Is the ‘Peter Principle’ Alive in Your Company?

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How many times last year did you hear that someone was promoted to sales manager in their company, then got demoted or fired and with a puzzled look, you asked, “Why?”

The answer to that can be found as the subject of an entire book by Laurence J Peter, titled “The Peter Principle.” In its 180 pages, which IMHO is about 175 pages too long, wrote about what could go wrong inside a company or our case, inside an Offsite Construction factory.

The Peter Principle states that, if you perform well in your job, you will likely be promoted to the next level of your organization’s hierarchy. You will continue to rise up the ladder until you reach the point where you can no longer perform well.

The Modcoach interpretation is simpler: “Everyone rises to their level of incompetence.”

A great sales rep who is promoted to sales manager and no longer has direct contact with his past clients could become a terrible manager.

An article by Kevin F Davis in Hubspot identified why newly promoted sales managers aren’t successful:

They’ve been trained to avoid conflict.

Great salespeople instinctively avoid conflict. Sometimes it may make sense to tell the customer they’re wrong — but for the most part, a rep will steer clear of clashing with her prospect. Unnecessary disagreements hurt the rapport and trust she’s built and make them less likely to listen to her on the issues that actually matter.

Unfortunately, this tendency harms salespeople when they’re promoted. To drive progress and growth in their team, sales managers must rock the boat.

They’re too quick to rescue their reps.

It’s normal for sales managers to miss the front-line sales experience, especially now that most of their time is spent in meetings, doing administrative work, delegating, and coaching. In addition, they don’t want their reps to screw up and if they sense a deal is going south, they’ll step in and rescue it.

Sales reps don’t like it when they’re talking to a customer and the sales manager takes over.

They hate giving up.

To outperform your peers in sales, you need tenacity. Most of the salespeople who are promoted to managers are highly determined and persistent. This trait is fantastic except when they apply the “never give up” spirit to coaching their below-average reps.

Sales managers tend to hang to unsuccessful salespeople for far too long. A sales rep can bring down morale. Newly promoted sales managers will continue to help the below-average rep even at the expense of losing the high performers who are tired of not being recognized and helped.

They have fallen into the habit of criticizing instead of coaching.

Sometimes, when someone has fallen into a new role, it may be instinctual to begin rectifying all the visible “flaws” right away. In addition, a new sales manager may feel the pressure to assert authority early or improve performance fast to justify their promotion or role change.

The danger to this is that they can easily fall into the trap of only pointing out the negatives.

They never learned active listening.

If you’ve ever brought up a concern in a meeting with your boss only to have the conversation devolve into a tangent that had no bearing on the original concern, you probably felt unheard and unappreciated. 

In addition, that concern may have never gotten fully acknowledged and dealt with later, and you likely lost a little bit of respect for them along the way.

Bottom Line:

While the road from salesperson to sales manager might usually be a bumpy one, some foresight and planning can smooth your way. Upper management can help the newly promoted sales manager by working with them to make the transition from sales to management easier.

Unfortunately, many of those same upper management types are also victims of the Peter Principle who have reached their own level of incompetence.

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Gary Fleisher is the Editor in Chief of Modular Home Source and Offsite Builder magazine. Email at [email protected]

Gary Fleisher, the Modcoach
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