The Petty Principle: How international civil servants rise to their level of incompetence and continue to be promoted

Antonio Graziosi

Abstract: The paper provides a critical review of current practices for the selection of senior managers in international public organizations, particularly discretionary “political” appointments. Paradoxically, the more senior the position, the less weight is often given to actual managerial competencies. Appointed managers may still turn out to be good or just delegate work. In the worst scenario, they may seriously affect organizational performance. Bad managers may eventually be removed but will be often appointed to another and even more senior – though less operational – position (the “Petty Principle”). The weak governance by the organizations’ executive boards is often complemented by external auditors, which encourages managers to place higher emphasis on documenting compliance with rules than on producing results. Remedial action may include greater focus on results, leaner organizational structures, accountability on senior appointments and more inclusive management styles. These principles should also underpin the process of U.N. reform.

Keywords: International civil service, U.N.

I. Introduction

As the title suggests, this short work is inspired by Laurence J. Peter’s landmark book The Peter Principle (Peter 1969). The Peter Principle proposes that employees tend to be promoted on the basis of good performance in their present jobs. If upgraded employees continue to work well, they will be further promoted until they are appointed to a job they are unable to perform effectively and will get stuck there for good. Therefore, as Peter suggested, all employees eventually rise to their level of incompetence.

International public organizations may represent a deviation from the Peter Principle, insofar as, when employees have reached their level of incompetence, they continue to be upgraded in the hierarchy. In international civil service – the U.N. and other intergovernmental entities – a much older principle applies, which was formulated by the ancient Romans as promoveatur ut amoveatur, i.e., “let us promote him in order to remove him.”

This statement is based on over 30 years of U.N. working experience. By no means do I wish to imply that staff in multilateral organizations is generally incompetent. I actually came across amazing cases of professionalism, commitment, generosity, and even sense of sacrifice. I, therefore, have the greatest respect for the many U.N. colleagues with whom I worked and met.

Yet, these good people hardly ever rise to the highest levels of the institutional hierarchy. In the international civil service, competence for the job is just one of several criteria for the appointment of senior management, usually not the most important. As a result, the chosen candidates may still eventually turn out to be good managers, but this is just a matter of probability in a random selection process.

II. Background

One factor influencing the management selection process is the promotion of technical specialists to management positions as part of their career development. Professional staff are often hired because of their specialized technical skills – good doctors, engineers, economists, agronomists, lawyers, sociologists, etc. To advance in their careers, however, they are obliged to abandon technical work and become managers/supervisors, which requires a set of skills they do not necessarily possess. As a consequence, international organizations tend to turn their good specialists into mediocre managers. Some organizations seek to address this problem by establishing a parallel career path for specialists, who can rise in the hierarchy on the basis of their professional excellence without having to abandon technical work.

A second factor is concern for ensuring the geographic, cultural and gender diversity of the staff and management. This concern is more than legitimate: The credibility of international organizations also depends on their capacity to represent different values, experiences and cultures, so that they are perceived as neutral and honest brokers in the international arena. At the same time, this narrows the scope of candidates for a specific job. Often, a candidate will be given priority because of their personal background rather than competence.

Also, in many organizations, the composition of the staff is based on national quotas, on countries’ populations, and membership fees. A good candidate may, therefore, not be retained simply because their country of origin is already adequately or over-represented in the staff. This may become a constraint to the effective recruitment – and allocation of human resources, particularly from small countries.

The so-called political appointments have the most devastating impact on the quality of senior management in international organizations. Here, “political” is a euphemism for “discretionary.” As a general rule, in international organizations staff shall be hired through open, competitive processes based on the publication of job vacancies – with the purpose of finding the best candidate across the world. This rule, however, usually suffers one important exception: Senior management positions can be filled by the chief executive officer bypassing competitive processes and competency assessments when the head officer considers this to be in the superior interest of the organization.

Political appointments have an easy explanation. Chief executive officers are elected or re-confirmed by the governing boards of the international organizations concerned, which are mostly composed of representatives of member countries. Chief executive officers are, therefore, keen to please stakeholders with a heavier weight in the decision-making process, either because they pay more money or because they exercise political influence on others. This includes generously distributing senior jobs to keep stakeholders happy. If the number of jobs available is insufficient to appease everybody, one can create new and unnecessary positions just to ensure everybody will feel adequately represented, even if this entails a waste of public money and a blurring of decision-making and reporting lines.

In the event a national decision-maker is given the opportunity to unilaterally nominate a senior manager in an international organization, they may a) exercise due diligence in finding the right person for the job, b) appoint some friend, ally, or someone to whom one owes a favor, or c) use this opportunity to get rid of a difficult and/or incompetent person. Only in the first scenario the appointment is likely to meet the requirements of the job.

Nothing thus far contradicts the fundamentals of the Peter Principle, except the fact that a candidate’s previous performance may have little weight in the appointment process. This is where the problem starts. A new manager is in place and nobody knows how effectively this manager will perform. There may still be a positive surprise if the appointee actually turns out to be a good manager.

What if the chosen manager turns out to be a poor performer? The manager may soon realize they are not fit for the job and give up on it. Their presence in the organization will progressively slide into irrelevance, only performing representation functions and signing off on other people’s work.

The worst scenario, however, is when the incompetent manager believes they can make a difference. The manager will then actively interfere in the work processes, make wrong decisions, affect the effectiveness and sustainability of the work of the organization, and degrade the staff’s motivation.

Fundamentally, the issue is (lack of) self-confidence. If appointed to a job one is unable to perform, a sense of insecurity will seize one. The response will depend on personal awareness and emotional intelligence. As an irrelevant manager, one may decide to let others do the work while taking credit for the results. If managers are, however, unable to recognize their incompetence, they will see collaborators as a threat and will try and impose themselves at all costs. For the paranoid and insecure boss, accepting collaborators’ and employees’ opinions and suggestions implies recognizing that they know better. This manager profile will then turn out to be not only incompetent, but also authoritarian. In other words: the harmful manager.

In this latter case, sooner or later the chief executive officer of the organization will realize there is a problem (unless they are the problem themselves…). If the incompetent manager is kept in the current position, institutional performance will be affected. If the manager is sacked, sponsors may get upset. The only solution that will keep everybody happy is to promote the manager to another position before things deteriorate. Promoveatur ut amoveatur, as we said. We will call it “The Petty Principle” inspired by Petty, a pseudonym for a real person I met who succeeded in climbing the top of a U.N. organization while lacking any managerial and professional competencies.

The reader may legitimately ask: How can this happen? Should oversight by the organization’s governance not prevent or address extreme situations of inefficiency and consequent squander of public resources? To understand that, we need to analyze the perspectives of the different stakeholders.

The chief executive officer will be reluctant to make drastic moves, such as firing Petty. This would entail a) recognizing that a mistake was made in hiring Petty in the first place, and b) risking a confrontation with the constituency behind Petty. The chief executive officer will, therefore, consider the costs and benefits of leaving Petty where Petty is – which is still an option if the expected damage is not too visible or too extreme depending on the strategic nature and impact of the functions under Petty’s responsibility – or promoting Petty to a higher position, further away from direct action. This may imply adding one more, unnecessary layer in the hierarchy, thus wasting money and further affecting the effectiveness of decision-making processes.

The governing boards should be keeping the top management’s performance under scrutiny. However, individuals participating in the institutional decision-making processes are usually middle-ranking government officials or diplomats with a conservative attitude, narrow agency and limited understanding of the substantive work of the organization. They usually do not have the time and means to probe into the information submitted to them for approval or decision by the secretariat of the organization.

Of course, Petty would be delighted to be offered a further promotion. Petty may even consider this as a recognition of leadership skills. Finally, if Petty is promoted to a higher position, Petty’s staff and collaborators – who are the most directly affected by the manager’s poor performance – may be more remote and better sheltered from Petty’s influence.

In other words, no stakeholder has the necessary assertiveness, self-confidence, and motivation to make explicit criticism or demand that Petty be removed, unless it is upwards.

III. Implications: What Petty does to organizations

The institutional impact of Petty-like managers will differ depending on the organizational business model and the room for maneuver it leaves to senior management. The work of some organizations is tightly regulated and leaves little space for either good or bad managers to make a dent. As a manager, you are often given a budget and told how to spend it. This is a constraint for good and creative managers who struggle to change for the better. However, it is also an insurance against incompetent managers who strive to change for the worse. Conversely, significant and sometimes irreparable damage can be made in organizations where managers have greater latitude, particularly organizations which are largely funded through voluntary contributions and/or cost-recovery mechanisms. In this latter case, poor management performance and decision making may seriously jeopardize institutional credibility and financial sustainability.

Another key factor is staff’s resilience. In the face of incompetent management and wrong decision-making, the staff may react – for the sake of simplicity – in three ways:

a)     Submit and obey. The vast majority of the staff with some experience and common sense will understand how Petty’s decisions are counterproductive and may eventually affect the performance and sustainability of the organization. However, they also perceive that any expression of disagreement – no matter how legitimate – may backfire, as they may lose their jobs, miss a promotion, be re-assigned to undesired positions or be mobbed. In some cultures, the boss is always right and you shall never contradict them. Why waste energy for a lost cause?

b)    Stand up and react. If the staff is able to forge a common position in response to wrong management choices, it may succeed in voicing its dissent and confronting Petty. This takes courage, self-assurance and, particularly, strong cohesion among middle managers and staff. If individual middle managers or staff members pursue their own individual survival strategies, the cause is lost. Conversely, if unity is maintained, Petty will eventually have to negotiate or the conflict will escalate to higher-level managerial instances, who will be obliged to take some action. If, however, the remedial action consists in moving Petty to a different position as a quick fix, the problem – as explained earlier – is just moved elsewhere. This is probably why Petty-like managers tend to be quite mobile: It is probably safer to let them do a little damage all over the place than deep damage in just one place.

c)     Swallow and try to fix it. A basic instinct of survival will lead the officials of the organization affected to swallow their pride out of fear for retaliation. Still, they may use their own judgment and experience to mitigate the impact of poor decisions by making them ineffective or applying pragmatic remedial action. While this reaction may look somewhat opportunistic, it may often be the most successful survival strategy. It bets on the fact that Petty does not know or care enough about the business process to be able to realize that instructions are not being applied.

The proliferation of incompetent senior managers in the international civil service has two negative, complementary consequences. It represents a direct squander of taxpayers’ money that could be used for better purposes, and weakens the effectiveness, reach, and credibility of organizational performance.

IV. Remedies: how to deal with organizations’ Petty problems

Any solution requires either the chief executive officer or the governing board of the organization concerned to take the issue into its hands. A few areas of improvement may be considered:

Enhanced results-based management:

Most U.N. and international organizations have by now adopted a results-based management approach. The underlying principle is that organizational performance should be assessed on the basis of producing results and change, rather than on a list of activities or expenditure rate. Most organizations have redesigned their planning and reporting mechanisms following a results-based concept or format.

In the absence of competent guidance and oversight, however, a results-based management approach may backfire. Often, managers are asked to set themselves the targets on the basis of which they will be evaluated. Managers will therefore be as modest as possible in formulating them, in order to eventually be able to demonstrate that all the results were achieved or exceeded. As governance board members do not know the operation well, they will shy away from assessing how ambitious the objectives and targets were.

Another perverse incentive is the fact that, in the absence of proper oversight by stakeholders, the only ones who really look into organizational business processes are the external auditors. As a result, organizational business processes are progressively redesigned to please the auditors rather than the constituents or beneficiaries of the organization. A strong emphasis is placed in ensuring that every transaction is properly authorized and documented in line with the financial rules of the organization.

Weighing the pig, however, will not make it fatter. Accountability and transparent use of public money are essential preconditions for the credibility of an organization. However, they cannot be ends in themselves. Meanwhile, multiple levels of approval, justification, and reporting absorb an increasing share of organizational resources at the expense of operations. Also, auditing firms have smelled the business: On the one hand, they tend to expand their field of competence from financial management to overall management, for which they may not have adequate experience and competence. On the other hand, they may say to you, “Dear manager, your business process is quite inefficient. However, if you hire me as your consultant, I will fix it for you.” The recent history of international organizations is rich of examples of this conflict of interest.

An alternative way of looking at results-based management may be by adding flexibility to the definition of objectives, outcomes, and targets, but making them more ambitious, while strengthening the capacity to measure results. Achievement of goals set for international organizations also depends on the absorptive capacity of recipient governments and institutions as well as on external factors beyond partners’ control. Focusing on outcomes in terms of political, economic, social, cultural and environmental changes – rather than strictly on the outputs produced – would, however, demonstrate the relevance and effectiveness of the policies and work of the organization. 

Longer-term evaluation:

While decision-makers often pay lip service to the need for longer-term evaluation exercises, limited, if any, resources are allocated to this end. The main reason is not budgetary constraints but lack of instruments allowing the organization and its donors to allocate resources beyond the limited time frame of programming and budgeting exercises. Organizations may improve by setting aside adequate funds – both from core budget and from extra-budgetary sources – for ex-post evaluation exercises in the longer term. With a better understanding of organizational performance, constituents and stakeholders would get a clearer picture of the senior management’s leadership skills. Lessons learnt in a longer time frame could feed into future planning and actions.

Leaner organizational structures:

Another critical area of concern is the multiplication of management layers. International organizations, regardless of their size, have multiple layers of hierarchy: a chief executive officer, one or more deputies, then departments, branches, sections, regional, sub-regional and country offices. Additional reporting levels exist within each of these units. This complexity may affect both the cost-effective use of scarce human resources, to the detriment of technical and operational work, and the speed, consistency and effectiveness of decision-making processes. Leaner organizations, conversely, might by attrition liberate substantial resources to be invested in technical excellence and operational efficiency.

Leaner management and reporting lines may also have an immediate benefit on the simplification and consistency of internal business processes. Today, international officials are burdened with multiple, uncoordinated requirements related to reporting, financial accountability, legal clearances, cybersecurity, etc. While all these dimensions are necessary, the uncoordinated design and application of procedures by a plurality of managers who do not talk to each other has enormous transaction costs. As a manager, I ended up handling nine or ten different passwords to access data or tools in the same management information system.

Inclusive management:

In many organizations, awareness of the need to streamline and improve internal business processes has gained ground. Sarah Cliffe, Director of the New York University's Center on International Cooperation, indicates, “reform is really needed: the U.N.’s antiquated processes for the management of people and funds are at the heart of its difficulties in responding to real world challenges. Secretary-General António Guterres has laid out a bold vision to address this.” (Cliffe 2017) The current U.N. secretary-general identified five areas of management reform, namely a) eliminating duplicative internal controls; b) major budget simplification; c) ability to adjust to evolving conditions, with strengthened ex-post transparency and accountability; and d) centralizing administrative transactions in a reduced number of locations.

In my experience, however, a frequent answer is the outsourcing of business process reviews to external consultancy firms. This often turns out to be an expensive, time consuming, and inconclusive solution. As Lacity and Willcocks noted, “many companies look to business-process outsourcing to save money. But the most successful clients concentrate less on cost savings and more on achieving innovation.” (Lacity and Willcocks 2013) While external expertise and an outsider look may add value, it is essential to closely involve the relevant internal staff in redesigning business processes and procedures. Staff can offer precious experience, information, and ideas throughout the different steps of the business process, if senior management listens to them and encourages them to join forces. In my experience, internal task forces usually produce more relevant and feasible proposals for reform and improvement in a much shorter time and at a considerably lower cost than external consultants. These processes may also give an opportunity to junior staff to stand out and gain the visibility and motivation which is often lost in the daily routine of implementing inefficient and complicated rules and procedures.

Selection of managers:

Organizations may consider greater transparency in the appointment of senior managers. Senior management positions should be systematically filled through competitive processes, as happens for the rest of the staff. “Making more of the U.N.’s senior leadership appointments subject to open advertisement processes and pursuing this down the organization” is one of the key improvements that Cliffe has emphasized as part of an effective U.N. reform (Cliffe 2017). The chief executive officer of an organization should even produce a justification of why a given candidate was chosen for a senior position. This would dramatically reduce the scope for arbitrary appointments that are not driven by competence, but by other reasons – politics, nepotism, the Peter Principle, etc.

V. Petty and U.N. reform

Over and above the scope for improving the performance of individual U.N. organizations, an overall reform of the U.N. system has been on the agenda for decades now. The Security Council in its statement of 31 January 1992 asked the Secretary-General, Boutros Boutros-Ghali, to prepare an “analysis and recommendations on ways of strengthening and making more efficient within the framework and provisions of the Charter the capacity of the United Nations for preventive diplomacy, for peace-making and for peace-keeping.” (Boutros-Ghali 1992) Different U.N. secretaries-general initially declared their commitment to reform, but their enthusiasm often faded over time in the face of political, financial, and bureaucratic hurdles.

Some scholars or experts are quite skeptical about the possibilities for real reform. Andrew Barungi called it “foolhardy” to expect reforms when the U.N. has failed in its mandate to bring peace and promote sustainable development since its formation. “Reforms can be achieved when all states share the same interests,” Barungi argued (2017). Anthony Banbury, former U.N. Assistant Secretary-General, wrote that the U.N. is failing in its overall mission because of “colossal mismanagement.” (Banbury 2016)

To be fair, some substantial improvement has been made in recent years in the capacity of the U.N. and multilateral system to set a more coherent common agenda, such as:

• The Millennium Development Goals that aimed to halve extreme poverty, stop the spread of HIV/AIDS and provide universal primary education by 2015 (United Nations n.d.).

• The Paris Declaration on Aid Effectiveness of 2005, which offers a roadmap to improve aid effectiveness and a establishes a system to monitor progress (OECD n.d.).

• The Addis Ababa Action Agenda on Financing for Development, under which heads of states affirmed their “strong political commitment” to ensure sustainable development goals receive financing (United Nations n.d.).

• The new Sustainable Development Goals agenda, which came into force on January 1, 2016 after its adoption in September 2015.

Still, global coherence meets serious hurdles in trickling down to the country and operational level. In late 2016, eight countries – Albania, Cape Verde, Mozambique, Pakistan, Rwanda, Tanzania, Uruguay and Vietnam – agreed to pilot the U.N. initiative known as Delivering as One, which would have all arms and agencies of the U.N. work under a single leader and with a single budget and program. (United Nations n.d.). This pilot experience of enhancing U.N. joint work has been subsequently expanded to a larger number of countries.

While it has contributed to improved communication and coordination, the Delivery as One approach is essentially based on goodwill and has no binding operational mechanisms. Once again, U.N. headquarters preferred to pay lip service to the need for reform and coordination, without addressing the political, operational, budgetary, and human resource implications of actual policy and operational integration. Therefore, the buck was ultimately passed to country representatives, while central planning and decision-making, legal and financial rules and procedures, resource allocation, and human resource policies remained unrelated and inconsistent.

This is the consequence of a system made of different organizations that were created in response to different political incidents at different times in history. As of today, each organization retains its own independent governance, management, rules, and procedures. Also, the way the scope and mandate of each organization is defined inevitably generates overlaps, duplication, competition, and mission creep. In the absence of clear policies and standards, U.N. collaboration is entirely ad hoc, based on individual goodwill and the possibility of pragmatically reconciling different interests and procedures.

Against this background, the big question – not an easy one – is: Can a U.N. reform be effectively implemented through incremental changes and improvements, or does it require going back to the drawing board?

VI. Conclusion

There is no doubt that a complete redesign of the U.N. system would enhance its relevance and effectiveness. For instance, a new Sustainable Development Goals agenda was adopted with 17 goals and measurable indicators: Would it not make sense to have 17 agencies, each one taking the lead in one SDG? Of course it would, but it will not happen. This option would de facto imply zeroing out on the current agencies and redesigning new ones from the start. The political challenges, transaction costs and transition arrangements in terms of operational and staff continuity would be so high that nobody would reasonably engage in such a process.

The alternative should, however, not be just paying lip service to policy coherence from the respective headquarters while leaving country managers and representatives to work it out among themselves. Is a third way possible?

A reasonable option would consist of an agreement across the U.N. system to streamline and harmonize legal provisions, financial rules, human resource policies, field representation, and management information systems with a view to reaching a common set of rules and tools for improved operational performance. Also, full mobility across the U.N. system should be enacted. This reform would however only be possible if each member country engaged to speak with the same voice in the different governance boards. If that happened, the effectiveness and credibility of the U.N. system would be amazingly enhanced. We can hardly expect member coU.N.tries to take an initiative in this direction. While Mr. Guterres, the current U.N. secretary-general has already demonstrated competence and an innovative approach, we hope that – through more transparent senior management selection mechanisms – strategic leaders may emerge across the U.N. system and take over from Petty-like managers to trigger and support real reform and innovation.