During last Monday's presentation on the economy for the Orange County BIA, Chris Thornberg noted something about incentives that I had also seen echoed in an article for Fast Company magazine -- namely, that they often backfire when people only think about short-term goals.
As an example, one primary reason that a former employer of mine wasn't able to manage a specific division was because they didn't realize that since everyone was maniacally focused on individual monthly revenue instead of collaboration, not only did that prevent honest teamwork from forming, but ultimately let to the entire group's destruction. In the end, the efforts I made to strengthen the entire team through branding and promotion were usurped by those individuals who only saw incentives as a path to monthly riches, and thus in direct contrast to building a long-term organization. According to the Fast Company article, the world of sports is full of such examples -- as are real estate and finance:
Years ago, AT&T executives tried to encourage productivity by paying programmers based on the number of lines of code they produced. The result: programs of Proustian length.
Incentives are dangerous, and not just because people game them. They often yield collateral damage. Remember the tale of the Darwin Award winner who strapped a jet engine to his car, dreaming of a joyride for the ages, and then met his sorry end as a human flapjack on the side of a mountain? Incentives are like that jet engine. There's no question the engine will take you somewhere, fast, but it's not always clear where. Or what you're going to mow down on the way. Yet incentives are still the first resort of most managers, perhaps because they all think they're smart enough to create the perfect carrot...
To be fair, there are some contexts where one variable dominates. If you're employing a field sales rep who is selling a simple, self-contained product, then it probably makes sense to tie incentives to the sale. If you're traveling a long, straight road, the jet engine will get you there faster.
But chances are you don't live in a one-variable world. In your complicated, squishy, matrixed world, if you're dreaming up an incentive plan, you're almost certainly in the grips of a focusing illusion. You're trying to maximize or optimize or minimize something. And you may unwittingly find that when you maximize the length of your programmer's code, you end up minimizing your job tenure...
No comments:
Post a Comment