Sunday, June 24, 2012

An amusing implication of the Peter Principle wins an Ignoble Award

The most recent Ignoble Award given out for research in management (awarded in 2010) caught my eye.  The study is available here and the official reference is: Pluchino, A. Rapisarda, A.; Garofalo, C. (2010). "The Peter principle revisited: A computational study". Physica A: Statistical Mechanics and its Applications 389 (3): 467–472

In essence, they proved the Peter Principle.  For those of you unfamiliar with the Peter Principle  it is the practice of promoting people when they are really good, with the consequence that you are taking them out of the job they are good at and putting them in a different one.  Simple probability predicts that they will be less good at their new job then they were at the previous one where they excelled.  This research found that organizations would do better if they promoted people at random.  This way they would be equally taking people out of jobs they are good at and out of jobs they are bad at. Again, it is simply the law of averages at work.

But doesn’t this imply that the BEST way to award promotions is always to promote the worst performers?  It would be kind of scary to find out that this is actually the best strategy. 

Do you think it would?  Let me know in the comments.

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