We all like to think we are in control of our own destiny, but on average, the evidence disagrees.
Most of us spend too much time on our phones. Advertising works on us. We like to think we can fight these influences, but there is a lot of money, expertise, and incentive behind nudging us in the direction someone wants us to go.
The same thing happens with incentives at work.
Many of us think we are simply doing what is best for the customer or the product we make. But if you work for a public company, there are also strong incentives to create value for shareholders. What is best for shareholders might align with what is best for the customer or product, but it doesn’t always.
We may think we aren’t influenced by this because most of us only see our small section of the business. That makes it easy to miss the larger forces shaping the decisions around us.
Senior leaders are exposed to a different set of incentives. Their goals and compensation may be tied to things like revenue, profit, stock performance, or other financial measures. Those incentives influence the goals they set for the business, which eventually influence the goals the rest of us work toward—even if we don’t think about them in our day-to-day work.
So the next time something happens in the business that doesn’t seem to make sense for the product or the customer, ask yourself another question:
Does it make sense for the shareholders?
That doesn’t mean the decision is automatically bad. It just gives you another way to understand why it might be happening.
And I still believe it is okay to push for what is best for the product or customer when it goes against some of these incentives. Sometimes you have to justify it extremely well. Sometimes you have to find a way to do it quietly within the authority you have.
The important part is recognizing the incentives in the first place.