BusinessWeek Opinion Piece: In Praise of Simple Competence

Written by

I wrote an opinion piece for the new BusinessWeek, which is now available online and in the current print version of the magazine. The graphic in the magazine is above — it is pretty graphic! They seem to be calling it The Peter Principle Lives, although the PDF of the final I saw was called "In Praise of Simple Competence." In any event, the argument is that our collective lust for extreme levels of performance led to all kinds of incompetence and cheating — think Bernie Madoff and Barry Bonds. And the pressure to create a false illusion of superstardom contributed to the meltdown; notably, reasonable and relatively safe returns weren't good enough for financial service firms and their shareholders, so they rolled the dice in dangerous ways that were another kind of incompetence. I argue that perhaps one path out of the current mess is a return to the celebration of simple competence. As I say in the piece, this notion was inspired by The Peter Principle, which I took as a plea for simple competence.

It was really fun to write, but the process of cutting it down to 800 words or so was painful — although having great editors helps. As I wrote earlier in the week, BusinessWeek has also published the foreword that I wrote to the new edition of The Peter Principle online, which you can get here.

P.S. This basis of some of the ideas in the opinion piece are in this post, also called In Praise of Simple Competence.

Comments

8 responses to “BusinessWeek Opinion Piece: In Praise of Simple Competence”

April 4, 2009

Scott

Spot on with the Peter Principle and your descriptions. The Peter Principle, in light of the collapse of capitalism as we studied it, continues to remain strong with Corporate America and failed companies.
I’ve seen, worked with, and observed the Peter Principle more in the past 5 years than any time before. The front lines are massacred to protect those who are promoted beyond their own level of competence.
If you want to take comfort in some real leadership, someone who has turned their back on the People Principle, and (hopefully) a new age of management, pick up a copy of:
Dropping Almonds by Bach Anon
http://www.droppingalmonds.com

Reply
April 4, 2009

Scott

Spot on with the Peter Principle and your descriptions. The Peter Principle, in light of the collapse of capitalism as we studied it, continues to remain strong with Corporate America and failed companies.
I’ve seen, worked with, and observed the Peter Principle more in the past 5 years than any time before. The front lines are massacred to protect those who are promoted beyond their own level of competence.
If you want to take comfort in some real leadership, someone who has turned their back on the People Principle, and (hopefully) a new age of management, pick up a copy of:
Dropping Almonds by Bach Anon
http://www.droppingalmonds.com

Reply
April 5, 2009

Murthy

Hi Professor Sutton,
Congrats on the BusinessWeek article! Another very timely piece as organizations sort through their human resources in changing environments.
I’d like to share 2 adjunct points:
1) When we talk about a return to simple competence, I think its important that the “complexity” or greed or excess that we are seeking to eliminate is in *how* we work and not in the returns or results of our work itself. As an example, I don’t think we want to constrain people from wanting to make money – that desire for personal prosperity, when aligned with organizational and societal goals, is what fuels a lot of innovation. What needs to be constrained are the rules for how you make money. Bernie Madoff was not ill for running a fund – indeed, many funds do fantastic jobs for their investors and for businesses needing capital. Bernie was ill in how he went about it. Barry Bonds might have wanted to be a great athlete – that desire was a noble one – his flaw is in how he went about it.
The reason the distinction between the goal and how you get to the goal is important is because constraining the former can have far more dangerous consequences. You don’t want a society where ambition is capped. This is what leads to a sort of communal reward system whereby no one feels the need to innovate. You want a society where ambition is highly encouraged, but where the exercise of ambition is restricted and regulated.
2) Perhaps another explanation for the Peter Principle is that organizational position has evolved into a currency to motivate performance, therefore taking organizations off the hook for developing and evaluating competence. For example, lets say you have a Director who is working 40 hours a week and doing a great job. It seems to me that the modern view on employee motivation is to tell this Director, “If you work 60 hours a week, we’ll promote you to Senior Director in 1 year.” This allows the Director’s boss to now generally be checked out in monitoring and developing the Director’s actual performance – probably so that they can do their own 60 hours a week in pursuit of their own fast path up the ladder.
Organizations need to go back to “simpler times” when being a Director meant that you spent time with your boss being trained and coached over the course of many years on how to become a Senior Director. And Managers spent time with their bosses over many years being trained and developed, etc.
This shift in spirit requires significant leadership from the CEO and the board. Modern corporations are evolving towards seeking returns on financial capital in ways that are not congruent to seeking returns on human capital. To the extent these are merged back together, I think the Peter pressure will be reduced as well.

Reply
April 5, 2009

Murthy

Hi Professor Sutton,
Congrats on the BusinessWeek article! Another very timely piece as organizations sort through their human resources in changing environments.
I’d like to share 2 adjunct points:
1) When we talk about a return to simple competence, I think its important that the “complexity” or greed or excess that we are seeking to eliminate is in *how* we work and not in the returns or results of our work itself. As an example, I don’t think we want to constrain people from wanting to make money – that desire for personal prosperity, when aligned with organizational and societal goals, is what fuels a lot of innovation. What needs to be constrained are the rules for how you make money. Bernie Madoff was not ill for running a fund – indeed, many funds do fantastic jobs for their investors and for businesses needing capital. Bernie was ill in how he went about it. Barry Bonds might have wanted to be a great athlete – that desire was a noble one – his flaw is in how he went about it.
The reason the distinction between the goal and how you get to the goal is important is because constraining the former can have far more dangerous consequences. You don’t want a society where ambition is capped. This is what leads to a sort of communal reward system whereby no one feels the need to innovate. You want a society where ambition is highly encouraged, but where the exercise of ambition is restricted and regulated.
2) Perhaps another explanation for the Peter Principle is that organizational position has evolved into a currency to motivate performance, therefore taking organizations off the hook for developing and evaluating competence. For example, lets say you have a Director who is working 40 hours a week and doing a great job. It seems to me that the modern view on employee motivation is to tell this Director, “If you work 60 hours a week, we’ll promote you to Senior Director in 1 year.” This allows the Director’s boss to now generally be checked out in monitoring and developing the Director’s actual performance – probably so that they can do their own 60 hours a week in pursuit of their own fast path up the ladder.
Organizations need to go back to “simpler times” when being a Director meant that you spent time with your boss being trained and coached over the course of many years on how to become a Senior Director. And Managers spent time with their bosses over many years being trained and developed, etc.
This shift in spirit requires significant leadership from the CEO and the board. Modern corporations are evolving towards seeking returns on financial capital in ways that are not congruent to seeking returns on human capital. To the extent these are merged back together, I think the Peter pressure will be reduced as well.

Reply
April 6, 2009

dblwyo

Here, here. You’ve got to work on your timing though, please. Could have used this in an investigation of decision-making distortions and corporate mal=performance. Without going into my argument let me just point to the url:
http://llinlithgow.com/bizzX/2009/04/firestorms_and_rethinkings_bus.html
and instead cite an incomparably greater authority:
Sons of Martha
The Sons of Mary seldom bother, for they have inherited that good part;
But the Sons of Martha favour their Mother of the careful soul and the troubled heart.
And because she lost her temper once, and because she was rude to the Lord her Guest,
Her Sons must wait upon Mary’s Sons, world without end, reprieve, or rest.
It is their care in all the ages to take the buffet and cushion the shock.
It is their care that the gear engages; it is their care that the switches lock.
It is their care that the wheels run truly; it is their care to embark and entrain,
Tally, transport, and deliver duly the Sons of Mary by land and main.
http://www.poetryloverspage.com/poets/kipling/kipling_ind.html
Hopefully you’ll of course recognize the Bard of the work-a-day world.

Reply
April 6, 2009

dblwyo

Here, here. You’ve got to work on your timing though, please. Could have used this in an investigation of decision-making distortions and corporate mal=performance. Without going into my argument let me just point to the url:
http://llinlithgow.com/bizzX/2009/04/firestorms_and_rethinkings_bus.html
and instead cite an incomparably greater authority:
Sons of Martha
The Sons of Mary seldom bother, for they have inherited that good part;
But the Sons of Martha favour their Mother of the careful soul and the troubled heart.
And because she lost her temper once, and because she was rude to the Lord her Guest,
Her Sons must wait upon Mary’s Sons, world without end, reprieve, or rest.
It is their care in all the ages to take the buffet and cushion the shock.
It is their care that the gear engages; it is their care that the switches lock.
It is their care that the wheels run truly; it is their care to embark and entrain,
Tally, transport, and deliver duly the Sons of Mary by land and main.
http://www.poetryloverspage.com/poets/kipling/kipling_ind.html
Hopefully you’ll of course recognize the Bard of the work-a-day world.

Reply
April 9, 2009

Shane Twomey

Bob,
Great post and article.
One of the major flaws in the modern organisation is that, in many cases, the only option for advancement (career and financial) is to move into a managerial role. Not everyone, for example, is a natural people manager but has to ‘manage’ people as a consequence of the promotion. Unless organisations recognise this limitation, the Peter Principle will still hold true in another 30 years.

Reply
April 9, 2009

Shane Twomey

Bob,
Great post and article.
One of the major flaws in the modern organisation is that, in many cases, the only option for advancement (career and financial) is to move into a managerial role. Not everyone, for example, is a natural people manager but has to ‘manage’ people as a consequence of the promotion. Unless organisations recognise this limitation, the Peter Principle will still hold true in another 30 years.

Reply