Susan C. Paddock
University of Wisconsin, Madison
The concept originated by Laurence J. Peter and discussed in his book of the same name (Peter and Hull 1969) that "in a hierarchy, every employee tends to rise to his level of incompetence." Peter's Corollary is "in time, every post tends to be occupied by an employee who is incompetent to carry out its duties."
Based on his observations of schools, government organizations, and businesses, Peter hypothesized that employees are promoted to positions because of their competence in their current position, not because of the competence they might have in a future position. As a result, employees are promoted to positions where they might not have the necessary skills.
While a person might move from a level of competence to a higher level of competence—for example, from a line worker to a lead worker— ultimately, Peter claimed, the final promotion would be to a level of incompetence. As a result, hierarchies are staffed by people operating beyond their level of competence.
There are apparent exceptions to this rule. An incompetent person may be promoted, or a competent one not promoted. Peter argued that these are not exceptions but rather further proof that the Peter Principle is accurate. An already incompetent person who is promoted may be moved in such a way that the new position is outside the hierarchy, as in a promotion to a staff position, for example; or the individual may be "promoted" laterally.