Before anyone gets up in arms, that's a quote. I'm not saying your boss is incompetent -- New Scientist is. (Well, they're writing about research that suggests it.) Also, this proclamation doesn't really apply to small businesses; instead it's more likely to be accurate in big companies with lots of levels of hierarchy. Be thankful you work in a smaller business!
To summarise one part of the article, although jobs get tougher and more demanding the more important they become, people generally have a fixed level of ability. Eventually, someone will get promoted to a job they can't quite handle. At that point, they've 'reached the level of their own incompetence'.
Once they've found that level, it's likely they'll stay there until they retire / their job is made redundant or they bugger up so badly that they have to leave. (Think of a waiter that brings food slowly, occasionally brings the wrong dish, but never manages to pour hot coffee into your lap for several seconds. Which is something I've seen happen at a wedding.) There's more to it than my simple explanation suggests, but you'll have to jet over to the article to find out more.
New Scientist – Why your boss is incompetent
