Employers generally promote the employees who show that they’re capable of handling a greater responsibility within the company. But sometimes promotions backfire when the employee fails to live up to expectations. This is known as the Peter Principle.


In an article published in the January 1967 issue of Esquire magazine, and later developed into a bestselling book, Dr. Laurence J. Peter introduced his famous Peter Principle. The Peter Principle illustrates how employees in companies that employ a hierarchical structure of management are often promoted to their level of incompetence.


Often, corporate success is solely measured by moving up the ladder. Yet this repeated movement frequently places employees in positions outside of their natural skill set. Peter describes this negative reality saying, “The cream rises until it sours.”


You may have seen this principle at work in your company. A telltale sign is less effective business. Peter himself proposed some humorous techniques of combating the Peter Principle, like “Creative Incompetence,” where an employee self-sabotages their career in order to avoid being promoted too far. But here are some more realistic strategies to combat the Peter Principle’s presence in your company.


Promote Learners and Doers

When you promote, look for candidates who perform their current duties skillfully and have demonstrated a hunger and ability to learn new concepts and skills. Be sure to evaluate how their current skills will translate to their new role. For example, Greg is a proficient technician, but does he possess the effective interpersonal skills needed to be a team supervisor? If not, does he demonstrate a desire to learn and grow into this new role?


Create a Culture of Transparency

Educate your employees in their individual roles and the roles of others around the office. And before you offer promotions, make sure the employee has thorough knowledge of what the new role will look like, what will be expected, and what kinds of skills are needed for that specific role.


Company Success > Personal Titles

Celebrate great work that benefits the company. Reward this work with greater compensation and benefits other than promotions. Emphasize that your company goal is to work toward being a better company, not to claim more prestigious job titles. Reinforce this idea by having the courage to demote employees back to positions where they’ve proven to be more influential. This can humble the executives who made these promotional decisions, but it’ll work to illustrate your commitment to both your company goals and your employee’s personal success.


While each business will struggle with the Peter Principle differently, all must be mindful of how they’re choosing to promote. Businesses should determine whether their promotions system is a productive system, and if it isn’t, determine how they can grow and change to better serve their employees and ultimately their customers.