Peter Principle of Leadership

Excerpted from News Leader Editorial

By: Howard Pines

Amelia Island resident Howard Pines has more than 30 years of  experience as CEO, chairman and founder of BeamPines, a premier firm in the executive coaching business. He also co-founded the BeamPines/ Middlesex University Master’s  Program in Executive Coaching.  Prior to that, he served as senior vice president of human resources for a Fortune 100 corporation. He is the author of “The Case for Wasting  Time and Other Management  Heresies.”

In business, one issue we thought about when recruiting and promoting executives was “The Peter Principle.” This was named after Lawrence J. Peter, who wrote a book in 1969 that fully discussed the subject. Peter stated that “employees tend to move up until they reach the position where they don’t do well.” Said another way, it is they move up until they reach their level of incompetence. As we see in business and sports when individuals move up the organization the skills required for successful performance change. For example, the closer one comes to the top the less technical knowledge and administrative skills one needs and the more managerial, leadership and possibly strategic skills one requires. In fact, one thing I discovered was that in Fortune 500 companies some general managers who were extremely good at producing results and driving their people failed as CEOs because they lacked strategic and innovative skills.  In professional sports, we see strong managers and coaches fail as general manager because again the skill sets required are very different.