75% of Organizations Are Failing at Culture…Are You One of Them?

McKinsey’s recently published global study, “The State of Organizations – 2026,” found that 75% of organizations are struggling to build high-performance cultures. Why? Culture initiatives fail because many organizations address culture through programs rather than understanding culture as an operating system.

The strategic approach to developing and sustaining a performance-driving culture involves defining its organizing framework and supporting the resulting structure through accountability efforts. An energizing cultural framework makes it clear to the entire organization who it is, how it works, and what experiences it intends to engender. Coherent cultural frameworks also remove distraction from an organization because employees at all levels understand how to be successful.

Many Silicon Valley start-ups aim to create performance cultures centered on “fun and free”, installing basketball hoops and high-end coffee bars. These measures do not build cultural tenacity. Employees rely on leaders to show how the organization operates because they model behaviors, guide decision-making, and support employees' success. Too often, leaders believe they are immune to cultural dictates and instead opt to compete for resources and rewards. Leaders are cultural exemplars and must first create, then hold themselves accountable to, the cultural structure they initiate.

Culture begins with identity, answering the question of who we will be. Leaders must articulate a cultural vision as the bedrock of their culture’s organizing framework. The vision informs other culture-building activities. For example, Netflix uses Freedom & Responsibility to sponsor cultural efforts. This two-word vision conveys what the workplace is like: we allow freedom, but you must take responsibility. It creates the throughline of the organization’s operating code.

Each team must identify the cultural attributes that, when realized, drive both strategic and cultural success. The two or three attributes that will drive success are likely unique to the organization, as each organization is distinct within its industry. Attributes like teamwork and collaboration are tepid offerings to employees because these overused traits do little to teach them how to be successful. Netflix has two attributes, Stunning Colleagues and No Rules rules, which inform all employees that colleagues will be highly talented and capable of assuming responsibility, so very few rules will be necessary. These attributes apply up, down, and across the organization, further supporting Freedom & Responsibility.

With each organization, no matter how large or small, methods for working together emerge. These methods may be beneficial, maladaptive, or a combination of the two. Teams that invest time in addressing how will we work further define the operating code, provide guidance, and establish accountability levers. Netflix chose Candor, Empowered Decision-Making, and Transparency to build out its operating code. Executives hold themselves and employees accountable to these standards, modeling behaviors so employees feel confident replicating them.

When leaders recognize their cultures as a critical throughline of their operating systems, they are more likely to actively establish and maintain the standards that support them. Are you leaving culture to chance, or have you intentionally designed a model to direct your cultural efforts?

For additional information, please visit www.cultural-coherence.com.