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GLW - Goodhart’s Law
Supports:
Context:
In the context of DAOs, particularly those focused on public goods and capital deployment, metrics and measurable targets play a critical role in assessing performance and allocating resources.
Problem:
Reliance on fixed metrics for decision-making can inadvertently prompt parties to manipulate or “game” these metrics to achieve desired outcomes, potentially at the expense of the organization’s broader goals.
Forces:
- Optimization Pressure: Individuals or teams may focus exclusively on metrics that are rewarded, ignoring broader objectives.
- Metric Simplification: Important nuances of what the organization values may be lost when reduced to simple metrics.
- Evolving Contexts: Static metrics may not adapt well to changing external conditions or internal goals.
Solution:
Implement adaptive metrics that evolve over time, ensuring that they continue to represent the true intentions and values of the DAO. The system should integrate a diverse set of both qualitative and quantitative feedback mechanisms that allow for regular updates to what is being measured and rewarded. Emphasize metrics that are difficult to game and align closely with long-term organizational health rather than short-term outputs.
Therefore:
DAOs should design and periodically recalibrate their metrics system to reflect true success and value creation, safeguarding against manipulation and unintended consequences.
Supported By:
