Fire your CEO! - FinanceFeeds

Fire your CEO!

Within any organization, more often than not an employee’s promotion prospects are often based on the performance of their current position says Paul Orford as he analyzes what constitutes mismanagement, how leadership is critical, and refers to the icon of corporate faux pas, David Brent

If any of you have been fortunate enough to watch either iteration of the TV show ‘The Office’, you have probably cringed at someone entrusted with a key management position of an organization who is terribly mismatched for the role.

Although this makes great comedy, in real life this can be incredibly challenging for all of those who are trapped in the orbit of an individual like this.

Before we begin, please don’t think that this is going to be a hatchet job upon the inept that we often find ourselves coming across on a daily basis. To take cheap shots at the lower end of the spectrum in their unfortunate situation is foolhardy, as it has been proven that it is actually something that these individuals are not in control of.

Strong and dynamic leadership is critical,, says Paul Orford

So next time the politics of the water cooler take over, take a moment to understand that we are all passive passengers in this journey according to a variety scientific, sociological and psychological schools of thought, in that ultimately we all end up in the same position as David Brent!

The first step on understanding this area of discussion, it is perhaps best by first taking a look at the most famous theory which is often discussed when analyzing organizational structural inefficiencies. Laurence. J .Peter outlined the ‘Peter Principle’ in 1969, and laterally the “generalized Peter Principle” argues that anything that works will be used in progressively more challenging applications and circumstances until it fails.

Peter noted that there is a strong temptation for people to use what has worked before, even when this might not be appropriate for the current situation.

Within any organization, more often than not an employee’s promotion prospects are often based on the performance of their current position. This will eventually result in them being promoted to their highest level of competence, and to then take on a role they are not competent at. By the individual reaching their “level of competence”, the employee has no chance of further promotion reaching their career ceiling at an organization.

Peter went further and argues that “in time, every post tends to be occupied by an employee who is incompetent to carry out assigned duties” and that “work is accomplished by those employees who have not yet reached their level of incompetence”.

He found that the incompetence maybe because the required skill set for the new task is different, but not more difficult. He gave the example of an excellent engineer who maybe a poor manager if they lack interpersonal skills necessary to lead the team.

Where promoting a ‘super-competent’ junior employee, Peter argues that an incompetent manager may set them up to fail or dismiss them, as they are likely to “violate the first commandment of hierarchical life with incompetent leadership: the hierarchy must be preserved”

So as we can see those who we shake our heads at in positions of power, who can sometimes struggle with the role, it is not necessarily their fault, but the fault of the organization….or is it.

David Dunning and Justin Kruger were two psychologists who devised the Dunning-Kruger effect. They argued that there is a cognitive bias in many, with persons who have a low ability who appear to suffer from ‘illusory superiority’. They mistake their cognitive ability as greater than what it actually is. Without this awareness they argue that people with the lower ability cannot objectively evaluate their actual competence or incompetence in the given role.

Moreover, their study also went further and found that “persons of high ability tend to underestimate their relative competence and erroneously presume that tasks that are easy for them to perform also are easy for other people to perform”.

So when it comes to having to deal with these challenging people don’t get angry or frustrated, as the organization has probably promoted them above their skill set which was perhaps outstanding in a previous role, but ill-fitting for this one. Which happily following this logic we will all be at the mercy of at some point in our professional lives!

Paul Orford is Head of Institutional at Cyprus based institutional firm AMB Prime

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