MFG 2.0

Promoting Incompetents Is A Good Thing, Say Researchers

Back in 1969, a Canadian psychologist named Laurence Peter cleverly inferred a rule concerning organizational behavior that has since become enshrined in the corporate canon, and is now known as the Peter Principle. It says:

"All new members in a hierarchical organization climb the hierarchy until they reach their level of maximum incompetence."

Leaving the sarcasm aside for a moment, consider that the Peter Principle may be as useful a rule for engineering as it is for human resources -- that is to say, if something works, you will use it in ever more challenging applications until it fails.

I just read about the latest application on the MIT Technology Review site (h/t Stowe Boyd) where two Italian professors from Universita di Catania have published an interesting study that suggests that promotion based on competence is not perhaps as successful as you might think (or hope). Instead, their models seem to show that two other strategies outperform this conventional method of identifying candidates for promotion:

The first is to alternately promote first the most competent and then the least competent individuals. And the second is to promote individuals at random. Both of these methods improve, or at least do not diminish, the efficiency of an organization.

One of the commenters at Boyd's blog, Christopher Herot, made the observation that "an IQ test was a better filter than an interview for predicting the success of new hires. It wasn't that the IQ test was so good but that the usual hiring process was so prone to bias, especially hiring in one's own image, that almost anything else was better."

Is this kind of bias inevitable? How does this reflect on your own hiring decisions? Or, the path to where you sit today, for that matter? And does your organization suffer from (or possibly benefit from) the Peter Principle? And after reading this, are you going to march into top management and demand a change in promotion decision-making at your firm? (Or do you suspect that incompetence and randomness already rules the roost where you work?)

TAGS: Innovation
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