The Peter Principle is a management theory that says an employee will continue to get promoted until he is in a role where he is incompetent.
In other words, if Sam was a great Associate he gets promoted to Senior Associate. Since he was also a great Senior Associate, he becomes a Manager. Once again, he does a great job as a Manager so he gets promoted to Director. But he’s not a good Director so he never gets promoted again. That’s unfortunately because Sam is now doing a job he isn’t good at which is hurting the company.
As a result, the Peter Principle says that a company is made up of employees who are working in roles they are unfit to be in. That’s a pretty grim outlook.
But like all theories, it’s written on paper and we don’t live on paper. When we reach a role that is too difficult for us, we can learn from our mistakes, seek education, get mentors, and become competent in our new roles. Over time, we turn our failures into success, get promoted, and repeat the cycle again.