Fight The Peter Principle With Five Minute Fit

Five Minute Fit is a featherweight business reorg process using binary 360° feedback. I’m about to tell you why we ought to implement such a process, but if you’re already on board with the notion of moving personnel around to find their best fit, you can skip to the demo here.

One of the most damning teardowns of traditional corporate structure can be found in the Peter Principle. Its semi-satirical theory argues that employees rise to their level of incompetence, which for our purposes here, deserves a bit more explanation:

A. People are promoted to a point of failure, yet remain in that position indefinitely because we have no organizational mechanisms for refitting them

B. People are promoted based on performance in their prior position, rather than being promoted based on their fitness for the impending position

It’s the kind of theory most lower-level employees would readily agree with, and most upper management personnel would dismiss. The latter may argue that as employees advance, they inherit greater obligation to shoulder the failures of others — that is, the perceived incompetence of a boss is really just a manifestation of the broader team’s limitations and mistakes. There’s a kernel of truth to that, but it neglects to account for why subordinates are causing this failure friction.

Many orgs are riddled with drag created by their own employees, but most employees would say their behavior is merely the output of management’s direction. It’s a vital component of the Peter Principle, but often dismissed: we don’t promote people into management because of how well they manage, so when they do reach management, their newfound incompetence infects everyone beneath.

In a hierarchical structure, this is leadership’s obligation to remedy. By design, no one sitting in the lower branches of an org tree can shake a supervisor down without disrupting the whole plant.

To be fair (for now), some of that hierarchical hardening is practical. If we promote someone to a point where they can access sensitive information (e.g. salaries, trade secrets, questionable business practices), they don’t unlearn those things when we demote them. The people just become liabilities… so we leave them in place to…