In 1969, a book was published that, although indirectly, questioned much of the theoretical framework underlying management: The Peter Principle, by Canadian psychologist Laurence J. Peter.
Every member of a hierarchical organization rises through the ranks until they reach their highest level of incompetence.
The thesis presented was provocative and intriguing, as it argued that in an organization, individuals who demonstrate skills and abilities in their current position are promoted to a higher level. This dynamic, in turn, leads them to reach new levels in a process that only stops when they are assigned to a role for which they do not demonstrate the necessary skills. In short, within a hierarchy, every employee tends to rise to their level of incompetence.
Building on this assumption, a few years ago, three Italian professors theorized that in today’s complex society, random choices could play a positive role and prove advantageous. They sought to demonstrate that one of the most effective strategies for enhancing overall company efficiency is undoubtedly random promotions.
This remains true even for more complex types of hierarchical organizations, regardless of their size. Moreover, it only takes a fraction of promotions to be random to produce a net, immediate, and lasting advantage, resulting in improved efficiency compared to the naïve meritocratic approach, where the best individuals are promoted to new positions that they may not perform with the same competence.
The study won the IG Nobel Prize, a semi-serious award for the most absurd and out-of-the-box research, but the idea of randomness as a decision-making mechanism had already been considered before: evidence of better performance in groups where leaders were chosen by lottery, empirical confirmation that changing managers does not affect business results, and case studies of tribes that make efficient hunting decisions by throwing animal bones into the fire.
Some theories define the business using a holistic approach, a view in which the whole is greater than the sum of its parts.
The brilliant writer Douglas Adams—author of The Hitchhiker's Guide to the Galaxy—created a bizarre holistic detective, Dirk Gently, who responded to questions about his investigative techniques by saying: the important point is the fundamental connection of all things. I don’t waste time on trivialities like fingerprint dust, revealing clues taken from pockets, or foolish shoeprints.
I believe that the solution to every problem should be sought in the overall design and pattern. The relationship between causes and effects is often subtler and more complex than we would naturally assume upon first, superficial observation of the physical world.
That’s why tossing a coin or rolling a dice to decide strategies, bonuses, or promotions might be a decision-making method that should not be ruled out prematurely.