If you’re climbing the corporate ladder, here’s a real kick in the shorts. It’s in your employer’s best interests not to promote you if you’re doing a great job. It’s called the Peter Principle, and it’s been a “truism” in business since it was first proposed in the late 60s by psychologist Lawrence J. Peter.
Here’s how it works. In the real corporate world, each level in a hierarchy is substantially different than the other levels. That is, a lowly paper pusher needs different skills and strengths than his supervisor, who needs different skills than his manager, who needs different skills than the regional manager, and so forth. When an employee does a great job at one level, they’re typically promoted to the next, where they may or may not excel. If they do excel, they’re promoted again. The process repeats until they reach a level at which they are not competent enough to get promoted. When this practice is applied through the whole company, the net result is that everyone ends up in a job they are bad at.
The bad news is that it’s been proven to be more than a truism. It’s a fact of game theory now. Alessandro Pluchino, et al, received an Ig-Nobel award for their mathematical proof that it’s better to promote people at random.
The layman’s explanation goes like this. In general, the skill set for one level in a corporation is not correlated to the skill set for the next level up. For instance, to be a good paper pusher, you need to have attention to detail, long term focus, the ability to sit at a desk for hours on end, and willingness to take directions. To manage paper-pushers, you need good people skills, attention to the “big picture,” creative problem solving skills, and the drive to keep moving and not get locked behind a desk. Very few people have both sets of skills.
Since the skill sets of most jobs are not similar, it’s better to promote at random. This way, you’re unlikely to promote the best person from the lower level, which ensures continued efficiency. Since there’s no way to guess whether someone will be good at the new job, random chance is as good as any other method. Maybe the person being promoted will be better in the new job.
Of course, there’s one element which was not included as a variable in this study — worker satisfaction. How would employees feel knowing that they had no influence on whether or not they’d get promoted. How would that affect job performance? Is there any way to ensure workers’ happiness while avoiding merit-based promotions?
I’m guessing we’ll need another study or two before this is fully resolved.
The Peter principle revisited: A computational study. Original Research Article
Physica A: Statistical Mechanics and its Applications, Volume 389, Issue 3, 1 February 2010, Pages 467-472
Alessandro Pluchino, Andrea Rapisarda, Cesare Garofalo