A lateral move is a change of job at roughly the same level: similar grade, title and pay, but different work, team, function or location. It is neither a promotion (up) nor a demotion (down). Employees use it to build new skills or find a better fit; companies use it to fill roles from inside, which research on internal labour markets links to better early performance than external hiring.
Drawing by The Business Engineer.
How it works
01
What stays the same
Grade, title level and usually pay. That is what separates a lateral move from a promotion, where all three rise.
02
What changes
The work itself: the function, product, team, customers or country. The employee trades some depth for breadth.
03
How the move happens
Inside a company, a manager may hand-pick someone for an open role (slotting) or post the job so anyone can apply (posting). Between companies, it is a new job at the same level.
04
Why it pays later
New skills and contacts widen the set of future roles a person can take. The return comes at the next move, not this one.
Where you see it today
Insiders start stronger
In personnel data from a US investment bank, workers promoted into jobs performed better in their first two years than external hires in similar jobs, who were paid more (Bidwell, 2011). The same study found that workers promoted and transferred at the same time did worse than other internal movers, a reason to keep a lateral step separate from a step up.
Open posting beats hand-picking
In internal hiring data from a large US health-services firm, workers who moved through an open job posting had higher performance ratings and higher pay, and were less likely to leave, than those slotted in by a manager (Keller, 2018). Internal talent marketplaces are built on the posting model.
The research firm i4cp reports that high-performance organisations are over twice as likely as low performers to prioritise talent mobility, and that they focus on lateral moves across functions, projects, business units and geographies, not only promotions.
AI matching meets regulation
Employers increasingly use software to match staff to open roles and projects. Under the EU AI Act (2024), AI systems used to decide promotions, allocate tasks based on personal traits or evaluate candidates are classed as high-risk, which brings duties on how such matching tools are built and overseen.
Typical reasonPerformance, restructuring or personal choice
Job rotation
Level and paySame level, planned and temporary
Typical reasonStructured development programme
External hire at same level
Level and paySame level, often higher pay
Typical reasonNew employer, outside offer
How to use it
Name the skill you want before you move, and check the new role will build it.
Ask how people from the new team were promoted in the last few years; a sideways step should lead somewhere.
Move to the work AI is changing fastest in your field, so you learn it early rather than late.
If you manage people, post internal roles openly instead of hand-picking, and do not block your best staff from leaving your team.
Avoid combining a lateral change and a step up in one move when you can sequence them.
The Business Engineer lens
When AI changes which tasks a job contains, the most valuable career asset is range across functions, and a lateral move is the cheapest way to buy it. The Business Engineer sees internal mobility as how a company redeploys people as fast as it redeploys software.
A change to a job at about the same level, title and pay as the current one, but with different work, team, function or location.
Is a lateral move a good idea?
It can be when it builds skills or networks that open bigger roles later; it is weaker when it repeats the same work under a new name.
Does a lateral move come with a raise?
Usually not on the day; the pay-off tends to come at a later move. Moving between companies can carry a pay change even at the same level.
Why do companies encourage lateral moves?
Filling roles from inside keeps knowledge in the firm, and research on internal labour markets finds insiders often perform better early than external hires.
The complete explainer, cleaned up and reformatted for mobile.
FourWeekMBABusiness EngineerAt a glance
Unlike a vertical move (promotion) or a downward move (demotion), a lateral move involves changing roles or departments without a significant change in job title, responsibilities, or seniority.
Lateral moves are a strategic career choice that can lead to long-term career growth and satisfaction.
Layout refreshed 7 October 2026. The article text below is unchanged.
Why it mattersFrom the article
More capable employees โ organizations that promote lateral moves and career mobility tend to employ smarter, more productive, and more talented workforces.
Lateral moves are a career choice where an employee leaves their current role for another role with a similar salary, title, or seniority. Lateral moves can be made between two companies, within the same company or even the same department. Lateral moves describe the process of an employee moving from their current position to one that is similar in salary, title, or seniority.
Visual Overview
Key Components
Understanding lateral moves
Lateral moves describe the process of an employee moving from their current position to one that is similar in salary, title, or seniority.
Lateral moves may result in a business losing reliable or talented employees, but there do also exist some research-backed benefits:
What are some of the downsides of a lateral move?
Like any career move, lateral moves will not be suitable for everyone. Here are some of the potential downsides:
Strengths
✓Improved organizational performance โ in a 2021 article published by Harvard Business Review, researchers found that high-performance…
✓Improved employee retention โ LinkedIn discovered that employees who shift from one position to another are more likely to stay with a…
✓More capable employees โ organizations that promote lateral moves and career mobility tend to employ smarter, more productive, and more…
Limitations
โ
Real-World Examples
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Quick Answers
What is lateral moves?
Lateral moves describe the process of an employee moving from their current position to one that is similar in salary, title, or seniority.
What are the benefits of lateral moves to business?
Lateral moves may result in a business losing reliable or talented employees, but there do also exist some research-backed benefits:
What are some of the downsides of a lateral move?
Like any career move, lateral moves will not be suitable for everyone. Here are some of the potential downsides:
Key Insight
Lateral moves are a career choice where an employee leaves their current role for another role with a similar salary, title, or seniority. Lateral moves can be made between two companies, within the same company or even the same department.
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Lateral moves are a career choice where an employee leaves their current role for another role with a similar salary, title, or seniority. Lateral moves can be made between two companies, within the same company or even the same department.
Aspect
Explanation
Definition
A Lateral Move, in the context of careers and employment, refers to a job change or transition where an individual moves to a different position within the same organization or to a different organization at a similar level or role. Unlike a vertical move (promotion) or a downward move (demotion), a lateral move involves changing roles or departments without a significant change in job title, responsibilities, or seniority. Lateral moves are often pursued for various reasons, including career development, skill acquisition, broadening experience, or finding a better fit within an organization. They can offer new challenges, opportunities, and perspectives while allowing individuals to leverage existing skills and knowledge. Lateral moves are a strategic career choice that can lead to long-term career growth and satisfaction.
Key Elements
– Job Role Similarity: In a lateral move, the new position should have a similar job title, responsibilities, and seniority level to the current role. – Change in Department: Lateral moves often involve changing departments or teams within the same organization. – Career Development: The move should align with an individual’s career development goals and objectives. – Skill Transferability: Lateral moves can leverage existing skills while acquiring new ones relevant to the new role. – Organizational Fit: Assessing whether the new role aligns better with personal values and goals is crucial.
Characteristics
– Skill Enhancement: Lateral moves provide opportunities to gain new skills or refine existing ones. – Experience Diversification: They allow for diverse experiences by working in different departments or on different projects. – Maintained Seniority: Individuals maintain their seniority level, which can be important for future career progression. – Risk Mitigation: Lateral moves can reduce the risk of stagnation in a current role. – Career Flexibility: They offer career flexibility without significant changes in job title or compensation.
Implications
– Skill Growth: Lateral moves can lead to skill growth and diversification, making individuals more versatile. – Career Advancement: They can position individuals for future vertical moves or promotions within the organization. – Enhanced Job Satisfaction: Finding a better fit or more engaging role can enhance job satisfaction. – Reduced Stagnation: Lateral moves reduce the risk of career stagnation and burnout. – Organizational Value: Organizations benefit from employees with broader skill sets and experiences.
Advantages
– Skill Development: Lateral moves facilitate skill development and diversification. – Career Progression: They can position individuals for future career advancements. – Enhanced Satisfaction: Finding a better fit or more engaging role often leads to increased job satisfaction. – Reduced Stagnation: Lateral moves help individuals avoid career stagnation and burnout. – Organizational Value: Organizations gain employees with diverse skill sets and experiences.
Drawbacks
– Salary Stagnation: Lateral moves may not come with significant salary increases. – Risk of Irrelevance: Repeated lateral moves without vertical progression can risk career stagnation. – Limited Change: Individuals may not experience a significant change in their daily tasks or responsibilities. – Lack of Challenge: If not carefully chosen, a lateral move might not provide new challenges. – Organizational Fit: There is a risk that the new role may not be a better fit than the previous one.
Applications
– Large Corporations: In large organizations, employees can explore lateral moves to different departments or business units. – Multinational Companies: Multinational corporations offer opportunities for lateral moves to various locations or divisions. – Government Agencies: Government agencies provide lateral move opportunities within different departments and functions. – Educational Institutions: Educational institutions offer lateral moves between departments or schools for faculty and staff. – Nonprofits: Nonprofit organizations have opportunities for lateral moves across programs or initiatives.
Use Cases
– Large Corporation: An employee in a large corporation seeks a lateral move from the marketing department to the product development team to gain a broader perspective and skills. – Multinational Company: An executive in a multinational company takes a lateral move to a different country to work with a new team and broaden their international experience. – Government Agency: A civil servant in a government agency shifts to a different department within the same agency to work on a new policy area, enhancing their expertise. – Educational Institution: A professor in an educational institution moves laterally to a different department to explore new research opportunities and teaching experiences. – Nonprofit: A program manager in a nonprofit organization transitions laterally to a different program area to contribute their skills and expertise to a new cause.
Understanding lateral moves
Lateral moves describe the process of an employee moving from their current position to one that is similar in salary, title, or seniority.
Whilst a lateral move is not a promotion, it can be beneficial for those who want to:
Increase the depth or breadth of their skill set.
Follow their passions and do meaningful work.
Develop more resilience. Many employees find lateral moves to be an effective way to challenge themselves and keep things interesting.
Improve work-life integration.
Establish or increase their professional network., and
Open up the potential for a better salary long-term. Lateral moves may be a short-term price some are willing to pay to eventually access roles with more attractive salaries.
Benefits of lateral moves to business
Lateral moves may result in a business losing reliable or talented employees, but there do also exist some research-backed benefits:
More capable employees โ organizations that promote lateral moves and career mobility tend to employ smarter, more productive, and more talented workforces. This is mainly because employees move to upskill or pursue meaningful work.
What are some of the downsides of a lateral move?
Like any career move, lateral moves will not be suitable for everyone. Here are some of the potential downsides:
Compensation โ as we touched on earlier, these moves are not promotions. Each individual must weigh up their circumstances to determine whether moving companies is worth the hassle. In other words, would a lateral move advance their career faster at another employer? Is the individual willing to work for a lower salary for the prospect of more attractive remuneration in the medium-term?
Lack of clarity โ those who make lateral moves often and deviate from their career path risk raising a red flag to recruiters. In this instance, employees must be able to articulate why they change positions frequently and how those moves fit into their career plans.
Lack of career growth โ when a lateral move does not eventually result in a promotion or a more attractive salary, it can result in career stagnation. To reduce the likelihood that a lateral move leads nowhere, employees must perform due diligence on the new company and ask lots of questions. Is there a clear growth path? What is the expected timeframe for promotions and does the company tend to promote internally?
Case Studies
Technology Company:
Scenario: An experienced software engineer at a technology company has been working on backend development projects for several years. However, they are interested in gaining experience in frontend development to broaden their skill set and explore new challenges.Lateral Move: The software engineer discusses their career aspirations with their manager and expresses interest in transitioning to a frontend development role within the same organization. After assessing the engineer’s skills and potential impact on frontend projects, the company approves the lateral move.Implications:
The software engineer gains valuable experience in frontend development while leveraging their existing backend expertise.
The company benefits from a more versatile employee who can contribute to both backend and frontend projects, enhancing project flexibility and team collaboration.
Financial Services Firm:
Scenario: A financial analyst working in the equity research department of a financial services firm is interested in exploring opportunities in fixed income research to diversify their knowledge base and career options.Lateral Move: The financial analyst discusses their career goals with their manager and expresses interest in transitioning to fixed income research within the same firm. Recognizing the analyst’s potential and the benefits of cross-training, the firm supports the lateral move.Implications:
The financial analyst gains exposure to a new asset class and expands their expertise in financial research, increasing their marketability and career options.
The firm benefits from a more versatile analyst who can provide insights and analysis across different asset classes, enhancing the firm’s research capabilities.
Healthcare Organization:Scenario: A nurse working in the medical-surgical unit of a hospital is interested in transitioning to the critical care unit to expand their clinical skills and experience in caring for critically ill patients.Lateral Move: The nurse discusses their career aspirations with their nursing supervisor and expresses interest in transferring to the critical care unit within the same hospital. After assessing the nurse’s qualifications and readiness for the new role, the hospital approves the lateral move.Implications:
The nurse gains specialized training and experience in critical care nursing, enhancing their clinical skills and professional growth.
The hospital benefits from a more versatile nurse who can contribute to critical care services, improving patient care and staffing flexibility.
Manufacturing Company:
Scenario: A production supervisor in a manufacturing company is interested in transitioning to the quality assurance department to gain experience in quality control and process improvement initiatives.Lateral Move: The production supervisor discusses their career interests with their manager and expresses a desire to transfer to the quality assurance department within the same company. Recognizing the supervisor’s potential and the benefits of cross-functional experience, the company approves the lateral move.Implications:
The production supervisor gains hands-on experience in quality assurance practices, including process audits, defect analysis, and corrective actions, enhancing their leadership and problem-solving skills.
The company benefits from a supervisor with a broader understanding of quality management principles and an ability to drive continuous improvement initiatives across different departments.
Key takeaways:
Lateral moves describe the process of an employee moving from their current position to one that is similar in salary, title, or seniority.
Lateral moves can be beneficial for employees who want to pursue a passion career, extend their professional network, or simply start afresh. At the organizational level, lateral moves improve performance, employee retention, and the capabilities of the workforce.
Some of the potential downsides of lateral moves include a lack of career growth and clarity. It can also be difficult to determine whether the move is worth the employeeโs time or resources.
Key Highlights
Lateral Moves Definition: Lateral moves involve employees shifting from their current role to a similar-level position in terms of salary, title, or seniority, either within the same company, between companies, or within the same department.
Employee Benefits:
Skill Set Enhancement: Lateral moves offer a chance to broaden or deepen skills by taking on new responsibilities.
Pursuit of Passions: Employees can engage in more meaningful work aligned with their interests.
Resilience Building: Such moves challenge employees, enhancing adaptability and resilience.
Work-Life Integration: Lateral moves allow exploration of new roles without the pressure of promotions.
Networking: Employees can expand their professional network through exposure to different teams.
Long-Term Salary Growth: Although not immediate promotions, lateral moves might lead to better roles and compensation in the future.
Business Benefits:
Organizational Performance: Companies promoting lateral mobility tend to have better overall performance.
Employee Retention: Internal role shifts contribute to higher employee retention rates, reducing turnover costs.
Skilled Workforce: Encouraging lateral moves results in a workforce with improved skills and talents due to upskilling efforts.
Potential Downsides:
Compensation Consideration: Lateral moves don’t offer immediate promotions, so employees must weigh salary implications.
Lack of Clarity: Frequent lateral moves might raise concerns for future employers, necessitating clear explanations.
Stagnation Risk: If lateral moves don’t lead to growth, employees might face career stagnation.
Lack of Career Growth: Without clear paths, lateral moves may not lead to desired advancements.
Company Research: Thorough research is vital to ensure that a lateral move aligns with long-term career goals.
Key Takeaways:
Lateral moves are career transitions to similar-level positions for employees.
Employees benefit from skill enhancement, passion pursuit, resilience building, and networking.
Businesses gain improved performance, retention, and a skilled workforce.
Downsides include compensation trade-offs, career growth concerns, and ambiguity in paths.
Thorough research is crucial before making lateral moves for career alignment.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
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