A company keeps promoting its top salespeople into management and watches their teams' numbers slip. What does the Peter Principle suggest is the better fix?

Create a senior track that pays top sellers more without making them managers

Only promote salespeople who consistently hit their targets

Create a senior track that pays top sellers more without making them managers

📈 Why your best salesperson makes a terrible sales manager

In 1969, educator Laurence J. Peter noticed a strange pattern in how organizations promote people. We reward great work with a promotion — but the new job usually demands completely different skills. Your star engineer gets promoted for writing brilliant code, then spends her days in meetings, mediating conflicts, and coaching juniors. The very talent that earned the promotion is now barely used. This is the Peter Principle: employees tend to rise to their level of incompetence.

The logic is quietly brutal. As long as you're good at your job, you keep getting promoted. The moment you land in a role you're not good at, the promotions stop — so you get stuck there. Over time, organizations fill up with people parked one rung above their competence. A 2018 study of sales workers even found it in the data: firms that promoted their top salespeople saw those new managers' teams underperform, because selling skill didn't predict managing skill.

The fix isn't to stop rewarding good work — it's to decouple reward from role change. Smart managers offer raises, bonuses, or senior 'individual contributor' tracks so a brilliant specialist can earn more without being forced into management. And they treat management as a distinct skill to be trained and tested, not a trophy handed to whoever performed best at something else.