"All new members in a hierarchical organization climb the hierarchy until they reach their level of maximum incompetence."
The Peter effect arises from the practice of promoting the best performer at Level N to a position at level N+1.
The Italians also simulated two other promotion policies:
1. Alternately promote first the most competent and then the least competent individuals.
2. Promote individuals at random.
According to their simulations, each of these methods improves the efficiency of an organization over the Peter method.
My thought: They could try promoting on the basis of who is most suited for the next level job. Duh!
Or maybe they could try not mixing the concept of "promotion" with that of "reward."
Or maybe even getting rid of the hierarchical notion altogether.
The Paul PrincipleAs a relevant post-script for my audience, they might want to look into the "Paul Principle," proposed by Paul Armer, who, like me, started out in computing as a desk calculator operator (or "computer" as we were known back then).
"People become progressively less competent for jobs they once were well equipped to handle."
Paul proposed his law in 1970, the year after Peters proposed his. Paul claimed his principle was more relevant in high-tech fields, when the complexity of jobs grows faster than the people doing them. The Paul Principle has been virtually forgotten, but I think it is still worth some careful thinking by IT managers and consultants.
The Other Paul PrincipleIt seems there's another "Paul Principle," after St. Paul's treatise in Corinthians:
"Continue to provide people with what they need to succeed."
I suspect this management principle would also prove more effective at growing an organization than the Peter Principle.
Perhaps those old Pauls knew something that's still worth studying today.