The hidden risk of lateral career moves and how leaders can fix it

It’s the kind of career advice that gets repeated at every all-hands, mentoring panel, and HR strategy deck: “Don’t just climb—move across. Try new functions. Broaden your scope.” Lateral moves are framed as acts of courage, curiosity, and long-term growth. They’re supposedly the smart play for high-potential talent seeking agility, not just advancement. But inside most organizations, the reality sounds different. Because while senior leaders talk about the value of horizontal movement, the system rarely matches that enthusiasm with real structural support.

Lateral career moves still feel risky—not because employees don’t believe in their strategic value, but because they’ve learned to distrust how these moves are assessed, rewarded, and remembered. In practice, many of these transitions feel like career limbo: high uncertainty, unclear payoff, and potentially stalled advancement. That contradiction—between the narrative and the lived experience—undermines not just mobility but organizational adaptability itself.

If we want lateral movement to become a real strategic advantage, leaders need to do more than encourage it. They need to fix what makes it fragile.

There’s a deeper truth here that few corporates have fully acknowledged: lateral moves are still treated as the employee’s risk to manage. The support is optional. The validation is delayed. The benchmarks are vague. And the career cost—should the move not yield immediate visibility or quick wins—can be quietly devastating. This isn't just an HR oversight. It's a structural design flaw. One that signals, even unintentionally, that sideways is not success.

This misalignment plays out in measurable behavior. In a recent internal mobility report across firms in the UK and MENA, over 60% of eligible lateral transfer roles remained unfilled by internal applicants—despite company-wide communications urging cross-functional development. The explanation isn’t just fear. It’s skepticism. Talent has learned to decode what a move will mean for future promotion rounds, compensation resets, or leadership sponsorship. They know when a lateral shift is framed as a “growth stretch” but is internally viewed as “starting over.” And that perception isn’t paranoia. It’s pattern recognition.

Much of the discomfort around lateral moves stems from a persistent identity bind in corporate systems: employees are still rewarded for becoming vertical specialists, not horizontal integrators. Promotions, influence, and credibility tend to follow those who deepen expertise within a function—finance, strategy, engineering—not those who move across them. Even when generalist skills are applauded at the C-suite level, the journey there rarely incentivizes such exploration. Breadth, paradoxically, must often be earned after depth. And for many employees, that sequencing is too rigid—and too slow.

In companies that say they value agility, the actual architecture of growth tells a different story. Performance reviews remain function-specific. Compensation frameworks reward tenure and depth more than risk and mobility. Talent sponsors often lack the visibility or incentive to advocate for someone who’s mid-transition. And worst of all, lateral movers can find themselves stranded between identity and output: too new to lead with authority, too senior to be onboarded properly, and too ambiguous to fit cleanly into succession charts.

This isn’t just anecdotal. It’s systemic. The post-pandemic workforce has introduced new variables—remote onboarding, hybrid teams, global mobility policies—that have made horizontal transitions even more complex. Employees moving laterally often do so without the support structures that traditionally scaffold new hires. There’s no formal re-induction. No onboarding roadmap. And while expectations remain high, the informal networks that once helped people navigate new roles have thinned or disappeared altogether. The result? Even confident, capable talent can experience an identity stall: a period where they feel less visible, less certain, and less strategically positioned than before.

This phenomenon cuts across markets, but the cultural coding varies. In the GCC, rotational programs for nationals are carefully curated, often tied to state-backed talent agendas. These transitions are celebrated—but they’re also tightly managed and usually structured within a clear talent pipeline. Voluntary lateral moves outside of this context can be perceived as missteps unless clearly positioned by leadership. In contrast, UK-based institutions have historically emphasized functional loyalty, making internal sideways moves feel like deviations from a steady track unless they’re coupled with a rebranding of purpose or future relevance. In both settings, the risk profile of a lateral move depends more on how it's perceived than how it's performed.

Where some progress is visible is in consulting and advisory firms—especially in Europe—where internal labor markets are being deliberately redesigned. Lateral moves into strategic adjacencies like sustainability, AI integration, or DEI transformation are not only supported but accelerated. Some firms are introducing lateral bonuses, retention-linked pathways, and re-entry guarantees—ensuring that a return to one's prior function, if needed, doesn’t come at a loss. It’s not perfect. But it shifts the perception from "career bet" to "career hedge."

Meanwhile, sovereign wealth entities and public-sector hybrids in the Gulf are attempting a different pivot. Rather than anchor prestige to seniority alone, they are experimenting with identity models that prioritize contribution to national strategy over hierarchy. In practice, this means that a lateral move into, say, a new sovereign vehicle or a special policy unit can carry as much reputational capital as a promotion—provided the function is linked to high-priority objectives. It’s a shift from “where you are on the ladder” to “what you’re building.” But this model remains more plausible in contained ecosystems than in highly competitive, globalized corporates.

Still, these exceptions prove the rule. Most organizations are still operating with outdated growth scripts that don’t reward lateral momentum unless it eventually translates into vertical success. The interim period—the learning phase, the contribution curve, the identity shift—is treated as optional context, not measurable value. And that’s where talent loses faith.

So how should organizations respond?

It begins with accepting that talent strategy is not just about messaging. It’s about matching structure to signal. Encouraging lateral moves without recalibrating performance metrics, compensation design, and leadership accountability frameworks is not strategic—it’s cosmetic. Leaders need to ask: what does success look like in a lateral transition? How is it tracked, recognized, and leveraged in future decisions? And critically—who’s responsible for ensuring the move is a step forward, not a stall?

Redesigning for lateral movement means more than creating a portal or assigning an HR sponsor. It means integrating mobility into the DNA of progression systems. One model gaining traction is the "mobility window"—a defined period within an employee’s development cycle where a lateral move is not only permissible but positively weighted in promotion calculus. Another approach is “dual-track acceleration,” where employees who take on lateral roles are given the option to fast-track back into their original stream or continue in the new function with accelerated benchmarking. These mechanisms turn exploration into advantage—not into ambiguity.

It also requires a leadership culture shift. Too often, managers treat lateral movers as transfers, not investments. There’s little clarity on what support they’re owed, what outcomes they’re evaluated against, or how their success contributes to broader team impact. Without a clear playbook, even well-meaning leaders default to treating lateral hires as “staffing solutions” rather than strategic bets. That framing erodes trust. It suggests that breadth is a backup plan—not a business asset.

Perhaps most importantly, lateral movement must be redefined in narrative terms—not just logistical ones. Companies love to tout their high-potential programs, innovation labs, or rotational fellowships. But the average employee making a lateral move doesn’t get that shine. They get ambiguity. If organizations want to make mobility stick, they need to elevate the story. Showcase successful lateral journeys. Normalize step-changes that don’t involve a title bump. Speak clearly about the long-term payoff of range, not just rank.

For some organizations, this will mean investing in what feels like intangible infrastructure: narrative design, talent storytelling, re-onboarding rituals, and lateral mentorship. But those are the scaffolds that make mobility safe—and success visible.

Because here’s the reality: agility isn’t just about speed. It’s about permission. And if lateral moves still feel like career risk wrapped in corporate platitudes, the system isn’t agile. It’s stalled.

There’s a final question every operator, strategist, and team builder should ask: If I were my most ambitious team member, would I make a lateral move here? If the answer is no, then the problem isn’t the employee. It’s the architecture.

Strategic mobility isn’t just an HR trend. It’s a test of organizational credibility. And until the system treats horizontal ambition with the same seriousness as vertical success, talent will continue to do the math—and stay put.

Because they’re not afraid to move. They’re afraid the system won’t catch them when they do.