MAKING CULTURE THE ADVANTAGE

INTEGRATING PERFORMANCE AND PEOPLE

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Culture is a funny thing in business. As a finance executive once told me, "I know culture is important, but I just can’t see it on my P&L".

Culture is largely intangible. It lives in the collective mindset, behaviors, and unwritten norms of an organization. It’s the “feel” of a company—the shared values, assumptions, and habits that shape how employees interact, make decisions, and approach their work. Because of this intangible nature, many companies struggle to manage culture as a key business lever. Instead, it’s often treated as a separate, HR-driven initiative focused on employee experience and engagement rather than being directly linked to productivity, innovation, and financial performance.

Investors have noticed and they are interested in replicating across all the companies in their portfolios.

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This shift aligns with my experience as the former President of KinderCare, the largest provider of childcare and early learning, with more than 1,500 centers and over 30,000 employees. Leading a cultural transformation strategy, we reversed 14 quarters of financial decline and achieved more than 25 consecutive quarters of growth. During this transformation, employee engagement moved from the bottom quartile of Gallup’s engagement database to the top quartile. The correlation between engagement and productivity was clear—we enrolled families at a rate three times the industry average. Today, many years after I’ve left the organization, KinderCare continues to thrive as a beacon of excellence in the childcare sector.

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The Data Behind Culture's Impact

McKinsey Global Institute’s 2023 whitepaper, Performance through People: Transforming Human Capital into Competitive Advantage, analyzed nearly 1,800 large companies across all sectors in 15 countries. The study found that only 9% of companies excelled in both Performance and People metrics—McKinsey called these organizations P+P Winners. Their results were extraordinary:

• 28% higher returns on invested capital
• 4.3x more likely than the average company to sustain top-tier financial performance for nine out of 10 years
• 2x faster revenue growth than performance-driven companies during the pandemic

This research reinforces a simple truth: thriving companies don’t treat culture and performance as separate priorities. The challenge, however, is doing both well. Solving this challenge gives your company a clear competitive advantage.

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Culture is the No. 1 reason employees choose to stay or leave a company (Workhuman). Tired of the expensive cost of losing your employees? We can help!

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Becoming a P+P Winner

My passion today is helping companies become P+P Winners by modernizing business processes to improve employee productivity. This isn’t about window dressing or traditional culture-building exercises—it’s about creating the clarity and connection needed to drive discretionary effort. A great place to start is by assessing how well your culture practices integrate with your performance practices. Here are three key areas to examine:

1. Vision, Mission, and Values in Strategic Priorities: Many companies prominently feature their vision, mission, and values in onboarding materials but rarely reference them afterward. That’s a missed opportunity. Strategic priorities define what teams are working on, but vision and mission clarify why those priorities matter, and values shape how work should get done. Together, these elements should be consistently reinforced. Ask yourself: How often do you communicate all three? Can leaders at all levels articulate them in a way that inspires followership?
2. Leadership Development Tied to Business Performance: Employees’ perceptions of their company are shaped largely by their immediate supervisors. That’s one reason why companies invest millions in leadership development. However, many of these programs focus too heavily on abstract leadership concepts without tying them to business performance. When leadership development success is measured against tangible business outcomes, companies drive both culture and performance forward.
3. Meetings and Access to Information: Most organizations say they have too many meetings, yet employees often report lacking the information they need to do their jobs effectively. How can both be true? Meetings are a key indicator of cultural and business health. Instead of debating hybrid work policies, focus on whether meetings add value. Are they aligned with performance? Do the right people attend? Optimizing meetings can significantly enhance both culture and productivity.

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The Power of Integration

Too many companies treat culture and performance as separate domains—HR drives culture, Business Operations leads performance, and Finance ensures fiscal discipline. But to become a P+P Winner, these functions must work together with a shared focus on improving employee productivity and discretionary effort. When done successfully, organizations don’t just improve culture or performance—they thrive in both.

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Ready to make culture YOUR competitive advantage ?

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