Leadership incompetence: an organizational reality
- Stephane Casteleyn
- Jun 17
- 4 min read
In my previous article, I discussed how toxic leadership often emerges not from bad intent, but from flawed promotion decisions. This leads to a reality most organizations eventually face: being stuck with an underperforming or, even worse, a toxic leader. At the same time, removal is not always an option due to legal constraints, internal politics, or succession gaps. So what happens then?
Organizational blind spots
Before addressing toxic leadership, organizations first need to be able to see it. One of the main reasons it persists is simple: it is often not measured.
Most organizations track results, but not how those results are achieved. Yet without measuring leadership behavior, there is no reliable way to distinguish strong performance from performance that comes at the expense of teams. You don’t control what you don’t measure.
High‑performing organizations address this by incorporating indicators such as employee turnover patterns, team-level feedback, and psychological safety indicators as metrics of leadership performance. Without these signals, toxic leadership often remains invisible until the damage is already significant.
Doing nothing has predictable consequences
Once leadership quality is measured, organizations gain clarity: they know whether they have a problem. And what matters most is not the presence of a single weak leader, but how long the system allows the situation to persist.
The research is very clear on this point: over time, toxic or weak leadership leads to higher turnover, reduced psychological safety, and increased burnout. All of these effects compound and ultimately result in long‑term performance decline.
So, what to do when firing isn’t an option?
The key is to stop thinking in binary terms (keep vs. remove) and instead think in terms of contain, correct, or redirect.
Contain
If a leader cannot be replaced immediately, the first responsibility is to contain the damage. This is done, on the one hand, by putting in place highly structured processes and increasing transparency, and on the other by reinforcing behavioral expectations.
When the stakes are especially high, the organization must further limit the impact of a toxic leader by narrowing their unilateral decision space, while shielding critical team members from direct exposure.
This is precisely why armed forces are, to some extent, able to absorb weak leadership: their reliance on standardized procedures, clear chains of command, and strong norms helps buffer the system against individual shortcomings. This is consistent with research on team dynamics showing that structured systems reduce the negative impact of weak leadership.
Correct
Organizations often assume that leaders will “grow into the role”, an assumption that, in reality, is unreliable at best. Evidence from promotion studies, however, shows that targeted intervention are very effective.
What works is not generic training, but focused support: mentoring or coaching tailored to individual gaps, structured feedback loops such as 360° feedback with explicit follow‑up and accountability, and clear behavioral expectations tied to consequences. These approaches directly address the specific deficiencies that led to the mismatch in the first place.
Redirect
One of the core insights from research on the Peter Principle is that the mismatch is often partial, not total. This creates a real risk of throwing the baby out with the bathwater if organizations overlook what still works.
Struggling leaders may retain strong technical expertise, strategic thinking, or client relationships, while at the same time facing difficulties with people management, emotional regulation, or communication. Yet organizations rarely adjust roles after promotion, when in fact they should.
When confronted with a toxic leader, options include redistributing people‑leadership responsibilities or pairing the individual with another leader who brings strong operational or interpersonal capabilities. This is not a demotion, but a realignment of responsibilities with capabilities, an approach consistent with research suggesting that partial mismatches can be mitigated when roles are adapted to better fit individual strengths.
However, redirecting a leader can be highly stigmatizing. Organizations can counter this only by creating credible “off‑ramps,” such as expert tracks, openly communicating about these moves, and normalizing them. Without such reversibility, the system effectively traps itself.
System responsibility
Finally, and often most difficult to accept, is that persistent toxic leadership is rarely just an individual issue; it is usually a system‑level tolerance problem.
If an organization purely rewards output while ignoring (or does not measure) behavioral signals, toxic leadership becomes a predictable outcome rather than an exception.
Similarly, when organizations delay intervention because they do not know how to act, they implicitly tolerate toxic behavior, reinforcing and emboldening those who exhibit it. Leadership behavior, in the end, reflects what the system allows.
Conclusion
Organizations do not need a perfect promotion system, because the Peter Principle cannot, and should not (see previous article), be eliminated; it must be managed.
What organizations do need is a clear and deliberate response to toxic leadership, whether through containment, correction, or redirection. Ultimately, what distinguishes strong organizations is not whether mismatches occur, but how quickly and how deliberately they respond when they do.
Sources
Hackman & Wageman (2005) – When and How Team Leaders Matter Hackman_Wageman_When_and_How_Team_Leaders_Matter.pdf
Rathore et al. (2024) – Toxic Leadership Mitigation Strategies
Alan Benson, Danielle Li, Kelly Shue (2018) - Promotion and the Peter Principle
P. Rajguru, I. R. Churchill, G. Graham - The Peter Principle Revisited: An Agent-Based Model of Promotions, Efficiency, and Mitigation Policies
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