Why Incentive Systems Don't Work
The French colonial rulers in Hanoi had enacted a law: They paid for every dead rat delivered. In this way they intended to overcome the rat infestation. The law that was passed caused people to breed rats.
When the Dead Sea scrolls were discovered in 1947, archaeologists set a reward for each new manuscript. The result was that the scrolls were torn and split to increase the number. The same thing happened in China in the 19th century, when rewards were promised to those who brought dinosaur bones. Farmers dug fully preserved bones from the ground, smashed them and earned money.
A company's supervisory board has promised to pay a bonus to management when the target is met. So what happened? Instead of managing the company in a profitable way, managers struggled to set low goals.
These are examples of incentive sensitivity. First of all, it describes a simple phenomenon: People respond to incentive systems. It's not surprising. People do things that are in their favour. What is astonishing are the two side elements of this phenomenon: The first is how quickly and radically people change their behavior when incentives come into play or when incentives change. The second is that although people respond to the incentive, they remain indifferent to the motives behind the incentive.
Successful incentive systems ensure that the purpose and the incentive overlap. For example, in Ancient Rome the engineer of a bridge had to stand under the bridge arch as the bridge was being opened. It's a pretty good incentive method to make the bridge strong enough. On the other hand, unsuccessful incentive systems mislead or even mislead the purpose. In this way, for example, the censorship of a book exposes the contents of that book. Or a lousy loan portfolio will pile up, with bank officials getting paid according to the loan deals that are made.
It is foolish to agree with a lawyer, architect, consultant, accountant or driving school teacher to pay for the time and effort they spend. So first of all, agree on a flat fee. It is always in the interest of a specialist to treat you as thoroughly as possible, and perhaps operate on it – even if it is not necessary. Investment advisors will "recommend" you the products for which they receive a sales commission. The business plans of entrepreneurs and investment bankers are trash because they have a direct interest in the transactions. An old German proverb says: "Never ask a barber if it's time to cut your hair."
Sonuç: Teşvik hassasiyetine karşı tetikte olun. Bir insanın ya da kuruluşun tavrı sizi şaşırttığında, arkasında nasıl bir teşvik sistemi olduğunu sorun kendinize. Davranışların % 90’ını bu şekilde açıklayabileceğinize dair size güvence veririm. Tutku, ruhsal zayıflıklar, psikolojik bozukluklar ya da hainlik olsa olsa %10’u eder.
Investor Charlie Munger broke into a fishing gear store. He stood in front of one of the shelves and grabbed a glaringly shiny bait and asked the shopkeeper: "Tell me, do fish really like that kind of thing?" The owner smiled, “Charlie, we don't sell to fish.”
Rolf Dobelli – “The Art of Flawless Thinking”
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