Business is up. Real money got you there: a faster site, quicker follow-up, maybe a marketing agency finally worth the invoice. But someone still answers the phone, reads the enquiry first, and decides whether to chase a hesitant lead or let it go cold. That person sounds exactly like they did before any of that changed. Ask most owners why. The answer comes fast: I need better people, or I should pay them more. Both assume the problem lives inside the person answering. It doesn’t. It lives inside the deal struck with them, and that deal was never built to reward what growth now asks of it.
Here is the question underneath that one: you want to win more business, so why does it feel like nobody on your team is actually pulling in that direction?
Why nobody on your team pulls in the same direction you do
The people fielding customer contact at a moving, freight, or pet-transport business are almost never the owner. They’re salaried coordinators, hourly staff, sometimes cash-paid crews pulled in for a busy week. None of them personally profit from the gap between a booked job and a missed one. Paid twenty-two dollars an hour to answer intake calls, a coordinator captures none of the marginal revenue when a four-thousand-dollar move books instead of falling through. Whether they chase eight leads that day or eighteen, the paycheck reads identical on Friday. The same holds for a freight dispatcher deciding which lane to push harder on, or a pet-transport coordinator choosing whether to call a nervous client back today or tomorrow. None of them own equity in the business. None of them see a cent of what a stronger quarter is worth to the person who does. A system built to send that person more leads doesn’t raise their pay. It raises their workload, at the same rate, at the end of the same week.
This site has already measured what that produces. Why enquiries go quiet found that a majority of enquiries get a reply too late to matter, and traced it to slow response, missing after-hours coverage, and quotes nobody chases back up. That’s the symptom, measured correctly. It doesn’t ask why a business that genuinely wants the work keeps producing that exact behavior, month after month, regardless of who’s staffing the desk that week.
The honest answer isn’t a training problem. It’s an incentive problem. Once that’s visible, the slow reply stops looking like negligence and starts looking like the predictable output of the system that produced it.
Economists gave this exact gap a name in 1976
Michael Jensen and William Meckling’s 1976 paper in the Journal of Financial Economics, Theory of the Firm, is the founding document of what’s now called agency theory: the study of what happens whenever one person, the principal, hires another, the agent, to act on their behalf, and their interests don’t fully line up. The paper opens by borrowing a warning from Adam Smith: someone managing another person’s money will rarely watch it with the vigilance they’d apply to their own. Fifty years on, the warning describes exactly what happens at a phone desk. The owner is the principal. The person answering is the agent. The agent has no built-in reason to treat a stranger’s enquiry the way the owner would.
Jensen and Meckling also named the resulting waste: agency costs, the sum of what a business spends trying to keep an agent aligned. That spending shows up as monitoring, oversight, and tighter scripts. But agency costs also include what the agent still gives up to protect their own interests anyway, and the value that’s simply lost in between. Most owners are already paying the first kind, in call-monitoring software and mandatory check-ins, without touching the reason any of it is needed in the first place.
This isn’t theoretical. Steven Levitt and Chad Syverson put a number on it in 2008, using a market where the same person plays both roles at different times: real estate agents. Their study in the Review of Economics and Statistics found that agents sell their own homes for 3.7 percent more, and leave them on the market 9.5 days longer, than they achieve for an identical client’s house. Same person, same skill, same market knowledge. The only variable that changed was who kept the extra money. When it’s the agent’s own equity on the table, they hold out for a better number. When it’s a client’s, they take the first workable offer and move to the next file, because their commission barely moves either way and their own time does.
A phone desk runs the identical arithmetic. Nobody just writes it down. The person capturing that lead well chases it, works the follow-up, and gets the quote out fast, but gets none of the marginal revenue a closed job represents. They get the same paycheck whether the enquiry converts or dies quietly. What they do get, if they push harder and it works, is more of exactly this next week, at the same rate. A system that’s run smoothly for years on this basis looks stable only because nobody has asked it to do more yet. Stability that has never been tested by real growth isn’t evidence the incentives are working. It’s evidence the test hasn’t happened.
Does paying people more actually fix it?
The tempting fix is obvious: pay more, or add a bonus tied to bookings. Alfie Kohn’s 1993 Harvard Business Review piece, Why Incentive Plans Cannot Work, remains the sharpest institutional answer to that instinct, and it isn’t encouraging. Kohn’s review of decades of workplace and laboratory research found that rewards reliably buy one thing: short-term compliance on simple, easily measured tasks. On anything requiring judgment, persistence, or genuine care, a bonus tends to narrow effort down to exactly what gets measured, and nothing past it.
The counter-case is real too, and an honest piece has to sit with it rather than argue around it. Edward Lazear’s 2000 study in the American Economic Review, Performance Pay and Productivity, tracked roughly three thousand workers at Safelite Glass after the company switched windshield installers from an hourly wage to piece-rate pay. Output per worker rose 44 percent. Profits rose with it. Incentive pay, done right, genuinely works.
The two findings sit together once you look at what made Safelite’s bet succeed. Installing a windshield is a task with one countable output, attributable to one person, with quality easy enough to check on the spot. A phone desk is nothing like that. Persuading a hesitant caller, chasing a quote through three follow-ups, staying warm with someone who isn’t ready yet: none of it reduces to a single number one person can be paid against without inviting exactly the corner-cutting Kohn documented. Pay a flat bonus per booked job and watch coordinators start pressuring undecided callers instead of qualifying them properly. The fix that worked on a windshield doesn’t transfer cleanly to a conversation.
The skeptical owner’s real objection belongs here: I’ve hired great people before, and they still don’t chase hard enough. That’s likely true, and it isn’t evidence against any of this. A strong hire dropped into the same unrewarded structure behaves like everyone else in it within a few months, because the deal, not the person, sets the ceiling on effort. Swapping the person without touching the deal just resets the clock on the same outcome.
The research that does transfer is less comfortable than a bonus scheme. Harvard’s Heskett, Jones, Loveman, Sasser, and Schlesinger built the service-profit chain from studying companies where frontline performance drove profit, and the lever wasn’t sales pressure. It was internal service quality: the tools, the authority, and the working conditions given to the person doing the job. Those elements drove employee satisfaction, then retention, then the customer experience that shows up as revenue. Two things can be true at once, and the honest version of this argument holds both without picking a side: incentive pay can work, and most businesses reaching for it are applying a windshield-shop fix to a job that never resembled one.
The deal never gave the person answering the phone a reason to care whether the business wins more work. It gave them a reason to avoid taking on more of it for the same pay. That isn’t a motivation problem waiting on a pep talk or a better hire. It’s structural, built into the deal itself, and it explains why growth stalls even when an owner genuinely wants it and is doing everything else right.
What happens when nobody fixes it and the market does instead
Businesses that never correct this misalignment eventually meet a competitor who solved it structurally. That competitor built a model where the person closest to the customer carries real exposure to the outcome. Three cases, decades apart and nothing to do with logistics, show the identical mechanism at three different scales. These aren’t stories about a scrappy underdog outworking a comfortable giant. Each one is a story about a cost structure crossing a threshold: once the marginal dollar started flowing to whoever closed the sale, the businesses on the other side of that shift never had a real chance, no matter how much they spent trying to compete on service or marketing instead.
A hotel’s front desk clerk earns the same wage whether the room sells or sits empty. An Airbnb host earns nothing unless the listing books, and keeps the difference personally when it does. That single difference in who’s exposed to the outcome is a large part of why the hotel industry’s revenue moved when Airbnb entered a market. Georgios Zervas, Davide Proserpio, and John Byers, economists at Boston University, measured it directly: every 10 percent increase in Airbnb listings in a market cut hotel room revenue by roughly 0.39 percent on average. In Austin, Texas, where Airbnb’s presence grew fastest and deepest, the cut reached 8 to 10 percent. Hotels didn’t lose that revenue because their staff got worse at the job. They lost it because a host with direct equity in every booking will out-hustle a desk clerk with none, every time the two compete for the same guest.
The same mechanism decided a format war a generation earlier, with nothing to do with picture quality. Sony kept Betamax’s licensing closed, manufacturing it alone and controlling every detail of the format. JVC did the opposite with VHS, licensing it to Matsushita, Hitachi, Sharp, and a dozen other manufacturers, each one now personally invested in VHS’s success because their own sales depended on it. Michael Cusumano, Yiorgos Mylonadis, and Richard Rosenbloom traced the outcome in the Business History Review in 1992: VHS players got cheaper faster, more manufacturers meant more tape titles worth stocking, and more titles pulled in more buyers, a loop Betamax couldn’t match because only one company had anything riding on it. Sony’s own leadership later acknowledged, well after the war was decided, that keeping the format closed had cost them the market they were trying to protect. A coalition where more people carry a real stake in the outcome beats a monopoly on control more often than not, because more of the people who could make it succeed have a reason to.
The starkest version of this mechanism is what happened to New York City’s taxi medallions, and it’s the one that deserves the most care in how it’s told. This isn’t a clean story about an upstart beating a slow incumbent on efficiency. It’s a story about who was exposed to a bet and who wasn’t. The people who ended up carrying all of the loss were the ones with the least control over how the bet got made.
Between 2004 and 2014, the price of an individual taxi medallion at auction rose from $283,300 to $965,000, according to a 2020 lawsuit that New York Attorney General Letitia James filed against the city’s own Taxi and Limousine Commission, alleging the agency ran its auctions in a way that artificially inflated those prices for over a decade. A Democracy Now interview covering the crisis reported that the city collected more than $855 million from medallion sales across that period, and bore none of the risk if the value it had helped inflate ever came back down. Lenders wrote loans against those prices and collected origination fees and interest regardless of what happened next. Neither the city nor the lenders had a dollar of their own tied to what the medallion would be worth later.
The drivers who bought those medallions did. The same interview found that roughly 91 percent of New York’s taxi drivers were born outside the United States, many without fluent English, and that a number of them did not fully understand the terms of the loans they signed. When ride-hailing arrived and pulled fares away, medallion prices collapsed. By mid-2019, individual medallions were selling at auction for as little as $137,000 to $138,000, according to Crain’s New York Business, a fraction of what many owners had borrowed against them just a few years before. At least eight drivers, including three medallion owners, have died by suicide since 2018, and reporting on the crisis has directly connected several of those deaths to the debt.
This deserves to be said plainly: none of it should read as a tidy lesson about disruption rewarding the efficient. It’s a story about a bet that only ever had one set of people exposed to losing it, set by parties who had nothing of their own at stake and walked away regardless of how it ended. That’s the same mechanism as the phone desk and the hotel counter, at a scale that cost people their lives, and it deserves to be remembered as exactly that, not filed away as a punchy statistic about an app beating a taxi.
The alternative to waiting for a competitor to fix this for you
Two of those three examples share something worth naming plainly. The hotel clerk and the medallion driver were both incumbent workers, and both disruptions landed at their expense, not at the expense of the executives who ran the systems that failed them. That’s the version of this story most operators fear, and they’re right to. It doesn’t have to be the only one available. The partnership structure behind Movaros’s own fulfilment page exists for a different reason: a smaller operator plugs into a network with real demand behind it and grows because of the arrangement, instead of waiting to see which competitor solves this incentive problem first and takes the market while everyone else is still hoping a pep talk works.
Run this test before the next growth push
Every fix described so far corrects a structure, not a person. Before reaching for a new hire, a script, or a bonus plan, run a smaller test first. Picture the business landing 20 percent more qualified work next month than it has today. Now picture the specific person who answers the phone or opens the first enquiry each morning. Would that person be better off with a bigger share of the extra revenue, more authority to make a call without checking with someone else, a clearer stake in whether the extra work turns into extra pay? Or would they just be busier, doing the identical job, for the identical rate, with more calls left unanswered by closing time?
Most owners, asked directly, already know the honest answer. It explains far more about a slow reply, an unchased quote, or a caller who never gets a real answer than any story about a lazy hire ever will. The fix was never a better person. It’s building the one thing the phone desk has never had: a reason to want the growth as much as the owner does.
The incentive gap doesn’t fix itself with a better hire.
See how a fulfilment partnership gives the person doing the work a real stake in whether it’s won, not just a bigger workload for the same pay.
