The easiest path reveals what your company actually rewards

Every company has two strategies. One is written in a document, and one is built into the everyday: it is composed of what is visible, what is fast, what gets measured, and what requires an explanation afterwards. When the two disagree, the everyday wins, because people do their work inside a system, not inside a document. This produces the question we use as the first test of any operating model: what does this system currently make the easiest thing to do, and is that the outcome we actually want? The question may not be answered from a policy document or from intentions. It gets answered by watching what an ordinary person does on a busy Tuesday when nobody is looking. The answer is usually uncomfortable, which is exactly what makes it worth having.

The metric eats the goal

The phenomenon has a name. The observation known as Goodhart’s law says that when a measure becomes a target, it ceases to be a good measure.¹ People do not start optimising the thing the metric was meant to represent. They start optimising the metric, because the metric is what is visible, and what is visible is what gets rewarded.

None of this requires bad faith. It only requires ordinary people acting sensibly within their own field of view. That is why hunting for culprits is almost always the wrong first move. Before anyone is accused of lacking values, it is worth finding out what the system actually measured and paid for.

The four hour rule and the ambulances in the car park

Britain’s health service once set a target requiring emergency patients to be treated within four hours of arrival. The target was reasonable, and real things improved. Then the system began doing what systems do: hospitals held patients in ambulances outside, because the clock only started at check-in.²

The researchers who documented this gave it a name that survives translation: hitting the target and missing the point. The measure was met while the purpose went unmet, and no participant felt they were doing anything wrong. Each was solving a local, entirely real problem that the system itself had handed them.

Running the same inspection on your own company

The same inspection runs on any company, your own included, and it takes fifteen minutes. One recurring decision or routine at a time: what here is visible and what is hidden? What is fast and what is laborious? What gets measured, and what falls outside the metric? What earns thanks, what earns punishment, what demands an explanation?

The answers draw the real incentive map, and it almost never matches the intended one. A salesperson measured on new deals serves old clients with their weaker hand. A team asked only about deadlines saves time on quality, because quality is invisible in the report and lateness is not. The map does not describe who your people are. It describes where they work.

The smallest change that changes the decision

Once the map is visible, the fix rarely needs to be large. The search is always for the smallest change that alters the decision situation itself: a new default, one added metric to balance an old one, friction placed in front of the wrong choice, visibility given to the right one.

Severity has its own ladder: information first, then friction, then a forcing structure, and prohibition only last. Each step up removes judgment from people, and judgment is what resolves the situations no rulebook anticipated. A system that prevents every error usually prevents thinking too, and the bill for that arrives with the first case the rules never imagined.

The inconvenient part

There is one trap in studying the easiest path: it is far more pleasant to do to other companies than to your own. Your own system feels neutral because you built it, and its distortions feel like common sense. Yet a one-person company has an incentive map too, and it also drifts from the intended one. What does your everyday make easiest: the billable hour, or the hour that would be worth most to the client? The answer is not in your strategy. It is in your calendar.

From words to done.

Sources

1. Marilyn Strathern, “‘Improving ratings’: audit in the British University system”, European Review (1997); the generalised formulation of Goodhart’s law. https://doi.org/10.1002/(SICI)1234-981X(199707)5:3%3C305::AID-EURO184%3E3.0.CO;2-4
2. Gwyn Bevan & Christopher Hood, “What’s measured is what matters: targets and gaming in the English public health care system”, Public Administration (2006). https://doi.org/10.1111/j.1467-9299.2006.00600.x