Ellison: The sales staff was compensated based on deal size, not profit. So the commission on a $1 million sale that generated $500,000 in profit was the same as one that cost the company $100,000, he said. "The sales force could care less if they sold things that lost money because the commission was the same in either case," he said.

Meanwhile, I've never encountered an organization with more perverse sales incentives than Oracle had when I used to deal with them, back in the early 90s. Salesman were fired if they missed their sales quota for a single quarter, so we used to get phone calls at the end of each quarter begging us to buy something, anything, and return the item and cancel the invoice after the first of the month. Et cetera.