To be fair to Bloom, perhaps the incentive design he talks about applies to deal-making. Or perhaps the ideas are meant in an atomised, theoretical way.
But every idea in there is almost certainly going to trip you up in bad ways if you tried to apply them to your org.
Conversation
The basic tools when it comes to org design looks like this:
1. You have an accurate model of the people you are dealing with. This is context dependent. Salespeople respond to incentives differently from engineers.
2. You have the ability to think in terms of systems.
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3. Finally, you have an accurate understanding of how culture works.
The shape of the expertise is like this: you design through a step-by-step unfolding. Over time, you design policies, shape culture, and nudge behaviour through meetings, one-on-ones, and actions.
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The most important nuance is to recognise bad behaviours early and nip them in the bud by course-correcting.
It is useless to talk about the cobra effect, or about Goodwin's law, or about skin in the game if you don't have these skills pinned down.
In fact, it is not necessary.
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Because you are able to model the behaviour of the humans you are dealing with, you understand the system you are modifying, and you understand how to mould culture, none of these issues will come up.
These are just frameworks that sound intelligent but are not useful.
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"Wait, but Cedric, Goodwin's law is a thing! Other intelligent people talk about it!"
Yes, but the way you defeat Goodwin's law is not by talking about Goodwin's law. Bloom talks about Amazon in his tweet thread. Amazon actually deals with Goodwin's law quite well.
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In Working Backwards, Colin Bryar and Bill Carr dedicated an entire chapter to how they think about metrics.
The number of times they mention Goodwin's Law: 0.
Amazon has a process they call DMAIC. The book tells the story of the step-by-step unfolding that led them to it.
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It's more or less the same. They note that they adapted it from Six Sigma after facing some problems with their metrics management.
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It'll be interesting to get your take on what they do differently:
