The Dilbert Principle refers to a 1990s satirical observation stating that companies tend to systematically promote their least-competent employees to management (generally middle management), in order to limit the amount of damage they’re capable of doing. The term was coined by Scott Adams, an MBA graduate from U.C. Berkeley and creator of the Dilbert comic strip. Adams explained the principle in a 1995 Wall Street Journal article. Adams then expanded his study of the Dilbert Principle in a satirical 1996 book of the same name, which is required or recommended reading at some management and business programs. In the book, Adams writes that, in terms of effectiveness, use of the Dilbert Principle is akin to a band of gorillas choosing an alpha-squirrel to lead them. The book has sold more than a million copies and was on the New York Times bestseller list for 43 weeks.
Although academics may reject the principle’s veracity, noting that it is at odds with traditional human resources management techniques, it originated as a form of satire that addressed a much-discussed issue in the business world. The theory has since garnered some support from business and management.
The Dilbert Principle is a variation of the Peter Principle. The Peter Principle addresses the practice of hierarchical organizations (such as corporations and government agencies) to use promotions as a way to reward employees who demonstrate competence in their current position. It goes on to state that, due to this practice, a competent employee will eventually be promoted to, and remain at, a position at which he or she is incompetent. The Dilbert Principle, on the other hand, claims that incompetent employees are intentionally promoted to prevent them from doing harm (such as reducing product quality, offending customers, offending employees, etc.) The Dilbert Principle draws upon the idea that in certain situations, the upper echelons of an organization can have little relevance to the actual production and the majority of real, productive work in a company is done by people lower in the power ladder. It is possible for both Principles to be simultaneously active in a single organization.
The Peter Principle is a colloquial principle of hierarchiology, stated as “In a hierarchy every employee tends to rise to his level of incompetence.” Formulated by Dr. Laurence J. Peter and Raymond Hull in their 1968 book The Peter Principle, the principle pertains to the level of competence of the human resources in a hierarchical organisation. The principle explains the upward, downward, and lateral movement of personnel within a hierarchically organised system of ranks.
The Peter Principle is a special case of a ubiquitous observation: anything that works will be used in progressively more challenging applications until it fails. This is “The Generalized Peter Principle.” It was observed by Dr. William R. Corcoran in his work on Corrective Action Programs at nuclear power plants. He observed it applied to hardware, e.g., vacuum cleaners as aspirators, and administrative devices such as the “Safety Evaluations” used for managing change. There is much temptation to use what has worked before, even when it may exceed its effective scope. Dr. Peter observed this about humans.
In an organisational structure, the Peter Principle’s practical application allows assessment of the potential of an employee for a promotion based on performance in the current job, i.e. members of a hierarchical organisation eventually are promoted to their highest level of competence, after which further promotion raises them to incompetence. That level is the employee’s “level of incompetence” where the employee has no chance of further promotion, thus reaching his or her career’s ceiling in an organisation.
The employee’s incompetence is not necessarily exposed as a result of the higher-ranking position being more difficult — simply, that job is different from the job in which the employee previously excelled, and thus requires different work skills, which the employee usually does not possess. For example, a factory worker’s excellence in his job can earn him promotion to manager, at which point the skills that earned him his promotion no longer apply to his job.