Scientific Definition
Narrowly tied bonuses get gamed; people optimize the metric, not the underlying goal.
Plain-English Definition
Narrowly tied bonuses get gamed; people optimize the metric, not the underlying goal.
Feynman Explanation
Pay for the indicator, get the indicator. And nothing else.
Core Principle
Narrowly tied bonuses get gamed; people optimize the metric, not the underlying goal.
Mechanisms
Pending editorial review.
Narrowly tied bonuses get gamed; people optimize the metric, not the underlying goal.
Pending editorial review.
Pending editorial review.
Comp narrowness predicts gaming.
Pending editorial review.
Pending editorial review.
Inputs (Triggers)
Pending editorial review.
Outputs (Behaviors)
Pending editorial review.
Behavioral Signature
Pay for the indicator, get the indicator. And nothing else.
Examples
- Sandbagged sales, padded quarterly closes.
- Comp narrowness predicts gaming.
Pending editorial review.
Famous Experiments
Pending editorial review.
Design Principles
- Composite, lagged, peer-relative comp.
Measurement Approaches
Pending editorial review.
Evidence
Pending editorial review.
Pending editorial review.
The Perverse Incentive Lens™
How this behavior is exploited — and how to redesign around it.
- Composite, lagged, peer-relative comp.
Pending editorial review.
Pending editorial review.
Interactive Mini Network
Click any neighbor to re-center the graph and follow the threads of connection.
Knowledge Graph Neighbors
Auto-linked to the rest of the Human Behavior Taxonomy by family, domain, dimension, and shared keywords.
Earn-outs designed to retain founders often demotivate the team they bought.
Funnels rewarded for new logos under-invest in retention and lifetime value.
Cuts that lift margin this quarter erode product quality and brand equity over years.
Re-hires often get raises larger than internal promotions.
Pay tied to stock price encourages short-term price management.
CEO pay tied to size rewards deal-making even when acquisitions destroy value.
Sales forecasts under-set to ensure attainment bonus.
Capital tied to growth rates funds unsustainable scaling and unit-economics denial.
Managers measured by team size grow teams beyond need.
Awards reward visible novelty; quiet excellence goes unrecognized.
Innovation programs designed to signal innovation, not to produce it.
Managers hoard talent; cross-team mobility dies.