Why Did Peterson, an MIT and Dartmouth Graduate, Fail as a Leader?

The story of Eric Peterson is a realistic and important example that shows how a smart, hardworking, and highly qualified leader can still fail.

Eric Peterson had a very strong academic background. He graduated from top universities such as MIT and Dartmouth. He was ambitious, committed, and worked very long hours, sometimes 60–80 hours per week. However, despite all this effort, his experience ended with him being fired from his position as General Manager.

So, what happened? Let us go through Eric’s story from the beginning and see what went wrong.

Eric Peterson earned a Bachelor’s degree in Electrical Engineering from MIT, then served as an officer in the U.S. Army Signal Corps, and later completed an MBA at Dartmouth College. During these years, he developed a strong interest in cellular communications, especially as this technology was rapidly expanding in the United States.

Seven months before the main events, Eric Peterson was appointed General Manager of GMCT, a company working on launching new cellular systems expected to serve around 400,000 people. The project had been in the construction phasefor about a year and a half, but it had not yet entered the start-up stage.

When Peterson accepted the job, he believed he would work directly with the company founder, Jenkins. However, he was surprised to find that the organizational structure required him to report to Hardy, the Director of Budgets and Planning. Hardy had no real experience in cellular communications or in managing start-up projects.

The system was originally planned to go live on February 1, with 16 out of 21 cell sites operating, while the remaining five would be completed later. But when Peterson arrived in Hanover, he discovered that the project was already behind schedule. The launch date had been postponed to April 1 due to several operational and organizational problems.

One of Peterson’s first decisions was to terminate the contract with the construction company because of poor performance. After negotiations with headquarters, he succeeded in hiring a new local contractor. This was a bold decision aimed at speeding up the work and improving quality.

However, the problems were not only technical. Peterson quickly noticed personal tensions and conflicts within the team. His relationship with Hardy was tense, and so was his relationship with Andrews, the Chief Engineer. From the beginning, Peterson felt that Andrews was not capable of leading a start-up project of this size. Andrews struggled with inventory management and had frequent conflicts with colleagues, including Metzke, Peterson’s assistant.

Peterson faced problems with both management and the team.

He tried to transfer Andrews to another project, but senior management rejected the request. Instead, Peterson decided to coach Andrews personally, but Andrews’ performance did not improve. In fact, he became more resistant and dissatisfied.

To reduce pressure and improve workflow, Peterson promoted his assistant Metzke and tried to hire new staff. However, this step faced obstacles. Senior management refused to honor the salary offers Peterson had made, which embarrassed him in front of employees.

In one case, a serious conflict occurred between the Radio Engineering Supervisor and an employee after it was discovered that the employee was being paid much more. Peterson had to personally step in to resolve the issue.

To reduce friction with Andrews, Peterson created a new role called Construction Coordinator, hoping to create some distance between them. At the same time, he tried to apply a participative leadership style by holding weekly meetings with all employees to build trust and reduce misunderstandings.

Externally, Peterson worked to build positive relationships with the local community, especially government entities such as the police and fire departments, and he offered to provide them with free phone equipment. However, Hardy rejected this proposal for financial reasons.

The team also faced additional pressure when the company decided to change equipment specifications and emergency systems, which increased complexity and negatively affected the schedule.

In March, a new Vice President, Dash Harper, was appointed. Chip Knight was also appointed as Director of Pre-Start-Up Systems, and Hardy became his assistant. Knight announced that he would visit the GMCT project for two days to closely review the situation. This gave Peterson a new opportunity to explain the challenges he was facing.

However, after the visit, management made an unexpected decision. They appointed another General Manager to work alongside Peterson to help with system launch. Although this was presented as support, Peterson felt that it undermined his role. Their relationship did not go well, and tensions increased instead of decreasing.

Eventually, during a car trip, Peterson was informed that he would be let go. When he returned to his office, he found a representative from senior management waiting for him. He was officially given two weeks’ notice of termination.

This was Eric Peterson’s first major professional failure. Despite his hard work, his journey with GMCT ended in a sudden and harsh way. His story remains a clear example of the complex challenges of leadership in start-up projects.

This was Peterson’s story.

Now the question is:What could Peterson have done differently so that this outcome might have been avoided?

Before answering this question, the main weaknesses in the situation were related to:team interactions and sensitivities, a weak organizational structure, and unclear roles.

According to Hackman’s model, there is a concept called the Real Team. The idea is to distinguish between a Real Team and a Working Group.A Real Team is one where members are interdependent, share responsibility, and work in a coordinated way toward a common goal.A Working Group, on the other hand, consists of individuals who work more independently. This can be acceptable in some situations, such as academic work or call centers, where tasks do not strongly overlap.

The real problem happens when there is interdependence, but poor communication. You cannot imagine the productivity of a team where members truly respect and support each other!

In Eric Peterson’s case, the group was closer to a working group, not a real team. Team members did not communicate effectively, did not share information, and often surprised each other during meetings. This lack of interdependence weakened collaboration and led to failure in achieving goals.

Another key element in Hackman’s model is organizational structure. A good structure means having the right people in the right roles, with clear responsibilities and integrated tasks.

In Peterson’s case, there was major confusion about who was responsible for what. Sometimes, even Peterson himself was unsure about who he should report to. This ambiguity caused decision delays, wasted resources, and failure to meet operational milestones.

Because of this dysfunction, Peterson began doing other people’s work instead of empowering them. This is a common mistake among new leaders, who believe, “If you want something done right, do it yourself.” This behavior exhausted him and increased the team’s dependence on him instead of encouraging responsibility.

Although this is very common among new leaders, sometimes they also realize that certain team members cannot be empowered, and empowering them may cause more harm.So, what is the solution?

Another major factor in Peterson’s failure was the absence of a clear and compelling direction.

A compelling direction gives the team meaning and answers questions like:Why are we here? What are we trying to achieve?

In this case, Peterson himself felt that the project might be meaningless in the long term, because failure would simply lead to him being replaced. This feeling was implicitly transferred to the team, reducing motivation and commitment.

When people do not see real value in their work, collaboration weakens and internal conflicts increase.

The story also highlights two types of conflict:

• Functional conflict, which supports learning and better decision-making.

• Dysfunctional conflict, which is emotional, personal, and creates tension.

Peterson’s team mainly suffered from dysfunctional conflict. Relationships were tense, both within the team and between Peterson and senior management. Instead of addressing conflict collectively, Peterson tried to handle problems individually, which increased pressure on him and left the root causes unresolved.

Peterson also faced lack of support from senior management. One important external factor in Hackman’s model is organizational support and resources.

Peterson did not receive enough support. His decisions were often overridden, whether related to salaries or agreements with local authorities. This undermined his authority and damaged his credibility as a leader.

Leadership is not only a formal position; it is the ability to influence. Peterson failed to build a strong network, both within his team and with peers in other regions. He could have learned from other managers facing similar challenges, but he remained isolated.

Eric Peterson’s story ended with a harsh dismissal, without proper guidance or real support. This outcome was not only the result of individual failure, but of poor team design, weak leadership systems, and flawed organizational culture.

A person may succeed as a leader in one environment and fail in another. External factors and empowerment matter a lot.

So again, the question remains:What could Peterson have done differently to change the outcome?

In my opinion, if Peterson had demanded clear authority and strong top management support from the beginning, everything could have been different.

For example, he should have:

• Clearly and directly asked for a clear definition of his authority.

• Confirmed the professional reporting structure, so everyone knew who reports to whom.

• Secured a formal commitment from senior management to support his key decisions related to:

  • Hiring

  • Salaries

  • Transferring employees

  • Dealing with local authorities

If he had done this early, he would not have later found himself in a situation where:

• His authority was undermined in front of his team,

• His decisions were rejected after being made,

• And he was held responsible for a project without having real leadership tools.

  
  

Eric Peterson’s story is not just a case study. It highlights a common mistake made by new leaders:hard work alone is not enough.

Real leadership starts with clearly defining authority and power, not only with effort and good intentions.

What do you think?

And if you have moderate empowerment and an average environment, can you pull the team and results upward?

And if you are in a negative environment with low empowerment, is it better to leave?Or would you try to create alternative solutions?