The Peter Principle Why Things Always Go Wrong

Highlights

My father loved The Peter Principle because it explained why life could be so maddening—and why everyone around you seems, or is doomed to become, incompetent. The people who ran the U.S. Navy and the shipyards didn’t intend to do such lousy work. They were simply victims of Dr. Peter’s immutable principle. They had been promoted inevitably, maddeningly, absurdly to their “level of incompetence.” Dr.

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Dr. Peter also taught my father not to expect the few competent bureaucrats and managers he encountered to stick around for long, as they would soon be promoted to a job that they were unable to perform properly.

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Yet the book’s main ideas remain as pertinent to running and working in an organization today as they were forty years ago. None of this would have surprised Dr. Peter, who depicted his ideas as timeless and immutable facts of organizational life. “Incompetence,” he argued, “knows no barrier of time or place.” Dr. Peter observed that one reason so many employees are incompetent is that the skills required to get a job often have nothing to do with what is required to do the job itself. The skills required to run a great political campaign have little to do with the skills required to govern. There is nothing about being a great surgeon that prepares a doctor to run a hospital. Learning to be a great litigator in no way prepares a lawyer to run a law firm.

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Many organizations, from hospitals to law firms, use such standards to select new leaders—yet devote little or no attention to their management skills. They often end up with lousy leaders and lose their best individual performers. These observations remain just as true in 2009 as they did in 1969.

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Or consider Dr. Peter’s counterintuitive claim that “in most hierarchies, super-competence is more objectionable than incompetence.” He warned that extremely skilled and productive employees often face criticism, and are fired if they don’t start performing worse.

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Much of Dr. Peter’s advice about using “pull” echoes Jeffrey Pfeffer’s Managing with Power, the main text used in many business schools to teach MBAs how to get ahead in organizations. Pfeffer’s analysis and advice is more detailed and sophisticated, but the basic ideas are remarkably similar.

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Instead, I was searching for the underlying principle which would explain why so many important positions were occupied by persons incompetent to fulfill the duties and responsibilities of their respective offices.

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No, there was nothing wrong with my credentials; the forms were correctly filled out; an official departmental stamp showed that they had been received in good order. But an accompanying letter said, “The new regulations require that such forms cannot be accepted by the Department of Education unless they have been registered at the Post Office to ensure safe delivery. Will you please remail the forms to the Department, making sure to register them this time?” I began to suspect that the local school system did not have a monopoly on incompetence. As I looked further afield, I saw that every organization contained a number of persons who could not do their jobs.

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In time I saw that all such cases had a common feature. The employee had been promoted from a position of competence to a position of incompetence. I saw that, sooner or later, this could happen to every employee in every hierarchy.

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So my analysis of hundreds of cases of occupational incompetence led me on to formulate The Peter Principle: In a Hierarchy Every Employee Tends to Rise to His Level of Incompetence

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For each individual, for you, for me, the final promotion is from a level of competence to a level of incompetence.2 So, given enough time—and assuming the existence of enough ranks in the hierarchy—each employee rises to, and remains at, his level of incompetence. Peter’s Corollary states: In time, every post tends to be occupied by an employee who is incompetent to carry out its duties.

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You will rarely find, of course, a system in which every employee has reached his level of incompetence. In most instances, something is being done to further the ostensible purposes for which the hierarchy exists. Work is accomplished by those employees who have not yet reached their level of incompetence.

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Her work goes fairly well, except when no rule or precedent is available. For example, when a water pipe burst and flooded the classroom floor, Miss Ditto kept on teaching until the principal rushed in and rescued the class. “Miss Ditto!” he cried. “In the Name of the Superintendent! There are three inches of water on this floor. Why is your class still here?” She replied, “I didn’t hear the emergency bell signal. I pay attention to those things. You know I do. I’m certain you didn’t sound the bell.” Flummoxed before the power of her awesome non sequitur, the principal invoked a provision of the school code giving him emergency powers in an extraordinary circumstance and led her sopping class from the building. So, although she never breaks a rule or disobeys an order, she is often in trouble, and will never gain promotion. Competent as a student, she has reached her level of incompetence as a classroom teacher, and will therefore remain in that position throughout her teaching career.

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You can find similar examples in any hierarchy. Look around you where you work, and pick out the people who have reached their level of incompetence. You will see that in every hierarchy the cream rises until it sours.

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A Question of Standards The competence of an employee is determined not by outsiders but by his superior in the hierarchy. If the superior is still at a level of competence, he may evaluate his subordinates in terms of the performance of useful work—for example, the supplying of medical services or information, the production of sausages or table legs or achieving whatever are the stated aims of the hierarchy. That is to say, he evaluates output. But if the superior has reached his level of incompetence, he will probably rate his subordinates in terms of institutional values: he will see competence as the behavior that supports the rules, rituals and forms of the status quo. Promptness, neatness, courtesy to superiors, internal paperwork, will be highly regarded. In short, such an official evaluates input. “Rockman is dependable.” “Lubrik contributes to the smooth running of the office.” “Rutter is methodical.” “Miss Trudgen is a steady, consistent worker.” “Mrs. Friendly co-operates well with colleagues.” In such instances, internal consistency is valued more highly than efficient service: this is Peter’s Inversion. A professional automaton may also be termed a “Peter’s Invert.” He has inverted the means-end relationship. Now you can understand the actions of the Peter’s Inverts described earlier. If the liquor-store clerk had promptly explained the Customs regulations, the traveller would have thought, “How courteous!” But his superior would have marked the clerk down for breaking a rule of the department. If the book-store cashier had accepted my traveller’s check, I would have considered him helpful: the manager would have reprimanded him for exceeding his authority.

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The Paradox Explained These cases illustrate the fact that, in most hierarchies, super-competence is more objectionable than incompetence. Ordinary incompetence, as we have seen, is no cause for dismissal: it is simply a bar to promotion. Super-competence often leads to dismissal, because it disrupts the hierarchy, and thereby violates the first commandment of hierarchal life: the hierarchy must be preserved. You will

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Conclusions The apparent exceptions are not exceptions. The Peter Principle applies to all employees in all hierarchies.

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Employees in a hierarchy do not really object to incompetence (Peter’s Paradox): they merely gossip about incompetence to mask their envy of employees who have Pull.

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The difference between cases of Pseudo-Achievement Syndrome and Final Placement Syndrome is known as Peter’s Nuance. For your own guidance in classifying such cases, you should always ask yourself, “Is the person accomplishing any useful work?” If the answer is: a) “YES”—he has not reached his level of incompetence and therefore exhibits only the Pseudo-Achievement Syndrome. b) “NO” he has reached his level of incompetence, and therefore exhibits the Final Placement Syndrome. c) “DON’T KNOW”—you have reached your level of incompetence. Examine yourself for symptoms at once!

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W. Wheeler was a bicycle delivery boy in the Mercury Messenger Service. Wheeler systematized his delivery work to an unprecedented degree. For example, he explored and mapped every passable lane, alley and short-cut in his territory; he timed with a stop watch the periods of all the traffic lights, so that he could plan his route to avoid delays. As a result, he always delivered his daily quota of packages with two hours or more to spare, and spent the time sitting in cafés reading books on business management. When he began reorganizing the routes of the other messenger boys, he was fired. For the moment, he seemed to be a failure, an example of the super-incompetent hierarchal exfoliate, a living testimony to the “poor-follower-poor-leader” theory. But soon he formed a concern of his own, Pegasus Flying Deliveries, and within three years drove Mercury out of business. So we see that exceptional leadership competence cannot make its way within an established hierarchy. It usually breaks out of the hierarchy and starts afresh somewhere else.

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FAMOUS NAMES FILE, CASE NO. 902 T. A. Edison, fired for incompetence as a newsboy, founded, and successfully led, his own organization.

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Good followers do not become good leaders. To be sure, the good follower may win many promotions, but that does not make him a leader.

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In a political party, as in a factory or an army, competence in one rank is a requisite for promotion to the next. A competent door-to-door canvasser becomes eligible for promotion; he may be allowed to organize a team of canvassers. The ineffective or obnoxious canvasser continues knocking on doors, alienating voters. A fast envelope stuffer may expect to become captain of an envelope-stuffing team; an incompetent envelope stuffer will remain, slowly and awkwardly stuffing envelopes, putting two leaflets in some, none in others, folding the leaflets wrongly, dropping them on the floor, and so on, as long as he stays with the party.

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“Too many cooks spoil the broth” suggests that the more people you involve in any project, the greater are the odds that one of them, at least, has reached his level of incompetence. One competent vegetable peeler, promoted to his level of incompetence as cook, may add too much salt and ruin the good work of the other six cooks who helped make the broth.

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In other words, scarcely an employee is content to remain at his level of competence: he insists upon rising to a level that is beyond his powers.

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K. Marx undoubtedly recognized the existence of hierarchies, yet seemed to believe that they were maintained by the capitalists. In advocating a non-hierarchal society, he obviously failed to see that man is essentially hierarchal by nature, and must and will have hierarchies, whether they be patriarchal, feudal, capitalistic or socialistic. On this point his insight is vastly inferior to that of Pope. Then, with glaring inconsistency, Marx proposes, as the ruling principle of his non-hierarchal dream society, “From each according to his abilities and to each according to his needs.” This suggests the creation of twin hierarchies of ability and neediness. Even if we overlook this inconsistency in the Marxian scheme, the Peter Principle now shows that we cannot hope to obtain work “from each according to his ability.” To do that, we should have to keep employees permanently at a level of competence. But that is impossible: each employee must rise to his level of incompetence and, once arrived at that level, will not be able to produce according to his ability. So we see Marxist theory as a pipe dream and another opiate of the masses. No government which has tried to apply it has ever been able to make it work. Marx must be dismissed as an unscientific visionary.

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W. Dodgson, in Through the Looking-Glass, refers to life at the level of incompetence when he makes the Queen say, “Now here, you see, it takes all the running you can do to keep in the same place.” In other words, once an employee has achieved final placement, his most vigorous efforts will never win him any further promotion.

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But suppose the hierarchy is not operating efficiently with its thousand employees. As the Peter Principle shows, many, or most, senior employees will be at their levels of incompetence. They cannot do anything to improve the situation with their existing staff—everyone is already doing the best he can—so in a desperate effort to attain efficiency, they hire more staff. As pointed out in Chapter 3, a staff increase may produce a temporary improvement, but the promotion process eventually produces its effect on the newcomers and they, too, rise to their levels of incompetence. Then the only apparent remedy is another staff increase, another temporary spurt and another gradual lapse into inefficiency.

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Insight Is Not Enough, Either! Sometimes, after granting a promotion, management attains insight and realizes that the promotee cannot properly fulfill his new responsibilities. “Grindley isn’t working out too well as foreman.” “Goode wasn’t quite big enough, after all, to fill Betters’ shoes.” “Miss Cardington isn’t shaping up as filing supervisor.” Occasionally the employee also attains this insight and accepts his own incompetence for the higher rank. Here, too, insight produces much regretful thought, but little or no action.

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Compulsive Incompetence While reviewing depth studies of a few cases of competence at the top levels of hierarchies, a remarkable psychological phenomenon presented itself to me and I will here describe it. Summit Competence is rare, but not completely unknown. In Chapter 1, I wrote, “Given enough time—and assuming the existence of enough ranks in the hierarchy—each employee rises to, and remains at, his level of incompetence.” Victorious field marshals, successful school superintendents, competent company presidents and such persons have simply not had time to reach their levels of incompetence. Alternatively, the emergence of a competent trade-union leader or university president simply shows that, in that particular hierarchy, there are not enough ranks for him to reach his level. These people exhibit Summit Competence.2 I have observed that these summit competents are often not satisfied to remain in their position of competence. They cannot rise to a position of incompetence—they are already at the top—so they have a strong tendency to sidestep into another hierarchy—say from the army into industry, from politics into education, from show business into politics and so on—and reach, in the new environment, that level of incompetence which

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While reviewing depth studies of a few cases of competence at the top levels of hierarchies, a remarkable psychological phenomenon presented itself to me and I will here describe it. Summit Competence is rare, but not completely unknown. In Chapter 1, I wrote, “Given enough time—and assuming the existence of enough ranks in the hierarchy—each employee rises to, and remains at, his level of incompetence.” Victorious field marshals, successful school superintendents, competent company presidents and such persons have simply not had time to reach their levels of incompetence. Alternatively, the emergence of a competent trade-union leader or university president simply shows that, in that particular hierarchy, there are not enough ranks for him to reach his level. These people exhibit Summit Competence.2 I have observed that these summit competents are often not satisfied to remain in their position of competence. They cannot rise to a position of incompetence—they are already at the top—so they have a strong tendency to sidestep into another hierarchy—say from the army into industry, from politics into education, from show business into politics and so on—and reach, in the new environment, that level of incompetence which they

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Summit Competence is rare, but not completely unknown. In Chapter 1, I wrote, “Given enough time—and assuming the existence of enough ranks in the hierarchy—each employee rises to, and remains at, his level of incompetence.” Victorious field marshals, successful school superintendents, competent company presidents and such persons have simply not had time to reach their levels of incompetence. Alternatively, the emergence of a competent trade-union leader or university president simply shows that, in that particular hierarchy, there are not enough ranks for him to reach his level. These people exhibit Summit Competence.2 I have observed that these summit competents are often not satisfied to remain in their position of competence. They cannot rise to a position of incompetence—they are already at the top—so they have a strong tendency to sidestep into another hierarchy—say from the army into industry, from politics into education, from show business into politics and so on—and reach, in the new environment, that level of incompetence which they could not find in the old. This is Compulsive Incompetence.

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I have reported this study, conducted at Perfect Pewter Piano Strings Inc., because it illustrates the four basic classes of incompetence. Mal D’Mahr was promoted beyond his physical competence. J. Smugly was promoted beyond his social competence. Roly Koster was promoted beyond his emotional competence. B. Willder was promoted beyond his mental competence.

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The Mathematics of Incompetence Incompetence plus incompetence equals incompetence.

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IT SHOULD BE clear by now that when an employee reaches his level of incompetence, he can no longer do any useful work. Incompetent, Yes! Idle, No! This in no way suggests that the ultimate promotion suddenly changes the former worker into an idler. Not at all! In most cases he still wants to work; he still makes a great show of activity; he sometimes thinks he is working. Yet actually little that is useful is accomplished. Sooner or later (usually sooner) these employees become aware of, and feel distressed at, their own unproductivity.

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Smattering of Sense The only treatment, my survey shows, which gives any relief for the F.P.S. is distraction therapy. “Learn to play bridge.” “Start a stamp collection.” “Take up gardening.” “Learn barbecue cookery.” “Paint pictures by numbers.” Typically, the doctor senses the patient’s copelessness with regard to his job, and so tries to divert his attention to something that he can cope with.

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The competent employee normally keeps on his desk just the books, papers and apparatus that he needs for his work. After final placement, an employee is likely to adopt some unusual and highly significant arrangement of his desk.

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The employee rationalizes his incompetence by complaining that he cannot keep in close enough touch with colleagues and subordinates. To remedy this, he installs several telephones on his desk, one or more intercommunication devices with buttons, flashing lights and loudspeakers, plus one or more voice-recording machines. The phonophiliac soon forms the habit of using two or more of these devices at the same time; this is an infallible sign of galloping phonophilia. Such cases degenerate rapidly and are usually considered incurable.

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Papyromania, the exact opposite of papyrophobia, causes the employee to clutter his desk with piles of never-used papers and books. Consciously or unconsciously, he thus tries to mask his incompetence by giving the impression that he has too much to do—more than any human being could accomplish.

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Self-Pity Many executive conferences consisted of the high-ranking employee telling hard-luck stories about his present condition. “Nobody really appreciates me.” “Nobody co-operates with me.” “Nobody understands how the incessant pressure from above and the incurable incompetence below make it utterly impossible for me to do an adequate job and keep a clean desk.” This self-pity is usually combined with a strong tendency to reminisce about “good old days” when the complainant was working at a lower rank, at a level of competence. This complex of emotions—sentimental self-pity, denigration of the present and irrational praise of the past—I call the Auld Lang Syne Complex. An interesting feature of the Auld Lang Syne Complex is that although the typical patient claims to be a martyr to his present position, he never on any account suggests that

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Compulsive Alternation Some employees, on achieving final placement, try to mask their insecurity by keeping their subordinates always off balance. An executive of this type is handed a written report; he pushes it aside and says, “I’ve no time to wade through all that garbage. Tell me about it in your own words—and briefly.” If the subordinate comes in with a verbal suggestion, this man chokes him off in mid-sentence with, “I can’t even begin to think about it until you put it in writing.” A confident employee will be deflated with a snub; a timid one will be flustered by a display of familiarity. One may at first confuse Compulsive Alternation with Potter’s One-upmanship but they are quite different. Potter’s method is designed to advance the user to his level of incompetence. Compulsive Alternation is primarily a defensive technique employed by a boss who has reached his level. This man’s subordinates say, “You never know how to take him.”

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The Teeter-Totter Syndrome In the Teeter-Totter Syndrome one sees a complete inability to make the decisions appropriate to the sufferer’s rank. An employee of this type can balance endlessly and minutely the pros and cons of a question, but cannot come down on one side or the other. He will rationalize his immobility with grave allusions to “the democratic process” or “taking the longer view.” He usually deals with the problems that come to him by keeping them in limbo until someone else makes a decision or until it is too late for a solution. I notice, by the way, that teeter-totter victims are often papyrophobes as well, so they have to find some means of getting rid of the papers. The Downward, Upward and Outward Buckpasses are commonly used to effect this. In the Downward Buckpass the papers are sent to a subordinate with the order, “Don’t bother me with such trifles.” The subordinate is thus bullied into deciding an issue that is really above his level of responsibility. The Upward Buckpass calls for ingenuity: the teeter-totter victim must examine the case until he finds some tiny point out of the ordinary which will justify sending it up to a higher level. The Outward Buckpass merely involves assembling a committee of the victim’s peers and following the decision of the majority. A variant of this is The John Q. Public Diversion: sending the papers to someone else who will conduct a survey to find what the average citizen thinks about the matter. One teeter-totter victim in government service resolved his problem in an original manner. When he got a case that he could not decide, he would simply remove the file from the office at night and throw it away.

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Cachinatory Inertia A sure mark of final placement is the habit of telling jokes instead of getting on with business!

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Many Words, Few Thoughts Some employees, on final placement, stop thinking, or at least sharply cut down on their thinking. To mask this, they develop lines of General Purpose Conversation or, in the case of public figures, General Purpose Speeches. These consist of remarks that sound impressive, yet which are vague enough to apply to all situations, with perhaps a few words changed each time to suit the particular audience. My Executive Wastebasket and Trash Can Research Project1 turned up the following notes, obviously fragments from the rough draft of an all-purpose speech. The writer has problems enough without my identifying him. My cause is education, not humiliation. Here are his notes: Ladies and/or Gentlemen: In these troublous times, it gives me great pleasure to speak to you on the important topic of ———. This is a subject in which fantastic advances have been made. We naturally—and rightly—take pride in our accomplishments locally, yet we must not omit a word of tribute to those individuals and groups who have made outstanding contributions on a larger scale, at the regional, national, yes, and—dare I say it?—the international level. . . . While we must never underestimate the marvels that can be achieved by personal devotion, resolution and persistence, yet I suggest that it would be presumptuous for us to think that we can solve problems which have baffled the best brains of bygone and present generations. In conclusion, then, let me state my position without qualification or equivocation. I stand solidly behind progress; I call for progress; I expect to see progress! Yet what I seek is true progress, not simply a chopping and changing for the mere sake of novelty. That true progress, friends, will be made, I suggest, only if, as and when we fix our minds, and keep them unshakably fixed, on our great historical heritage, and those magnificent traditions in which, now and forever, our real strength lies.

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WHEN AN EMPLOYEE reaches his Level of Incompetence (Peter’s Plateau) he is said to have a Promotion Quotient (PQ) of zero.1 In this chapter I shall show how different employees react to the situation.

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Face the Sordid Truth (Not Recommended) The employee realizes consciously that he has achieved final placement, reached his level of incompetence, bitten off more than he can chew, is out of his depth or “arrived.” (These terms are synonymous.) The type of employee who is capable of realizing this truth tends to equate incompetence with laziness; he assumes that he is not working hard enough, so he feels guilty. He thinks that, by working harder, he will conquer the initial difficulties of the new position, and become competent. So he drives himself mercilessly, skips coffee breaks, works through his lunch hour and takes work home with him on evenings and weekends. He rapidly falls victim to the Final Placement Syndrome.

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Ignorance Is Bliss Many an employee never realizes that he has reached his level of incompetence. He keeps perpetually busy, never loses his expectation of further promotion, and so remains happy and healthy. You will naturally ask, “How does he do it?” Substitution: The Lifesaver

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a) CONFIRM THE NEED for action. The true Substituter can never get enough evidence. “Better be safe than sorry,” is his watchword, or “More haste, less speed.” Spend sufficient time in confirming the need, and the need will disappear. (Peter’s Prognosis.) For example, in organizing famine relief, study the need long enough, and you will eventually find that there no longer is any need for relief!

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Instead of carrying out the proper duties of his position he substitutes for them some other set of duties, which he carries out to perfection.

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The watchword for Side-Issue Specialists is Look after the molehills and the mountains will look after themselves.

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Technique No. 2: Side-Issue Specialization P. Gladman was promoted to manager of a rundown inefficient plant of the Sagamore Divan and Sofa Company, with the specific task of increasing production and making the branch pay. He was incompetent for this task, realized it immediately and so quickly ceased to apply his mind to the question of productivity. He Substituted a zealous concern with the internal organization of the factory and office.

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Mrs. Vender is Substituting. Her technique is not uncommon, and it may be employed consciously or unconsciously. The rule is: for achieving personal satisfaction, an ounce of image is worth a pound of performance. (Peter’s Placebo.)

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The technique is much used, too, in the arts. A. Fresco, a painter in Excelsior City, produced a few successful canvases and then appeared to run out of artistic inspiration. He then established his career as a speaker on the value of art. Typical is the Saloon Writer who sits in a bar all day, at home or overseas, talking about the importance of writing, the faults of other writers and the great works he himself is going to write someday.

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