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I came to know of the Peter Principle when I attended one of our company seminars. Like any other management concept being adopted by the company, it became a buzz-word and oftentimes used to ridicule managers who aspired for promotion or those who had been on the executive seats for a long time.

Just what is the Peter Principle and how does it affect motivation and performance? The author of the Peter Principle, Dr. Laurence J. Peter, described how hierarchies in the company work and how employees get promoted to positions where their fields of competence no longer apply or enough to discharge the duties of the new positions. In other words, "an employee tends to rise to his level of incompetence". If this is indeed an internal dynamics in any organization, this should explain situations where an employee who strives to be promoted find himself wanting for more skills in order to be effective and meet the expectations of higher management. The more he moves up in the organizational ladder the clearer he will realize that the job expectations get higher and more complicated and there will not be much time to keep up with the urgency of the moment. Eventually an employee will just remain contented in his comfort zone and will do everything to dispel any plan by higher management to uproot him for another position in which his skills and experience will no longer work well.

Management can do better

While there is logic to this principle, I feel a bit uneasy accepting it completely. The concept seems to view management as rather "static" in that it can do no lesser than leave a newly promoted employee helpless in his position, awkwardly brandishing the tools of his trade. I believe otherwise. Management can do a lot in terms of guidance and mentoring. Guidance comes in the form of setting achievable, realistic and time-bound goals. Performance can be assessed periodically and where there is a need for improvement, causes of deviations from set goals can be identified and action plans can then be defined mutually. Mentoring is another technique that management can take in order to really mould the employee's skills, knowledge and attitude to the desired level.

The Effect of Setting Expectations

To mitigate the perceived negative effect of the Peter Principle in organizations, management should understand that people possess the capacity to adapt and exceed expectations of others. The capacity to change has been observed in experiments made by Robert Rosenthal and

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