I learnt a new term today: “The Peter Principle”. I had to go out to rod the drains (again..!) and ended up having a chat with my neighbour who was returning from walking her dogs. I love these random chats we have in our lane; always fun and often informative. So what is this principle?
The Peter Principle is a concept in management theory that suggests people in a hierarchy tend to be promoted until they reach their “level of incompetence.” This means individuals are often promoted based on their performance in their current role rather than their ability to excel in the new role.
Once promoted to a position that requires skills they don’t have, their performance may stagnate, leading to inefficiency within the organization as well as causing problems with staff who have to work with them as well as external clients and/or customers.
The Peter Principle highlights the importance of considering a candidate’s skills and suitability for the new role rather than just their current performance. Equally importantly, a company needs to provide training and support for newly promoted individuals to develop the skills required for their new responsibilities.
Key Points of This Principle:
- Promotion Based on Competence: Employees are promoted because they perform well in their current roles.
- Incompetence at Higher Levels: The new role often requires different skills or expertise, which the individual may not possess. Unless this can be remedied by sending them on courses, they are going to fail. For example, a software developer is promoted to a managerial position. While excellent at coding, they may lack leadership or team management skills, making them ineffective as a manager.
- Impact on Organizations: Over time, this can result in key positions being filled by individuals who are not effective, potentially reducing organizational efficiency and morale. This particularly affects staff below them which makes them leave at the first opportunity and you end up having to recruit and retrain people.
How to Mitigate the Peter Principle:
- Competency-Based Promotions: Evaluate whether a candidate has the necessary skills for the new role, not just success in their current one. A trial / probationary period allows all parties to assess how the candidate performs in their new role.
- Training and Development: Offer leadership and skill-building programs to prepare employees for higher roles before moving them into the role.
- Lateral Career Progression: Encourage alternative growth paths that don’t necessarily involve hierarchical promotion, such as specialist or expert roles. This allows staff to feel a sense of progress
The Peter Principle serves as a cautionary insight into how organizations can better manage talent and ensure individuals are set up for success at every level. Failure to do can seriously impact on your company.
Photo by Megan Lee
