
The Peter Principle Isn't Just Real, It's Costly - dalek2point3
http://www.nber.org/digest/may18/w24343.shtml
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erikbern
This is probably just a variant of Berkson's paradox, similar to Google's
observation that success in programming competitions is negatively correlated
with job performance: [http://www.catonmat.net/blog/programming-competitions-
work-p...](http://www.catonmat.net/blog/programming-competitions-work-
performance/)

The mechanism would work this way: sales people exhibit multiple features, and
they are promoted based on some combination of those. If a sales person has
outstanding other credentials, they might be promoted despite poor sales
percentile. Those other credentials might actually be better predictors of
managerial experience. Conversely, many of the top sales people might have
been promoted on the grounds that they were _good sales people,_ without
exhibiting any other skills.

Note that there might still be a positive correlations between sales skills
and managerial skills, but due to how the promotions are selected, you end up
observing a negative correlation in the promoted group.

[https://en.wikipedia.org/wiki/Berkson%27s_paradox](https://en.wikipedia.org/wiki/Berkson%27s_paradox)

~~~
geocar
> similar to Google's observation that success in programming competitions is
> negatively correlated with job performance

I find it very interesting that Google then interviews with programming
challenges...

~~~
s2g
I'm pretty convinced half of that is ability to handle arbitrary bullshit, and
the rest is just an IQ test with a different name.

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wool_gather
The corollary to the Peter Principle, I think, has always been that it's
_caused by_ bad management. Taking "is good at IC duties" as the measure for
"should lead a team of ICs" is sloppy. You are not considering the person/what
they're good at. You're just using an easy shortcut to reward them for their
performance.

One problem is high-contributing ICs who _think_ they should get promotions to
manager. For whatever reason: it's how things are done, they really want to do
it, etc. There needs to be a separate, _equally status-conferring_ , career
track for them if they're really not going to be good at managing people. They
need to be convinced that the best thing for them is to stay where they are,
being awesome. Which is probably hard. The idea that you are awesome,
therefore you become a manager, get an office, etc. is pretty pervasive.

(The bonus would be that those of us who never, ever want to be managers no
matter how much our directors want us to would have that career path available
too.)

~~~
justherefortart
My favorite thing is seeing people I wouldn't hire to be a low level IT tech
as CIO/IT Director because they're a "network guy".

So not only do they end up not understanding 90%+ of IT's functions in any
real sense, they are typically not even trained on how to manage.

I work with one such moron at my current job. The entire company goes around
the fool, yet they keep him. Why? The acting CEO is likely embezzling and
competent IT might shine a light on it. That and the CEO outsources work to
her husband's company for 10s of thousands a month with no deliverables or
results (beyond what I suspect is the normal embezzlement in other areas).

I've been in this field for ~25 or so years. Maybe I'm jaded by working in
consulting/contracting for most of that (and working for myself). I have never
worked with an IT Director or CIO that I would personally hire for my own
business in that entire time. Being technical enough to make the right
decisions and having enough managerial experience/knowledge to be a good
manager at the same time is extraordinarily elusive.

Another question is, how do people hire a CIO, when they themselves don't
understand IT (or even want IT it seems). They guess or outsource it. I've
never seen that work either.

~~~
ghostbrainalpha
I have the problem of being the "moron" at your work. I wanted to just be a
web developer. It's the only thing I'm good at, and I'm not even really great.
Just functional.

But people start to ask you for IT related things because you are the "tech"
guy. If your honest and say you need to hire someone to do that specific task,
often people are ok with that.

I follow this simple guide when hiring someone to do something I don't
understand.

1\. Explain to me how you would solve problem X, in as many steps as possible.
I make them walk me through it, and ask for more and more detail. Usually
spending about an hour.

2\. If they have no problems getting into the details, then we set a roadmap
and schedule and I check in periodically to make sure we are staying close to
it. If they can't stick to their own plan... I move on.

3\. If they could give me enough detail to start with, and too much of it was,
I'll have to do research or figure it out when we get there, I don't hire
them.

4\. This results with me having a solid bank of IT people I can outsource
problems too, and in tern executives depend on ME to deliver actual results.

That doesn't sound awful, but it actually is. I get to spend extremely little
time doing something I could potentially be great at, WEB DEVELOPMENT. And I
know the people that work for me, think I'm an idiot and don't understand why
they don't have my job.

I try to ask questions and get domain knowledge as I go, but unless you are a
genius or spend many years, its just too hard to know everything. And I can't
pretend that I'm an expert at managing people, because I'm not. I just do
those 4 steps, and then try to be friendly. That's it.

I feel like I'm stuck managing a team of people, when I would rather be an
intern for a master developer.

~~~
AnimalMuppet
The ability to hire contractors who can actually do the work... that's a
_formidable_ asset to the company. You're not the moron. You're not the
incompetent. You are actually very valuable.

The problem is, you're being very valuable doing something that you don't
actually want to do. You may not feel that it is emotionally rewarding. You
may just want to do what you like. That's fine; I'm not trying to argue with
that. But don't feel like an incompetent or a failure at what you're doing.
You're not.

------
kokey
I think in some countries, cultures and industries there's some kind of legacy
class system where only people of the managerial class can share in the spoils
of the company, so the only way to reward a competent and skilled employee
with an income above a certain level is to make them a manager, while it's
also assumed that's what the employee is also striving for. I see this in
various engineering industries in developing countries, where in the same
country no one thinks that a specialist surgeon can only be rewarded by being
given the job of hospital manager.

~~~
Clubber
That certainly fits what I see. Managers are a separate class in larger
companies, similar to officers vs. enlisted in the military.

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rhapsodic
_> Taking "is good at IC duties" as the measure for "should lead a team of
ICs" is sloppy. _

What's an "IC"?

~~~
mason55
Individual contributor

~~~
rhapsodic
_> Individual contributor_

Thanks. First I've heard that one.

~~~
stan_programmer
I just have a hard time with this term. It feels.. disconnected... I don't
know.

It reminds me of George Carlin's bit on "Shell Shock"/"Post Traumatic Stress
Disorder".

[https://www.youtube.com/watch?v=vuEQixrBKCc](https://www.youtube.com/watch?v=vuEQixrBKCc)

~~~
wool_gather
You're not wrong. I admit, it's a term from the euphemistic cogs-in-the-
machine language of management. But I've found no way to entirely avoid
adapting to "their" culture.

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empath75
One of the nice things about agile (done well) is that there basically are no
managers and the engineers have equal status to people like scrum masters and
product owner. They don’t get to make every decision about everything but
everyone is similarly constrained to mostly make decisions about what they
understand best — the product owner sets requirements and priorities, the
developers figure out how to make it happen, and the scrum master makes sure
things are flowing along.

At least where I am, there’s no management role I could go to that would make
me happier or better paid.

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s2g
It's real, but I'm not a fan of the application in tech.

You have junior people who are evaluated according to arbitrary metrics. So
they try to put in a process and get a bunch of people to give feedback. So
now you have these people getting evaluated according to arbitrary metrics in
an overwrought process. You have overhead and barriers and all sorts of
politics in place just to prevent a junior engineer getting promoted to mid
level with slightly less experience. The impact to the company of doing that
is negligible. The impact to the employee can be negative, but if they don't
make that level fairly quickly they get fired anyway.

I'd say the impact of that person giving up and quitting and getting the next
level at another company is worse. Now you have lost someone you put years of
effort into.

I've seen this first hand. Surveys showing that a majority of engineers don't
know what it takes to get to the next level, don't believe they can make the
next level on their current team, frustration with promotion processes. Orgs
arbitrarily deciding to ignore new guidelines because they think they are too
easy. All because of a lack of transparency and a broken process, developed as
a result of the dreaded peter principle.

No different than shitty interviews powered by false negatives because "it's
too costly to hire someone bad".

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yosito
My hypothesis is that salespeople do best without strong managers. So when a
poor-performing salesperson becomes a manager, the sales team is forced to
step up to the plate and give it their all because the manager isn't carrying
the team. But when a high performing salesperson becomes a manager, the team
rests on the manager's performance and individual effort decreases.

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karma_fountain
I was a high performing software engineer who just got promoted to management
and is currently Petering it up. Any tips on how become a competent Charlie?

~~~
rb808
Most devs going into management need to spend less time coding and more time
communicating. Another thing is I've found doing testing is a good way to see
the quality of what people are doing.

A big thing about management is knowing how to keep people engaged and
motivated, with freedom to be creative but enough oversight so they're kept on
track and not lost. You'll have to experiment with this. Also importantly
different people need different guidance, so the experienced old hand needs
little advice just steer them in the right direction, where the new guy needs
daily help.

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regularfry
I can't read the actual paper, but from this summary it sounds like people who
have just started doing one job aren't as immediately effective as people
who've shown they're experienced and effective over time at a completely
different job. That doesn't sound like a very controversial finding, nor does
it tell you very much about their long-term prospects.

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fulafel
The motivation, and reason for their perfomance, of some "high performing
salespeople" might be to get out of the ditches and into a comfy management
job. They might not be able to keep up such a pace for long, but consider it
more of a sprint. In other words, the direction of causality might be
inverted.

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tofflos
Costly compared to what? Did anyone figure out what the article is comparing
against?

------
chillingeffect
The dots on the plots tell an even more compelling story than the fitted
lines.

~~~
wool_gather
Wow, indeed! That outlier at the 5-ish% sales mark needs more study.

~~~
enord
Hypothesis: High outlier @5pctl - outstanding graduates groomed for
management. Low outlier @10pctl - family/friends/favours groomed for
management.

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jgwynn2901
The trouble I have is assuming that one can measure "managerial performance."
Measuring worker performance is straightforward, after all, they do the work.

------
PunchTornado
Why assume that someone wants to be forever competent in his position?

Many people just want to be mangers, even disregarding the salary. I would
take a management job anytime even if my salary is reduced and even if I'm not
competent enough.

What do they think that I'll be productive in my current role forever? NO. I'm
productive now so that I can be a manager someday.

