Silicon Valley Business Ethics Cases
Quality or Quantity
When Incentives Don't Match Your Values
Noah Rickling, Hackworth Business Ethics Fellow â13
Frank, a recent Santa Clara University graduate, recently landed a sales job for a Silicon Valley tech company. He is part of a team that qualifies sales opportunities. After talking to potential customers, Frank decides whether or not they are quality leads. If they are, he refers them to an account executive (AE) to close the deal, saving the company precious time in money in avoiding low probability contracts. If not, he will not pass them on and the sales opportunity is not pursued. Account executives expect prescreening of potential leads in order to maximize their time. Each referral Frank passes to the AE is added to a tally that counts toward his target monthly total, and there is a monetary bonus for all sales staff members who reach their monthly quota.
This creates some controversy among Frank's team members, who are faced with conflicting incentives; pass on low quality leads to hit your quota, or focus on quality and risk missing the monthly target. The pressure to "hit your number" comes from both the monetary incentive and management, who benefit when their sales team hits their quotas. To further complicate matters, since each sales representative self-reports how many leads they passed along, they can inflate their numbers in order to reach the monthly target goal: a common occurrence among Frank's coworkers.
As Frank tries to adjust to his new job, he is finding it difficult to balance his own moral compass with the pressure of hitting his monthly number.
How would you handle the dilemma between hitting the quota and submitting quality work you stand behind? What factors would weigh into your decision? What solutions would best solve this dilemma?
Jun 3, 2013
Ethics in the News
Irina Raicu was quoted in an article in The Mercury News
The Trust Project is mentioned in an article in American Press Institute.
By Ann Skeet, director of Leadership Ethics.