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As the new financial year gets underway, it’s increasingly clear that the power of leadership extends far beyond boardrooms and quarterly targets, writes Gavin Morse.
Culture Amp’s latest research across over 1.7 million employee voices has revealed the truth: leadership is not merely an influence; it’s the multiplier of organisational performance.
In today’s post-pandemic, AI-disrupted, hybrid work environment, leaders find themselves at the epicentre of engagement, culture, and resilience. Yet, while many at the top believe they are steering their ships well, the people on deck tell a different story. Our data shows a troubling “leadership sentiment gap”; leaders consistently rate their workplace experience far higher than their employees do. This disconnect isn’t a footnote; it’s a fracture line that can erode engagement, belonging, and ultimately, business performance.
Why does this matter? Because the effectiveness of leadership doesn’t just shape culture; it drives performance. Our analysis confirms that employees reporting to high-performing leaders are 4.5 times more likely to be high performers themselves. When leadership is strong, even average managers can achieve above-average results. Conversely, even the best managers struggle to lift teams in the shadow of poor leadership. In short: great leadership is a prerequisite for great organisational and individual performance.
What’s more, the cost of leadership transitions is steep, not only financially (up to 200 per cent of the departing leader’s salary) but also in lost confidence and cultural stability. The ripple effect is real: one change at the top reverberates through every layer of an organisation.
So, where should HR leaders focus? We believe it starts with intentional, science-backed leadership development. This means identifying leadership profiles that work, like the “trusted leader” who inspires confidence and clarity, and investing in the tools and insights that turn average leaders into organisational catalysts.
As we continue to move through uncertain terrain, organisations can no longer afford to rely on charisma or legacy. The future belongs to those who cultivate leaders capable of aligning vision with action, empathy with execution, and trust with transformation.
Gavin Morse is the lead people scientist at Culture Amp.
RELATED TERMS
Your organization's culture determines its personality and character. The combination of your formal and informal procedures, attitudes, and beliefs results in the experience that both your workers and consumers have. Company culture is fundamentally the way things are done at work.
