Paperback | 192 pp. | Harper Business | 25/10/2011 | Reprint Edition
The book The Peter Principle, written in 1969, is often cited, but not many must have read it. It is a great book that allows for a two-way reading: the first looks at its funny and humorous side: the book mocks managerial literature in trying to define absolute rules based on simple observations, hinting that behavioural sciences seemed not too scientific from the author. The second reading is a lot more serious and aims at portraying the dysfunctionalities of the traditional hierarchical organisation model, and the way that careers are planned and executed.
Even half a century later, the book is right on many accounts on both sides. Some paragraphs sound even prophetic, primarily when they refer to Technology. Above all, we can trust that a lot of the content is rooted in reality, as many researchers have found over time.
The Peter Principle
The Peter Principle, in its purest form, states the following:
In a Hierarchy Every Employee Tends to Rise to His Level of Incompetence.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 15
This is the result of the observation of Dr Peter in the many years of experience within the education system (but not only). He refers to this as a new science, hierarchiology, the study of hierarchies.
The principle is based on the fact that in a hierarchy, members are promoted so long as they work competently. Indeed, when it is time to fill a vacancy higher up in the hierarchy, managers will choose to promote a person who is currently competent in their current job (no-one wants to promote a person who is already incompetent). Sooner or later, an employee is promoted to a position at which he will no longer be competent (his “maximum level of incompetence“, also known as Peter’s Plateau), and there he remains, enjoying no further promotions.
The employee’s incompetence is not necessarily exposed as a result of the higher-ranking position being more difficult. Simply, that job is different from the job in which the employee previously excelled, and thus requires different work skills, which the employee usually does not possess. For example, a salesperson can be excellent at his selling skills and then get promoted to a Director Role where he might be required to have organisational skills (that he might lack).
Seen this way, career simply is a journey towards incompetence, brilliantly explored by Peter’s Corollary:
In time, every post tends to be occupied by an employee who is incompetent to carry out its duties.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 16
Luckily it is almost impossible to find a system in which every employee has reached his level of incompetence. Which brings to another important observation:
Work is accomplished by those employees who have not yet reached their level of incompetence.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 16
The efficiency of a hierarchy is inversely proportional to its Maturity Quotient (M.Q.):
Obviously, when M.Q. reaches 100, no useful work will be accomplished at all.
In pursuing his theory, Dr Peter examines several exceptions to the Peter Principle, but on his closer evaluation, they do not violate the principle.
The Percussive Sublimation – a hopelessly incompetent person, a bottleneck, that management kicks upstairs to get him out of the road.
The Lateral Arabesque – the incompetent employee, is given a new and longer title and is moved to an office in a remote part of the building.
Peter’s Inversion – e.g. amongst minor officials with no discretionary powers, one sees an obsessive concern with getting the forms filled out correctly, whether the forms serve any useful purpose or not. No deviation, however slight, from the customary routine, will be permitted. Peter’s Invert (aka professional automaton) always obeys, never decides. This, from the viewpoint of the hierarchy, is competence, so Peter’s Invert is eligible for a promotion. He will continue to rise unless some mischance places him in a post where he has to make decisions. Which is where he will find his level of incompetence.
Hierarchical Exfoliation – the case of the brilliant, productive worker who not only wins no promotion but is even dismissed from his post. Indeed, in most hierarchies, super-competence is more objectionable than incompetence. Ordinary incompetence is no cause for dismissal: it is simply a bar to promotion. Super-competence often leads to dismissal because it disrupts the hierarchy and thereby violates the first commandment of hierarchal life: the hierarchy must be preserved.
The Paternal In-Step – this is when the owner of a family business brings in his son at a high level with the idea that in time, without rising through the ranks, he should take over the supreme command (“step into his father’s shoes”). There are two ways this can happen:
- An existing employee is dismissed/removed to make a place for the in-stepper; or
- A new position, with an impressive title, is created for the in-stepper.
What’s interesting about the Paternal In-Step is that modern organisations have evolved to provide opportunities also for those that do not have line-of-blood relatives. This has given origin to the Modern Father Substitutes, which often exist because people the budgeting process provides funds that need to be spent. Usually, around the beginning of the last quarter of the year, superiors will notice the budget residual and propose that a new project or role is created to ensure that the budget is fully spent. Respecting the process is the main objective! (Something we have seen in Beyond Budgeting). As soon as money is offered, a way must be found to spend it. Which is where a new generation of hierarchy members appear: the in steppers. The In-Stepper may or may not solve the problem that he was set to solve: that does not matter. The important point is that he must be able and willing to spend the money.
Performance Management according to the Peter Principle
A direct consequence of the Peter Principle is the question of Who Defines Competence? In a Hierarchy, this is pretty easy to define: the competence of an employee is determined not by outsiders but by this superior in the hierarchy. It is this principle of “self-preservation” which is the basis of the entire construct of the Peter Principle. It also serves as a framework to understand how Performance Management works.
When the manager has not yet reached the max of his career, he will still have a level of competence. Thus he will be able to evaluate the output of his team. But if the superior has reached his level of incompetence, he will probably rate his subordinates in terms of institutional values. He will see the competence of those below him as the behaviour that supports the rules, rituals and forms of the status quo. in one word; he will stop considering outputs and start to evaluate the input. This is the reason why Peter’s Inversion exists, by which a superior often look at the managers below him simply in terms of compliance with the rules. Which is why often we see that internal consistency is valuer more highly than efficient service. People, in this framework, tend always to obey and never decide. Because from the viewpoint of the hierarchy, this is competence.
Competence, like truth, beauty and contact lenses, is in the eye of the beholder.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 32
Pull & Push in Promotions
Career is a critical aspect that the authors examine in The Peter Principles. Especially for what concerns promotions, Dr Peter and Raymond Hull go at length at analysis two strategies: Pull and Push.
Pull is “an employee’s relationship – by blood, marriage or acquaintance – with a person above him in the hierarchy“. Winning promotion through Pull is a thing we all hate – in other people.
Employees in a hierarchy do not really object to incompetence (Peter’s Paradox): they merely gossip about incompetence to mask their envy of employees who have Pull.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 42
Pull is “an employee’s relationship – by blood, marriage or acquaintance – with a person above him in the hierarchy“. Winning promotion through Pull is a thing we all hate – in other people.
Employees in a hierarchy do not object to incompetence (Peter’s Paradox): they merely gossip about incompetence to mask their envy of employees who have Pull.
Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 42
How to acquire Pull – here are five practical suggestions:
- Find a patron.
- Motivate the Patron (“an unmotivated Patron is no Patron”). See that the Patron has something to gain by assisting you or something to lose by not supporting you, to rise in the hierarchy.
- Get out from under – neither your efforts nor the Pull of your Patron, can help you if the next step above you is blocked by someone at his level of incompetence (a Super-incumbent). This awkward situation is called Peter’s Pretty Pass (Things have come to a pretty pass). To move up the job hierarchy, you get out from under the Super-incumbent and move into a promotional channel that is not blocked. This manoeuvre is called Peter’s Circumambulation.
- Be flexible – there is only so much that anyone Patron can do for you. If your Patron cannot climb higher, then the Pullee must find another Patron who can. So be prepared to switch your allegiance to another Patron of higher rank. “There’s no Patron like a new Patron!”
- Obtain multiple patronages – “The combined Pull of several Patrons is the sum of their separate Pulls multiplied by the number of Patrons” (Hull’s Theorem). The multiplication effect occurs because the Patrons talk among themselves and continuously reinforce in one another their opinions of your merits. “Many a Patron makes a promotion”.
In established organisations, the downward pressure of the Seniority Factor nullifies the upward force of Push. Pull is stronger than Push. Pull often overcomes the Seniority Factor. Push seldom does. Never Push when you can Pull.
Push alone cannot extricate you from Peter’s Pretty Pass. Push apart will not enable you to execute Peter’s Circumambulation successfully. Using the Circumambulation without the aid of Pull simply makes superiors say, “He can’t apply himself to anything for very long”.
Signs and symptoms of Push – Push is sometimes manifested by an abnormal interest in the study, vocational training and self-improvement courses.
Many pushful persons exhibit Pseudo-Achievement Syndrome. They suffer from complaints such as nervous breakdowns, peptic ulcers and insomnia. This is not to be confused with Final Placement Syndrome (see later chapter) – they have not yet achieved final placement, and often have several ranks and several years of promotion ahead of them. The difference between cases of Pseudo-Achievement Syndrome and Financial Placement Syndrome is called Peter’s Nuance.
Leadership in the Peter Principle
As for the general concept of competence, also Leadership falls victim of the Peter Principle quickly. Because in this context, nothing fails like success. Peter and Hull have to simply extend their reasoning, to dismantle the old adage that you have to be a good follower to be a good leader. The reality is that competent followers show high promotion potential in the lower ranks, but eventually reveal their incompetence as leaders.
A few rules are therefore derived. A good follower promoted to a position of Leadership:
- a) Fails to exercise leadership
- b) Reduces efficiency among his subordinates
- c) Wastes the time of his superiors.
In most hierarchies, as a matter of fact, employees with the greatest leadership potential cannot become leaders.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 54
So the truth, according to The Peter Principle, is that exceptional leadership competence cannot make its way within an established hierarchy. It usually breaks out of the hierarchy and starts afresh somewhere else. But why would this be? Good followers do not become good leaders: essentially because Leadership in a hierarchical organisation equates to insubordination.
Leaders in these organisations (intended here as apical managers, not as individuals competent in Leadership), simply follow precedents, obey regulations, and move at the head of the crowd. Such employees lead only in the sense that the carved wooden figurehead leads the ship.
The role of consultants
Interesting to note that the book reserves two fascinating remarks on testing in recruiting and on external consultants.
On testing, the authors assess that the usage of psychometric as well as competency testing accelerates the Peter Principle. The main difference between tested and untested employees is that the tested people reach their levels of incompetence in fewer steps and in a shorter time.
On consultants, they observe that many of the consultants themselves will be at their level of incompetence. Which is why most outsourced reorganisation processes lead to the creation of coordination roles between incompetent leaders. And often the only recommendation that indeed produces an increase in output is: hire more employees.
Incompetence plus incompetence equals incompetence.Dr Laurence J Peter and Raymond Hull, The Peter Principle, Page 93
The pathology of “success.”
One of the most humorous sections of the book is when the authors try to link the physical and psychological effects of careers. So according to the author, doctors report that several complaints are typical among their “successful” patients: peptic ulcers, constipation, alcoholism, overeating and obesity, loss of appetite, hypertension, insomnia, chronic fatigue, skipped heartbeats, migraine headaches, tinnitus, sexual impotence, etc.
What the ordinary sociologist or physician calls “success”, the hierarchiologist, of course, recognises as final placement. The symptoms described are the Final Placement Syndrome.
Physicians typically make one of three medical errors in “treating” the patient:
- They attack the physical symptoms with medication or surgery, or good advice (“Don’t work so hard”);
- The second group of physicians, finding nothing organically wrong with a F.P.S. patient, will try to persuade him that his symptoms do not exist. “There’s really nothing wrong with you”.
- Alternatively, psychotherapy is sometimes attempted. It seldom succeeds, because it cannot affect the root cause of the F.P.S., which is the patient’s vocational incompetence.
Non-medical indices of final placement
It is often useful to know who, in a hierarchy, has and has not achieved final placement. Unfortunately, you cannot always get hold of an employee’s medical record to see whether he has Financial Placement Syndrome or not. So here are some signs which will guide you:
- Abnormal Tabulology – after final placement, an employee is likely to adopt some unusual and highly significant arrangement of his desk.
- Phonophilia – the employee rationalises his incompetence by complaining that he cannot keep in close enough touch with colleagues and subordinates. To remedy this, he installs several telephones and other communication devices on his desk. Interesting to notice that with technology advancement fixed phone lines have now been substituted by a) the number of mobile phones and their sheer size, b) the number of applications on which the person is reachable/connected and c) time in which the person answers phone calls and emails.
- Papyrophobia – the papyrophobe cannot tolerate papers or books on his desk or, in extreme cases, anywhere in his office, and calls this Clean Desk, an activity he invests much time.
- Papyromania – the exact opposite of papyrophobia – causes the employee to clutter his desk with piles of never-used papers and books. He tries to mask his incompetence by giving the impression that he has too much to do.
- Fileophilia – a mania for the precise arrangement and classification of papers. By keeping himself so busy with rearranging, the fileophiliac prevents other people (and himself) from realising that he is accomplishing little or nothing of current importance. This also happens with digital files.
- Tabulatory Gigantism – an obsession with having a bigger desk than his colleagues. Open Office set-ups have exacerbated this element.
- Tabulophobia Privata – complete exclusion of desks from the office. This symptom is observed only at the very highest hierarchal ranks.
Finally, there are several unusual psychological manifestations of final placement:
- Self-Pity – “Nobody appreciates me“, “Nobody co-operates with me” etc. told over and over by the successful person to peers and collaborators.
- Auld Lang Syne Complex – a strong tendency to reminisce about the “good old days“.
- Rigor Cartis – an abnormal interest in the construction of organisation and flow charts, and a stubborn insistence upon routing every scrap of business in strict accordance with the lines and arrows of the chart.
- Compulsive Alternation – some employees, on achieving final placement, try to mask their insecurity by keeping their subordinates always off-balance, always finding something wrong in what they deliver. This is has been elsewhere defined as Set-Up To Fail Syndrome.
- Teeter-Totter Syndrome – a complete inability to make the decisions appropriate to his rank. He usually deals with the problems that come to him by keeping them in limbo until someone else makes a decision. He gets rid of papers using:
- The Downward Buckpass – papers are sent to a subordinate with the order, “Don’t bother me with such trifles.”
- The Upward Buckpass – he examines the case until he finds some tiny point out of the ordinary, which will justify sending it up to a higher level.
- The Outward Buckpass – involves assembling a committee of his peers and following the decision of the majority.
- Cachinatory Inertia – the habit of telling jokes instead of getting on with business.
- Structurophilia – obsessive concern with buildings rather than with the work that goes on inside them. He noted that this happened mostly with politicians and universities. However, we can see that often occur also in many enterprises.
Can you be happy at Peter’s Plateau?
Employees who have reached Peter’s Plateau (their level of incompetence) can reach in several ways:
- Face the Sordid Truth (Not Recommended!) – the employee realises consciously that he has achieved final placement. But he tends to equate incompetence with laziness; he assumes he is not working hard enough, so he drives himself mercilessly. He rapidly falls victim to Final Placement Syndrome.
- Ignorance is Bliss – the employee never realises that he has reached his level of incompetence. He keeps perpetually busy, never loses his expectation of further promotion, and so remains happy and healthy. He does so by the process of Substitution. Instead of carrying out the proper duties of his position, he substitutes them for some other set of responsibilities, which he carries out to perfection. Here are several Substitution techniques:
- Technique #1: Perpetual Preparation – he busies himself with preliminary activities. Here are some well-tried methods:
- Confirm the need for action: “Better safe than sorry”. Spend sufficient time in confirming the need, and the need will disappear (Peter’s Prognosis).
- Study alternate methods: the Substitutor will want to be sure that he chooses the most efficient course of action.
- Obtain expert advice.
- First things first – minute, painstaking, time-consuming attention to every phase of preparation for action.
- Technique #2: Side-issue specialisation – Look after the molehills and the mountains will look after themselves.
- Technique #3: Image Replaces Performance – An ounce of image is worth a pound of performance (Peter’s Placebo). Politicians well understand Peter’s Placebo.
- Technique #4: Utter Irrelevance – This is a daring technique: the Utter Irrelevantist makes not the slightest pretence of doing his job. For example, the president of a company who spends all of his time serving on the directorates of charitable organisations.
- Technique #5: Ephemeral Administrology – Particularly in large, complex hierarchies, an incompetent senior employee can sometimes secure a temporary appointment as acting director of another division. He refrains from taking any significant action in the new post. “I can’t make that decision: we must leave that for the permanent director, whenever he is appointed”.
- Technique #6: Convergent Specialisation – Finding himself incompetent to carry out all the duties of his position, he simply ignores most of them and concentrates his attention and efforts on one small task.
The Ultimate Test for Incompetence
Next time you are wondering if someone around you is already at his level of incompetence, ask yourself this simple question: “Is he still doing something useful for his job?”
- If the answer is “YES” then there is still open space for more incompetence.
- If the answer is “NO” then he has reached his level of incompetence.
- If the answer is “Don’t Know” then you’ve reached your own level of incompetence.
Conclusion: The Peter Principle
Just by reading it from a humorous perspective, I’d say this book is worth reading. The authors’ analysis of the way many managers acts is merely hilarious, together with the style (with so many “laws” and “principles”, that aim at giving it an apparent scientific solidity), and some case studies that, hidden behind fantasy names, make us remember the Hitchhiker’s Guide to the Galaxy rather than a business book.
However, just reading the first page, where the Peter Principle is declared, gives us immediately a shiver on the back as our mind directly goes around to identify that former boss or that colleague that seems to have reached their highest level of incompetence. As you go through the symptoms linked to reaching out Peter’s Plateau, you start identifying behaviours you see every day in any organisation. And what about the truths that Dr Peter identifies in how Performance Management usually is run? And what about the role of consultants? Or committees?
And what about the relationship with Technology? The last chapter of the book also looks at Computerized Incompetence, a concept that we can very well relate to all the issues with bias in A.I., or in the development of more work coming from some software implementations. The computer vastly magnifies the results of incompetence in its owners and operators, something to remember!
The only reaction to the Peter Principle for many seems to move into Creative Incompetence. According to the authors, it is the only way not to be offered a promotion. There are different ways on how this creativity works, primarily based on not respecting the inputs on which your performance is evaluated. The only other alternative is to start applying The Power of Negative Thinking, which is exemplified, in the authors’ words, in asking yourself the question how would I like to work for my boss’s boss?
To conclude, this book gives vast amounts of thinking material. Yes, the book itself is very dated in a lot of parts (especially in its constant disregard for diversity: women are only looked at in their domestic work…). Besides this, however, it is excellent at framing a lot of right questions. Mainly because the Peter Principle is being demonstrated pretty well, research after research. Yes, we probably need to redefine the way we manage promotions in our organisations. Hierarchy is not the only answer as we have seen, and we have to rethink the way we handle competency specialisation (as perfectly exemplified by the book Range I have recently reviewed).
A highly recommended reading for many, and probably a need to really think more in detail on this Peter Principle in action. With the wish that this will trigger even more a true Rebellious approach to the way organisations are often set-up.
What do you think of The Peter Principle?