The Peter Principle: When Promotion Leads To Inefficiency

In many cases, just because an employee deserves a promotion does not necessarily mean that they are prepared for it or that it will be a beneficial option for them or the company itself. This is what the Peter principle is all about.

According to this theory, promotions can also be a setback. Sometimes the employee has to take on challenges that he or she cannot yet handle. Maybe he doesn’t have enough resources to deal with it or he doesn’t know how to manage his emotions properly.

The Peter Principle has been around for over sixty years and is still relevant today. In the late 1960s, University of Washington doctors Laurence J. Peter and Raymond Hull wrote a book called The Peter Principle: Why Things Always Go Wrong .

The book was very impressive and controversial. It discusses the mistakes they encountered, more often than not, in companies, educational centers or any work scenarios. In the book, they identified how sometimes giving an employee a promotion can be a big mistake.

Peter and Hull also stressed the importance of giving only trained people leadership positions. Giving a bad employee a leadership position can put a company at great risk.

When this does happen, it is not uncommon for an organization to go downhill. This leads to constant discomfort, dissatisfaction, low productivity and a high level of incompetence. This in turn leads to poor decision-making.

What is the Peter principle?

The Peter principle can be summed up in one basic idea: in the hierarchical structure of any company, employees will be promoted to a position they are not prepared for and will occupy the said position for the rest of their career.

This in turn implies another important aspect: managers who are unable to respond successfully to the responsibilities they took on.

This theory has many pros and cons. Researchers at Harvard Business School conducted a study pointing out that the Peter Principle didn’t exist in “every” company or in as many scenarios as we think.

The challenge of holding positions of responsibility

Many employees are very effective at what they do. Therefore, it is entirely possible that their boss will want to promote them at some point. Their superior can advance them to a position that advances the company in various areas.

• Promoting an employee means broadening his skills. Communication, leadership, conflict resolution, decision-making capacity, human resources management, creative vision, risk anticipation…

• Not everyone is willing to take this responsibility. Not all people, no matter how competent they are in a particular field, can take leadership positions in a company.

In addition, the Peter principle often causes managers to experience a high degree of fear and slowly but surely become aware of their incompetence. Others, however, are completely indifferent to the impact their bad decisions can have.

Can it be avoided?

The Peter principle has been present in business for decades and, as we know, this particular world is based on competition between companies and employees. This means that bosses often promote aggressive, authoritarian, and even charismatic employees rather than those with more ability.

According to the authors of this principle, the most striking aspect is that bosses rarely fire these people, regardless of the damage they have done to the company or how unproductive and negative they are. This is why every manager, officer or employee should take the following aspects into account.

What kinds of promotions lead to the Peter principle?

• Many executives promote employees because they believe they should, perhaps out of loyalty. They usually give the promotions to the employees who have worked the longest in the company.
• It is also common in many countries for promotions to be linked to management.
• It is also common to promote charismatic, extroverted, and even psychopathic people who, because of their unmistakable appearance, are standout leaders.

How do you avoid the Peter principle?

Powerful executives and entrepreneurs use the following strategies to avoid the Peter Principle:

• Think more carefully about who is promoting you. Avoid automatic promotions at all costs. The manager should think carefully before making a decision.
• Train better. It is necessary to constantly train the employee who has been promoted. One of the most important aspects is to ensure that the employee has the right leadership qualities.
• Degrade. In this case, every organization must implement adequate supervision measures so that any person who is not productive is demoted.

It is important to apply these steps to avoid making decisions that could lead to a negative work environment.