The Number That Replaced the Thing

In 2016, Wells Fargo agreed to pay $185 million after regulators found employees had opened accounts customers never asked for. The pressure behind it was a sales goal the bank had turned into a slogan: "Eight is great." Eight products per customer.

No one in that building needed a definition of an account. The count had simply stopped standing for what it was meant to stand for: a customer who is well served by the bank. People optimized the number, because the number was easy to optimize.

A semiotician would say the sign came loose from the thing it signified. I think that is the central leadership risk of the AI era, because AI is extremely good at optimizing a sign. Give a model a metric and it will move the metric, faster and with fewer questions than any employee ever asked.

Every business runs on signs. Average handle time stands for good support. Pipeline created stands for future revenue. Tickets closed stands for working software. Engagement stands for customers who value the product. Each count is a sign. The customer, the revenue, and the working product are the thing.

Over the next few weeks I'll write about three ideas. Signs: what our numbers, dashboards, and AI outputs actually stand for. Meta-learning: examining how we reached a judgment, not only whether it was right. And leadership: who keeps the sign tied to the thing when the tools get faster.

Before you point AI at a number, start with one question: what is it supposed to stand for, and how did we come to believe it was a good proxy?

Which number in your organization has quietly replaced the thing it was meant to measure?