Tag Archives: The Peter Principle

Ulysses S. Grant on micro management

I loved the candid and at the same time generous description of Union’s general Warren problem with micro management given by Ulysses S. Grant in his “Personal Memoirs”:

Warren’s difficulty was twofold: when he received an order to do anything, it would at once occur to his mind how all the balance of the army should be engaged so as properly to co-operate with him. His ideas were generally good, but he would forget that the person giving him orders had thought of others at the time he had of him. In like manner, when he did get ready to execute an order, after giving most intelligent instructions to division commanders, he would go in with one division, holding the others in reserve until he could superintend their movements in person also, forgetting that division commanders could execute an order without his presence. His difficulty was constitutional and beyond his control. He was an officer of superior ability, quick perceptions, and personal courage to accomplish anything that could be done with a small command.

Well intentioned, with good ideas, forgetting the bigger picture, wanting to keep everything under control, uncapabale of delegating and empowering… evidently, general Warren must had been an excellent officer of a lower rank (“with a small command“) who was raised to his level of incompetence (“His difficulty was constitutional and beyond his control“) following “The Peter Principle” :-).

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The Peter Principle

The Peter Principle says: “In a hierarchy, every employee tends to rise to his level of incompetence“.

The Peter Principle.

The book, by Laurence J. Peter, is a hilarious account of situations that arise in companies and institutions of why and how people are promoted, cornered, etc., or in his words is a treatise on hierarchology.

You probably have heard about the principle at some time. The author exposes a lot of other related concepts with invented jargon, including plenty of examples that we may have seen in our companies. The account of those seemingly contradicting, irrational, incomprehensible situations but which are so familiar to us is what makes the book hilarious.

Some of those other concepts and ideas introduced by the book:

  • The percussive sublimation: when someone is kicked upstairs to get him out of the road and unblock other promotions.
  • The lateral arabesque: when an incompetent employee is given a new and longer title and is moved to an office in a remote part of the building (easier in larger hierarchies).
  • Peter’s inversion: when internal consistency is valued more highly than efficient service (“xxx is methodical, consistent, he co-operates, is steady…”).
  • Pretty pass: getting out from under an incompetent to go up the ladder in a parallel circumvallation.
  • Flying T formation: organizations with plenty of VPs with few workers at the bottom… (I’m sure you can picture the T in your mind… and your organization).
  • Occupational incompetence is everywhere (a universal phenomenon).
  • In time, every post tends to be occupied by an employee who is incompetent to carry out its duties.
  • Work is accomplished by those employees who have not yet reached their level of incompetence.
  • You be the judge. Look at the mirror and ask whether… (there are no exceptions to the principle).

Years later, professor Edward P. Lazear, from Stanford Graduate School of Business, published the paper “The Peter Principle: A Theory of Decline“,  where he analyzed the principle and substantiated it with mathematical formulae. As he describes in the abstract of the paper:

Some have observed that individuals perform worse after being promoted. […] Being promoted is evidence that a standard has been met. Regression to the mean implies that future ability will be lower, on average. Firms optimally account for the regression bias in making promotion decisions, but the effect is never eliminated. Rather than evidence of a mistake, the Peter Principle is a necessary consequence of any promotion rule. […] Usually, firms inflate the promotion criterion to offset the Peter Principle effect, and the more important is the transitory component relative to total variation in ability, the larger the amount that the standard is inflated.

If your promotion has been reject, you find yourself overwhelmed with your current job, you have consciously decided to go along in the office with minimum effort trying to be unnoticed, are happy with your current job and do not wish to be promoted by any standard… go and read the book 🙂


I have already mentioned sometimes in the blog that every time that I pass by an airport (and that is often) I try to go to the book shop to see if I can grab something interesting. I was after this book since I read about it in another book “Management gurus” in 2010 (of which I already wrote a review – in that post I remarked 4 punching books I wanted to read, one was this) and found it two years later at Dubai International airport, this only reinforces that habit :-).


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Management Gurus (book review)

According to the Wikipedia a guru is someone “regarded as having great knowledge, wisdom and authority in a certain area, and who uses it to guide others”. The term comes from Sanskrit (गुरु), where gu means darkness & ru means light.

I mention this because during these last holidays I read a book about gurus, “Guide to Management Ideas and Gurus“, by Tim Hindle (322 pgs.).

Guide to Management Ideas and Gurus, Tim Hindle.

About two years ago The Economist used to send within a weekly alert a profile about a management idea and one guru, all of them coming from this book. Since then I had wanted to buy this book, which I found last June at a Schiphol airport book shop.

The book first reviews about a hundred management ideas, e.g., benchmarking, core competence, kaizen, lean production, SWOT analysis… Later it provides a short profile of over 50 authors or gurus, from Taylor and McGregor to Peter Drucker, Tom Peters, C.K. Prahalad… From each idea and author you get two pages. It is a good refresher of different concepts you may have studied and also helps relating some ideas and authors to others, interlinking them.

Along the book there is also bibliography related to each idea and from each author. In total I guess there are over 200 books and papers suggested. Also, it is very handy that from each author the book gives two or three notable quotations, from which you can get a quick idea of what is going to come. So now, after reading it I have a book with lots of marked pages, underlined parts and books and papers to look for.

I wanted to extract some ideas from three of those “gurus”:

  • C. Northcote Parkinson a naval historian famous for his book “Parkinson’s Law“, which can be stated as “Work expands to fill the time available for its completion”.
  • Laurence Peter a Canadian teacher famous for his book “The Peter Principle“, which can be phrased as “In a hierarchy, every employee tends to rise to his level of incompetence”.
  • Robert Townsend a former director of American Express famous for his book “Up the Organisation” with a more clarifying subtitle “How to Stop the Corporation from Stifling People and Strangling Profits”, where he is harsh on the vanity and stupidity of executive leaders.
  • Though not a “guru” from the ones profiled in the book, Scott Adams “Dilbert” comic strip is cited in at least a couple of times, take a moment to check it.

You can be sure that I have marked these three books in the to-read list.


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