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Wednesday, October 19, 2022
Division of labor
Imagine you are walking down Main Street and see a guy with a sign offering free b***jobs with the purchase of each pair of sneakers in a store nearby. You enter the store and find that they aren't even selling sneakers, just regular shoes, and of course there are no b***jobs on offer. You demand to speak to the manager and he tells you that the guy outside is not an employee; he is from a completely different company specialized in marketing, and is being paid for each customer he gets through the door of the store, regardless of whether they buy anything. Thus he is just making stuff up with barely any relation to the actual products of the store, just to get people to step inside, which is when he earns his money. That this is very bad business for the store is not his concern.
If you think that this hypothetical story is completely bonkers, you will be surprised to hear that advertising for mobile games works exactly like that. The people who make and run the games don't do their own marketing, but hire marketing companies to make ads for them. The marketing company is paid for every person who clicks on the link to the game, regardless of whether these people then actually engage with the game or spend money on it. So the marketing companies just make stuff up: Fake gameplay, graphics that only barely resemble anything in the actual game, and sometimes they even steal graphical assets from a completely different and popular game to pretend that this is the game they are advertising for. You can see examples in various videos on YouTube.
In economic theory the division of labor increases productivity. It is more efficient for people to specialize and only do one thing well, rather than doing lots of different things occasionally. But you can push that division of labor too far. And there have been lots of examples of companies outsourcing work, and then getting the incentives wrong. I once worked for a place where an outsourced IT company earned money for every time an employee called with an IT problem; guess what, those IT problems had a tendency to never get solved, necessitating further calls, earning the IT company more money. If you outsource in a way that the interests of the people doing the work aren't aligned with the interest of the company paying them, you can get pretty bad results.
- posted by Tobold @ 9:00 AM Permanent Link
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I don't think it's an issue of division of labour.
Yes, if your goal was to sell shoes, then just getting people through the door with phony promises won't work. But if your mobile game doesn't need to have people paying for ingame stuff because it's nothing but a glorified ad space that triggers as soon as the app is opened, then yes getting people through the door would suffice.
Yes, if your goal was to sell shoes, then just getting people through the door with phony promises won't work. But if your mobile game doesn't need to have people paying for ingame stuff because it's nothing but a glorified ad space that triggers as soon as the app is opened, then yes getting people through the door would suffice.
This seems more like the unintended consequences of incentivizing the wrong thing rather than a division of labor issue. I've run into this same issue in a couple of organizations where I believed that they were targeting and incentivizing the wrong metrics. The outcome was that people spent time trying to improve those metrics and not the overall objective because the metrics didn't really align with reality. That seems to happen when people stray from the actual goal. If the actual goal in your example is to sell X then that should be what's incentivized. That may be tricky in all circumstances since not all roles can lead to direct sales.
If humans develop approaches like the one that you described based on the types of incentives just imagine what an AI will do at some point. I think that we will have some very odd stories in the future about that.
If humans develop approaches like the one that you described based on the types of incentives just imagine what an AI will do at some point. I think that we will have some very odd stories in the future about that.
I would say this is nothing to do with the division of labor and everything to do with how incentivization is supervised. Clearly, in the mobile game industry, incentivization is not being supervised properly. This can be due to a badly done contact, or because you're leaving the proverbial fox in charge of the hen house.
In pizza delivery here, the store manager is incentivized to get all pizzas made really fast. Because of this, they will mark a pizza as made before it is even started. Their stats look good, so they get their bonus for this timing.
There was a massive scandal a while back in the US because one major bank was opening accounts for customers without permission, among other bank offerings. The bank had created metrics which incentivized the opening of these accounts. These were totally unrealistic metrics, of course. The managers only cared that numbers were being met, and either turned a blind eye to the fraud going on, or were actively complacent.
Tobold, you are correct that they are incentivizing the wrong thing with mobile advertising. They should be incentivizing actual game downloads, just like the bank should have been incentivizing actual account usage, but unfortunately humans don't always think two steps ahead. Now the advertising model is too ingrained to change it, unless some really big actor forces that change.
In pizza delivery here, the store manager is incentivized to get all pizzas made really fast. Because of this, they will mark a pizza as made before it is even started. Their stats look good, so they get their bonus for this timing.
There was a massive scandal a while back in the US because one major bank was opening accounts for customers without permission, among other bank offerings. The bank had created metrics which incentivized the opening of these accounts. These were totally unrealistic metrics, of course. The managers only cared that numbers were being met, and either turned a blind eye to the fraud going on, or were actively complacent.
Tobold, you are correct that they are incentivizing the wrong thing with mobile advertising. They should be incentivizing actual game downloads, just like the bank should have been incentivizing actual account usage, but unfortunately humans don't always think two steps ahead. Now the advertising model is too ingrained to change it, unless some really big actor forces that change.
This is what happens when company's incentivize short term profits and growth over everything else. Unfortunately your fictitious example isn't that outlandish when you look at what goes on in different industries all the time.
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