Why Your Boss Is Bad at Their Job

In December 1963, at a very bad play, the lead actor spent the evening saying his lines with his back to the audience. At intermission, a schoolteacher-turned-professor named Laurence Peter explained why: that actor used to be good, until he tried to direct and produce the show as well. He called it the Peter Principle: in a hierarchy, every employee tends to rise to his level of incompetence. It was meant as satire. Fourteen publishers turned it down. Then it became a number one best-seller, and for decades it was the office's favorite joke. Then economists got the real numbers from 131 American companies, and the joke turned out to be true. Just not in the way most people think. What this covers: The 1960 seminar where a statistician laughed so hard he fell off his chair Raymond Hull, the rejection letters, and a first printing of just 10,000 copies Tabulatory Gigantism, and the gardener who lost receipts on purpose to avoid promotion Edward Lazear's theory: why promotions, movie sequels and second restaurant visits disappoint The Ig Nobel-winning simulation where promoting at random never made things worse 38,843 salespeople, 156 million sales, and the best sellers who became the worst managers Why companies promote the star anyway, and what Gallup says about American managers The second ladder for engineers, and why 12 of 13 companies said they wouldn't do it again The actor never lost his talent. It was just facing the wrong way. ━━━━━━━━━━━━━━━━━━━━ ❤️ It's just me making these. If this one was worth your time, a like helps more than you'd think. If not, all good. See you in the next one. Wren ━━━━━━━━━━━━━━━━━━━━ S O U R C E S ━━━━━━━━━━━━━━━━━━━━ THE BOOK Peter, L. J. and Hull, R., 1969, The Peter Principle: Why Things Always Go Wrong, William Morrow (Profile Books edition, 2020, with forewords by Laurence J. Peter and Robert I. Sutton). The principle, the 1960 seminar, the play in 1963, the rejection letters, the 400 letters, and the fake science of hierarchiology. "Laurence J. Peter," New World Encyclopedia. His career, the 10,000-copy first printing, 200,000 copies in the first year and 38 languages. "List of The New York Times number-one books of 1969," Wikipedia. The weeks the book sat at number one on the nonfiction list. "Author of 'Peter Principle' dies at 70," Associated Press, Deseret News, 15 January 1990. Peter's life and his line that the cream rises until it sours. THE ECONOMISTS Lazear, E. P., 2004, "The Peter Principle: A Theory of Decline," Journal of Political Economy, 112(S1), S141-S163. Regression to the mean, movie sequels and second visits to restaurants. Pluchino, A., Rapisarda, A. and Garofalo, C., 2010, "The Peter principle revisited: A computational study," Physica A, 389(3), 467-472. A simulated company of 160 jobs on six levels, and the case for promoting at random. Improbable Research, 2010, Ig Nobel Prize winners, Management Prize. The prize "for demonstrating mathematically that organizations would become more efficient if they promoted people at random." THE REAL TEST Benson, A., Li, D. and Shue, K., 2019, "Promotions and the Peter Principle," Quarterly Journal of Economics, 134(4), 2085-2134. 131 US firms, 38,843 salespeople, triple the odds for the top seller, 6 percent lower team sales, lone wolves, and the 23-point exodus. MANAGERS TODAY Beck, R. J. and Harter, J., 2014, "Why Great Managers Are So Rare," Gallup Workplace, 25 March. One in 10 people with the talent to manage, and the wrong pick 82 percent of the time. CareerBuilder, 2011, "More Than One-Quarter of Managers Said They Weren't Ready to Lead When They Began Managing Others," press release, 28 March. 58 percent of managers with no management training. Allen, T. J. and Katz, R., 1986, "The dual ladder: motivational solution or managerial delusion?" R&D Management, 16(2), 185-197. Nearly 1,500 engineers and scientists, and the 13 companies asked if they'd build a second ladder again. ━━━━━━━━━━━━━━━━━━━━ #psychology #peterprinciple #work #documentary #economics