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Daily Leadership Thought #76 – Beware of the “Peter Principle”


We’ve all heard about the “Peter Principle” formulated by Dr. Laurence Peter and Raymond Hull.  In short, it states that in a hierarchy every competent employee tends to rise to their level of incompetence and from that point on they will hit a ceiling of how far they can move up in the organization.  I’ve seen this happen countless times.  In my experience, many of the people who hit this point end up ultimately being fired or leave on their own.  Unfortunately, many companies end up perpetuating this process through unwise promotions and a formulaic mindset about career paths and compensation.  Employees who were once happy and self-confident become stressed out and lose their confidence as they attempt to pursue a canned definition of success at work.

I encourage leaders of companies to think in terms depth not just breadth when it comes to their employees.   Not everyone is made to continually climb the ladder of success or assume increased management responsibility.  What we need to do is a better job of understanding the true value of individual contributions and motivations across every level of the business.  There is value in all work and everyone has the potential to master certain aspects of the job.  Expertise weaved throughout the entire fabric of the organization is the surest pathway to success.  It also is the safest way to mange risk and encourage innovation.  We also need to realize that sometimes we may ask too much of someone and should give them a graceful landing when they fail or struggle with increased responsibilities (as long as they have given it their best effort).  Why would we knowingly push someone out of the company who has a track record of commitment and success?  Sadly, it happens every day.

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