. Careers take place in specified social environments, and particularly in organizations. A “normal” or typical professional career usually follows a sequence of developmental phases, each of which is delineated by a distinct shift in the individual’s sense of self, but each is shaped and influenced by the organization in which the person works.
A career belongs to the individual, but in much, if not most, employment settings, the career is planned and managed for the individual by the organization. The organizational structure identifies an internal road map, clarifying positions and the interrelationships between these positions, as well as the relevant competencies necessary to fill them. Furthermore, organizational career management includes mechanisms that enable people to navigate this road map. This is how organizations take a leading role and have control over career planning and management.
The organizational system of career management relates to several levels, as depicted in Yehuda Baruch’s CAST model. The three P’s—philosophy (strategy), policy, and practice—are parallel to the three A’s of individuals—aspirations, attitudes, and actions. The need for matching individual and organizational needs has been emphasized by many scholars. Peter Herriot and Carol Pemberton’s model associates the business environment with the organization in terms of strategy, structure, and processes. Even more important, their model compares and contrasts the organizational and individual needs and expectations.
Moving from the strategic level to the practical level—the actual human resource management (HRM) activities that form the career management system—the next section of the entry outlines a comprehensive portfolio of HRM practices, which can be conducted by organizations to plan and manage employees’ careers. Evidence is presented regarding the extent to which these practices are actually applied in organizational settings. Based on both data and conceptualization, six dimensions are utilized to demonstrate the nature and role of these practices. Finally, a framework that integrates the various practices into a comprehensive system is offered.
The interpretation of the utilization of these practices needs to be taken in the context of dynamism of the social system. Contemporary work has focused on the changing meaning of careers. There is a clear shift from long-term relationships to transactional “short-termism,” with major changes in the nature of the psychological contract between employers and employees.
The Utilization of Career Practices
The importance and prominence of organizational career planning and management (CPM) as part of HRM have been widely recognized. Organizational career systems comprise a three-level framework of strategy, policy, and practice. At the practical level, one may find a number of activities and practices that aim to help organizations manage the careers of employees, in particular managerial and professional careers. An appropriate system should aim to ensure a fit between individual needs and aspirations and organizational requirements.
The list of practices discussed in this entry evolved from several earlier studies of CPM practices. Table summarizes findings from these studies, all of which examined the use of CPM practices in organizations as reported by human resource directors. The next section describes these practices, with a specific consideration of their relevance and viability in the context of the twenty-first century. This is followed by a discussion of how the practices can be integrated into a single comprehensive system.
Before embarking on the task of describing the various practices, let us identify their target population. Each person, be they the porter or the CEO, has a career, a personal and occupational journey. Each organization is a career system, the landscape for people’s journeys. Nevertheless, many individuals develop their career outside the boundaries of large organizations. Self-employed people who run small businesses, freelancers, and the unemployed all have their career external to an organizational framework. However, most working people are engaged in organizations, usually as employees. Career management practices are carried out by organizations, usually via the HRM unit, to answer employees’ needs and match them with the organization’s needs.
A Portfolio of Career Management Practices
Posting (Advertising) Internal Job Openings
Whenever a position needs to be staffed, the organization can look to fill the vacancy with candidates either inside the organization (internal candidates) or outside the organization (external candidates). The choice depends on the level and type of the position and the norms of the organization’s career management practices. A model developed by Jeffrey Sonnenfeld and Maury Peiperl identifies such a typology of external versus internal recruitment. Many organizations employ a policy that requires internal job posting before any external search is conducted. Extensive use of job posting within the company indicates to the employee that the organization focuses on the internal labor market, preferring internal promotion to recruiting managers from outside.
Formal Education as Part of Career Development
With this practice, the organization selects people of managerial or technical potential and sends them to a program of formal study as part of their development path. The education can include a first degree in engineering, an MBA, other academic studies, or professional and vocational qualification training. Once the organization has identified a training or education gap in the near or far future, these programs can rectify the problem with this long-term approach.
Lateral Moves to Create Cross-functional Experience
Lateral moves to create cross-functional experience are on the increase and may be seen as elementary career planning and management practices that most organizations with HRM systems need to apply. The flattening of organizations means fewer hierarchy levels and thus fewer opportunities for upward mobility. Because people no longer move up the ladder so fast, organizations need to clearly indicate that a route with slower upward mobility reflects career success rather than failure, a shift from past norms.
Retirement Preparation Programs
This practice is directed at a target population of employees approaching retirement and about to leave the organization. In these programs, the employee is prepared to face retirement in several ways. Much attention is devoted to financial considerations such as understanding the pension conditions and learning tax regulations. However, the more effective programs also take into account the psychological issues surrounding an individual’s need to readjust to life without work. With the advent of heavy redundancies (reductions in force or layoffs), fewer people are leaving the workplace at the legal retirement age. As a result, traditional pre-retirement programs might become quite rare in the future. Progressive organizations may opt to transform the pre-retirement program into a pre-redundancy program.
Booklets and/or Pamphlets on Career Issues
Booklets, pamphlets, or leaflets on career issues represent a formal presentation by an organization regarding all kinds of career-related information. Such information is directed at all employees but is important especially for newcomers, either recently recruited to the organization or recently promoted to the managerial ranks.
The dual ladder provides an organizational hierarchy for non-managerial staff, such as professional or technical employees, that is parallel to the managerial hierarchy. The major role of such a ladder is to enable upward mobility and recognition for those employees who cannot or do not wish to pursue a managerial role in the organization.
Induction or Socialization
The process of introducing people to their new organization is the first CPM practice that the employee experiences. This is a process whereby all newcomers learn the behaviors and attitudes necessary for assuming roles in the organization. Part of this process is formal, led by organizational officials, whereas other aspects are learned in an informal manner.
Assessment and Development Centers
Assessment centers have been found as a reliable and valid tool for career development. Assessment centers were first used as a selection device for managerial recruitment. Later they were also used for identifying managerial potential and for developmental purposes.
The principal aim of mentoring is to bring together a person with managerial potential and an experienced manager who is not necessarily the direct manager. Such a senior manager can provide advice and tutoring, serving as a kind of “uncle” or “godfather” in the workplace. Thus mentoring is directed mostly at managerial personnel and is used frequently for graduate recruitment programs. The potential of this practice has been suggested in many studies. Mentoring might also be dysfunctional, due, for example, to a negative relationship between mentor and protege, a possible collision of interests between the individual’s mentor and his or her direct manager, and the challenges of managing a cross-gender relationship.
Career workshops are short-term workshops focusing on specific aspects of career management that aim to provide managers with relevant knowledge, skills, and experience. These can be specific to providing certain skills, to help the individual learn about organizational processes and changes, or to improve self-career management (e.g., workshops to introduce career concepts such as career resilience or intelligent careers).
Performance Appraisal as a Basis for Career Planning
Performance appraisal (PA) systems operate in most organizations. There is, however, a need for a close connection between the PA system and career development. PA is perhaps the most fundamental system and can be utilized by human resources in a very similar way to that by which accounting reports (such as profit and loss statements or balance sheets) provide information regarding financial and accounting systems. Valid and reliable PA systems provide answers to acute questions such as who should be promoted, who should be made redundant in case of a downsizing, and who should receive training and development. The most recent development in PA is 360-degree feedback that includes self-appraisal, peer appraisal, upward appraisal, committee appraisal, or a combination of several sources in addition to that given by the direct manager. Although the literature supports the use of 360-degree feedback, this practice is very demanding in terms of the time that needs to be invested and the analysis that needs to be conducted.
Career counseling involves two-way communication between the employer and the employee, and two main sources are available for conducting the counseling. The first is the direct manager (or another higher manager) who has a good knowledge of the employee’s attitudes, behaviors, skills, and so on, and the second is a human resource manager. Depending on the complexity and the financial resources of the organization, external counseling can additionally be provided.
Succession planning (also labeled management inventory) can be valuable for long-term planning. It determines the possible replacement of every manager within the organization and evaluates the potential for promotion of each manager. It is primarily directed toward the managerial workforce. It will be different, but not less important, in a flattened organization where lateral movements predominate.
Programs for Special Populations of Employees
With an increasing level of employee diversity, new work arrangements, and globalization, career practices need to address the needs of specific populations, such as ethnic minorities, women, physically disabled, and dual-career couples. In the banner of equal opportunities and with increased litigation brought against companies, organizations realize the need to go beyond paying lip service to equality and to make sure that all members are given a fair option for promotion.
New Career Planning Management Practices
Building Psychological Contracts
The concept that a psychological contract exists between the employee and the workplace was discussed earlier and is a crucial aspect of the employment relationship. Recent research has examined the negative impact of breaking these psychological contracts. The cycle of career planning and development for each person joining the workforce starts with the establishment of a mutual agreement, a psychological contract, that sets the stage for future relationships.
A secondment is a temporary assignment to another area within the organization and sometimes even to another associated organization (such as a customer or supplier). A person from the managerial or professional echelons of one organization is transferred for a specific time (usually from one to three years) to another organization. Experience is shared in a way that benefits both the organization and the individual.
CPM Practices That Require Reassessment for the Future
Written Personal Career Planning for Employees
Written career planning documents imply a commitment on the organization’s part. Long-term commitment (e.g., lifetime employment) has already become virtually an extinct feature of organizational life. Written personal career plans are problematic also in the sense of creating employee expectations that may not be capable of being fulfilled in the organization.
Common Career Paths
A career path is the most preferred and recommended route for the career advancement of a manager in an organization. Such career paths can lead people through various departments and units within the organization, as in the case of future top-level managers in multinational companies who take a managerial role in an overseas subsidiary. With traditional hierarchical structures flattening and diminishing and with the creation of boundaryless and virtual organizations, future development in career paths seems likely to decline. It is now the norm, rather than the exception, for organizations to have no fixed career paths and for individuals in them to see no further than one or two years ahead.
Integrating a Set of Practices Into a System
The practices presented above have a significant problem if they are presented as distinct, almost standalone practices. However, both managerial logic and practical experience point out that there should be a system designed to manage careers, and this system applies the various practices according to need. However, a question remains: What are the relationships between these practices? Two answers are provided here in the form of descriptive and normative models.
A Descriptive model For Career Planning Management Practices
The first answer is based on a descriptive model, that is, what happens in real organizations. The results of an empirical study in the United Kingdom (shown in the figure above) reveal five clusters of CPM practices. It is a model based on field-research data gathered from almost 200 organizations and was constructed using a statistical procedure known as factor analysis. The classification of CPM practices is configured along two dimensions: (1) the degree of sophistication embodied in the practice and (2) the level of organizational involvement required by the practice. The five clusters are described below:
Job posting, formal education as part of career development, preretirement programs, and lateral moves to create cross-functional experience appear in this category. These may be seen as elementary CPM practices that most organizations with HRM systems need to apply. Evidence indicates that they are applied in most of the organizations studied. Although currently widespread, they may best fit the traditional, bureaucratic organization model. Contemporary organizations, for example, may be reluctant to invest in education, see no need for preretirement programs, and due to the frequency of organizational changes, abandon long-term planning.
This category includes performance appraisal as a basis for career planning, career counseling by the direct supervisor, career counseling by the human resources department, and succession planning. These practices share both an active involvement on the part of the organization in individuals’ career development over time as well as the organization’s need to fill jobs in the future. This manifests a forward-looking, initiative-taking HRM system.
Assessment centers, formal mentoring, and career workshops are the three practices in this group. They clearly all have an informational element, which characterizes either the process of gathering information for the organization or the use of information for developing individuals. The bidirectional nature of this information transfer (between the organization and the employee) is characteristic of organizations that take the time to put these elements in place.
Written personal career planning for employees, dual career ladders, and books and/or pamphlets on career issues are the three practices in this group. These represent elements of career management whereby the organization provides the employee with a formal system of information and presentation of opportunities. However, this represents a downward direction of information transfer (from organization to employee) rather than bidirectional.
Peer appraisal, upward (subordinate) appraisal, and common career paths comprise this category. The inclusion of common career paths in this category is a bit surprising, because they are logically associated with formal career structures. The remaining two practices could be characterized as increasing options by expanding the directions through which people can receive feedback and develop within the organization. These are more advanced practices, which many organizations will need in the future.
Analyses regarding these five clusters revealed that they were associated with different aspects of an organization’s culture. For example, practices in the active planning category tended to be provided in open and proactive cultures, the basic practices in team-oriented cultures, and the multidimensional practices in open cultures and in organizations that used an internal labor market to fill positions. Not surprisingly, formal practices were more likely to be provided in large organizations than in small organizations.
The practical implications for HRM suggested by this descriptive model are as follows:
- For the basic: Offer basic career system elements, satisfy employees’ expectations, and provide a relevant infrastructure
- For the formal: Support the internal labor market, provide stability, and clarify options for career development within the firm
- For the active management: Maximize the firm’s knowledge of employees and maximize the employee’s knowledge of the firm, including the options within the firm
- For active planning: Make performance-career links explicit, offer personal and emotional support, provide for succession
- For the multidirectional: Maximize performance feedback, promote an open culture, but beware of risks in small or “closed” organizations.
A Normative Model for Career Planning Management Practices
Whereas a descriptive model identifies clusters of practices that are currently used in organizations, a normative model identifies what should be used. A subsequent study expanded the number of dimensions for evaluating the relevance of a career practice from two to six and was based on the perceptions of leading career scholars who were asked to identify how the various CPM practices can be characterized by these six dimensions. The six dimensions are as follows:
- Involvement: From a very low to a very high level of organizational involvement needed while dealing with the specific career practice
- Sophistication and complexity: From a very simplistic to a highly sophisticated and complex practice
- Strategic orientation: From a very practical “tactical” practice to a very strategic practice
- Developmental focused: From a low to a high relevance for developing individuals
- Organizational decision-making focused: From a low to a high relevance of the practice to aid organizational decision making
- Innovative: From a very traditional or conventional practice to an innovative and unorthodox practice.
Career practices should not be discussed in isolation, as if they are a set of unrelated or disassociated practices. Careers in organizations are meant to be planned and managed in a joint manner. A system should be designed to answer the needs and requirements of both the individual and the organization. Professional, effective HRM will make sure that the career system operates in a well-integrated, comprehensive way.
Applying a twofold level of integration is necessary to achieve a fit and optimal utilization of career practices. These levels are “internal” integration among the various practices and “external” integration between the bundle of practices (that is, the career system) and the organizational culture and strategy. Both internal and external integration should be driven by the organization’s strategy, because it determines major business decisions. For example, the decision whether to go international or stay within national borders has implications for career practices, because such a strategy necessitates policies and practices regarding expatriation and repatriation.
Internal integration relates to the match between the various career practices, a fit that is in dire need. For example, an effective performance appraisal system should be associated with other CPM practices. Inputs from certain practices (e.g., mentoring) will influence the use of others (e.g., workshops, secondments). For external integration, career systems that best fit the organization depend on the operational strategy of the whole enterprise. The career system should be developed in line with business objectives and needs. The culture of the organization will help in shaping the career practices and their use, but in a complementary way, career management practices can help in the reshaping of organizational culture.
With the boundaryless organization came the boundaryless career, and with them came new psychological contracts. These had a profound effect on the management of careers. Much of the burden of career planning and career management has shifted from the organization to the individual, as individuals are expected to shape their own future. The involvement of the organization will vary too, according to the target population (e.g., their educational level, professionalism, and proactivity). Thus there is apparently a lesser need for a system of “command and control” from the organization and a greater need for a support system in which human resources is the enabler of successful individual careers rather than the manager of them. This will be reflected in CPM systems in organizations of the future. The future will bring more managerial complexity, resulting in more sophistication required from career systems.
- Boundaryless career
- Career-planning workshops
- Performance appraisal and feedback
- Psychological contract
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