Leaders and the Peter Principle’s bug

One of the world’s most respected management experts, Dr. Laurence J. Peter, posits that, “In a hierarchy every employee tends to rise to his level of incompetence.” This statement is now known as the Peter Principle. The thrust of the principle is that in an organisation, employees will eventually get to their highest level of competence after which they are no longer promotable.

That point is the employee’s level of incompetence, the ceiling of his career in that particular organisation.

Peter goes ahead to explain that a non-growing company usually has incompetent employees at many levels of its structure because what is being rewarded is loyalty, not competence.

On the other hand, a growing company has competent employees heading its departments.

Thus, it is able to beat its past performance because its employees have not reached the end of their capacity.

So, for a company to grow, it must be peopled by leaders and staff who still have new ideas, leaders who are not fixed in their thinking, leaders who will not be making references to how the company used to operate 30 years ago. A growing company must have leaders who are in tune with today’s demands, today’s customers’ mindset and have the capacity to deploy today’s technology.

While the Peter Principle has been found to be true in most cases, a few individuals have made themselves an exception to that rule. Two of such people are Dr Christopher Kolade, former chairman of Cadbury Nig. Plc, and Mr. Waheed Olagunju, Acting Managing Director of the Bank of Industry.

 

Dr Christopher Kolade

At 84, it seems Dr Christopher Kolade will never get to his level of incompetence as he is still much sought after by national and multinational organizations either to head or sit on their boards. After his retirement as the Director General of the Nigerian Broadcasting Corporation at 45years of age, he was employed by Cadbury Nigeria Plc as Director of Administration. He eventually became Chairman/Chief Executive of the organization. On retirement from Cadbury, he was appointed Nigeria’s High Commissioner to the United Kingdom and held that position for five years. He has served as President of various national and international organizations. These include the Nigerian Institute of Management (1985-88), the Institute of Personnel Management of Nigeria, the International Institute for Communications and the World Association for Christian Communication. He has also served on the board of many companies. In 2012, when Dr Goodluck Jonathan, then President of the country, needed somebody of impeccable integrity as board chairman of the Subsidy Reinvestment and Empowerment Programme, he turned to the then 79-year old Kolade.

Dr. Kolade currently serves as the Pro-Chancellor/ Chairman of Council of the Pan-Atlantic University, Lagos, where he still finds time to lecture on Leadership and Business Integrity.

He is also chairman, board of directors of SystemSpecs Nig Ltd, among many others.

Waheed Olagunju

Mr Waheed Olagunju came into national consciousness when he became Head of the Economic Desk at the Nigerian Television Authority (NTA) in the 1980s where he distinguished himself as an economic reporter. It was the dexterity he displayed in his reportage and his profound understanding of the business environment that recommended him to the leadership of the Nigerian Industrial Development Bank (NIDB), the precursor institution of the Bank of Industry, to headhunt him. He was subsequently appointed Senior Manager, Corporate Affairs.

For many who get such offer they would have plateaued there, seeing such ascension as the peak of their career aspiration. But through the demonstration of exceptional capacity, critical thinking and a determination to make positive impact on the organization, Olagunju did not last as the Head of Corporate Affairs. As a result of his remarkable comprehension of corporate governance, he was appointed Assistant Company Secretary and Secretary to the Executive Management Committee in 1994. Three years later, he was elevated to the position of Company Secretary and Secretary to the Board. He occupied that position for 15 years until he was promoted to the Board in 2012 as an Executive Director.

But while he was the Company Secretary, because of his profundity in strategy and planning, he was appointed General Manager in charge of Strategic Planning, Business Development and Corporate Communications in addition to his functions as the Company Secretary. Olagunju has made himself such a value-adding member of the organization to the extent that the fusion of three organizations; Nigerian Industrial Development Bank (NIDB), Nigeria Bank for commercial and Industry (NBCI) and National Economic Reconstruction Bank (NERFUND) into the Bank of Industry in 2001 did not negatively affect his career progression.

As an Executive Director, he has headed the Business Development and the Small and Medium Enterprises directorates. Between April 11and May 16, 2014, he was the Acting Managing Director/CEO of the company. Again, he has been Acting MD/CEO since February 15 this year.

 

Posers

What is it about Dr Kolade that makes the urge to stack him with increasing responsibilities irresistible? Why is it that at an age when his peers sit idly at home believing they have contributed their quotas he is still asked to head organizations and teach upcoming generation? What always makes Kolade the obvious choice whenever there are critical situations? Why has he been able to beat the bug of Peter Principle?

Why does BoI always make room for Olagunju? How did Olagunju, who was employed as a communication specialist, manage to get to the pinnacle of banking at the expense of those who were employed into the mainstream of the bank’s operation? What was so unique about Olagunju that whenever there was a major challenge in the bank he was called upon to handle it? How did Olagunju manage to escape the Peter Principle’s bug?

Both Kolade and Olagunju practised a few principles that put them ahead of others and enabled them to beat the trap of Peter Principle. Here are some of them.

 

Setting and reviewing goals

The first is regular review of career goal. Every employee at any level must set a career goal. The essence of this is to give fillip to the career. Career goal setting gives the employee something to look forward to, something to work towards.

However, as you move closer to the actualisation of your career goal, you need to upwardly review the goal to avoid the lure of complacency.  If, for instance, your initial career goal is to become the manager of your department, the moment you become deputy manager you have to set a higher career goal, otherwise you become complacent which comes with a dip in the discharge of your functions. You probably have to raise your career goal to becoming a general manager so that you can at least maintain your present pace of work. If, on the other hand, you do not set a new goal, believing that being a manager will do, your productivity will decline because in your mind you already believe that you are next in line. But as your productivity heads south, your superiors will not fail to notice. The sad part of this is that you may not even become a manager because your superiors may conclude that you have reached your level of incompetence.

One unintended upside of setting and reviewing goals is that it becomes a way of life that it never stops at any point. Imbibing that practice will result in an unending improvement to the extent that it becomes impossible to ignore the person. That is the Kolade’s appeal.

 

Upgrade your thinking

Many people fail to realise that the higher they go on the company’s ladder, the higher their responsibility in the company, not just with respect to their physical output but in the quality of their thinking. Many senior officers believe that the higher they go the more routine their work becomes. That is why some senior military and police officers do less than they ought to. They go to officers’ mess by midday and remain their till end of the day. They are invariably shown the door before they reach retirement age.

While it may be true that the higher one goes in the hierarchy the less one is expected to do in physical sense, it is also true that as one ascends the corporate ladder, one’s thinking capacity should be enhanced to meet the expectations of the organization. While staff are graded based on their productivity, managers are assessed principally based on their ability to proffer solutions, which is a product of their capacity to think creatively. Managers are graded at every meeting in respect of the quality of their contributions. So, to beat the Peter Principle’s bug, think out of the box, think creatively, think vertically, think horizontally, think the unthinkable.

 

Learn new things

A recent study reveals that 51 per cent of employees have not completed reading a single competence-enhancing book after graduation. This is why productivity is low among many employees and they reach their level of incompetence quite early.

One way to beat this is to regularly upgrade knowledge and skills. As a superior, one edge you have over your staff is knowledge. But if it becomes clear to your subordinates that you are deficient of the required skill or knowledge for the job, then, you are simply saying that you have reached your level of incompetence.

As you grow on the job, you need to increase your knowledge base. The skills and knowledge that brought you to your present level are inadequate to move you beyond the present level. Olagunju understands this point quite well.

 

Be passionate

Those who are tired of their jobs are easily discernible. It is easy to know if your job no longer excites you. Once this is noticed, your employers will conclude that you have reached your level of incompetence. Even if you are not asked to go, you can be sure that your responsibilities will be scaled down and so will your influence.

Be enthusiastic about your job and every assignment you are given. Think of better ways of doing your assignment. Kolade is over 80 years of age. Many of his mates have retired to their villages but age has not slowed down the man. He waxes stronger by the day as he sits aboard a number boards. His secret is the passion with which he goes about every assignment. To beat Peter Principle’s bug, bring passion to your operation, it will make you irresistible to your employers.