Are you familiar with the Peter Principle? It’s a management and work organization concept developed by two Canadians. In 1969, Professor Laurence J. Peter and writer Raymond Hull published The Peter Principle, a book in which they stated that in a hierarchy, every employee tends to rise to their level of incompetence. In other words, employees are promoted based on their performance in their current role rather than on their suitability for the position to which they are moving. As a result, they reach their level of incompetence, since they don’t have the skills needed for their new position.
In summary:
- Competent employees are promoted.
- Incompetent employees remain in their positions; they are neither promoted nor demoted.
- Promoted employees eventually reach their level of incompetence.
- Management positions are filled by incompetent people.
At Campus Lean, we agree with the broad strokes of the principle, but we’re less enthused by its sarcastic side, not to mention its oversimplification of the promotion process, which lacks nuance.
So, let’s bring some clarity to this rather bleak outlook.
The limits of the Peter Principle and the subtleties to consider
Although the Peter Principle holds a degree of truth for many organizations, it has its limits and would benefit from more nuance.
1: Overlooking the potential for evolution
Peter and Hull present an oversimplified view of the dynamics of internal promotions. They don’t consider the increasing complexity of management positions and the responsibilities involved the higher a manager climbs.
They also overlook individuals’ ability to adapt and acquire new skills.
2: Overlooking the variety of positions
The Peter Principle also neglects to consider another important aspect: the diversity of skills required. Some positions, such as controller or human resources manager, may call for specialized skills, while others, such as plant manager or customer experience manager, may require management and leadership skills.
3: Assuming that managers and executives are left to their own devices
It’s quite rare for someone to be catapulted into a management position without preparation. In many cases, there will be an onboarding and training process to give the new manager the best chances of success.
4: Considering a single selection criterion
According to Peter and Hull, the only criterion for promotion is competence. While competence is important, it’s far from being the only consideration. It’s just as vital to look for soft skills like leadership, communication, benevolence, time management, priority management, agility, curiosity, and humility.
5: Having a hierarchical view of companies
Collaboration and flatter structures are gaining ground in the corporate world, so rigid hierarchies are becoming less and less relevant.
Skills development through training
A number of measures can be taken to counteract the Peter Principle. The first is to specify the skills needed to fill the position. With rigorous assessment, you’ll know how much of a gap there is between the skills the position needs and those your new manager or executive already has.
Then, you can design a training plan that will help them develop the skills to meet the chosen priorities. Options are plentiful and include internal mentoring, management coaching, and training.
With regular assessment, you can measure their progress and make adjustments if necessary.
In conclusion, the experts at Campus Lean believe in the benefits of internal promotion as a strong driver of motivation, engagement, and loyalty. What’s more, when a company focuses on developing talent, training, and supporting employees as they progress, the Peter Principle can be dismissed easily. Consider how your organization manages promotions and ongoing training. What are your best practices? What could be improved?
by Bernard Gagnon
Master Black Belt LEAN Six Sigma,
Professional Scrum Master PSM I
