Companies would be more efficient if they promoted workers randomly
Posted: Tue Dec 17, 2024 5:50 am
In the 1960s, Canadian psychologist Laurence J. Peter put forward a seemingly paradoxical principle: “each new member of a hierarchical organization rises in the hierarchy until he or she reaches his or her level of maximum incompetence.” Despite its apparent irrationality, it is quite realistic because the promotion mechanism based on choosing the best people with the nuance that management at the new level of the hierarchy does not depend on the competence that one had at the previous level, is fulfilled on numerous occasions.
Scientists have demonstrated computationally, using mathematical algorithms, that a simple meritocratic method of promoting the best to the next level of management does not work well for bulgaria email list companies. A company may take the risk of promoting an excellent employee to a new role, which may require different qualities and skills. If the employee does not perform and his old position is filled by someone else who may not perform as well, there is a risk of double loss. These scientists show that random promotion may result in an employee who is not particularly qualified for his position, but if he is transferred to another location he may perform better.
The study was conducted by Alessandro Pluchino, Andrea Rapisarda and Cesare Garofalo from the University of Catania, Italy. Initially, they started working on computer simulations for fun to see if they could numerically corroborate Peter's ideas. Little by little, they realized that they had a solid basis and continued investigating until they achieved their goal. To do so, they used modeling based on game theory.
The details and keys of the analysis
The key to their study is the measurement of an organization's efficiency , understood as the ability to perform work while reducing costs. Around this premise they built the algorithm that shows that if people rise in a non-random manner in a pyramidal hierarchical organization, made up of 160 positions distributed in 6 levels, then the Peter principle is inevitable and there is also a significant reduction in the overall efficiency of the organization.
However, it seems that efficiency is not affected if the members of the organization maintain their position at each level. This, which seems like common sense, is in practice very unrealistic due to the large number of movements that occur in companies.
Scientists have demonstrated computationally, using mathematical algorithms, that a simple meritocratic method of promoting the best to the next level of management does not work well for bulgaria email list companies. A company may take the risk of promoting an excellent employee to a new role, which may require different qualities and skills. If the employee does not perform and his old position is filled by someone else who may not perform as well, there is a risk of double loss. These scientists show that random promotion may result in an employee who is not particularly qualified for his position, but if he is transferred to another location he may perform better.
The study was conducted by Alessandro Pluchino, Andrea Rapisarda and Cesare Garofalo from the University of Catania, Italy. Initially, they started working on computer simulations for fun to see if they could numerically corroborate Peter's ideas. Little by little, they realized that they had a solid basis and continued investigating until they achieved their goal. To do so, they used modeling based on game theory.
The details and keys of the analysis
The key to their study is the measurement of an organization's efficiency , understood as the ability to perform work while reducing costs. Around this premise they built the algorithm that shows that if people rise in a non-random manner in a pyramidal hierarchical organization, made up of 160 positions distributed in 6 levels, then the Peter principle is inevitable and there is also a significant reduction in the overall efficiency of the organization.
However, it seems that efficiency is not affected if the members of the organization maintain their position at each level. This, which seems like common sense, is in practice very unrealistic due to the large number of movements that occur in companies.