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Employee development and the Peter Principle: Why your managers keep messing up

Keith MacKenzie
Keith MacKenzie

Passionate about human resources, employment, and business management, and an expert at sharing that expertise.

Employee development and the Peter Principle

“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.”

That’s the basic tenet of The Peter Principle, a mostly satirical discussion on the inevitable failings of management.

Who better than Workable’s top manager, CEO Nikos Moraitakis, to offer commentary? Some backstory first: Nikos and CTO Spyros Magiatis launched Workable in 2012 to meet the growing need for more streamlined recruitment software – the software has now helped more than 20,000 customers hire 50 million candidates and continues to grow to this very day with existing users in more than 100 countries.

It’s safe to say that this kind of multilateral success required substantially smart management principles. Being an expert in such, Nikos is now certain; the Peter Principle is more a failure of execution than anything else.

In short: the cream doesn’t sour. It needs time to germinate, so that it tastes better than it ever did before. If you rush the process, that’s when it sours.

The tendency for employees to rise like said cream in their organizations is so entrenched in Western culture that it’s practically instinctual. We’re inclined – encouraged, even – to grow, explore, rise as people, so this drive to improve naturally carries over to the workplace. In fact, Nikos suggests that we’re so driven to move people to the next level that this is where we trip up when it comes to employee development.

Nikos picks no bones about how that happens. “If somebody’s good at something, we say, ‘OK. Let’s give them more to do. Let’s make them in charge of this.’ Because usually, management finds people they trust and can get results from, and wants to give them more of the responsibility. It’s the curse of being good.”

Rising too fast in the ranks

Why is it a curse, though? Consider a sports analogy where a good player doesn’t necessarily mean a good manager. Wayne Gretzky – touted by many to be the greatest hockey player in history – racked up seemingly insurmountable statistics in his 20-year professional career. His “management” record is lacklustre, though: a 143-161-24 career record as head coach of the National Hockey League’s Phoenix Coyotes over a four-year span in 2005-2008, without making the playoffs even once. For the non-sporting folks, that means the team won just 43.5% of their games under Gretzky’s guidance – not very good at all.

And baseball’s Ted Williams, the Boston Red Sox Hall of Famer regularly cited as one of the greatest players to swing a bat and snag a ball, infamously managed teams to a dismal 273-364 career win-loss record over four seasons in the late 1960s-early 1970s. That’s a 42.9% win record – even worse than Gretzky.

There you have it: two great examples of how employee promotion and employee development have gone wrong. Actually, great players-turned-bad coaches is a common trope in sports. What’s going on here? They, after all, know the game well. The defining difference is that playing and coaching (ergo, managing) are two very, very different things.

So, were these players struck by the ‘curse of being good’, as Nikos suggests? You could say that. In all the years of playing the game, being so focused on the immediate tasks at hand – and carrying those out exemplarily well – Gretzky and Williams weren’t adequately prepared during their playing careers to tackle the finer points of coaching and managing. They, perhaps, didn’t have an opportunity to step back and see the bigger picture of running an actual team. In fact, one player said about the Splendid Splinter as a manager: “He was so hard on the guys … He’d say, ‘Why couldn’t they hit the way I hit?'”

You can’t expect someone who’s good at a job to know how to teach others to do that job well, too, as exemplified in Williams. “[Their success] creates the temptation to give them too much too quickly, and essentially incapacitate them,” Nikos says. “They might not be ready for that.”

But that kind of employee promotion is an invitation to failure, in the same way that Williams simply expected his players to perform under his management rather than actually manage them.

You get someone and you push them up the ranks in the place where really the job has changed substantially, and they’re not ready for it. And then you see them fail.

Execution, not principle

Companies see a need for leadership, and a need to promote. Moving people up isn’t a bad thing, Nikos says, adding; “it’s just bad execution and bad promotions.”

So why are companies failing in this? As Nikos explains, the problem is that employee promotion to management is considered as a “reward” for hard work and exemplary performance, as opposed to it being the next natural incarnation in one’s career evolution.

“There is more of a desire to get someone to get more responsibility than their natural ability to go up,” Nikos explains. “Often, you have good performers and the natural tendency is, ‘OK. Get the best person we have here to fill that new role that we have, or that bigger role that we have.’ And it’s well-intentioned. You say, ‘I’m going to get the best person and give them more responsibility. Let’s give them more, and more, and more.’“

He continues: “But if you do it too much, maybe at some point you’re going to burn them out. You’ve got to do it progressively.”

It’s not just a trip-up at the decision-making side, Nikos says. The employee may also be pushing too hard to move up the proverbial ladder before being ready to do so.

“Most people have learned to say, ‘Give me more responsibility.’” Nikos chuckles. “Would you really? Couldn’t you just have this existing responsibility and do it better, or could we do it progressively? Why should I just give you another three things to do?”

He summarizes that it’s “the eagerness of people to get to that status quicker, and the need of companies to give more to the people who seem to be doing well. If you’re a manager, you have so many problems to solve. If you have someone who’s a really good guy [to promote], then fantastic.”

“But you have to make sure that [employee development] is going to get done in the best possible way.”

Darwinian progress

Management isn’t a different skill, Nikos clarifies. “It’s an evolution of the same skill.”

The answer is not to say good individual contributors should not become managers. No, they should. It’s definitely part of becoming better at your job to be able to do it better with others.

It’s part of the natural progress of one’s career arc, he adds.

He gestures to the skyscrapers outside his office at the Workable headquarters in downtown Boston, and notes that they are technical and architectural marvels, and it would be impossible for one single person to build that whole skyscraper by themselves.

Instead, if that one single person was an artisan, a master of architecture and design, you’d want them to oversee the process of the skyscraper being built because who better than them to identify and implement crucial steps at every stage of the project? Such a collaborative effort requires teamwork, and for teamwork to happen, there needs to be a manager – ideally, that artisan – to pull all that together. And so, it makes sense that that manager should be ready when you put them there.

Since preparing them for that transition is your job as an employer, what can you do to avoid the managerial pitfalls commonly associated with the Peter Principle? How can you avoid having the Gretzkys and Williamses in your organization fall flat on their face when you assign them to teams?

  1. Know that when an employee becomes a manager, they don’t simply add that management skill to their existing toolbox. Rather, the employee evolves to management. It’s a maturation – or a fermentation, in terms of the cream analogy – of that employee’s skill set. It’s an advancement in that employee’s career.
  2. Consider your reasons to promote an employee. Are you doing it because you want to reward that employee’s incredible performance year over year, or because that employee’s been hounding you for greater responsibility? If yes, take a step back and keep the business front of mind when you make your decisions in employee promotion. You may also consider refining your employee promotion policy and procedure to reflect this.
  3. When you promote an employee to a managerial position, make sure they’re actually ready. Are they working well with others? Are they able to delegate responsibility? Most importantly, are they able to see the bigger picture and vision and implement sound processes to make that vision a reality? If your answer to all three is yes, then that employee is ready to move up. If the answer to any of these is no, then you need to prepare them for promotion via training and coaching.
  4. Just because an employee is now a manager does not mean they are no longer in the trenches with the others. Make sure they have an opportunity to be a player-coach, rather than just one or the other. This helps hugely in employee morale, both for the newly promoted employee and for colleagues in the same department.

Your star employees, after all, are the cream of the organization’s crust. Treat them and develop them as such, and they will rise accordingly. It’s not every day you get to say your employees can be better than Gretzky and Williams, but now, here’s your chance.

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