Why aligning incentives works

Here’s another example: in World War 2, US paratroopers had a problem with the fact that, allegedly, one in twenty chutes failed in some way. The solution was to require the packers and inspectors to regularly jump out of airplanes using parachutes chosen at random from the store. The quality of packing then rose to 100 per cent and stayed there. “The packers are all jumpers,” explained an NCO to Stars and Stripes magazine: “We try to have each man jump once a month. That’s a pretty good way to keep them honest on the tables.”

The source calls the one-in-twenty figure alleged, and it should stay that way. The important bit is the sudden improvement in attention when the parachute packer might become the passenger. Most systems arrange the opposite. The landlord chooses the boiler; the tenant enjoys January when it fails. A delivery app rewards speed; the cyclist discovers which junctions make the target possible. Procurement saves 4p on a box; the customer needs garden shears and the patience of a hostage negotiator to open it. Each decision looks sensible from the chair where it was made because the bruise lands on somebody sitting elsewhere.

We call the cure accountability because “everyone escaping the consequences of their own decisions” makes a depressing slide title. Put consequences back within smelling distance. Let the person who approved the form complete it on a phone while standing at a bus stop. Let the chef taste the dish leaving the pass. Let developers hear the support calls. Pay acquisition partly for customers who remain customers. A grand shared metric gives twelve departments something vague to admire; a specific consequence gives one decision-maker something difficult to ignore. Follow the inconvenience upstream and deliver it before the choice repeats.

Nobody needs to jump from an aircraft over a Jira ticket. They should at least have to pack the bloody parachute they are handing to everyone else—and hear whether it opened.