Chief Receptionist Officer? Title Inflation Hits the C-Suite: Knowledge@Wharton (http://knowledge.wharton.upenn.edu/article.cfm?

articleid=1748)

Chief Receptionist Officer? Title Inflation Hits the

C-Suite
Published: May 30, 2007 in Knowledge@Wharton

We're all familiar with titles like chief executive officer, chief
financial officer and chief operating officer. We have even
grown used to chief technology officer, chief marketing officer
and chief diversity officer.
But what about chief talent officer, chief cultural officer, chief
innovation officer, chief privacy officer, chief reputation officer,
chief apology officer and chief geek, to name just some of the
more contemporary titles that have cropped up in today's
companies? What happened to corporate hierarchies where there This is a single/personal use copy of
Knowledge@Wharton. For multiple copies,
were only a few chiefs and many, many subordinates reporting custom reprints, e-prints, posters or plaques,
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On the surface, this looks like title inflation. An overabundance
of C-level job descriptions -- like the increasing number of "A"s routinely passed out in classrooms -- is
cheapening the prestige and achievement that top titles and high grades once signaled. Yet chief
you-name-it titles can also be a reflection of corporate restructuring, says Betsey Stevenson, professor of
business and public policy at Wharton. Job title inflation, she suggests, "seems to go hand in hand with
the flattening of the organization. People want to be distinguished in some way from everyone else, but
in a flat organization there is less hierarchy and therefore less opportunity to be distinguished. One good
thing about hierarchy is you can climb a corporate ladder. If there is no ladder, there is nothing to climb."
Before coming to Wharton, Stevenson worked for a company that struggled with this issue. "Employees
wanted to feel they could get promoted, but because the company had a very flat structure, there were no
jobs to get promoted into. So the company started to invent titles for people they valued and wanted to
keep." Indeed, one way companies can compete in the marketplace is to offer key employees "a little
more money but also a more prestigious title that would help their resumes down the road," says
Stevenson.
According to Peter Cappelli, director of Wharton's Center for Human Resources, "the original title
inflation goes back to the 1970s during wage and price controls when you couldn't give employees an
increase higher than a certain level, but you could give them a promotion. Your compensation wasn't
going up, but your [job title] was. That began to die in the 1980s when we started restructuring and
flattening the organizational chart. There just weren't that many promotions anymore. Then, in certain
industries, when labor markets got tight, you began to see title inflation again."
Along with corporate restructuring over the past decade have come less job security and fewer benefits
for employees, who then feel less loyalty to their employers and greater responsibility for managing their
own careers, including their promotions. Because companies "just don't have enough titles that are
significant sounding, they generate new ones as a reward," says Cappelli. "Before, people just wanted to
be promoted up the food chain, but now they are looking for functional recognition so they can move on
if they have to." Companies, he adds, have figured out that "many times it is cheaper to give people a
title increase than a raise increase." And if the issue is hiring, "it's easy to offer a potential employee a
title that he or she asks for if it means he will come on board."

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Chief Receptionist Officer? Title Inflation Hits the C-Suite: Knowledge@Wharton (http://knowledge.wharton.upenn.edu/article.cfm?articleid=1748)

High Expectations
Long before the proliferation of chief you-name-it officers, companies and individuals came up with
creative titles, some serious and some irreverent, as a way to distinguish their roles and to send a message
to their constituencies. In the 1980s, Guy Kawasaki called himself chief evangelist at Apple Computer --
a title that seemed rather quirky at the time, but would hardly raise an eyebrow today. On the Yahoo
website, co-founders Jerry Yang and David Filo are listed as chief yahoos, along with a CEO, CFO, chief
sales officer, chief strategy officer, chief accounting officer, chief communications officer, chief data
officer and "chief people yahoo." In other companies, chiefs now run the gamut from chief blogging
officer and chief hacking officer to chief customer insights officer, chief sustainability officer and chief
knowledge officer.
These titles and others are often tied to recent events or trends, such as chief ethics officer, reflecting the
post-Enron concern with corporate corruption; chief security officer, showcasing the need to keep all
systems and information flows secure from theft and terrorism; chief reputation officer, a response to
attacks on companies' brands by bloggers, reporters and competitors, among others; chief privacy officer,
reacting to public outrage over companies' failure to protect private data; and chief apology officer,
issuing apologies for poor service (think airlines) and promising to do better.
Indeed, says Wharton management professor Sarah Kaplan, the reason many companies give out chief
titles is "to signal the importance of that particular issue to the corporation. So you have a chief diversity
officer because the company realizes that diversity is an important initiative. And the way to signal that
is to create a C-level job to implement it." In addition, "it might also be signaling that the job is more
than just an operational one, that there is something about it that is strategic," she says. For example, the
title of chief learning officer suggests that "learning is important as opposed to just having someone in
the HR department look at training. It is an elevation of the importance of the role."
The only problem with this, Kaplan adds, "is that now [all the companies] are doing it ....Now everybody
is strategic. So at some point, companies will have to create some other term."
Wharton marketing professor George Day agrees that the purpose of some chief titles is to emphasize the
importance of an initiative or a function within the organization. He cites one large consumer goods
company that recently appointed a chief branding officer as a way to say, "'Look, our brands are a huge
asset; we have way too many of them, and we aren't coordinating them across countries and businesses.'
It's a signal that this is going to be a high priority." At the same time, he adds, "I don't think this title will
be very prevalent simply because branding should be the CEO or CMO's job. They should be keepers of
the brand, and everything the company does and communicates should revolve around that brand."
The chief marketing officer job, Day says, comes with its own challenges, including high expectations.
"Naming a CMO suggests that the company is looking for more than what the incumbent senior vice
president or director level was offering. It's taking this particular function -- marketing -- and saying that
it is now strategically critical. A CMO not only has to be very adroit about building a brand, but has to
learn how to contain costs, improve productivity and communication," and most importantly, drive
organic growth.
The cost of a high-sounding title? Job insecurity, Day says. "CMOs are probably the most vulnerable. If
they can't deliver results fast enough, such as increase market share, improve brand awareness and
preference and build a marketing organization, then that CMO doesn't last long. Excessive expectations
are probably the single biggest problem for the CMO."
"Not Everyone Can Be above Average"
As for the lower-level C titles, Wharton management professor Ben Campbell suggests that the dynamic
is different in small firms as opposed to larger ones. "There is more value there to these titles. When I
was studying startups in the semiconductor industry in California, I would talk to engineers who, at one
point, were project engineers in big companies. They worked on just one small project at a time and
didn't have any big-picture responsibility. Then they joined a startup and all of a sudden they were ...
chief technology officers, and they were being asked to do a much broader range of tasks. They had a
much more strategic view of the company and as a result, developed a lot of skills they wouldn't have
developed in the bigger companies. So in this sort of situation, there is real information in the title. It's

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developed in the bigger companies. So in this sort of situation, there is real information in the title. It's
saying, 'Here is somebody who is a strategic thinker and has strategic responsibilities.'"
Campbell agrees with others that in terms of job tasks, inflated titles can be "meaningless. They don't
contain much information so there isn't much value in demonstrating what people are actually doing on
the job. Where this does have value is in retention. Titles are a very cheap way, almost costless to the
firm, to recognize and elicit high commitment from key employees. It is a very public statement that this
employee is important to our company."
Especially in big companies, Campbell says, too many title promotions can lead to cynicism about what
these new titles really mean. "A company does need to be frugal. Not everyone can be above average.
Firms should be deliberate about how they give these title awards out to employees, because each
additional person who gets a C-level title dilutes the currency" of the title structure.
In Kaplan's view, "I personally think that projects are more effective" than creating permanent C-level
positions. "By making jobs ongoing, you make them bureaucratic. That will be what people discover
with [these chief positions]. When you have a one-time special project you can get a lot more action than
when you have an ongoing job."
Job Inflation down the Line
Inflation, everyone agrees, hasn't occurred just at the C-level. Stevenson remembers that in her old firm,
"they changed a lot of people's titles from 'senior analyst' to 'vice president.' Senior analyst actually
means something, but in the investment banking world, it is a pretty low rung. So people got new titles
even though nobody's job changed." Or, as Cappelli says, in the investment banking and brokerage
industries, just about everyone is a vice president, including "the guys opening the door and serving you
coffee."
Wharton marketing professor Len Lodish agrees. Vice presidents in the financial services industry "are
typically sales positions. That's no big deal. And now even the title of president has been hit with
inflation. The number of presidents within organizations has risen significantly in the last 15 years,
especially as the pressure increases on companies to stay competitive when it comes to hiring and
retaining employees." Yet it's still "just inflating titles. The companies aren't organized any differently;
they are just giving people different titles. Being president doesn't mean what it once did."
One new title that Lodish puts up for consideration is "chief customer advocate.... That's what every
CEO should be," he says, "but that's not necessarily the way it is." Others, partly in jest, suggest chief
wiki officer -- for the employee in charge of making sure that the Wikipedia entry for his or her company
is both accurate and positive -- and chief malfeasance officer, which speaks for itself.
Stevenson offers one final explanation for title inflation. She wonders whether the people pushing for
higher titles are "the same ones who, as students, pushed for 'A's and caused grade inflation. Now they
are making it into the corporate world and they want big titles." She recalls a psychological study that
looked at students from 1970 through today and concluded that the more recent entrants into the job
market are significantly more spoiled and self-absorbed than their predecessors. The people who are
getting inflated titles, she says, "could be part of what is an increasingly narcissistic generation."

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