Illustration: Oscar Ramos Orozco

"The Peter Principle" and Other Reasons To Think Twice Before Accepting a New Promotion

It’s the offer you thought you’d been waiting for. You’ve put in long hours, juggled various client projects and now the firm has offered to reward your efforts with a promotion. You’re about to become the newest manager or creative director.  You’ll have higher pay, a bigger office, and more responsibility. Your life in the new role looks sweet. But maybe you should look again.

In many organizations, large and small, promotions often don’t turn out to be the reward they were intended to be. Newly promoted team members often find themselves over-extended and their performance suffers. Moreover, when the new workload calls for managing projects instead of contributing to them, the newly promoted spend less and less time working on tasks that drew them to the firm in the first place. This dilemma is actually quite common in companies and it isn’t an exactly a positive scenario for either party.

The phenomenon of under-performing, un-engaged managers was first described by the Canadian psychologist Dr. Laurence Peter in a theory that now bears his name: The Peter Principle. Simply stated, the Peter Principle predicts that “in a hierarchical organization, employees tend to rise to the level of their incompetence.”

Dr. Peter observed that in most companies, team members are rewarded for their high performance with a promotion, but if they under-perform in the new role, they are rarely demoted. Instead, companies try more training, smaller teams, or hiring assistant managers to help—all of these in order to avoid facing the painful admission that the promotion wasn’t really the best decision. Peter first proposed this theory in the 1960s mostly as satire, but more recently researchers have begun to test it scientifically.  In a statistical model of organizations that tested the traditional promotion strategy (Peter Principle) against randomly handed out promotions, researchers found not only that the Peter Principle dilemma occurred. It was practically inevitable.

The team found that any time that the competencies required in one level of an organization were not the same as the competencies required to perform well at the level below, the newly promoted would find themselves facing the possibility of their incompetence. In the creative industries, this distinction can be quite important. Moving “up” in many firms can mean less time serving clients or less time creating new projects and more time managing budgets or holding people accountable.

Team members are rewarded for their high performance with a promotion, but if they under-perform in the new role, they are rarely demoted.

If the newly offered promotion involves much of the same skill set with a minimal addition of new skills, then it’s likely a good fit. If however, the new position would draw you away from your core strengths, then perhaps you should reconsider. Either way, it’s important to examine whether any new competencies are ones you feel capable of acquiring. If you feel like you’d be a quick learner, then it might be worth rolling the dice. If not, then perhaps you should pass and wait for a more fitting assignment to come along.

The Peter Principle is more than just a satirical comment on large bureaucracies or a strange organizational phenomenon. It’s a symptom of a culture that over-values titles and under-values being connected to the work you’re best at. That culture drives us away from the roles in which we’d thrive all for the promise of a better-looking business card. We’re subtly influenced to believe that more responsibility, bigger offices, and better sounding titles are always better. The truth is: working on projects you have the potential to thrive at is better than any title.

 

More insights on: Career Development, Hiring

David Burkus

more posts →
David Burkus is assistant professor of management at the College of Business at Oral Roberts University, where he teaches courses on creativity, entrepreneurship, and organizational behavior. He is the author of The Myths of Creativity: The Truth About How Innovative Companies and People Generate Great Ideas.
load comments (16)

Comments