Peter pointed out that in large organizations where these practices are used, it is inevitable that individuals will be promoted until they reach their level of maximum incompetence. The unavoidable result is the runaway spread of incompetence throughout an organization.
Now Pluchino and co have simulated this practice with an agent-based model for the first time. Sure enough, they find that it leads to a significant reduction in the efficiency of an organization, as incompetency spreads through it. That must have an uncomfortable ring of truth for some CEOs.
Solution? Two show promise:
The first is to alternately promote first the most competent and then the least competent individuals. And the second is to promote individuals at random. Both of these methods improve, or at least do not diminish, the efficiency of an organization.
Or a third, luck?