Only 46% of professionals say they are satisfied with the career development provided by their companies. Even worse, nearly 90% of HR leaders admit that the career paths offered by their organizations are not clear to a large portion of the team, according to surveys by Gartner.
The data is uncomfortable, but it is rarely a lack of investment in people. In most cases, what is missing is a career path model: a formal system that connects each professional's growth to business objectives, rather than leaving this trajectory at the mercy of ad-hoc promotions and informal criteria.
In this guide, you will understand the concept of a career path, learn about the main types of career paths used by medium and large companies, see examples of career paths applied in practice, and learn how to structure a model that truly retains talent.
What is a career path in the company?
A career plan in a company is the formal set of tracks, criteria, and steps that guides an employee's progression within the organization. It indicates which competencies, deliverables, and experiences are necessary to advance from one level or role to another.
This explains why a career is also a matter of purpose, not just personal growth. When the employee clearly sees how their effort connects to the company's goals, the goal management stops being bureaucracy and starts supporting day-to-day engagement.
More than just an HR benefit, a well-designed career path model is a tool for retention and strategic execution.
Career plan concept: from hierarchical ladder to growth architecture
The concept of a career path has changed quite a bit in recent decades. In the past, it was synonymous with a ladder: climbing from position to position, in a straight line, within the same area.
Today, the concept of a career plan encompasses multidirectional trajectories, because career and organizational chart do not always coincide.
This change matters because it directly affects retention. According to the LinkedIn Workplace Learning Report 2024, 90% of organizations are concerned with talent retention, and offering development opportunities is currently the most cited retention strategy by them.
Professionals who set clear career goals engage four times more with learning initiatives than those without this direction.
It is also worth remembering that career is not dissociated from identification with the company. A good cultural fit also directly influences retention, because employees who identify with the culture tend to find more meaning in building a career there.
The real cost of not having a formal career path model
Gartner found that Only 25% of professionals feel confident about your career path at your current company.
On the other side, the McKinsey identified that the lack of development and career advancement was the main reason cited by professionals for resigning in recent years.
Three short sentences summarize the risk of ignoring these numbers. Talent without a track does not stay. A track without criteria does not convince.
A criterion without a system does not scale, and it is this last point that is usually missing even in companies that have already mastered performance evaluation, but still treat career development as a separate issue.
Types of career paths: which model makes sense for your company?
There are three predominant types of career paths in companies: linear, Y-shaped, and network (or lattice). The choice between them depends on the organizational structure, the weight of the technical areas, and the speed of business change.
Linear (vertical) career path
It is the most traditional model. The employee advances within their own area, taking on increasing management responsibility: from analyst to coordinator, from coordinator to manager.
It works well in stable hierarchical structures, but tends to create bottlenecks in companies with few leadership positions available.
Y-shaped career path
Split the career path into two tracks starting from a certain level: a people management track and a technical specialist track, both with equivalent compensation and recognition.
It is the most common format in engineering, data, and product, since not every high-performing professional wants to lead teams.
Lattice career path
The newest and most flexible model. Instead of a single track, it allows for lateral movement between areas, projects, and squads, recognizing that multidisciplinary experience is also progression.
It is the format closest to the current concept of a career, but it requires greater maturity in people data management to avoid turning into chaos.
None of these types of career paths is superior in the abstract. The right choice depends on the complexity of the structure, not HR's preference, just like good human resource management it is no longer limited to administrative processes, but rather strategic decisions about people.
How to structure a five-step career path model
An effective career path model is born from the mapping of positions and competencies, goes through the definition of objective progression criteria, connects to the individual assessment and development cycle, is communicated with transparency, and is periodically reviewed in light of business results.
1. Map job titles, levels, and competencies
Before designing tracks, it is necessary to have clarity on the current structure: which roles exist, what seniority levels each one holds, and which competencies differentiate one level from another.
Without this mapping, any career plan becomes a vague promise, the equivalent, in project management terms, of create an action plan without a clear goal behind it.
2. Define objective progression criteria
This is the point where most models fail. Subjective criteria erode trust in the system. A solid career path defines, by level, which deliverables and behaviors are expected, and communicates this before the evaluation, not after.
3. Connect the career plan to the performance cycle
A career path model dissociated from performance appraisal becomes a static document.
Connecting progression to the Individual Development Plan and regular evaluations makes it possible to track each employee's progress using data. If your company still doesn't have this process designed, it's worth checking out how to structure an IDP Before moving forward.
4. Make the model transparent to the entire company
Paths that only HR knows do not build trust. Publishing the criteria and expected competencies for each stage in accessible language is what turns this system into a real motivational tool.
Actually, this type of transparency usually goes hand in hand with a stronger recognition culture, since the two things feed each other.
Not for nothing, Harvard Business Review reinforces that well-timed career conversations, conducted regularly by managers, have a direct impact on the employee's tenure at the company.
5. Revise the model with the same discipline as a strategic process
The business changes, the required skills change, and the job structure needs to keep pace. Mature companies review their career path model at least once a year, supported by calibration data and potential mapping tools.
Once the criteria are defined, the natural question is: how does this translate into practice, in real companies?
The link that sustains any career path model
No career path model survives in isolation. It depends on a continuous system that connects individual goals, evaluations, feedback, and development—without this backbone, the track becomes intention, not practice.
This is why mature People and Management teams increasingly treat career planning and performance management as a single discipline, rather than as two separate HR fronts.
That is precisely the role of individual performance management: to transform evaluation, calibration, and development data into structured decisions about who is ready to advance, in what direction, and with what support.
When this system exists, the career path model ceases to depend on a manager's memory and comes to rely on traceable criteria, reviewed cycle after cycle, a principle that Actio details in how to transform performance into people management strategy.
Where to start structuring your company's career path model
A well-structured career path model answers the question that most dissatisfied professionals are silently asking: “here, do I know where I can grow?”.
Companies that answer this clearly retain more talent and make succession decisions more securely.
If your company still treats careers as hallway decisions, the next step is not writing another HR document.
It is structuring the system that supports this career path model in day-to-day management.
Learn about the solution to Actio Individual Performance Management and understand how to connect assessment, IDP, and career tracks into a single process.
