Freakonomics Radio
Why Are There So Many Bad Bosses? (Update)
Apr 11, 2024
Katie Johnson, a data scientist turned manager turned freelancer, shares her journey navigating the challenges of leadership. Kelly Shue, a finance professor, discusses the Peter Principle — the tendency for capable employees to be promoted into ineffective managerial roles. Steve Tadelis, an economics professor, emphasizes the significant impact that managers have on employee success and productivity. Together, they explore why firms perpetuate this cycle of promoting incompetence and how rethinking promotions could reshape organizational dynamics.
49:41
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Quick takeaways
- Promoting top salespeople into management roles can lead to a decline in team performance due to the Peter Principle.
- Recognizing contributions without promoting individuals to managerial roles can boost motivation and performance in technical specialists.
Deep dives
Promotion Doesn't Always Mean Progress
Promoting top salespeople into management roles can lead to a decline in team performance. Good individual contributors may not necessarily make good managers. The Peter Principle, where employees reach a level of incompetence upon promotion, is evident in many firms despite being aware of this issue.
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