The Ship and the Cargo

A trading company sent ships to distant ports. The captains chose routes, managed crews, and made trading decisions thousands of miles from the owners.

One captain, paid per voyage, rushed through storms to complete more trips per year. Another, paid a share of profits, took the safest routes to protect the cargo. A third, paid a flat wage, took scenic detours and lingered in pleasant ports.

Same ocean. Same ships. Same opportunities. Three completely different behaviors, driven entirely by how each captain was paid.

The trading company learned that the contract is the strategy. Change the contract, and you change the captain’s every decision at sea.