Management didn’t know what to do with Steven and it was their fault. Steven was a 28-year-old coworker and assistant project manager. We worked at a corporate construction company and project managers were our most important personnel.
Steven was smart and had stellar reviews, but when prompted about promoting to PM, he said, “No, no, I’m good.” It perplexed our CFO and COO, who didn’t know why a good employee wouldn’t want more money and responsibility.
I knew why. I was the budget manager at his division and sat in on many of their meetings. I saw the grueling pressure put on project managers and saw them yelled at on occasion. It wasn’t an easy job. Steven figured, he was young and enjoying his life and didn’t want that kind of pressure. And perhaps he thought he’d be bad at the job — which is wiser than most realize.
The Peter Principle was first proposed by psychologist Laurence J. Peters and was intended as satire. It proposed that competent employees will be continually promoted until they are incompetent in their new role. Then, they remain in that position for the remainder of their career. Consequently, every role is eventually held by an incompetent employee. His concept was unexpectedly hailed by researchers as having relevance and truth. Many firms now actively work to combat it.
I would wager any person reading this, who has been in corporate long enough, can think of at least one manager who was shockingly bad at their job. Yet they seemed untouchable.
It makes intuitive sense that as the demands and competition go up, your shine can easily lose its luster. For example, I was a good swimmer and the captain of my high school team. I felt like a god when I swam in local meets against kids who only swam a few months a year. But as I went up to districts, states, and then regionals, I felt increasingly less special.
Today, I’m a writer who sits on the other side of the corporate fence, living mostly free of hierarchal structures and constantly worrying about mistakes slipping through. I see my own partner, and friends, all angling for promotions and raises. This isn’t bad on its own as I admire ambition. Yet I’ve watched many of them take a hit to their life satisfaction.
The data reflects this: Employees are the unhappiest they’ve been in years, due to a lack of control, unreasonable workloads and not enough time off. You’d wonder why anyone would want to take on more if they are already drowning, but they do — by the millions.
It seems paradoxical. You work to be good at your job and gain respect, only to be promoted to a position that jeopardizes those perceptions. Being highly competent risks making you incompetent.
If you succeed enough, your high flying incompetence may introduce the Peter Principle’s brother, dubbed Peter’s Pinnacle, where you make a huge mistake and are paid to go away. It happened with the president of Disney, Michael Ovitz, who was fired after 16 months but made off with a $38 million severance.
The art of balancing
A few programmers I’ve known are good at dodging this responsibility paradox. My buddy Brian is a high flying coder, who is stiff-arming attempts by management to bring them into their fold and start managing people. He insists his goal is to be a skilled programmer and contribute to the company.
But beware of letting this mindset drag you to stagnancy. Don’t become the middle aged employee who has been in the same role for 10–20 years, just going through the motion and replying blandly to questions about their day with, “Living the dream.” The difference with Brian is that he is continually refining his programming, and is passionate about coding. There’s still a fire in him.
I’ve seen many falls from grace over the years, employees who were five star performers and thought highly of. Then, months after the company gleefully announced their promotion, the whispers started, “I heard he’s been struggling in his new role.” And, “He’s slipping.”
At a former employer, there was a corner room we called “The Death Trap.” The role for that office fell under a difficult manager and had sky-high expectations. They went through four people in 18 months. The company fired three managers who’d had great reviews in prior roles. One was saved by the skin of his neck and transferred to a horizontal capacity. It was the Peter Principle on full display.
Companies can do better too
Per a study by Dr. Ed Lazear at Stanford University, companies should account for the Peter Principle in any promotion decision because it’s an inevitable consequence. One solution is to inflate the original promotion requirements to smooth the transition. Put another way, ensure the candidate is an absolute star in their current role before leading them to deep waters.
Sometimes, you shouldn’t promote great employees at all. For example, in school, they often took our “Teachers of the Year” and offered them jobs in the administration. It’s tragic because it removed the teacher from working with students and making an impact where they thrived. Why not pay the teacher more to keep being an awesome teacher? To the managers seeing this, think long before hard-capping salaries by job title.
Think about your job well beyond compensation. Your motivation and job satisfaction are driven by feelings of competence, relatedness (feeling connected to coworkers), and autonomy. Every move up the ladder impacts those three things in unpredictable ways. If you do take a promotion, use that job to supplement your skills. Hire and surround yourself with smart people, and listen to what they have to say. That alone would save many from the clutches of the Peter Principle.
Everything is a tradeoff. I was keenly aware of that when I quit finance to be a writer. It was a conscious but difficult decision. I resolved I would probably never get wealthy. Upward mobility, outside of me writing a fluke hit book, would be limited. My health benefits would vanish. But I’d be doing something creative and that I loved doing, with minimal oversight and flexibility. Four years out, I’m still happy with this decision, but I am constantly doing status checks. Things can change on a dime.
My point is: Take a long view. Protecting your reputation and integrity gets harder as you carry more responsibility and teams to manage. Make sure the new role aligns well with your skillset, lifestyle, and has the support in place for you to thrive. If you make the decision solely for money, you may fall into an old and dangerous career trap.