These companies got rid of job titles. Here’s what happened

Posted at 9:23 AM, Oct 16, 2018
and last updated 2018-10-16 18:47:31-04

A job title can say a lot about a person. It can give a sense of seniority or experience and also be indicative of someone’s salary or serve as motivation to climb the career ladder.

But for these very reasons, some companies are getting rid of them.

“Clients have absolutely no clue what all these titles mean, and it’s basically a nuclear arms race,” said Ed Mitzen, who launched advertising agency Fingerpaint Marketing, in 2008 without job titles.

He pointed to the gaggle of 24-year-olds running around with vice president titles at banks and ad agencies.

“I wanted to strip out and get rid of these artificial titles and just have everybody work in a functional area,” he said.

Mitzen rarely uses the title CEO, though that’s essentially what he is, and he usually only uses the term in legal documents. Instead, he tells people that he helped start the business.

Not having titles makes workers feel more comfortable speaking up and sharing ideas, he argued.

“I didn’t want the 23-year-old to be afraid to speak up in a meeting because they weren’t a vice president, and I didn’t want people’s egos to get in the way of doing great work.”

Doing away with job titles doesn’t mean there’s no organizational chart or that people don’t know who they report to.

At Cloud-based payroll platform Gusto, workers often identify themselves by their responsibility or team.

“Titles can be a distraction,” said co-founder Josh Reeves. “And in a fast-growing startup, using titles can lead to title inflation.”

There are eight levels of employees at Gusto: entry-level employees start out as a “Level 1” and “Level 8” is Reeve’s level. Every role has a different set of expectations and goals and department heads make it clear who reports to who.

Celebrating and rewarding achievements is even more important in offices where there are no titles to make sure workers feel that they have a career path.

At Gusto, employees sit down with their “people empowerers” (what it calls managers) at least once a month to discuss their performance and potential opportunities.

“Leaders need to have the ability to give really constructive feedback on career, compensation and professional growth,” said Reeves.

Fingerpaint gives out “piton awards,” named after the mountain climbing tool, to showcase when a worker has done a good job and is taking on more responsibility. These awards come with salary increases.

Trying to find a new job without an official title hasn’t been hard for Mitzen’s workers. In fact, he said, it can be an advantage. “They can basically go to another agency and sort of make it seem like they were responsible for more than they were,” he said.

When seeking new employees, descriptive job postings are essential — especially since there aren’t job titles to give potential candidates an indication of career and experience level.

“We spend a lot of time highlighting the specific needs and the ownership the role will take on projects,” said Reeves.

Still, not everyone can embrace a no-title policy.

“It’s a great filter,” said Mitzen. “Some people value the big corner office and big fancy titles. There is nothing wrong with that, but we may not be the best company for you based on how we work.”

But not having job titles can get tricky as a company grows.

Fingerpaint Marketing has around 200 employees, with five offices across the country. Mitzen recently hired someone to help run the people and culture group to help figure out how to keep growing sans titles. A major part of the role is developing programs to ensure that workers are recognized and rewarded.

“A company of 300, you can manage by walking around,” said Alec Levenson, senior research scientist at the Center for Effective Organizations at the University of Southern California. “If that 300 grows to 3,000, it will not be able to function. That is when you need more process and formalization of hierarchy roles.”