Is the Peter Principle a real phenomenon

[msmith537]

The Peter Principle is a theory put forth by Dr. Laurence J. Peter and Raymond Hull that states "In a Hierarchy Every Employee Tends to Rise to His Level of Incompetence."

Basically the gist of the theory goes like this. In a hierarchial organization, employees who perform their jobs competantly are promoted. At each promotion, the nature and responsibilities of the position change and the employees may not have the skills required to perform that job. At that point they will have reached as high as they will ever reach in the organization. Ultimately the entire hierarchy will be filled with incompetant employees.


Personally I do not believe in this theory as it has stated. I think it has become more of a way for workers to justify their contempt for their boss, their fellow employees and the mediocrity of their own position.

First of all, a person's competency isn't fixed. It isn't even consistently defined across the organization. What one boss values as "competent" may not be valued the same by another boss. And I find that as you rise in the organization, "competence" becomes much more subjective and nebulous.

The traits that get you promoted to the next level also may have nothing to do with how competent you are at your current job. The best programmer often doesn't get promoted because he lacks the social skills and leadership to manage. People are often promoted based on favoritism or other traits unrelated to their skill at their job.

Finally, everyone thinks their boss is an idiot. That is because no one knows the details of your job as well as you do. Not even the boss. If he asks about it, he's micromanaging and if he tells you to do something that you don't agree with, he doesn't "get it".

[Manda JO]

I think it certainly exists on an individual level--I've certainly known some people over the years who seemed incompetent at their jobs where people were quick to fall all over themselves to tell you how talented they'd been in their former position. In these cases, people weren't bitching about their boss--often they were trying to defend someone they admired. And it's certainly true that in many organizations a border-line incompetent person will never be fired or demoted, nor do they have any way to demote themselves without losing face.

If it's true in the cases of some individuals, it certainly seems plausible that there are some corporate cultures that accidentally encourage the pattern--most likely organizations that 1) promote from within 2) require very different skills at different levels and 3) tend to keep employees for decades.

Of course the term is often misapplied, and it doesn't describe everything that's wrong with American business. But yes, I think it happens. I've also seen the reverse--someone go from being a mediocre worker to a very talented one when moved into a position that called for different skills.

[gonzomax]

I saw it many times in engineering. A guy would be promoted to a supervisory position due to his engineering talents. Manging people and departments is a different skill set. I have seen horrible failures.

[tomndebb]

Originally Posted by msmith537

The Peter Principle is a theory put forth by Dr. Laurence J. Peter and Raymond Hull that states "In a Hierarchy Every Employee Tends to Rise to His Level of Incompetence."

It is not a theory, and barely a hypothesis, really. It is more an observation expressed as an aphorism.

I would never assume that every person in an established position is incompetent. However, there is certainly enough incompetence riddling most companies that the Peter Principle appears to provide some sort of explanation.

(I also suspect that this thread will make its way to IMHO if it does not attract some serious analysis, but we'll see.)

[RickJay]

It's not onyl not a theory, it's little more than a Dilbert joke before there was a Dilbert.

Everyone can think of someone who was a bad manager; that's to be expected. Laurence Peter came up with an idea that everyone thinks they know an example of, but he never actually supported it with any real evidence. If the Peter Principle is generally true, nobody's ever actually shown it with a real study.

[don't ask]

Originally Posted by RickJay

It's not onyl not a theory, it's little more than a Dilbert joke before there was a Dilbert.

I don't think that is even close to the truth. Over the years there has been plenty of research indicating that the principle contains much truth. it is included in many MBA courses. Because the original book is written in a deliberately amusing manner it hides the fact that the work is based on observations by real specialists in the field.

Here is a recent look at the theory's validity:

Not all research that supports Dr. Peter's assertions about hierarchiology is so difficult to understand. Professor Lazear summarizes a host of other, simpler studies suggesting that people with stronger skills tend to be promoted more quickly and that people with weaker skills tend to get stuck in their current jobs after just one or two promotions—as The Peter Principle proposes. Research related to The Peter Principle confirms that many of these ideas aren't just right; they are also useful.

[Richard Parker]

Isn't the principle simply true by deductive logic?

If every employee who performs his current job competently is promoted, then any employee who is passed over for promotion is incompetently performing his job.

The problem, of course, is that the first premise is almost never true. As the OP points out, jobs don't promote exclusively based on competency and not every employee who is competently performing his job is promoted. Most devastatingly, almost no job promotes you without regard to your prospective merit in the new position, focusing only on your ability to do your current job. But if there is some hierarchical organization that does in fact promote exclusively by competence in the current position, and everyone wants a promotion if offered, then logically everyone will rise to their level of incompetency, no?

[The Second Stone]

I don't think this was ever intended as a social hypothesis. I think it was intended as a humorous observation. Kinda how like Murphy's Law is not really a Law of Physics, or Gaudere's Law is a rule of spelling and grammar.

[Lantern]

It may have started as a joke but it is actually quite an elegant piece of logic which can and has been modelled rigorously.

[Lantern]

Incidentally there are at least three reasons for why Peter's principle might apply of which the Lazear article discusses two:

Regression to the mean means that of all the employees who have performed really well, some have done well just because of luck and they will return to their mean level after they are promoted.

The incentive reason means that the prospect of promotion is a major incentive to work hard. The older and more senior you get the more you might come to believe that future promotions are unlikely which reduces your incentives.

But a third which I don't think Lazear discussses is that promotions may involve a discrete and large jump in the capabilities required so that someone who is competent in one position may be incompetent in the next position after promotion.

I should add that Peter's principle is obviously not absolute and doesn't mean that everyone at senior levels is incompetent. There may be ways for companies to get around it as discussed in earlier posts. However it seems quite a valid argument to me and I suspect it applies to some extent in a lot of companies depending on how the promotions and incentives are structured. Apparently there is some evidence for the principle in a firm in the financial sector.
pdf file: http://www.dur.ac.uk/resources/dbs/r...mby27Feb09.pdf

[China Guy]

Sheesh, work in a corporation for some amount of time and you'll agree with the premise. Just because someone is good at A and "everyone" thinks that same person will be good at B or managing the A people, painful experience shows this logic does not necessarily work out in real life.

of course, how else are you supposed to promote people internally? Go for the losers with no drive?

[Locrian]

I think it's 100% true in show biz. I've worked in post-production for years, I'm now unemployed, and my goal is NOT to continue to work in this industry.

I've worked for and with many post companies with duplication, subtitles, captions, vaulting, delivery, client coordination, etc. I feel that each company I've experienced start at 50-50. That is, half the employees have experience and DO kno what they're doing, while the other half have no idea.

One thing in PP is you have a rare thing in Hollywood-- a steady paycheck. Many showbiz jobs do not, so you get actors, used-to-be producers, agents and salesman from every industry in the nation, but these people do not have experience or a real interest.

I have worked with salespeople who tell clients whatever they want, even though the work they need done is not what we do. Many times these salespeople have convinced some managers that we can outsource without telling our client and make even more money without doing the work. (!) Once they try, they find out how many details there are, the quote given to the client will give us a loss, and the deadline won't be met. They, of course, then lose the client.

I've known plenty of people who've moved around from post company to post company, but the management usually stays the same, making the same mistakes.

And let's face it, in a place where car, clothes, connections and hairstyle get the promotions, the Peter Principle is true.

[Mijin]

Brainstorming reasons why the Peter Principle might not often apply in practice:

1. Promotions don't happen often enough (so some people may not reach their level of incompetence in their working lifetime).

2. Part of why people are promoted is because they've shown an aptitude for doing some of the more senior work. So often people get promoted when they've already taken on many of the responsibilities of the more senior job, and the promotion is really just an acknowledgement.

3. People tend to try harder as they are promoted. So the terminal case may be a person who is competent but must work very hard to be so. And said person might realise, when being offered a further promotion, that it would be more than they can handle.

4. The Peter Principle is elitist in that it seems to assume that more senior roles require more intelligence, talent or whatever. In reality though, they just require a different skillset, and often a skillset which can be learned.
Indeed, there are many industries, like mine, where managers appear to require less expert knowledge/talents than the techies that they manage. And I'm saying that as someone who has worked on both sides of this fence.

In my experience the really awful managers tend to come from outside. People who get the job from being friend-of-a-friend or who are good at job interviews and nothing else.

[Hari Seldon]

I object to classifying Murphy's law with this. Murphy's law was a design principle and an excellent one: if you give people two ways of doing something, one of which is wrong, some people will do it the wrong way (so don't allow them two ways; make sure one of them cannot be carried out). Of course, others have misstated it and generalized it far beyond what was intended.

When I was on a local school board as a parent representative, there was one vice-principal who recognized his own incompetence at his job (he wasn't as bad as he thought, but he certainly wasn't enjoying it). He wanted to go back to teaching, which he was excellent at and enjoyed, but the teacher's union would not permit it. Quebec allows closed unions and they would not readmit him.

[msmith537]

Originally Posted by Mijin

In my experience the really awful managers tend to come from outside. People who get the job from being friend-of-a-friend or who are good at job interviews and nothing else.

That's why a lot of managers clean house when they start in a new position. It's much easier for me to bring in trusted people where there is already a respectful professional relationship than it is for me to try to gain the respect of a bunch of embittered and cynical employees as I learn the nuances of my new management role.

[Mijin]

Originally Posted by msmith537

That's why a lot of managers clean house when they start in a new position. It's much easier for me to bring in trusted people where there is already a respectful professional relationship than it is for me to try to gain the respect of a bunch of embittered and cynical employees as I learn the nuances of my new management role.

So wherever you go, you find "embittered and cynical employees" (which has nothing to do with your performance).
So you fire everyone and bring in your pals.

You sound like a great manager.

[Skald the Rhymer]

Originally Posted by RickJay

It's not onyl not a theory, it's little more than a Dilbert joke before there was a Dilbert.

I agree with you in mood, but not in particulars--by which I mean that it's a lot funnier than a Dilbert joke. The book is hilarious, and not meant to be taken seriously as anything other than someone bitching about the fact that the world sucks. I love the mock case studies.

[Musicat]

The Peter Principle is always true. If you find someone who's incompetent, that proves it. If you see someone who is competent, it's because they haven't reached their level of incompetence yet. So you can't falsify the premise.

[msmith537]

Originally Posted by Mijin

So wherever you go, you find "embittered and cynical employees" (which has nothing to do with your performance).
So you fire everyone and bring in your pals.

You sound like a great manager.

Well, since they seemed pretty cynical and bitter when I got there, I have to assume they were already like that. And as a manager, I have to be able to evaluate whether their attitude will hinder their ability to do their job effectively or otherwise undermine the group. And as someone who has "been on both sides of the fence" you should know this. One thing that "techies" fail to recognize that inhibits their advancement is that it's not just about being the best programmer. Management generally do not tolerate "delicate geniuses" who can't interact with other people.


The reason everyone at work seems like morons is probably because most of your coworkers and bosses are just as average as you (everyone "you") are. If they were that brilliant or extraordinary, they wouldn't be there. They would be pursuing their dreams and ambitions which probably do not include working as a cog in some large corporation.

Think about it. If you weren't head of your class in a top school with a shitload of extracurricular activities and currently working in your field of study, how did you get hired for your current job? Your employer probably settled on you. Either through a networking connection or some keyword on your resume, you appeared before an interviewer who just had a "good feeling" about you. So if most companies hiring practices are so arbitrary, what makes their promotion process any less arbitrary?

In other words, it doesn't matter who they promote because, well, they would all probably do about as well.

[Civil Guy]

But... but...

The Peter Principle doesn't seem to take into account just *who* is doing the promoting. Let's even presume that it's within the realm of ordinary competent management to fail to recognize sometimes that someone is already at their highest level of competence and thus should not be promoted.

The unwitting staffer is promoted and finds themself overwhelmed. Can't / won't admit it; falls into behaviors that are, for lack of a better word, incompetent. That promotee is now put into the position of hiring and promoting for the position the promotee used to work at. If the promotee's incompetence is all-encompassing, the promotee will fail to recognize the competency of others, and will make all sorts of random, goonish mistakes, occasionally making good choices by accident. It seems unlikely, though, that the incompetence will be all-ecompassing, and that the promotee will at least be able to recognize the skills needed for the job the promotee had been doing well.

The above analysis is offered in the same spirit in which Dr. Peter offered his.

[Freddy the Pig]

Originally Posted by Lantern

It may have started as a joke but it is actually quite an elegant piece of logic which can and has been modelled rigorously.

Did you read your own cite? It describes the Peter Principle as "unnecessary and inconsistent with the data".

[Mijin]

Originally Posted by msmith537

Well, since they seemed pretty cynical and bitter when I got there, I have to assume they were already like that.

Fair enough. And as a manager myself I have had to fire people who'd been with the company for some time but who just weren't putting any effort into the job.
I'd never make it a blanket policy though; and your phrasing implied that you do.

One thing that "techies" fail to recognize that inhibits their advancement is that it's not just about being the best programmer. Management generally do not tolerate "delicate geniuses" who can't interact with other people.

It depends. In my industry it seems to be the culture that programmers are just assumed to be autistic, and kept away from clients or management or whatever.
I resented that, and that's partly why I've shifted towards a more managerial role in the last couple of years.

If you weren't head of your class in a top school with a shitload of extracurricular activities and currently working in your field of study, how did you get hired for your current job? Your employer probably settled on you.

I agree with your overall point here, but I disagree with this particular way of putting it.
You could be the world's best "widget inspector" without having been top of your class or having gone to Harvard. Of course academic qualifications are a good guide, but they don't actually sort people into aptitude for a given job (unless, perhaps we're talking about vocational qualifications).

[msmith537]

Originally Posted by Mijin

Fair enough. And as a manager myself I have had to fire people who'd been with the company for some time but who just weren't putting any effort into the job.
I'd never make it a blanket policy though; and your phrasing implied that you do.

I don't, but I see how more senior managers and VPs might.

I generally don't believe in "blanket policies".

Originally Posted by Mijin

It depends. In my industry it seems to be the culture that programmers are just assumed to be autistic, and kept away from clients or management or whatever.
I resented that, and that's partly why I've shifted towards a more managerial role in the last couple of years.

I never understood that. When I worked in consulting, technology experts were expected to also be able to work with clients and each other. Companies tended to value highly skilled individuals.

Corporate America seems to actively resent them.

Originally Posted by Mijin

I agree with your overall point here, but I disagree with this particular way of putting it.
You could be the world's best "widget inspector" without having been top of your class or having gone to Harvard. Of course academic qualifications are a good guide, but they don't actually sort people into aptitude for a given job (unless, perhaps we're talking about vocational qualifications).

The head of the class or an Ivy League grad probably wouldn't be a "widget inspector" in the first place. That's sort of the point.

And we're talking professional qualifications, not vocational ones.

I'm thinking about my first job with a small consulting firm. I was hired with mediocre grades in an unrelated engineering major from a good school through a friend of mine. It is unrealistic to believe that my managers and coworkers would have the same level of skill and professionalism as someone from IBM, Deloitte, Accenture or McKinsey or some other highly competitive company with high hiring requirements. And what I saw was anyone who did demonstrate extraordinary competance (like myself...aparently I had a knack for it) ended up becoming frustrated and ultimately quit and used their experience leverage a position at a better company.

So maybe organizations as a whole suffer from a sort of Peter Principle.

[guizot]

Originally Posted by msmith537

So maybe organizations as a whole suffer from a sort of Peter Principle.

I've never met an institution that doesn't have some firmly ensconced incompetents. But In my experience, if you really want to identify some kind of "principle" you need to include a corollary: "A person who has been hired for reasons other than demonstrable ability will most likely simply be shifted to another position in order to mask their incompetence."

I'm talking about large organizations, and bureaucracies especially. I've seen many people shifted around just because they have connections. It's not that they are promoted. They just get moved to a place where their incompetence will be lesser noticed.

[Lantern]

Originally Posted by Freddy the Pig

Did you read your own cite? It describes the Peter Principle as "unnecessary and inconsistent with the data".

No it says that the suggestion that the promotion process is a mistake is unnecessary. In other words you have to accept the Peter Principle as part and parcel of any promotion system.

The Peter Principle, which states that people are promoted to their level of incompetence, suggests that something is fundamentally misaligned in the promotion process. This view is unnecessary and inconsistent with the data. Below, it is argued that ability appears lower after promotion purely as a statistical matter. Being promoted is evidence that a standard has been met. Regression to the mean implies that future ability will be lower, on average. Firms optimally account for the regression bias in making promotion decisions, but the effect is never eliminated. Rather than evidence of a mistake, the Peter Principle is a necessary consequence of any promotion rule.

[Mijin]

Originally Posted by msmith537

The head of the class or an Ivy League grad probably wouldn't be a "widget inspector" in the first place. That's sort of the point.

And my point was simply that performance at any given job is not necessarily the same as academic achievement.

One of the best programmers I've ever worked with had no degree and was basically self-taught.

[mswas]

If there is one thing this economic downturn should have taught everyone it's that most people's bosses ARE idiots.

[astorian]

Well, haven't sports fans seen NUMEROUS outstanding offensive and defensive coordinators fail miserably as head coaches? Guys who were brilliant strategists, top-notch X's and O's guys who fell on their faces when promoted to head coach? Sometimes that was because their people skills didn't match their strategic skills; other times, it's because they couldn't see the big picture.

The Peter Principle isn't an iron law of science, but it wouldn't have endured and been repated so many times if it didn't describe a scenario people have witnessed man, many times.

[Freddy the Pig]

Originally Posted by mswas

If there is one thing this economic downturn should have taught everyone it's that most people's bosses ARE idiots.

The Peter Principle, however, says more than that bosses are idiots. It says that everybody is an idiot, except for the people who haven't had time to reach their level of incompetence.

Of course, as Musicat notes, you can't tell by looking at a person whether or not they will receive further promotion. So if you want to study the Peter Principle as a falsifiable "theory", instead of humorous folk wisdom, you'll need to study an organization over a period of many years. And, you'll need objective measures of competence over a wide variety of jobs, which will be difficult to devise.

[Dangerosa]

My experience is that you have to be more than competent in a job to get promoted to the next level, there simply aren't enough next level spots to promote the simply competent people into them - you need to have excelled at that level, probably even taken on responsibilities that are commensurate with the next level - so that by the time you are promoted, you are competent for that next level.

There are exceptions - a big one is people who excel as individual contributors often do not make good managers - the engineer who becomes a poor manager. But that is such a change in skill sets that it seems reasonable that there would be a lot of misses - few people are going to be both great engineers and great managers. Some companies have decided to create career paths for great individual contributors that don't move them into management but still allow them to have a career ladder to address this.

Another exception is when a company is going through a lot of growth, and makes a lot of personnel decision because they have those people there and they need to create a different organization RIGHT NOW. That can open up rationalizations to build under someone that in a more normal business climate might have take a more sensible organizational path.

[gonzomax]

Old management sort of joke. if you have a weak employee you can fire him or promote him. That makes him someone else's problem. Especially if he has good connections.

[Cheesesteak]

Originally Posted by Dangerosa

My experience is that you have to be more than competent in a job to get promoted to the next level, there simply aren't enough next level spots to promote the simply competent people into them - you need to have excelled at that level, probably even taken on responsibilities that are commensurate with the next level - so that by the time you are promoted, you are competent for that next level.

This was exactly the point I was going to make. Employees don't rise to a level of incompetence, they rise to a level of mere competence from prior excellence.

You don't wind up with a company full of incompetents, you get a company full of people who are competent at what they do, where their competence has the greatest impact on the performance of the company, by virtue of promoting them to the highest level where they are still competent.

Change one assumption, that it's those who excel that get promoted, instead of those who are simply competent, and the Peter Principle goes from basically making fun of corporate idiocy to describing a very intelligent way to run your company.