Lateral Move

What is a Lateral Move?

In the professional world, a lateral move refers to a change in an employee’s position within an organization that does not involve a promotion or a demotion in rank or salary. This type of career transition allows an individual to shift their responsibilities, focus on a different area of the business, or gain new skills without altering their standing within the company’s hierarchy.

Lateral moves can be strategic decisions made by both employees and employers. For employees, it can be an opportunity to explore new interests, avoid stagnation, or develop a broader understanding of the company’s operations. For organizations, it can be a way to retain valuable talent, fill critical skill gaps, or foster cross-departmental collaboration and employee development.

While distinct from a promotion, a lateral move is often a precursor to future advancement. It can provide the experience and exposure necessary to qualify for higher-level positions down the line. Understanding the motivations and implications of lateral moves is crucial for both individual career management and effective human resource strategies.

Key Takeaways

• A lateral move involves changing roles or departments within the same company without a change in seniority or pay.
• Employees may pursue lateral moves to gain new skills, explore different areas of the business, or find greater job satisfaction.
• Companies use lateral moves to retain talent, address skill shortages, and promote internal mobility and employee development.
• While not a promotion, a lateral move can provide valuable experience and networking opportunities that aid future career advancement.

Understanding Lateral Moves

Lateral moves are a common phenomenon in corporate environments and offer a middle ground between staying in a current role and seeking external employment or a promotion. These moves are typically initiated when an employee seeks to broaden their skill set, gain exposure to different business functions, or address a lack of growth opportunities in their current position. For instance, a marketing specialist might move laterally to a product development role to gain a deeper understanding of the product lifecycle, potentially leading to a more strategic marketing position in the future.

From an organizational perspective, facilitating lateral moves can be a powerful retention tool. When employees feel their career development is supported, they are less likely to look for opportunities elsewhere. This is particularly true for high-potential employees who might become disengaged if they feel pigeonholed in their current role. By offering lateral assignments, companies can tap into their existing talent pool to fill needs that might otherwise require external hiring, saving time and resources.

The success of a lateral move often depends on clear communication and support from management. Both the employee and their new department should understand the objectives of the move, and the employee should be provided with the necessary resources and guidance to succeed in their new capacity. Performance expectations should be realistic, acknowledging the learning curve associated with a new role.

Formula

There is no specific mathematical formula for a lateral move, as it is a qualitative career progression. However, it can be conceptually represented as:

Current Role (Position Level A, Salary X, Skills S1) → Lateral Move → New Role (Position Level A, Salary X, Skills S2)

The key differentiator is that the Position Level and Salary remain constant, while the Skills set is expected to expand or change (S1 to S2).

Real-World Example

Consider Sarah, a software engineer at Tech Solutions Inc., who has been working on the backend development for the company’s flagship product for three years. She enjoys her work but is interested in exploring user interface (UI) design. Tech Solutions has an opening in its UI design team for an associate designer. Sarah discusses her interest with her manager and the hiring manager for the UI team.

After a series of interviews and discussions about her willingness to learn new design tools and principles, Sarah is offered the associate UI designer position. Her salary and job title (Software Engineer II, for example) may remain the same initially, or there might be a slight adjustment to align with the standard for the new role at the same level. She is not promoted to a senior designer or demoted; she is moving laterally to gain experience in a new functional area.

This move allows Sarah to broaden her technical expertise and explore a different facet of product development. For Tech Solutions, it’s a way to develop an employee with both backend and frontend/design understanding, making her a more versatile asset in the long run.

Importance in Business or Economics

Lateral moves are important in business for fostering employee development and organizational flexibility. They allow companies to cultivate well-rounded employees who understand various aspects of the business, which can lead to more informed decision-making and innovation. This internal mobility helps in knowledge transfer and can create a more adaptable workforce capable of responding to changing market demands or internal restructuring.

For the economy, widespread adoption of lateral movement strategies within companies can contribute to a more dynamic labor market. It reduces reliance on constant external hiring, potentially lowering unemployment rates within a company and promoting skill diversification among the workforce. It also signifies a mature approach to human capital management, where long-term employee growth is prioritized alongside immediate business needs.

Furthermore, supporting lateral moves can enhance employee engagement and loyalty, reducing turnover costs associated with recruitment and training. This internal development pipeline can be more cost-effective and efficient than constantly seeking new talent externally, contributing to overall organizational stability and productivity.

Types or Variations

While the core concept of a lateral move involves a stable hierarchical position, variations can exist:

• Cross-Functional Lateral Move: An employee moves to a different department or division, often to gain exposure to a new area of the business (e.g., moving from sales to marketing). This is the most common type.
• Project-Based Lateral Move: An employee temporarily shifts focus to a specific project outside their usual responsibilities, often as a development opportunity. This can be short-term before returning to their original role or transitioning permanently.
• Geographic Lateral Move: An employee transfers to a similar role in a different office location of the same company. This is often driven by personal reasons or a desire for international experience.

Related Terms

• Promotion
• Demotion
• Job Rotation
• Internal Transfer
• Career Development
• Employee Retention

Sources and Further Reading

• Harvard Business Review: hbr.org
• Society for Human Resource Management (SHRM): shrm.org
• Forbes – Career Advice: forbes.com/careers/

Quick Reference

Lateral Move: A job change within the same company, maintaining similar job level and pay, to gain new skills or experience in a different role or department.

Frequently Asked Questions (FAQs)