In yesterdays mental models email from George Mack.
Once the bounty stopped getting paid.
The cobras got released into the streets.
A way to prevent the cobra effect (from Georges newsletter):
- Andy Grove (Former Intel CEO) has a specific tactic to prevent this from happening: Pairing Metrics.
- To prevent one metric leading to perverse incentives, have the opposing metric as a goal too.
- For example, Keith Rabois will measure fraud rate AND customer service in his business.
- If his customer service team was solely optimised around fraud rate, they may achieve the objectives but treat every customer like a potential fraudster. (Resulting in awful customer service)