Getting a promotion to management can be a rewarding, if slightly daunting prospect.

Employers are keen to develop staff who perform well, but one theory suggests that high flying workers are often thrust into new roles for which they’re unprepared.

In this guide, we’ll explain what the Peter Principle is and how the right kind of training can offset the skill gaps in newly-promoted managers.

So, what is the Peter Principle?

Formulated by Dr. Laurence J. Peter and Raymond Hull in their 1969 book ‘The Peter Principle’ – the theory dictates that “in a hierarchy, every employee tends to rise to his level of incompetence.”

The Peter Principle is an observation about a common pattern in traditional, hierarchical workplace cultures. It explains how high-performing employees are continually advanced until they reach a position where they are no longer competent.

Rising to the level of incompetence can put a company into a tricky situation. It negatively impacts employee productivity and business performance, because it often means people are promoted to a level where they are incapable of doing a good job. Their meteoric rise through the company often comes to an abrupt halt as they flounder in a new role which they’re unequipped to handle given their experience and skill set.

If taken to its logical conclusion, the Peter Principle could pose a serious problem for organisations – with all senior positions eventually being held by staff whowhatisthepeterprinciple are incapable of fulfilling their duties.

How does it work in practice? To use a hypothetical example - Grace is a marketing executive that excels in her role and was recently promoted to marketing manager. Her new duties consist of budgeting, campaign planning and developing a marketing strategy. This means that she can no longer do the practical marketing work she used to love (and gained recognition for) and is now working in a role that she doesn’t enjoy and doesn't perform as well in.

Is the theory still relevant?

As the Peter Principle was introduced decades ago, its relevance in the modern workplace is often questioned. After all, it was first posited in a pre-globalisation period, where the vast majority of businesses only faced competition on a local basis.

In this era, individual careers were stable and linear, with most workers staying with one company in a ‘job for life’. Surely the sophisticated, modern workplace wouldn’t be afflicted by such a quaint prospect?

Surprisingly, in the new world of work, the Principle still is significant and remains a problem for top executives, regardless of most businesses boasting a less hierarchical management structure.

A study from Pluchino in 2010 explored the Peter Principle process and applied it to an organisation with a hierarchical structure. It found that in general, promoting the most competent people reduces efficiency, however, it can work well if staff maintain their competence at each level on the hierarchy. Although it may seem common sense, this can often be overlooked in large hierarchical organisations.

Richard Jolly, adjunct professor of organisational behaviour at London Business School said:

"Estimates vary, but at least 50% of executives derail at some point in their career – it could be getting fired, not getting the promotion or bonus you thought you would get, etc. – and one of the key reasons is the failure to adapt as they get more senior.

"Most of the time it’s avoidable."

The blame can’t be put on managers for employing incompetent people. At this level, it isn’t necessarily about experience or how knowledgeable someone is, rather that their job has changed but they’ve failed to change with it.

How do you overcome the Peter Principle? 

When someone gets thrust into a new and unfamiliar role the effects can be devastating for everyone involved. The manager is less productive, with lower overcomingthepeterprinciplemorale and less innovation – and this can often have a knock-on effect on staff.

This type of linear career advancement is often a cultural issue, which businesses need to take a holistic approach to tackle effectively. It’s obviously important to recognise and reward staff, but you shouldn’t necessarily conflate new and unfamiliar responsibilities with promotion or advancement.

After all, the people skills needed to manage a team effectively aren’t necessarily borne from being highly competent in the type of work that team does.

When it comes to combatting the Peter Principle, there’s a few key areas where we find most organisations could enhance their efforts:

Promote more effectively: There’s always room for improvement when it comes to career advancement and rewarding staff doesn’t necessarily have to mean thrusting more – or different – responsibilities on them. Instead you could give performance related bonuses, involve staff in new projects they’d be good at, identify what skill set is needed and score employees in line with this.

Don’t be afraid to demote: Changing an employee’s role because they’re under-performing can be a pain in regard to HR compliance and stifle morale for staff. But it can be worthwhile because failing to address these issues can lower the morale for an entire team or department. Moving staff to roles that better complement their skill set can often be preferable, even if it is moving them to the same level rather than higher.

Bespoke training: Identify the skills needed in the managerial role, compare with those of your candidate and highlight gaps. Then procure training to bring them up to speed rather than dunking them in the deep end.

After all, promoting an employee because they’re competent and productive shouldn't be a bad thing. Taking advantage of their current skills and moulding them into their new role will encourage a better move to management. 

In summary

Creating an effective management structure will help bridge any skills gaps that a newly promoted manager may have and therefore reduce any inabilities before they reach their level of incompetence.

There’s no silver bullets when it comes to tackling this perennial issue, but by bearing the Peter Principle in mind, you can understand how to avoid pushing staff to their level of incompetence and recognise any staff that are in danger reaching theirs.

And you?

Hopefully, we’ve managed to shed some light on the Peter Principle and how to overcome it through training but if you’ve got any questions about the topics above (or anything training-related) - don’t hesitate to get in touch via Twitter or LinkedIn.

And if you’re looking for bespoke advice or business training – our team have years’ of experience in business support, consultancy and workforce development - book a free consultation today and get expert help in tackling the root causes of cultural or other workplace issues:

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