While Dave calls it gaming the system, one of the problems with strong incentives is that you often get what the incentive asks for. So, if the incentive is for sales, you get sales which may not align with the most profitable sales. Wells Fargo had strong incentives to open accounts and got accounts open, etc. This is why incentives work better in sales (where you can better measure what you care about) and less well in other areas.

If you can’t fully measure the important parts of the job, strong incentives can pressure employees to over emphasize the measured parts of the job.

The employer must structure the job function of the employee to be one of mutually recognized importance, but not one of dependence, if possible. Those few n positions of dependence should be seen as partners, not employees. Of course, all of those working in a company should be thought of, in the aggregate, as partners.

The difference is that those with an interest in increasing the profits of a business must have a greater understanding of the relationship of wages to profits, whereas the focus of salaried only workers must focus on their role in creating customer satisfacction.

In many cases, it would be constructive, were it possible, to fairly assign revenue generation percentages to departments and even job functions. The greater the employee and employer recognize the importance of the employe to the business of the company, the better understood can be the fairness of employee benefits.