Aligning Incentives
- Ben Hudson
- Jun 9
- 4 min read
Updated: 4 days ago
If you want your business to grow without constantly feeling like you're dragging one half of the organization behind you, the first thing you need to do is make sure your finance and operations teams are aligned. Not just “aware of each other’s work.” Not just “friendly in Slack.” I mean genuinely aligned—on priorities, on outcomes, and most critically, on incentives.
Too many companies treat finance and operations like separate universes. Finance lives in the spreadsheets, buried under variance reports and budget models. Operations is on the ground, solving real-world problems and trying to hit customer SLAs. And in the worst cases, each side sees the other as an obstacle rather than a partner. That’s how silos form. That’s how value gets lost.
The truth is, finance and operations are just two different lenses on the same business. One sees with numbers; the other feels with boots on the ground. When they’re in sync, you get tighter forecasting, smarter resource allocation, and faster execution. When they’re not, you get missed budgets, bad blood, and endless meetings about “why the numbers don’t make sense.”
Misaligned Incentives Create Misaligned Behavior
Let’s take a simple example. Say your operations team is bonused on throughput—how many units they can ship or how many customers they can onboard. Meanwhile, finance is bonused on margin. See the problem?
Ops will push volume at all costs, including overtime, express shipping, or lower-quality labor. Finance will push back, trying to cap costs and slow spending. Both teams are technically hitting their KPIs, and yet the business suffers because they’re optimizing for different goals.
The solution isn’t to make one side “win.” The solution is to build shared incentives that reflect the whole business’s success. A joint bonus tied to both volume and margin. Or a scorecard that tracks customer retention, which is impacted by both product quality (ops) and pricing discipline (finance). When you reward collaboration, you get collaboration.
Shared Language Is the Antidote to Silos
Here’s another big reason silos form: nobody speaks the same language.
Finance talks in terms like “EBITDA,” “CapEx,” and “free cash flow.” Operations talks about “lead times,” “headcount,” and “turn times.” Ask each team to explain their numbers, and you’ll often get a wall of jargon that alienates the other.
This isn’t just a communication problem—it’s a trust problem. When people don’t understand what you’re saying, they assume you don’t understand the business. And that’s when suspicion creeps in.
The fix? Force clarity. Make people explain their metrics in plain English. Have finance leads walk the floor with operations. Have ops managers sit in on budget reviews. Normalize questions like, “What does that mean for the customer?” or “How does that hit the P&L?” Build a culture where numbers and narrative reinforce each other.
As a CPA who’s spent over a decade integrating acquisitions, I can tell you: the most successful integrations always came down to communication. Not in the fluffy, feel-good sense, but in the tactical sense—shared dashboards, regular check-ins, and language that everyone understood. That’s what turns two teams into one business.
Finance Should Enable, Not Police
One of the most damaging misconceptions inside companies is that finance exists to say “no.” To police the budget. To trim the fat. And sure, sometimes that’s part of the job. But if that’s all finance is doing, you’ve got a problem.
Great finance teams are enablers. They should be giving operations the data to make better decisions, not just flagging mistakes after the fact. They should be surfacing unit economics at the SKU level. Helping identify which customers are profitable. Modeling tradeoffs between speed and cost. That’s what it means to be a strategic partner.
If finance shows up with curiosity instead of judgment, ops will meet them halfway. And once the two sides start building together, you’ll see faster cycle times, better forecasting accuracy, and a business that actually knows what it costs to grow.
Aligning Starts at the Top
All of this—shared incentives, common language, cultural buy-in—starts with leadership. If the CFO and COO aren’t aligned, no amount of dashboards will save you. If your department heads are measured on different outcomes and never co-own decisions, you’re going to feel it in the results.
The CEO’s job is to make the seams disappear. That means setting cross-functional goals. It means measuring the business in ways that reflect how money gets made, not just where it ends up. It means rewarding teams that collaborate and holding accountable the ones that don’t.
And sometimes, it means just getting people in a room and forcing them to solve problems together, even if it’s uncomfortable. Especially if it’s uncomfortable.
The Bottom Line
If finance and operations are out of sync, your business is flying with one eye closed. You’ll make decisions with half the picture, and you’ll spend a lot of time unlearning mistakes you didn’t have to make.
But when you align incentives, speak the same language, and put the customer at the center of every conversation, you unlock a level of clarity and cohesion that most companies never reach.
Alignment isn’t a spreadsheet. It’s a practice. And it’s one of the most valuable ones you can build.
Comments