I always wonder what is fairness and equality; is equal opportunity or equal outcomes fair? Why do we have that instinctive fairness protest while being able to tolerate some degree of what would be considered ‘unfairness’? Is meritocracy fair?
So for the guy who is disabled, is it fairer that we make sure he gets to the second level perhaps by installing a lift or do we force him to crawl/walk up the stairs just as everyone else do? True meritocracy leaves no room for charity and we must thus acknowledge the limits of applying that argument on incentives and solutions to various different problems.
Whilst speaking to a family member about her workplace, I discovered a problem their management was facing, with incentivizing the sales team. Previously, they operated on a system where everyone shared a commission based on sales generated by the team; but the new system entails charging sales to individual salespeople based on who eventually closes a retail sale with the customer at the till.
As probably expected, the result was that salespeople begin ‘snatching’ customers by bringing them to the till while their colleagues helped obtain a pair of shoes or a dress of the right size for them at the storeroom. Instead of creating additional sales, the system merely redistributed commissions across different salespersons, and in a way that is not encouraging effort.
Previous system was scrapped because there were free-riders in the sales team but the new system didn’t work very much better. Question is, how much is the firm trading off and what exactly is optimal from the perspective of the management?