What Is the Corporate Ladder?

The term "corporate ladder" is a conceptualized view of a company's employment hierarchy in which career advancement is considered to follow higher rungs on a ladder, with entry-level positions on the bottom rungs and executive level, upper management, positions at the top. "Climbing the corporate ladder" is an expression used to describe one's advancement within a company through promotions.

Key Takeaways

  • The corporate ladder is the proverbial climb up a company's employment hierarchy, where career advancement is likened to climbing rungs on a ladder.
  • Entry-level positions are considered the bottom of the ladder, while upper management and executives are at the top.
  • Different companies have different corporate ladders, some having narrower paths to promotions, based on company culture or turnover.
  • One downside to corporate ladders is that they can lead to interpersonal conflicts as employees can have self-serving interests to move up the ladder.
  • Individuals desire to move up the corporate ladder to increase job satisfaction and salaries.

How the Corporate Ladder Works

Companies and organizations are structured with a corporate hierarchy, which is set up according to responsibilities, power, status, and job function. Every employee in a corporation fits somewhere in the corporate hierarchy. Moving up the corporate ladder involves leaving one level for a higher level.

The corporate hierarchy is most often set up like a pyramid with many low-level employees at the bottom performing basic tasks and job functions. The middle of the corporate hierarchy is smaller and typically comprises managers that oversee the low-level employees.

At the top of the corporate hierarchy will be top-level management performing difficult job functions and making crucial company decisions. These jobs typically include the CFO, the COO, and the CRO. At the top of the corporate hierarchy is the CEO, who is responsible for everything.

Certain roles, such as clerical ones, may have their own limits to scaling the corporate ladder, where the skillsets don't easily translate into executive positions.

The corporate ladder consists of specific jobs in a specific place on the ladder. Those jobs come with certain responsibilities, benefits, and pay. The higher one goes up the ladder the more responsibilities they have and the more pay they receive.

Moving your way up the corporate ladder usually involves outperforming at your current job where a manager recognizes your skills and contributions and promotes you up. An individual can move up the corporate ladder through promotions. They can also be hired into a new company at a higher level. Moving up within a company does require a lot of networking and support from upper management.

The higher an employee's position on the corporate ladder, the more difficult advancing becomes. As you move up, there are not as many positions available at the top. Once you reach the top there is nowhere further to go.

How to Climb the Corporate Ladder

There is a tremendous amount of information and advice on how to climb the corporate ladder, much of it above and beyond simply being good at your job. Often the first step is to position yourself as an individual that wants to grow and succeed. Communicating this to management will make them aware of your goals and they will keep you in mind when opportunities arise.

Next, it's important to have a plan on how to move up the ladder. What are your goals? How can you achieve them? Who do you need to work with? Set milestones and set deadlines. Having a plan and knowing how to execute it will get you on your way.

Networking is critical. No one can move up on their own without support, contacts, and advice. Networking with individuals that are higher up on the corporate ladder than you are will help you to achieve your goals faster, get recognized, and get promoted.

Learn. Anyone who wants to move up the corporate ladder needs to constantly be learning. The more you know the more you can contribute and shine. And if you want to move up the corporate ladder you need to learn about the roles you want to fill.

Learning also leads to another area that helps moving up the ladder. This is being an initiator. It's critical to look motivated and that can be achieved by executing the tasks given to you. But if you initiate ideas, come up with better solutions, and work to get them in place, you appear as someone who takes control and gets things done.

Work hard and work smart. Be efficient and get your work done correctly and as quickly as possible. Your hard work will speak for itself and you'll become an asset to the company; one they will want to keep and keep happy.

You've heard it before but be a team player. If you can work well with others and communicate strongly you have a better chance of moving up the ladder than someone who is difficult, stubborn, and a lone player. A company requires people that can work with others and the better you can do that, the happier people will be to work with you.

Advantages and Disadvantages of the Corporate Ladder

The action of advancing up the hierarchy within a company can follow numerous paths depending on the business’s structure. Some companies have a narrow path to promotion, making it a challenge for junior staffers to pursue moving upward within the organization. This can also contribute to interpersonal conflicts in an office as each employee seeks a way to move up the ladder.

For example, if there is no opportunity for middle management to rise to a higher position, it is plausible that those managers might be reluctant to assist workers in their own advancement. It may be more feasible to move higher within a company by switching to another department or section where there is more opportunity to take on leadership duties and responsibilities.

The pace at which one gets promoted in and of itself may be used by others to assess their talent and capability. Under such a perspective, the faster one climbs the corporate ladder is seen as a measure of the effort the individual is expected to put into their next position.

Moving up the ladder increases job satisfaction as new jobs bring new tasks and responsibilities. For a motivated individual that has grown out of their current role, this is one of the biggest aspects of moving up the corporate ladder.

Jobs higher up on the ladder also come with better pay and better benefits as well as more prestige and importance within the company.

Pros
  • Increased job satisfaction

  • Better pay and benefits

  • More prestige

  • More responsibilities

Cons
  • Increased competition with coworkers

  • Higher stress roles and responsibilities

Special Considerations

The corporate culture at a company may play a significant influence over who gets elevated up the corporate ladder and what criteria are used to offer promotions. For example, some companies are more likely to promote workers who got their start at the business and have committed to the company for the breadth of their careers.

Meanwhile, other companies may look to professionals who have proven themselves at other companies and may offer them higher-tier positions and salaries compared with their present employment.

Examples of the Corporate Ladder

Tracey Armstrong

Tracey Armstrong is the CEO at Copyright Clearance Center. She started at the company at the age of 21 as a clerk. According to her, she doesn't like to be bored, so in her spare time, she started to create marketing material for the company and showed it to the marketing department. They liked what they saw and asked her to work on more projects.

At 28, she was a customer service manager at the company when a boss asked her to manage an infrastructure project that was not on time or on budget. She worked on that project for 18 months, which according to her led to the success the company enjoys today. In 2007, she became CEO of the company.

Chris Rondeau

Chris Rondeau is the CEO of Planet Fitness. He started at the company at the age of 20 in 1993 while in college working at the front desk part-time. He eventually started working the front desk full time and then went on to become a personal trainer. He then transitioned from personal trainer to store manager to regional manager.

When Planet Fitness was opening its third store, Rondeau proposed to the founders not to sell the gym based on the equipment they offer but rather the atmosphere of the gym. The founders liked the idea, tweaked the company, and eventually made Rondeau a partner in 2003. He then became COO and eventually CEO.

Corporate Ladder FAQs

What Level of the Corporate Ladder Is Least Diverse?

The top spot on the corporate ladder is the least diverse. Most CEOs are white males, with few positions at that level comprising women or people of color. It is harder for minorities to move up the corporate ladder. For example, studies show that 12% of Blacks make up entry-level jobs but that number dwindles to 7% for the next level up.

What Have Been Barriers to Advancement for Women on the Corporate Ladder?

Barriers for women climbing up the corporate ladder include the existence of the old-boy network, exclusion from social gatherings, sex discrimination, sexual harassment, and a lack of mentors.

How High in the Corporate Ladder Can You Climb Without a College Degree?

There is no set cap on how high on the corporate ladder an individual can climb without a college degree. There are many individuals that lead or have led companies without a college degree. Once you are in the door at a specific job it is possible to climb the corporate ladder to eventually become CEO.

The Bottom Line

The corporate ladder represents a company's hierarchical structure of jobs that come with different responsibilities, status, and power. The higher up one goes on the corporate ladder the more responsibilities they have but also better pay and better benefits. Most individuals seek to move up the corporate ladder to increase job satisfaction and wealth.