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Management

Incentives and skin in the game

Suppose you are working in a company where your work is audited from time to time.
Your performance perception is directly linked to the amount of issues found in these audits. More issues, worse performance.

At the same time your management tells you that you need to be bolder, take more risks, aim higher (and eventually fall harder) to achieve bigger things.

How can you be convinced to take more risks in this case?

Wishing for the rewards without taking the risks is a clear path for dumb decisions. A traditional case of no skin in the game.

A better way to drive a behavior would be to suffer through your bad decisions and lead by taking the examples.

Want your teams to be bolder?
Start by being bolder yourself, suffer from the failures and show it.
Take ownership by putting your neck on the line.

People don’t always follow what you say, but they notice what you do.

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Nassim Taleb wrote the great book Skin in the game where he goes deep into this assymetry.

Jorge

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