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money & economicsWikipedia1969

The Peter principle says people keep getting promoted until they fail at the job

the gist

The Peter principle holds that people in a hierarchy are promoted for doing well in their current role, until they reach a job where they are no longer competent. Skill in one job does not automatically carry over to another, so the best salesperson may become a poor manager and stay there. Laurence Peter and Raymond Hull set out the idea in their 1969 book, which was written as satire but was taken seriously because it described real organisations. Since then it has become a standard way to explain why many managers seem out of their depth.

how it works

Promotions reward skill in the current job, but the skills that make someone excellent at one task may not match the demands of the next level. Once a person reaches a role they cannot do well, there is usually no further promotion to reward them, so they stay there. Over many promotions, each level tends to fill with people who have reached their limit.

so what

The idea explains why organisations can end up full of people doing jobs they cannot do well, even when everyone is trying hard. It has shaped how firms think about promotion, since rewarding past performance with a new role can quietly damage both the employee and the team. It remains a common reference point in management research.

fun fact

The Peter principle was published as a satirical book, and its co-author Raymond Hull wrote the text based on Peter's research.

more on this

Adapted from Wikipedia, the free encyclopedia · CC BY-SA 4.0