Incentives and Leverage

“Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.”

Archimedes

How do you get things done in your professional life? Simple: understand the incentives and find the leverage. 

In the early part of your career, as an individual contributor, you can exceed expectations and gain leverage by being incredibly good at your job. You may do it with your skills and talent or by working harder than others.

Later in your career, though, being great at your job is not enough. You need the intuition to see an untapped opportunity beyond your day-to-day job (a.k.a. “white space”) and the ability to seize it.

It’s no longer an individual matter. Even if you have the vision for company-wide improvement and a clear articulation of its value, the people you need may have no incentive to help you. 

When this happens, you may need more leverage to make your needs their priority.

Misaligned incentives are pervasive in corporate environments, and they are usually a combination of suboptimal management decisions and a complex business environment. Over the years, I learned not to let them frustrate me, but use them to my advantage.

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Why you shouldn’t use CLTV/CAC

Long-Term Business Sustainability Depends on the Right Measures

A metric commonly used to measure the performance of high-growth businesses is Customer Lifetime Value over Customer Acquisition Cost, or more simply CLTV/CAC. It is a much better metric to provide an objective to marketing teams than many others we have seen in the past, but it has also some tremendous flaws associated with it, and if not used correctly and in the right context, it can jeopardize the business using it.

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