Four Leveling Structure Lessons from CHROs

In a dynamic talent market, the right leveling structure is critical for more than just defining roles and responsibilities — it’s a strategic tool that aligns talent acquisition, compensation, and employee development with the long-term goals of your organization. 

Thoughtfully crafted leveling structures ensure you’re attracting the right talent at every stage of growth while fostering internal mobility and reducing reliance on external hires. 

In a conversation with The Circle, Kelly Wolf, CHRO at Hippo, Alicia Raymond, VP Human Resources at b.well, Danielle Crane, Chief People Officer at OneStream, Lori Magyar, EVP People at Truepic, and Natalie Archibald, SVP People and Culture at Boulevard, shared their leveling structure lessons. These include how to design your structure with room for future scalability, develop new leadership roles that make sense in the market, and reduce the amount of out-of-band hires.

The conversation happened in two parts. During the first section, a handful of CHRO|Circle members offered a “show and tell” of their company’s leveling structures. In the second, the VIPs shared how to address leveling structure pain points.

Peer Leveling Structure Examples

To review all of the examples, click here.

Lesson #1: Design Your Structure with Room for Future Scalability 

Leveling structures can become complex quickly and, once you set a certain standard, it is almost impossible to walk it back. So the simpler you can make (and keep) your structure, the better. Depending on where your company is on its growth curve, one idea is to leave some room in your structure for a more scaled and complex organization. 

Kelly worked at Amazon when it was a startup and one early decision they made in their leveling structure was to skip the senior director level (between director and VP) to give them space to add that role in the future. She has brought the concept to Hippo, where they skip certain levels that are unnecessary  for the current size of 500 employees. 

“Our first line of VPs are actually senior directors because of historical title inflation, but they’re E1s on the Radford method,” said Kelly. “Our C-Suite is then E3 because we don’t need that many levels of executives at this point in the company’s growth.”

The VIPs agreed it is nice to have buffers between levels in case you need them later. (And if you don’t, it is unlikely anyone will even notice.)

Lesson #2: When Assessing Promotions, Lean Into Your Data and the Business Need

Employees in a growth stage company can feel the organization’s momentum and might assume they should be promoted as fast as the company is growing – both now and forever. But, as a company matures, the pace of promotions is likely to slow down. That can lead to tough conversations with employees to reset their expectations. 

To have these conversations, Danielle always leads with the data. She highlights how when OneStream was growing its headcount at a double-digit percentage for years, they had numerous upper level roles to fill. So they promoted early employees into those roles to give more people more senior-level opportunities. With the company no longer in hyper-growth mode, however, there are now fewer senior level roles to fill. 

By sharing the context of the company’s trajectory, Danielle shows how the increased time-to-promotion figure is in line with the organization’s broader growth experience and not solely about an individual’s own journey. 

When employees think about their next promotion, they can often view it in terms of their own career progression. But the company has to also look at this decision from a more expansive point of view that factors in the business need for the new role. 

Danielle noted that at OneStream whenever someone wants to promote or hire a person into a director level or above position, they must present a business case using external examples. 

“We have our hiring managers tell us if this role exists in peer companies and if the span of control is similar. This forces the hiring manager to make the case not just for the individual, but also for a role that makes sense in the market.” – Danielle Crane, Chief People Officer at OneStream

Lesson #3: Get Your CXO Peers to Buy Into the Importance of Level Structures

In a high-growth environment, functional leaders are often focused on compensation and hiring, and they might view developing leveling structures as administrative busywork. What they miss, in Kelly’s view, is how this framework is critical to building every other element of the company’s talent strategy. Here is how she has made the case to them:

“I was able to unlock investment in the leveling strategy from the business by tying  it all back to how level structures support the growth of the business: ensuring we accurately recruit people, explain career pathing, and show employees where they can progress in their jobs.” – Kelly Wolf, CHRO at Hippo

Once her executive peers understood the business strategy behind leveling structures, Kelly went a step further and invited recruiters into her process of designing the levels for their departments. “That level of ownership translated to them being willing to give the time and resources to the development work,” she said. 

Lesson #4: Beware of Hiring Out-of-Band “Saviors”

Leveling structures have a direct impact on the hiring process – and ultimately your team makeup. The goal is to match the job responsibilities with the right role in the appropriate comp range – and do that at company-wide scale. But there are always hiring managers who want to hire someone who is overqualified for a role. That can often lead to frustrating internal conversations because the candidate wants more money or they don’t properly fit into the team structure given their higher-level experience. 

One way to address this is to educate your hiring managers and recruiters about the broader dynamics at play across their teams. For example, if they hire someone who is already one or two levels above the role, that will present a limiting factor to the new hire. That person might not have a team to build, clear path to promotion down the line, and they might get bored doing the kind of work they did years ago. By explaining the downstream impacts of hiring an overqualified person, you can help your hiring managers see beyond wanting to just “hire the savior”, as one CHRO put it.  

Pay transparency changes and requirements to post salary ranges have led to two outcomes that have helped mitigate this issue: An overqualified person doesn’t apply to a role because they want more money than what is offered, or they might still apply because they are fine with a lower compensation range. Both of these candidate decisions ultimately have a positive impact on the hiring process.

“We now confirm a candidate’s comp expectations at the first stage of the hiring process. If they’re not within the range we are offering, we don’t put them forward. That saves time and frustration for them and our team leaders.” – Alicia Raymond, VP Human Resources at b.well

The Takeaway:

Level structures act as an organizational backbone to a company’s talent strategy. They impact the ability to attract the right talent, foster career progression internally, and ensure that current and new employees are in the right roles in the appropriate comp range. 

By utilizing these peer lessons, CHROs can help their companies support both employee and business growth.

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