Denying promotions: the right and wrong ways for SMEs

As an SME employer, you are probably used to holding difficult conversations. From addressing a grievance to managing poor performance, there are plenty of ways in which they crop up in day-to-day business.

Almost by definition, these conversations are important, otherwise you could just sidestep them. But one that requires a particular nuance is when an employee approaches you for a promotion and, for whatever reason, you are not minded to give it to them.

Maybe you do not think they are worth a promotion with what they can bring to the company, or perhaps there is simply not a suitable role or the budget. Neither scenario will be satisfactory to them, but just as bad – what if they are good enough, there is a role and budget, but there is someone even better? Handling this wrongly could have widespread repercussions, especially in a close-knit team!

This week, we will look at our fictional company Random Offices who don’t have HR advice and make a series of mistakes in this area. We’ll interject with how a company would have achieved better outcomes by following our advice.

Setting the scene

Random offices has a headcount of about 20: Two directors, two managers and the rest of the staff. One of the managers is leaving and two of their juniors approach the directors independently saying they would like to be promoted to fill the vacancy. The directors feel that neither of them is ready for the step up and an external appointment will be better. Why the perception gap between directors and staff, and how could it have been avoided?

An absence of performance reviews

Random Offices do conduct annual reviews, but they are something of a box ticking exercise, with a lack of engagement from both parties at the meetings and little reinforcement throughout the rest of the year. This sows the seeds for a number of problems, one of which is that employer and employees are not on the same page in terms of career development. The employees do not have clarity on what they need to do to improve, and the company has no idea that these two employees saw themselves as ready to progress.

Our advice: We would advise bolstering the annual review process, making sure that meaningful two-way conversations take place and are recorded each year, with more regular check-ins taking place in between. This important line of communication will mean everyone is better placed when promotion opportunities arise.

An inadequate response

Blindsided by the request, the Random Offices directors are blunt in their response saying “no” and sending them back to their current positions with no further discussion on the matter. This creates ill feeling which has a negative effect on productivity and office culture.

Our advice: Such conversations should be handled sensitively. If someone is putting themselves forwards for a promotion they may be going out on a limb, feeling vulnerable. The chances are they are showing ambition and wanting to do their best for the company. Hear them out, they may have hidden talents which have had no place to flourish.

If your first instinct is correct and they are not ready for the job, let them down with dignity and offer further conversations to show the pathway to career progression.

Training and development

Hand in hand with the sub-par performance reviews, Random Offices has not invested in sufficient training and development for their staff. So before the promotion requests even came in, management shortcomings on this had set up the likelihood that they would be denied.

Our advice: Not withstanding the general lack of training and development, the conversation about promotion is an opportunity to be constructive. The directors could have guided the employees in the training and development necessary to be ready for promotion. Being proactive, Random Offices could then look at a wider training and development programme.

Done properly it will not be a cost, but rather an investment in productivity, recruitment, retention and career progression. The next time such a conversation arises, they are more likely to be in a position to say “Yes!”, to everyone’s benefit.

Looking at the bigger picture, all companies need to plan for succession. The higher up the management structure, the more is at stake. Strategic training and development is crucial for ongoing success and the future of a company.

Retained HR advice

We offer retained and ad hoc HR advice to SME businesses. We love building long-term relationships with clients helping them make the right decisions every day with our retained Advice Line service. If you would like to find out more, please get in touch.