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The Peter Principle is still at work

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Have you ever heard of a situation whereby a company grows to a level of incompetence?

It can happen easily within the ranks of management of any company. Say, for example, a person who excels at his or her position is rewarded with a higher position that exceeds the employee’s field of expertise.

This was initially observed and studied in the mid-to-late ’60s by Dr. Laurence J. Peter,  a psychologist and professor of education. The phenomenon was labelled The Peter Principle.

One recent study looked at an excellent web designer who excelled at his job. His company rewarded him with the title "Director of Internet Technology."

He was very skillful at designing web sites, but knew little about the added responsibilities in his new role. Hiring and firing of employees, motivating his staff and dealing with the company’s budget were completely foreign to him. But this is  precisely how companies become populated with incompetent workers at the top.

Whether it was the Peter Principle that was responsible for the collapse of Eatons department stores is debatable. Some say it was because of the Eaton family’s third generation. Timothy Eaton, the founder, started the company off with hard work and through his own blood, sweat and tears grew the business to become a Canadian icon. The second generation was less involved and hired various management teams to help run the business. By the time the third generation came to the fore the immediate family was even less interested in the business and more management teams came into play. There was certainly some incompetence involved, to say the least.

Some say that an employee who works his or her tail off so he or she can attain a promotion may slack off once achieving a goal. This "slacking" results in lower expectations and productivity in a higher position within the company. The Peter Principle strikes again!

In my own career I have seen companies take their best salespeople and try to make managers out of them. It’s often like taking a fish out of water. You have this person who accounted for 45% of your company’s sales doing something he or she is totally unfamiliar with and suddenly sales are hard to come by. This is the Peter Principle at its finest.

I wonder if you have seen, throughout your various jobs, people promoted to a jobs that exceeded their particular comfort zones?
 
Rick Sparling is a community correspondent for East Kildonan.

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