Death to the Peter Principle

For those who don’t know, the Peter Principle is the belief that in an organization where promotion is based on achievement, people will eventually be promoted beyond their level of ability. Put simply: “Employees rise to their level of incompetence.” More generally, anything that works well (including humans) will be used in progressively more challenging applications until it fails. Human beings love to use what has worked before, even when that isn’t the best course right now. They fail when they reach the upper limit of their ability to adapt to something new.

How much of the Peter Principle is a vestige of the industrial Age? If anything defined the 20th Century, it was the move from an agrarian world to one where people moved indoors in enormous numbers and began working in hierarchical structures. Those structures required leadership to keep things productive and we set up teams of workers and managers. We built whole sciences around it. We promoted people for working hard at whatever they were expected to do, which was usually pretty clear-cut. Management was about experience, not creativity.

Enter the Age of Disruption, which is our century. Jobs are no longer quite so prescribed and simply working hard isn’t enough. In fact, hard working people make up a sizable number of the unemployed. They belong to industries that die, roles that become cheaper overseas, and companies that are no longer competitive. So how does someone plot a course for success when everything we’ve been told is changing? There are two ways:

Adaptation

What will save your bacon in today’s world is an ability to assimilate large amounts of information, figure out what matters and act on it: Adaptation. And you have lots of competition. Thanks to the Web, everyone can learn anything fast and cheap. The value of a university education, once the only way to know the secrets of the successful world, has taken a hit now that anyone can digest the remarkable amount of information available to everyone. Sure, there’s a ‘rite of passage’ aspect and a networking value, but it isn’t what it used to be as the exclusive portal to good jobs. Learning and adaptation trump traditional education.

Once you’ve accepted that we compete on information, it isn’t a big leap to understand that workplace value and getting promoted are no longer a linear function of education and hard work. We help ourselves and our companies by being in a constant learning mode; assimilating information, filtering out the useless, and zeroing in on what counts to avoid risk and exploit opportunities.

Automation

Technology has an increasing role in this change. The best employees are the most connected to what’s happening and enabled with technology that finds, filters, and triggers. But how do you attract and retain the best, most adaptive workers in the Age of Disruption? You ensure you have trustworthy, fresh data on the marketplace and customers, analytics to interpret what it means and discover patterns, ways of pulling the big lever at the right moments, and tools to collaborate across a smart, adaptive workforce. There’s no alternative.

Having great people but poor systems breaks an organization just as quickly as poor management. Having smart people well-armed to make the right decisions at the right moments is the whole enchilada.

The successful Age of Disruption employee is a learner and adapter. The competitive employer in this age recognizes an adapter and enables them with excellent technology, making the Peter Principle so last century.

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Categories: Disruption, Future of work, Real-time, Technology

Author:Chris Taylor

Reimagining the way work is done through big data, analytics, and event processing. There's no end to what we can change and improve. I wear myself out...

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9 Comments on “Death to the Peter Principle”

  1. June 13, 2012 at 8:49 pm #

    Hey Chris, I think you left out a very important reason why the peter principle is waning. Employers increasingly look for people who are passionate about their work. This encourages would-be employees to find something they love to do and stick with it. Smart companies frequently create growth paths that don’t force good sales, technical or administrative people into management roles that they are not suited to. Also, technical people who are good are now commanding much better pay. Once upon a time, a programmer could never expect to get a six figure income. Now, it is commonplace.

    A lot of the young people I talk with reject the very notion that one must move into management to get ahead. This leaves the door open for people who are passionate about managing to fill those roles.

  2. June 14, 2012 at 7:23 am #

    Tom, you bring up a great point…that not everyone wants to be or should be a manager. The Peter Principle doesn’t only apply to management, though. It only says that people will ‘rise’ and that means they’ll be used in increasingly complex ways based on achievement at a lower level. Same thing applies.

    The point I was making is that we live in the age now where the ability to adapt to the situation trumps experience.

  3. Ron Webb
    June 14, 2012 at 2:31 pm #

    Chris, I would echo what you point out differently. First, I see a clash happening in many organizations. It is the clash of those that think career path and leadership come from promotion or position within the organization versus those that see leadership and career path coming from the fact you take on the challenge regardless of your role, you figure out how to get things done, and people want to work with you because the see value in the good work you do. I’ve found this latter group to be way more valuable to my organization.
    I’d rather have a group of people who are passionate, curious, and figure out how to get things done over a group of people with any specific degree or certification. The key, as you point out, is how to get out of their way and let them go. I agree that to do this you have to support them with data and technology, but I have to throw some level of standardized processes. Something to allow them not to have to reinvent their work each time and keep them coordinated and headed in the same direction.

  4. June 14, 2012 at 2:51 pm #

    Ron, great comments. I agree…you provide value to the organization when you take on what isn’t your responsibility. I started blogging, which was definitely not my responsibility, which allowed me to be ‘discovered’ by Harvard Business Review, which led to be recruited by TIBCO Marketing. I merely created my own value.

  5. June 15, 2012 at 5:20 am #

    To support your argument, I look at my father’s career — an electrical engineer at IBM, where he effectively had a deal of a career for life in the 1950s to 1970s, as contrasted with my son’s career, a software designer who worked at Google and now Foursquare. My son is in an industry where he knows mobile and social — there are no established experts in his field with years of experience and a Peter Principle. My son knows as much as any leader. My father was in a very well-managed meritocracy at IBM that played by the Peter Principle rules.

    There are still IBMs out there, such as IBM. Google has probably become more like IBM with success and scale, though it tries to maintain its innovative spirit. And some companies are less dependent on information or knowledge or innovation and the hierarchy is still alive and well.

    • June 15, 2012 at 8:08 am #

      Brad, thank you for your comments. I agree that there are IBM’s out there (maybe there always will be). What will be interesting is to see how the average worker changes their way of thinking in a different paradigm. How do companies change when a markedly different personality of worker is being promoted?

      I suppose the reason Google is moving toward being like IBM is that every larger enterprise shifts to bureaucracy to control such a large group of people and by doing so, promotes and hires bureaucrats instead of creative, adaptive people. Maybe we’ll see the decline of the really-large enterprise?

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