Have you ever wondered why so many people fail once they are promoted? Even if they were rock stars in their previous role? It’s definitely not just ‘bad luck’ or a ‘bad fit’.

In fact, it’s far more widespread. According to Gartner, a whopping 49% of people who are promoted within their own companies underperform up to 18 months after the move.

And this phenomenon has a name – it’s called the Peter Principle of Leadership. It’s where top performers who are great employees get promoted to management positions they are not ready for because they don’t have the leadership skills to excel at it, or they’ve simply not been proactively developed into the new role.

More often than not, companies wait until someone is in the role to develop them, which slows down the speed at which they perform and increases the negative impact they have on others or the team. Succession planning is often one of the last things many businesses do within their performance process and even then, it’s often only reviewed once per year.

Or, in the worst-case scenario, promotions are given without any support at all and it’s a sink or swim situation – we’ve all seen high performers crumble under the pressure of a new role and team.

Across the board, there’s just not enough forethought given to career progression, leadership succession and the skills individuals need to thrive in future roles.

But here’s what you can do in your organisation to prevent and address the Peter Principle and set people up for promotion success.

6 steps to ensure people succeed quickly in a new role: 

1. Provide tailored leadership development

This is the single biggest change an organisation can make to equip people to succeed in future roles. Rather than throw new managers into roles unprepared, companies can offer tailored development experiences, leadership training, mentoring programs, and gradual responsibility increases before filling a new role. This often includes coaching on delegation, communication, strategic thinking, and team building.

2. Rethink promotion criteria

A great team member does not always make a great leader. So instead of automatically promoting top performers, organisations should assess whether a candidate possesses the specific skills needed for the new role. This means evaluating leadership potential, desire to take on the new role, and people management abilities rather than just technical competence or individual achievement.

3. Use competency-based assessments

To evaluate whether someone is prepared for a role, structured assessments are an invaluable resource. Things like 360-degree feedback, leadership simulations, or coaching can assess whether they have the required skills and identify potential gaps before they become a problem.

4. Focus on leadership succession planning

Don’t rush to fill a role, proactively have a succession plan ready for key business roles. Identify potential candidates well ahead of time and upskill them for that future role. And save yourself wasted time and effort by asking people upfront if the job you’re earmarking them for is a role they actually want.

5. Create dual career paths

Parallel advancement tracks are the future – one for management and another for individual contributors. This allows subject matter experts to experience growth in salary, status, and responsibility without necessarily managing people. Not everyone is cut out for leadership, but they still need and want growth opportunities.

6. Allow Graceful Transitions Back

Don’t leave people stuck in a role they can’t handle or don’t enjoy – it’s bad for them, their team and the organisation. Instead, give people opportunities to gracefully return to old jobs or move sideways, without the stigma.

Based on our experience and industry knowledge, we estimate that most businesses only do about 2 to 3 out of the 6 above, which means their people, their teams and their profits are being adversely affected by the Peter Principle.

The easiest and simplest way to alleviate this negative impact is with proactive leadership training and targeted development experiences for your top talent. We offer a 6-month accredited (BSB50420) Diploma in Leadership and Management that comprehensively prepares people for future leadership roles.

One of our regular clients, The Entertainment & Education Group (TEEG), runs this for their organisation every year and it provides a baseline of experience and expectation for all their venue managers.

If you’d like to talk with us about placing some of your people in our next Diploma program or organising more bespoke training or coaching for your emerging or elevating leaders, simply email us at enquiries@tactician.net.au or call us on 1300 110 165, and we can talk through how we can help.