Culture is Strategy: Tend to It
Why Leadership Impact Matters Beyond Metrics: Culture isn’t just an abstract concept, it is a competitive advantage. The best strategies fail in toxic environments, while strong cultures amplify execution.
June 27, 2025
Most organizations evaluate executive performance based on measurable results: sales numbers, customer growth and so on. While these metrics are undeniably important, they don’t tell the whole story. Equally critical is the impact individuals, especially leaders, have on company culture. Do they foster collaboration or stifle it? Do they inspire or intimidate? Are they compassionate or combative? These behaviours shape the very fabric of an organization and play a pivotal role as to whether a company thrives or struggles.
While strong cultures amplify execution, even the best strategies fail in toxic environments.
Your Culture Shapes Your Success
Culture isn’t just an abstract concept, it is either a competitive advantage or a crippling handicap. While strong cultures amplify execution, event the best strategies fail in toxic environments. Google’s early culture of innovation propelled it to global dominance, while Uber’s early struggles with leadership and culture nearly derailed its success.
Every company operates within an ecosystem of relationships, trust and shared values. When employees feel safe and feel valued, they are engaged, take risks, share ideas and collaborate effectively. When they are afraid, when secrecy or internal competition are common, productivity plummets, turnover increases and innovation stalls.
Culture is Shaped by Behavior
Executives have an outsized influence on workplace culture, and as such a high-performing leader isn’t just someone who meets their KPIs, they are someone who elevates the people around them.
They set the tone, whether intentionally or not. The way they communicate, resolve conflicts and support their teams dictates whether employees are genuinely engaged and collaboration flourishes or whether dysfunction will take hold.
Recognising and rewarding cultural leadership is just as important as tracking short term business results, because your culture shapes your long term business results.
Anyone who has worked for a toxic leader knows that some of the seemingly highest-performing employees may be thriving at the cost of the company's culture. Sometimes the employees who appear to be superstars may actually be doing the most damage. Without structured feedback and broader visibility, leaders risk rewarding toxic behaviours that undermine the company’s long-term health.
We Need Clear Behavioral Expectations
Leading companies don’t leave culture to chance. They define what good leadership looks like, not just in outcomes, but in behavior.
Netflix distinguishes between real company values and nice-sounding ones, stating plainly: “The real values are shown by who gets rewarded, promoted or let go.” Amazon and Microsoft go even further, embedding cultural expectations into hiring criteria, performance reviews and day-to-day decision making.
But how do you operationalize that? How do you turn cultural intent into leadership action?
One way is through well-defined leadership competencies. These go beyond technical expertise and clearly articulate the behaviours that are expected and rewarded, things like cross-functional collaboration, emotional intelligence, humility and integrity. Competencies give you a shared language to evaluate, develop and promote leaders not just for what they achieve, but how they lead.
Reinforce Clarity with Systems
Clearly then, performance reviews should account for cultural impact, not just individual results. Even more importantly, before promoting someone or assigning them to a leadership role, take time to consider:
- Feedback from their peers, their direct reports and others in their organisation
- Their influence on the company's morale and collaboration efforts
- Whether they build trust and psychological safety
Beyond performance reviews, organizations can reinforce cultural expectations through:
- Peer recognition (e.g., kudos systems that highlight cultural leadership)
- Structured leadership selection (ensuring leaders embody company values before being promoted)
- Exit interviews that track culture warning signs
Not Everyone Should Be a Manager
It's been said before but it is worth repeating, not everyone should be a manager. Some great individual performers simply don’t have the patience, temperament or the interest to be effective leaders. Promoting them into management roles - because it’s the traditional path to career advancement - does a disservice to both them and the teams they lead.
With that in mind, it is important that companies create alternative pathways for growth. Microsoft, for example, introduced roles like Distinguished Engineer and Technical Fellow, both executive-level positions that recognise significant individual contributions without requiring people to manage teams.
By offering non-management advancement options, organisations can keep their best talent engaged without compromising leadership quality.
Holding People Accountable is Hard, But Necessary
To maintain a healthy culture, organizations must reward those who elevate it and refuse to promote or tolerate behaviors that erode it. This can be difficult, especially when high performers are the ones exhibiting toxic tendencies, but allowing damaging behaviors to persist poisons the workplace over time.
The clearer the accountability mechanism - the expectations, evaluations and consequences - the more effective it will be. That means talking about it, recognising those who contribute the most to the culture and following through even when it’s tough, including making the difficult decision to let go of individuals who refuse to align with the company’s values.
Culture is Strategy - So Be Intentional
Building a strong culture isn't about making sure everyone is always happy or talking about their feelings. Culture is an intentional effort to minimize politics, maximize collaboration, incentivize transparency and leverage the benefits of the clarity that all of this creates.
Discouraging toxic behaviors is essential, but the goal isn’t just to eliminate negativity - it is to create an environment where people can do their best work with as little friction as possible. That means ensuring cultural impact is held to the same level of attention and accountability as traditional performance metrics like revenue, sales numbers or efficiency.
A company’s culture isn’t just a nice-to-have, it is a strategic advantage. Every promotion, recognition and leadership decision is a choice about the kind of company you want to build.The best organizations don’t leave culture to chance. They define it, communicate it, reinforce it and hold people accountable to it.
Be intentional, be clear and above all, reward the behaviors that make your company better.
Our mission is to empower organizations by fostering cultures of clarity and transparency, engagement and collaboration. Through innovative tools, best practices and partnership with leaders, we strive to unlock the competitive advantages inherent in healthy organizations.