Mike Holt Enterprises Understanding the NEC
November 16, 2023
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Mike Holt

This newsletter series will give you insights and techniques to help you build a better business no matter how large or small yours is. I always say that success comes from working on your business as opposed to in your business. I want to share with you the systems and philosophies that have been successful for me over the years.

This is newsletter #45 in the series. If you have missed prior newsletters, and are enjoying the series, we encourage you to purchase the program. More information can be found by clicking on the coupon at the bottom of this page.
The Peter Principle


This principle is a concept in management developed by Laurence J. Peter, which describes the practice of promoting employees until they reach a position where they are no longer qualified to do their job. In other words, in time, every position will be filled by an individual who is incompetent!!

Avoid this by training employees for the job before advancing them. Make sure they qualify. Why transfer them from a position where they were doing a good job into one they can’t handle. Competence in doing one kind of job does not guarantee the same level of competence in a more demanding position.

The problem is not with the promotion, but rather with the lack of education and training to prepare for the new duties. Make it possible for your employees to learn their trade or enhance their skills so that they can first increase their productivity, and then qualify for advancement.

The affected individuals can also cause this problem. Some people are unwilling to give up responsibility to someone else. They maintain a feeling that no one can complete a task as efficiently as they can. On occasion, some individuals will attempt to take on additional responsibility without relinquishing a portion of their past responsibilities and find themselves in a highly stressful situation. Although they can perform all tasks effectively in theory, it proves to be impossible in actual practice.

Let your employees know that you will distribute responsibility based on performance, experience and need in specific areas. To relinquish former responsibility should not be looked on as a threat, but rather a positive change to increase one’s proficiency in a needed area. Stressing the need for people to be flexible so that the organization can be flexible helps to make changes seem less negatively stressful.

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For more information on this topic, get a copy of Mike Holt's Business Management Skills textbook or Ultimate Business and Success video library.

We'd love to hear from you about this series, and the ways you're using it. Send us your comments and feedback by clicking on "Post a Comment" below. Look out for the next part in this series a month from now, and please share with your colleagues.


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