How Misaligned Incentives Cripple Culture and Cost Millions

In 2016, Wells Fargo paid $190 million in a settlement with the U.S. government—a direct result of misaligned and unchecked incentives.

At Berkshire Hathaway’s annual meeting, Warren Buffet made it clear:

“This is where Wells Fargo failed—the lever was incentives.”

So here’s the question every conscious business leader must ask:
Do you really understand the power—and the risk—of incentives?

The Allure (and Danger) of Incentives

Incentives are powerful. When used well, they can guide behavior, fuel performance, and drive metrics that matter.

• We use them to steer sales teams toward specific offers.

• We use them to improve safety, production, and health outcomes.

• We use them to shape culture.

But because they work so reliably, leaders often default to them unconsciously, treating them like a magic lever.

That’s where trouble begins.

Overuse or misalignment of incentives creates blind spots, toxic cultures, and eventually—disaster. Wells Fargo is a case study in what happens when the incentive lever is pulled without conscious design.

Lesson 1: The Number Must Be Functional

Starting as early as 2010, Wells Fargo began incentivizing employees to sell eight accounts per customer.

Why eight?

Not because of data. Not because of customer behavior.
Because it rhymed.
CEO John Stumpf said, “Eight rhymes with great.” He later pushed, “Let’s go again—for ten!”

This is not strategy. This is corporate numerology.

Would you flip a coin to set your KPIs? Then why would you rhyme your way into revenue targets?

There was no connection to customer need or value delivery. The number wasn’t based on insight. It was a vanity metric in disguise.

Functional numbers must align with:

• Actual customer behavior

• Clear, measurable impact

• Realistic paths to sustainable growth

Growth for the sake of growth isn’t strategy—it’s entropy.

Start With the Customer’s Map

The best leaders—like Tony Robbins, who begins every consultation with a business map—don’t chase abstract growth. They track what’s real, necessary, and impactful for the customer.

Functional strategy begins by mapping the terrain of your ideal customer.

When your KPIs align with your customer’s journey, growth becomes a byproduct of relevance—not a manufactured outcome divorced from reality.

Lesson 2: Incentives Must Communicate Mission

Incentives don’t just shape behavior—they communicate values.

They whisper to your team:
This is what matters most.

So when Wells Fargo employees were screamed at, berated, and threatened over quotas, the message was clear:

“Serve the numbers. Not the customer.”

CNN interviews with former employees described an environment of abuse masked as motivation. One stated:

“I had managers in my face yelling at me… the pressure was unbearable.”

What was rewarded?
Accounts per customer.

What was punished?
Anything less.

And what was completely ignored?
Whether customers wanted or needed those products at all.

That’s how you end up with millions of fake accounts, widespread fraud, and a massive erosion of trust—not just internally, but with the public.

When incentives only honor short-term gains, long-term loyalty dies.

Lesson 3: Misaligned Incentives = Cultural Erosion

Every incentive trains behavior.

And what gets rewarded gets repeated—whether it’s integrity or dysfunction.

If your company culture is leaking energy, creating internal toxicity, or facing resistance at the customer level, pause and ask:

• What are we actually incentivizing?

• What behavior are we actually rewarding?

• Do our rewards align with our stated mission—or just our ego metrics?

Healthy Incentives Support Soul-Aligned Business

The deeper truth here is that incentives aren’t just operational tools—they are cultural instruments.

They set the tempo of the business. They reveal the soul of the brand.

If you want to create a business that leads from alignment:

• Start with the customer’s evolving journey

• Build incentives that reward real impact

• Hire people whose natural wiring matches the role

• Use incentives to elevate—not manipulate

Impact equals income.
But only when the path to income honors the integrity of the impact.

Final Thought: Design the Culture You’re Really Building

Too often, companies drift into cultural dysfunction by default—chasing short-term numbers and abandoning long-term purpose.

But if you're truly committed to conscious growth...

• Design incentives that mirror your mission.

• Measure what creates real transformation.

• Align your systems with your soul.

The lesson from Wells Fargo is this:
Culture is not what you preach. It’s what you pay for.

If you want to audit your current incentive structure or evolve your leadership around aligned performance, let’s talk. Integrated Leadership Coaching focuses on creating a conscious business—and it starts with the levers you're pulling.