What is the Peter Principle?
The Peter Principle is an observation that the tendency in the most organizational hierarchies, such as that of a corporation, is for every employee to graduate to a higher job level through promotion until they reach the level of their corresponding incompetence. The Principle is based on the idea that competent employees (currently competent in what they do) will continue to be promoted to higher positions, but at some point they reach the position for which they are incompetent, and they will then remain in those positions for which they are incompetent. At this time they will then remain in those positions because of the fact that they do not demonstrate any further competence that would help them to receive a additional promotion. And after some decades, according to the Peter Principle, every position in the given hierarchy will eventually be filled by employees who are incompetent to fulfill the tasks of their respective positions.
Breaking down the Peter Principle
The principle was invented by the Canadian educational scholar, Dr. Laurence J. Peter, in his book titled "The Peter Principle" which came out in 1968. Up to this point, the article sounds very negative and also illuminates a page that is rather not talked about so gladly. But Dr. Peter also stated in his book that an employee's inability to fulfill the requirements of a given position that he is promoted to may not be the result of general incompetence on the part of the employee as much as it is due to the fact that the position simply requires different skills than those the employee actually have. A good example from his book is the following: An employee who is very good at following the company rules or policies may be promoted into the position of creating the rules or polices for the company, but despite the fact that being a good rule follower does not mean that the employee got the required skills to create the rules.
From the employee’s point of view
So what happens when you reach the level where the cream gets sour? Well then you've already left the state where you reach your awesome goals and you slowly start to get dissatisfied with your current achievements and success. The perception of you is perceived differently. Everybody is more and more watching your hard skills, like arriving at work on time or having a good attitude. A important point to mention is that mere incompetence is often not enough to cause the employee to be fired from the position. Ordinarily, only extreme incompetence causes dismissal.
How to overcome this behavior
A possible solution for this problem is to provide adequate skill training for employees which receeiving a promotion, and to ensure the training is appropriate for the position to which they have been promoted.