I am sure this book is not alien to any of us and we have our perception of reading the same. Today, I take the blame for reviewing this masterpiece with all my wisdom and intellect. Laurence J. Peter and Raymond Hull are the writers behind this masterpiece that was considered to be a humorous satire but turned out to be the harsh reality of every individual stuck in a corporate hierarchy. After closely observing, recording, and analyzing the then corporate structures of many organizations including multinationals, government, semi-government institutions- these writers concluded that:

” in any corporate structure, employees tend to rise to ranks where they are not competent. If an individual works for a company that practices top-down management, then he is likely to be promoted until he gets to one rung above his level of competence. The educator referred to this level as the “final placement.”

Let us try to interpret the above statement in layman terms: If you are stuck up at a professional level of your job for long enough, you are incompetent, Period! According to the writers, there is a big flaw in the methodology of getting promoted that goes something as follows:

  • E works on task X for Y number of years.
  • E has been given a promotion to the next level of job, Z
  • The basis of promotion of E to task Z is either his expertise in task X or his Y number of years served for the organization

If you have found the loophole in the above mechanism, you have understood the writer’s point of view. The promotion has nothing to do with task Z, in which E has to dedicate his time and effort after the said promotion. So, if E is an average guy for task Z, he will be stuck for the rest of the coming years of his professional life wondering why did the next promotion stop at this level?

Peter and Hull not only described the problem at its core but also described a way out through the problem by:

  • Demotion: Recalling the promoted employee back to the previous title
  • Higher Pay, No Promotion: Rewarding the employee in monetary terms and not through titles
  • Lateral Arabesque: Shifting the employee to a different role that suits the competency level
  • Employing Alert Individuals: Employees should not just run behind promotions rather make an informed decision after realizing the additional responsibilities that come with the promotion
  • Outwit the Employer: Employee is aware of his shortcomings and avoids the promotion to the next level but simultaneously pursues his well-suited role.

There are some shortcomings in the design of the principle that does not specify the standard duration at one level, assumes that there is the next level to all levels, limitation in the limited number of superior professional titles and places, and the fate of the person being replaced. However, this principle always holds true and motivates any individual to create a roadmap for success, not relying just on any promotion but on one’s strengths. Finally, are you stuck up?

References:
Corporate Finance Institute. 2020. Peter Principle – Definition, Factors, And How To Prevent. [online] Available at: <https://corporatefinanceinstitute.com/resources/careers/jobs/peter-principle/> [Accessed 16 November 2020].
Stanford Graduate School of Business. 2020. The Peter Principle: A Theory Of Decline. [online] Available at: <https://www.gsb.stanford.edu/faculty-research/publications/peter-principle-theory-decline> [Accessed 16 November 2020].
Tom Olivo, H., 2020. Accelerating The Peter Principle In Healthcare – Unintentionally: A Disturbing Trend Is On The Rise For People Who Serve In A Management Capacity In Healthcare.. [online] Beckershospitalreview.com. Available at: <https://www.beckershospitalreview.com/hospital-management-administration/accelerating-the-peter-principle-in-healthcare-unintentionally.html> [Accessed 16 November 2020].

Mohamed Irfan Sheikh

Course Leader-AGE

Mohamed Irfan currently works as a Course Leader at Athena Global Education. Prior to this, he has worked as a faculty in the School of Business and School of Computing at University of Stirling and Birla Institute of Technology, U.A.E. He has worked in responsible positions in other companies as well. Irfan is an AFHEA (Associate Fellow of the Higher Education Academy), U.K. and holds a Masters in Management Studies (Major in Operations) along with Bachelor’s degree in Engineering (Major in Production) from Mumbai University, India.