The Conundrum of Promoting Your Top Talent

One of the more common and expensive management mistakes is to help perpetuate the Peter Principle. For those of you lucky enough (by the blessing of relative youth) to be unfamiliar with the term I’ll refer to Wikipedia:

“The Peter Principle is a concept in management theory formulated by Laurence J. Peter and published in 1969. It states that the selection of a candidate for a position is based on the candidate’s performance in their current role, rather than on abilities relevant to the intended role. Thus, employees only stop being promoted once they can no longer perform effectively, and “managers rise to the level of their incompetence.”

Unfortunately, we fall victim to this principle all too often and ultimately both the recipient of the promotion and the company mutually lose. Company management and the employee are caught in the middle of what often becomes a no-win situation, or at least they perceive that to be the case. To retain good talent, you must offer advancement and a clear career path. That traditional career path ultimately leads to management positions to justify continued increases in compensation.

Our accepted process of promotion says that without increased value to the company you cannot increase compensation faster than inflation or industry norms. This traditional view of increased value is where we can become conflicted.

So—what are the options?

All too often, the Peter Principle kicks in because we passively encourage it. We take that route by default, and we do little to assure the success of those we promote. A good engineer (or pick your field) is not inherently a good manager, and without proper support, many will fail miserably because they have no inherent understanding of what to do or where to go to find help to assure their own success. A few will survive because they have a sense of self-direction of how to successfully adjust but at some point, all but the rare exceptionally talented will fall victim to their own over-rewarded successes.

This same condition exists for production people. We tend to promote our best machine operators to foremen and somehow expect, by some mystical process of assimilation, they have grasped all the concepts of effective management. We equate their success as operators to an accompanying innate ability to obtain the maximum output from their former peers. To further compromise the chance of their potential success, all too often their “model of excellence” has arrived at their end point via the Peter Principle.

One obvious solution to avoid failure is to provide effective training. Optimally, this training should begin prior to a promotion to unfamiliar turf. For companies focused on lean methods, continuous improvement should be core to your ongoing process. Involvement in continuous improvement teams (CIT) offers an excellent avenue to provide insights into management techniques and “logic.” CITs give participants experience in evaluating decisions and realizing that acknowledging mistakes and making changes are not admissions of failure but opportunities for improvement. CIT’s also provide opportunity to be team leaders, a powerful stepping stone by teaching communications skills and meeting management.

Other avenues of development that I have found effective are to recommend specific reading, attendance at seminars, webinars, and professional society memberships as well as one on one coaching sessions. To assure that value is being gained from these activities, you must be interactive with them and monitor their progress. I recently gave two midlevel managers a new book that I want them to read, with the charge that I expect a book report (verbal) from each of them. Managing their developmental process is not a passive activity.

Not everyone is capable, even with training, of becoming an effective manager. In addition, not everyone wants to move into management.

So how do you increase someone’s value in a non-management role while assuring their own growth to justify increased compensation?

One approach is to utilize “competency-based career ladders.” The engineer that could fail to perform in a management role but excels in an engineering role might be more effective (and valuable) through expanding their role as an engineer. This might be in the realm of training junior people, researching of evolving technology, and developing a strategic plan for the department. An effective mentor and visionary can add significant value—and justify incremental pay increases as a result.

For that machine operator, a more valuable role for him might be as a “super operator” who becomes your chief trainer or possibly a dedicated programmer.

We all know how difficult it is to find “good help,” and we can ill afford to allow our good people to be underutilized, or worse, to fail. Sadly, this is one area that for many companies remains a hit and miss proposition. Ultimately, the costliest part of failure in these cases is that the person simply fails to be effective and most often leaves the company either voluntarily or by invitation. In any event, both the individual and the company have lost, now and into the future.

Both of these approaches offer ways that your high performers can succeed in new roles and both they and you stand to win as a result. Why would you not want to increase your chances of success?