DON'T BE A VICTIM OF THE PETER PRINCIPLE

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Education & Training with Performance Development Strategies

 

If you are growing your real estate business don't make the mistake of not growing your people. This can be a serious mistake. If you simply let people learn on the fly and promote them when needed, then you are setting them up to fail. This is so prevalent that a book called the Peter Principle was written about this phenomenon.

In 1969, Lawrence Peter wrote a humorous book titled The Peter Principle in which he postulated that, in a hierarchy people tend to be promoted to the level of their incompetence. He noted that although this is not planned it is the unintended consequence. Companies make a flawed assumption that because the employee was a great individual performer in the previous job that he or she will adapt and become a leader of the team. Inevitably, according to the Peter Principle, the person ends up being promoted to a job where they are no longer competent. This is referred to as the "level of incompetence". The employee has no chance of further promotion, thus reaching his or her career's ceiling in an organization.

We can see examples of The Peter Principle in many of our businesses. It is most commonly found in the selection and promotion of managers. Let’s use an example. Jane is a very highly performing accountant. She meets deadlines and delivers good and accurate reports for management. She is the right-hand person to the accounting manager. One day the accounting manager leaves the company for another job and management decides to promote Jane to the accounting manager position. Was this the right decision? Let’s find out.

•          What duties was Jane paid to do as an accountant?

•          What duties is Jane now paid to do as accounting manager?

Nothing is wrong with promoting Jane. In fact, we would encourage it. However, if you do nothing more to assist Jane then you are setting her up for failure. The skills that Jane used to perform as an accountant are different than those needed in her new role as manager.

This skill curve below illustrates this point.

 

skillscurve2

  As we can see here, in order to be effective as an individual performer you must utilize about 90% technical expertise with only 10% people skills.

However, at the next level in the organizational structure, the supervisory level, the curve makes its most dramatic shift, and the necessary knowledge and skills you now need to be effective on the job is about half and half. You still need a great deal of job knowledge—to train, to substitute, etc.; but, now your Number 1 responsibility is developing other people—to develop other high performing workers, to teach, to lead, and to manage.

Then, as you can see from the shift in the upper levels, the higher you go in the corporate ladder, the less you need technical skills, and the more you need good, effective management and human relations skills. At the management levels, more behavioral and management skills are required for your success.

Are you promoting and hoping for success? What do you need to do differently?  For a similar post on our web site see  DON'T SET PEOPLE UP TO FAIL.

Do you need help developing skills for leadership?

Contact us to learn more

or call 914-953-4458.

 

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Re-Blogged 4 times:

Re-Blogged By Re-Blogged At
  1. Roy Kelley 02/04/2019 01:00 AM
  2. Debbie Reynolds 11/28/2018 05:00 AM
  3. Ron Barnes 11/29/2018 06:56 AM
  4. Peter Mohylsky, South Walton 03/08/2019 04:09 AM
Topic:
Real Estate Best Practices
Location:
New York Westchester County
Groups:
Coaching and Mentoring
Tags:
real estate training and development in armonk ny
number 1 responsibility is developing other people
effective management and human relations skills

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Rainer
494,608
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton & rest of Maryland

Dear Grant,

Over the years, I have known many, who preferred to stay technicians, because that was their comfort zone. They did not feel, they were good with people & did not have the motivation to learn at the time.

Nov 29, 2018 07:30 AM #41
Rainmaker
267,298
Randal Jenkins
Coldwell Banker F I Gray and Sons Residential, Inc. - New Port Richey, FL

Very familiar with the Peter Principal.

Ponder how to capitalize on the knowledge.

 

 

Nov 29, 2018 07:55 AM #42
Rainmaker
302,462
Dennis J. Zisa & Associates, Inc.
Dennis J. Zisa & Associates, Inc. - Camden, NJ
28 years in So. Jersey and the Greater Camden area

I agree that the lack of effective "people skills" is way more limiting than lack of technical expertise.

 

Nov 29, 2018 07:56 AM #43
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Dörte - yes, that is particularly true in science and engineering.

Randal - best way to prevent it is to train people.

Dennis - and most certainly in a leadership role.

Nov 29, 2018 08:19 AM #44
Rainmaker
1,307,796
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hi Grant,
This received a well deserved Feature Gold Star.  Sadly, the Peter Principle is obvious in all industries.  

Nov 29, 2018 08:59 AM #45
Ambassador
3,274,141
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Great explanation of a classic, Grant! We see this in every industry. There are simply some people who excel at what they do but, if promoted, are a disaster!

Nov 29, 2018 05:11 PM #46
Rainmaker
976,779
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Interesting and unique post for AR. I can relate in my former banking career.  I was promoted to 5 different departments before I topped out. The last department manager was not in the place he should have been and was eventually canned.  Thankfully I moved on before witnessing his demise!  

Nov 30, 2018 11:04 AM #47
Rainmaker
63,791
Ricardo Mello
Manhattan Miami Real Estate - Manhattan, NY
Manhattan & Miami Real Estate Agent

Great post Grant!

Dec 01, 2018 06:02 AM #48
Rainmaker
1,198,024
Sheri Sperry - MCNE®
Coldwell Banker Residential Brokerage - Sedona, AZ
(928) 274-7355 ~ YOUR Solutions REALTOR®

HI Grant Schneider - To me, the biggest mistake managers make is not developing their people.  Managers won't succeed if they are afraid to train people to replace themselves. I have seen it numerous times. 

Dec 01, 2018 03:19 PM #49
Rainmaker
2,704,764
Lisa Von Domek
Lisa Von Domek Team - Dallas, TX
....Experience Isn't Expensive.... It's Priceless!

Grant Schneider Congratulations on another well deserved Feature!  Too many companies set up their employees for failure by not providing the proper support and training for them to grow. 

Dec 02, 2018 11:40 AM #50
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Carol - yes, sadly true but it can be fixed.

Debe - some are not inclined for the job which is another story.

Jan - so glad that you moved on.

Ricard - thank you.

Sheri - yes, some don't want to lose them.

Lisa - yes indeed, that is very true.

Dec 02, 2018 12:30 PM #51
Rainer
119,203
Anthony Kirlew
Keller Williams Legacy One Realty - Gilbert, AZ
Helping You Make Fiscally Sound Choices

Great advice. Sadly, we see this all too often in corporate America.

Dec 16, 2018 07:17 AM #52
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Andrew - we see it all the time don't we.

Dec 18, 2018 06:47 AM #53
Rainmaker
437,219
Greg Large
ERA Real Solutions - Grove City, OH
A Tradition of Trust

This can be easily recognizable in the Corporate world but it also happens in the Real Estate field.  Lack of self awareness and self assesment has led people that could not lead a one man parade forming "teams" and not providing adequate training and direction that results in a dysfunctional hot mess.

Dec 26, 2018 11:55 AM #54
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Greg - yes yes.  Hopefully people are taking heed of this.

Dec 27, 2018 09:17 AM #55
Rainmaker
3,235,388
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

People promotef beyond their abilities are a recipe for disaster.

Feb 04, 2019 03:25 AM #56
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Sally and David - happens all the time.

Feb 05, 2019 06:35 AM #57
Rainmaker
572,458
Peter Mohylsky, South Walton
PrimeSouth Properties - Santa Rosa Beach, FL
Let me help you find your path to the beach.

Love this information, I was searching for something else and stumbled across this post.  Thanks, you would think I knew more considering my first name.

Mar 08, 2019 04:07 AM #58
Rainmaker
1,137,560
Joyce Marsh
Regal | Christie's International Real Estate - Orlando, FL
Regional Manager Regal Christie's Int'l Realty

It’s important for companies to provide the training and the proper support so their employees can learn and grow in their respective positions. Sadly that is always not the case. 

Mar 08, 2019 05:26 AM #59
Rainmaker
1,894,744
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Peter - ha yes, this way a book that came out when I was in college.

Joyce - it is not the case for many companies.

Mar 08, 2019 11:28 AM #60
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