Confusing promotions with rewards

It’s time for midyear promotions for many groups at Microsoft. These promotions shouldn’t be confused with annual rewards of bonuses, stock, and raises given during the summer. Managers wishing to reward a deserving engineer at midyear may think a promotion is warranted, but that’s wrong—promotions are not rewards.

Midyear promotions certainly seem like rewards. You get a salary increase, sometimes a fancier title, and the warm feeling of telling friends and family that you’ve been promoted. However, confusing promotions with rewards can be disruptive, disheartening, and dishonest. Promotions are actually about satisfying a business need, not about rewarding someone—the reward is a side effect. If there’s no business need, there’s no promotion. If you treat promotions as rewards, you’ll be mistaken, disappointed, and in the worst case, over-leveled and underperforming.

How did confusion about promotions get started? What is a business need? When and why do people actually get promoted? Is denying a promotion fair? How should you reward someone when promotions aren’t available? For answers to these and other questions, keep reading.

I’m so confused

Promotions get confused with rewards early in a career. To build great products, Microsoft needs vibrant, diverse, and capable professional engineers. Experienced engineers eventually retire or move on, so the business needs new engineers to replace them. It would be wonderful if engineers entered the workforce as self-directed professionals, but that’s not typically true of people fresh out of school. Since the first few promotions are about reaching the level of an independent professional, those promotions are always needed by the business.

People mistakenly believe promotions reward career progression, because that’s how it feels at first. You’re promoted when you’ve learned and grown enough (called “readiness”) to progress up to the level of a professional engineer (level 62 in Redmond), because Microsoft needs professional engineers. Those early promotions feel like rewards, but they aren’t—something you might not realize until later in your career.

I feel the need

Engineers are often unclear about business needs, particularly when it comes to promotions. We’ve already covered Microsoft’s business need for a diverse collection of self-directed, independent, professional engineers—we can’t build, validate, deploy, and operate products without them. However, what about promotions into the Senior, Principal, and Partner engineering bands?

As I discuss in Level up, the Senior, Principal, and Partner engineering bands are about team, group, and organization leadership, respectively. Leadership comes in many forms: technical, design, business (including marketing and sales), or management. While you might not have people reporting to you in these higher bands, you’ll definitely be influencing and impacting peers across team, group, and org boundaries.

Our business needs a diverse set of team, group, and organization leaders to manage, plan, design, and bring its products to market. However, leaders are expensive, and too many leaders can result in conflict and confusion over direction, priority, and approach. Thus, there’s a limit to the number of leaders any team, group, or organization needs and can support.

One way to tell if your team, group, or org needs you as another Senior, Principal, or Partner engineer is to consider if your management would choose to hire at that level for your position. If they could continue operating the business adequately with a less expensive person, then there’s no business need for that level of additional leader.

Till I’m ready

So, when and why do engineers get promoted? People have the opportunity to be promoted in their group when there is a business need for an engineer at the next higher level of scope and competence. That business need has two conditions: sufficient scope for someone at that level and sufficient budget to pay them at that level. When there’s enough scope and budget, often due to a vacancy or growing market opportunity, the only other requirement is that the person has demonstrated sufficient learning and growth (“is ready”) to fulfill that business need at that scope.

Managers might be tempted to promote engineers as soon as they are ready, adlibbing a business need and hoping that budget is available. For rapidly growing portions of our business, that hope may be fulfilled. However, when the business need or the budget isn’t there, managers could be setting their employees up for disappointment or even dismissal.

What about me?

If you’ve demonstrated the ability to handle the scope and responsibilities of the next level in your career path, you might feel jaded or frustrated if there wasn’t a business need for that role on your team. However, consider what would happen if you got promoted without the business need. You would be a level up, but with the scope of your old level; thus you’d be underperforming at the higher level and subject to dismissal—not exactly the situation you desired. You could expand your scope on your own, but then you’d be exceeding the business need, incurring higher costs than budgets allow, and again subject to dismissal for ignoring the business plan and being over budget.

It may not seem fair that you’ve demonstrated you can handle the next level of responsibility, yet the right role eludes you. However, you have options.

• You could switch teams to one with a business need for your advanced skillset. In a growing competitive business area, business needs can work to your advantage.
• You could to continue to learn, grow, and excel in your current role, modelling and mentoring great engineering and inclusion practices for your peers and likely earning high bonuses and stock for your level, until business needs change.
• You could proactively work to change the official business plan, opening new opportunities, including the need for someone a level above yours. However, be open and inclusive. Changing plans without stakeholder buy-in can lead to overspending, overengineering, and an underwhelming review.

Getting promoted to higher levels isn’t as easy as it was early in your career, but business needs and budgets are real—and ignored at your peril.

I’m worth it

If you manage good people, how do you reward them without relying on promotions? There are countless ways, but allow me to focus on just a few.

• First and foremost, discuss your group’s business needs with your people, and lay out people’s options as I have earlier. You might lose some of your best people to other teams, but that will create growth opportunities for those below them and better align your group to the business. On the other hand, you might retain your high performers, thanks to the respect you’ve shown them, and even revamp your official business plan with innovative ideas that expand its scope. Those are all great results.
• Clarify the rewards and promotion model for your employees, and reward them fairly at annual review time. Remind them that receiving full rewards is outstanding and receiving extra rewards is unusual and extraordinary. This explanation will help them feel more appreciated and set appropriate expectations as they go forward with their careers.
• Finally, find ways to reward people every month, week, and day. Notice and quickly mention when they’ve written a great check-in or thoughtful email. Congratulate them when a meeting has gone well or their mentee has had success. Give them guidance and opportunities to learn and grow, and when you see progress, acknowledge their advances and their focus on self-improvement. There’s more to rewards than money, and little things really do mean a lot.

Doing it well

Promotions may feel like rewards, but they aren’t. Promotions are about fulfilling business needs. You get promoted when there’s a business need you are capable of filling and there’s budget to support it. When you’re fresh out of school, there’s always a business need for you to mature as a professional engineer, and there’s money to support your growth. However, as you move into the Senior, Principal, and Partner engineering bands at Microsoft, business needs and budget for those roles depend on market conditions and business plans. Ignoring that reality only sets you up for failure and disappointment.

If you want to continue to be promoted, you need to understand the responsibilities of the next level (see Level up), learn and grow your skillset and awareness of the business, and then place yourself in roles that have a need for expanded scope or help innovate official business plans to craft a larger need and budget that you can fill.

You are in charge of your career. Yes, your managers and mentors can help you, but you must be the one to seek opportunities and grab them, even if that occasionally means creating them yourself. At Microsoft, you are empowered to achieve more for yourself and our customers. Do so, and the promotions will follow.