What is the Peter Principle Costing You?

December 1, 2015 | By | Add a Comment

Who have you over-promoted, and why?

“The Peter principle is a special case of a ubiquitous observation: Anything that works will be used in progressively more challenging applications until it fails. Thus, employees only stop being promoted once they can no longer perform effectively, and ‘managers rise to the level of their incompetence.’” (Wikipedia)

In other words, there is a tendency among managers to promote leaders based on past or current performance, rather than evaluating a candidate’s potential to perform effectively in their intended role. This use of history as a predictor of future performance is not effective and reflects an unsophisticated way to manage people, yet we all do it.

Are business executives good judges of ability and fit?

In my work with executives across the country, I see that so much of poor business results is attributable to the wrong people being placed in the wrong spots. Promotions are based on expediency, or gut feel, or simply a misunderstanding of what the next position for someone will entail and how that does or doesn’t mesh with someone’s abilities and experience. Beyond poor results, the promoting manager ends up saddled with more work and an awkward situation, or unnecessary, or at least unplanned, turnover.

Research shows that most managers are not good at hiring – and promoting. Some managers are not great at planning, hence they don’t have the right people for the size, type of work, or changing work that is coming up. These classic growing pains are experienced because many managers are leading into uncharted territory, and the people we have on our team are in the same situation. It’s a classic case of the blind leading the blind.

Ultimately, the best solution is to use a team to hire and promote, or assign someone who is not as close to the situation. Your HR team, perhaps in conjunction with a selection of other managers, should be your best tool for promoting based on the qualities you outline for effective leadership, including: excellent communication skills, the respect of team members, and the ability to engage and inspire employees on a regular basis. It’s also helpful to surround yourself with people who have run businesses many times the size of the one you are running, and have had experience managing high-growth situations. These mentors can do in their sleep what you are just learning to do.

How are you safeguarding against the avoidable growing pains related to hiring and promoting?

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About the Author (Author Profile)

Executive coach, top team facilitator, author and speaker. I work with individual leaders and their teams to help navigate personal and professional transitions and to increase leadership capacity and improve communication and relationship skills. I founded my coaching firm in 2001 following 12 years asa CEO. Check out more on me and my coaching process in my book "The Business of Wanting More: Why Some Executives Move from Success to Fulfillment and Others Don't"

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