Unintended Consequences

Good metrics are powerful, but they are double-edged swords. When a measure becomes a target, teams chase the number instead of the underlying value, and the very act of measuring reshapes behavior. The newsletter shows how this dynamic repeats across history and modern product work, and why leaders must design incentives that reflect the full picture.

The story begins with Prohibition: a law meant to improve society created a black market and made Al Capone a billionaire. The policy's unintended consequence was a surge in organized crime, proving that any well-intentioned rule can spawn the opposite outcome. The piece uses this analogy to frame today's tech decisions.

A recent, concrete example is Wells Fargo's aggressive sales quotas. Employees opened millions of unauthorized accounts to hit targets, leading to fraud, fines, and a leadership shake-up. The same pattern appears in product teams that obsess over a single KPI-like ad revenue-while user engagement drops. Without counterbalancing metrics, the organization drifts toward harmful shortcuts.

The classic "Cobra Effect" illustrates how perverse incentives can amplify the problem they aim to solve. Paying for dead cobras encouraged people to breed them, and when the bounty was removed the snakes were released, worsening the infestation. The lesson is clear: incentives must be aligned with the true goal, not just the metric.

Leaders can break this cycle by adding complementary metrics-customer satisfaction, retention, ethical compliance-while regularly questioning whether current measures still serve the mission. Goodhart's Law and Campbell's Law warn that once a metric drives decisions it degrades as a signal. A culture of reflection, where teams constantly ask why a metric exists and what it might be hiding, turns metrics into guides rather than shackles.